Alert March 20, 2012

Ninth Circuit Rules Parens Patriae Suit Not a “Mass Action” under the Class Action Fairness Act

In an issue of first impression, the Ninth Circuit recently remanded a parens patriae deceptive practices suit, brought under the Class Action Fairness Act of 2006, back to state court.  The State of Nevada, through its Attorney General, filed a parens patriae suit against the defendant, claiming that the defendant mislead consumers about the terms and operations of its home mortgage modification and foreclosure processes in violation of the Nevada Deceptive Trade Practices Act.  The Ninth Circuit held that the parens patriae action was not a “mass action” – a civil action where the monetary relief claims of 100 or more persons may be tried jointly because common questions of law and fact exist and the claims allege $75,000 or more in damages – under CAFA because the real party-in-interest was the State of Nevada, thus failing to meet CAFA’s numerosity requirement.   The court also held that parens patriae actions are not removable under CAFA.  The Ninth Circuit is the third federal Court of Appeals to address the issue of whether parens patriae suits are removable under CAFA.  Click here for the opinion.