Edge v. Blockbuster Video, Inc.

10 F. Supp. 2d 1248, 1997 U.S. Dist. LEXIS 18461, 1997 WL 910414
CourtDistrict Court, N.D. Alabama
DecidedSeptember 29, 1997
DocketCV 96-B-2341-S
StatusPublished
Cited by9 cases

This text of 10 F. Supp. 2d 1248 (Edge v. Blockbuster Video, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Edge v. Blockbuster Video, Inc., 10 F. Supp. 2d 1248, 1997 U.S. Dist. LEXIS 18461, 1997 WL 910414 (N.D. Ala. 1997).

Opinion

MEMORANDUM OPINION

BLACKBURN, District Judge.

Currently before the court is the plaintiffs’ Motion to Remand the case to state court. The case was removed to this court on the basis of federal diversity jurisdiction, and plaintiffs contend that the amount in controversy requirement for federal diversity jurisdiction has not been met and that diversity jurisdiction, therefore, is not proper. Defendants counter that the amount in controversy requirement has been met in this case because ' the aggregation of the value of the injunctive relief sought far exceeds the amount in controversy requirement under the statute. Upon consideration of the record, the submissions of the parties, the argument of counsel, and the relevant law, the court is of the opinion that the amount in controversy requirement has been met and that .the motion to remand is due to be denied.

BACKGROUND

' The instant case was originally filed in the Circuit Court for Jefferson County, Alabama. Two days after the complaint was filed, the Circuit Court for Jefferson County, Alabama granted conditional certification of a nationwide class of plaintiffs in an ex parte hearing prior to any defendant being served with a summons and the complaint. Soon thereafter, defendants removed this action to this court on the basis of this court’s diversity jurisdiction.

The essence of plaintiffs’ claim is that defendant Blockbuster Video, Inc. (“Blockbuster”) 1 has been overcharging its customers in the form of late fees. The basis for this assertion is that the cost of renting a standard video from Blockbuster is approximately three dollars for two full nights while the late fee is two dollars per day. Thus,- if a video rented on Tuesday that is due to be returned by midnight on Thursday were returned on time, the total cost to the customer would be roughly three dollars. On the other hand, if the video were returned on Friday, an additional two dollar charge would be added. If the video were returned on Saturday (an additional two full nights), then the total late fee would be four dollars and the total cost would be seven dollars. If the video were returned on Thursday and then re-rented, however, the total cost would be six dollars rather than the seven charged *1250 because of late fees. The plaintiffs claim that this extra dollar in late fees is an overcharge for which they are entitled to relief. 2 Plaintiffs assert that the putative class consists of at least one million people, (Comply 4), and plaintiffs claim that Blockbuster has overcharged these customers a total of approximately $3,200,000,000.00 since January 1,1994. (Compl.lffl 3,19).

Plaintiffs seek relief in a variety of forms. Count I asserts a claim for breach of contract, essentially alleging that the contracts between the individual plaintiffs and Blockbuster do not authorize Blockbuster to charge a higher rate per day as a late fee. In the alternative, Count I seeks to have the late fee declared a penalty and held, therefore, to be void as a matter of law. In Count II, plaintiffs seek restitution for the overcharges for late fees and defendants’ resulting unjust enrichment. In both Count I and Count II, plaintiffs also request relief in the form of an injunction against defendants to prevent them from continuing to charge an excessive late fee. Specifically, the plaintiffs allege:

The Defendants have refused to or will refuse to cease and desist from charging members of the class an amount in excess of the agreed upon rental viewing fee for rental of “standard rental” videos returned after the expiration of the initial viewing period, in violation of the written contract and/or applicable law ... making it appropriate that the Defendants be enjoined from doing so with respect to the class as a whole as alleged above.

(Compl-¶ 15).

At present, Blockbuster has approximately 61 million accounts across the United States. (Barrett Aff. ¶ 8). 3 Of those accounts, over 48 million have been active since January 1, 1994. (Id.). Almost 29 million of those active accounts have incurred an “extended viewing fee,” and slightly less than 20 million of those accounts have not. (Id. ¶ 9).

DISCUSSION

Under 28 U.S.C. § 1441 a case may be removed to federal district court by the defendant or defendants in the action if the district court has original jurisdiction over the action. 28 U.S.C. § 1441(a). Original jurisdiction may be based on a federal question or diversity. A federal court has diversity jurisdiction over an action if the action is between citizens of different states and the amount in controversy exceeds $50,000, exclusive of interest and costs. 4 28 U.S.C. § 1332 (1994). Additionally, if removal is premised upon diversity jurisdiction, none of the defendants in the action may be citizens of the forum state for the action to be removable. Finally, in a case in which the value of the relief sought is unspecified, a defendant must prove by a preponderance of the evidence that the amount in controversy exceeds the jurisdictional amount. See Tapscott v. MS Dealer Service Corp., 77 F.3d 1353, 1356-57 (11th Cir.1996).

In the present case, it is not disputed that the parties are citizens of different states. The named plaintiffs are citizens of Alabama and the defendants are not. 5 Plaintiffs’ challenge to the court’s jurisdiction is based on the amount in controversy. Plaintiffs assert that each plaintiffs claim must exceed the *1251 $50,000 threshold to meet the amount in controversy requirement. Defendants contend that the court should consider the value of the injunctive relief sought in order to determine whether or not the amount in controversy requirement is satisfied.

The individual compensatory damages claims of plaintiffs in a class action may not be aggregated for the purpose of determining diversity jurisdiction. See Zahn v. International Paper Co., 414 U.S. 291, 94 S.Ct. 505, 38 L.Ed.2d 511 (1973); Snyder v. Harris, 394 U.S. 332, 336, 89 S.Ct. 1053, 22 L.Ed.2d 319 (1969). Rather, the claims of each plaintiff must meet the amount in controversy requirement for a court to have diversity jurisdiction over that plaintiff. Zahn, 414 U.S. at 300, 94 S.Ct. 505. The Eleventh Circuit has held, however, that punitive damages available under Alabama law may be aggregated for purposes of satisfying the amount in controversy requirement for federal diversity jurisdiction. See Tapscott, 77 F.3d at 1358-59.

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Bluebook (online)
10 F. Supp. 2d 1248, 1997 U.S. Dist. LEXIS 18461, 1997 WL 910414, Counsel Stack Legal Research, https://law.counselstack.com/opinion/edge-v-blockbuster-video-inc-alnd-1997.