United States Court of Appeals For the First Circuit
No. 00-1775
MICHAEL SPIELMAN,
Plaintiff, Appellant,
v.
GENZYME CORP. and GENZYME DEVELOPMENT CORP.,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Edward F. Harrington, U.S. District Judge]
Before
Boudin, Lynch, and Lipez, Circuit Judges.
John Peter Zavez, with whom Adkins, Kelson & Zavez, P.C. were on brief, for appellant. Michael T. Gass, with whom Paige Scott Reed and Palmer & Dodge LLP were on brief, for appellees.
May 24, 2001 LIPEZ, Circuit Judge. Michael Spielman, the named plaintiff
in a putative class action, appeals the district court's dismissal of
his suit for lack of subject matter jurisdiction. The court found that
the plaintiff's individual damages claim failed to satisfy the amount-
in-controversy minimum set by 28 U.S.C. § 1332 for entry into federal
court. The court also rejected the plaintiff's alternative argument
that his claim for attorney's fees under Chapter 93A of the
Massachusetts Consumer Protection Statute fulfilled the amount-in-
controversy requirement because Massachusetts law allowed him to
aggregate all of the fees anticipated by the class. We agree that
Spielman does not meet the amount-in-controversy minimum and affirm the
district court's dismissal of his suit.
I.
In 1987, Michael Spielman, a New York resident, bought a
limited partnership interest in Genzyme Clinical Partners, L.P. (GCP),
which sought to develop a treatment for Gaucher's disease. At that
time Genzyme Development Corporation (Genzyme Development), a
subsidiary of Genzyme Corporation (Genzyme), was the general partner
of GCP. As general partner, Genzyme Development was obligated by law
and by the limited partnership agreement to issue annual federal and
state tax schedules to the limited partners. No schedules were issued
between 1987 and 1990. In 1990, the GCP limited partners approved the
-2- sale of the partnership's assets to Genzyme in exchange for shares of
common stock. As a result, GCP was liquidated.
This transaction had tax implications for Spielman and some
of the other 190 GCP limited partners who lived outside of
Massachusetts. Sometime after Genzyme bought GCP, the Massachusetts
Department of Revenue determined that the sale and liquidation was a
taxable event under state law. In 1993, the Department notified the
former limited partners who had not filed 1990 Massachusetts tax
returns that they owed state taxes on their share of the liquidation
income. Spielman was assessed a tax of $10,820, which he did not pay.
In 1995, the Department penalized Spielman for delinquent payment by
doubling the amount he owed to $21,640.
On November 9, 1995, Spielman filed a class action in
federal court on behalf of himself and similarly situated former GCP
limited partners against Genzyme Development and Genzyme.1 The
complaint included claims of negligent misrepresentation, common law
fraud, breach of fiduciary duty, and breach of contract. It alleged
that Genzyme Development's failure to issue the required 1990 tax
schedules for GCP caused Spielman and the other class members to incur
Massachusetts tax liability. As a resident of New York suing a
Massachusetts corporation, Spielman asserted diversity jurisdiction
1Genzyme Development ceased to exist in 1990, and Genzyme, as parent corporation, assumed its liability. Spielman's suit named both entities but proceeded against Genzyme alone.
-3- under 28 U.S.C. § 1332, but did not specify a damages amount. At the
time the suit was filed, § 1332(a) required that the "matter in
controversy" exceed $50,000 for federal court jurisdiction to attach.
See Act of Oct. 19, 1996, Pub. L. No. 104-317, 110 Stat. 3850 (amending
28 U.S.C. § 1332(a) so as to raise jurisdictional amount from $50,000
to $75,000).
Five days after filing the class action complaint, Spielman
filed an appeal with the Massachusetts Appellate Tax Board to determine
the taxes and penalty he owed for the GCP liquidation. On October 24,
1996, Genzyme filed a motion to dismiss for lack of subject matter
jurisdiction, alleging that Spielman's damages fell below the required
$50,000 minimum. In opposition to this motion, Spielman filed an
affidavit on November 21, 1996 claiming $21,640 in "double taxes,"
$16,211.47 in interest, $11,246.48 in penalties, and $1,305 in
accountant fees. The itemized damages totaled $50,402.95. The
affidavit asserted, however, that Spielman's damages as of the date his
complaint was filed were $61,673.77, though it did not explain the
$11,270.82 discrepancy between that amount and the itemized total.
On December 12, 1996, the district court denied Genzyme's
motion to dismiss for lack of subject matter jurisdiction, but stayed
Spielman's action pending the state Tax Board's ruling on the amount
of his tax liability. The court said: "This action . . . has been
prematurely brought. After a review of the papers and pleadings, it
-4- is not possible at this time to determine plaintiff's damages, as
damages can be reasonably calculated only upon completion of the state
administrative proceedings."
This stay remained in place for more than two years. Then
at a February 8, 1999 status conference, Spielman told the court that
the Tax Board had assessed his final tax liability at $10,820--the
taxes he owed for GCP's liquidation, with no assessment of penalties
or interest. Spielman also said that to achieve this result he had
paid attorney's fees of $7,000 and accountant's fees of $1,305, for a
total of $8,305. Spielman told the court he would consider whether the
Tax Board's ruling meant that he could no longer meet the amount-in-
controversy minimum. The next day, the court lifted the stay on
Spielman's class action.
Five months later, on July 16, 1999, Spielman asked the
court for leave to file an amended complaint. The amendment alleged
no new facts, but added a claim under Chapter 93A of the Massachusetts
Consumer Protection Act, which permits prevailing plaintiffs to recover
attorney's fees as part of their damages award. Genzyme protested,
arguing that Spielman's attempt to amend the complaint was untimely and
a "transparent attempt to establish federal court jurisdiction where
none exists." On September 22, 1999, the court granted Spielman's
request to amend the complaint, saying that the court's December 1996
stay accounted for the delayed filing of the amendment.
-5- On November 2, 1999, Genzyme renewed its motion to dismiss
for lack of subject matter jurisdiction, claiming that the state Tax
Board ruling established that Spielman had incurred at most $8,305 in
damages.2 In opposition to this motion, Spielman argued that his
damages claim for attorney's fees under Chapter 93A should include the
fees for the class, and that aggregating the fees to him would boost
his claim over the $50,000 minimum. Spielman also urged the court to
exercise supplemental jurisdiction over the other members of the class
even if they individually failed to meet the amount-in-controversy
requirement.3 On May 5, 2000, the district court granted Genzyme's
motion to dismiss for lack of subject matter jurisdiction under Federal
Rule of Civil Procedure 12(b)(1). The court found that the Tax Board's
ruling meant that the damages that Spielman alleged on the face of his
original complaint failed to satisfy the jurisdictional minimum at the
time that complaint was filed. The court also declined to exercise
jurisdiction on the basis of Spielman's amended complaint, finding that
2 While Spielman also claims as damages the $10,820 in taxes that he owed to Massachusetts, we think it inappropriate to treat as damages a tax liability that Spielman had to pay independently of Genzyme Development's alleged failure to provide the required tax schedule. 3 On October 25, 1999, Spielman filed a motion to certify the suit as a class action. The district court did not rule on this motion. Nonetheless, the court properly treated the suit as a class action for purposes of the jurisdictional analysis. See Doucette v. Ives, 947 F.2d 21, 30 (1st Cir. 1991) ("During the period between the commencement of a suit as a class action and the court's determination that it may be so maintained, the suit should be treated as a class action.").
-6- under Massachusetts law Chapter 93A anticipated the pro rata
distribution of attorney's fees to members of the class for purposes
of determining jurisdiction, rather than aggregation to the named
plaintiff. Spielman appeals.
II.
We review de novo the district court's dismissal for lack
of subject matter jurisdiction. Coventry Sewage Assoc. v. Dworkin
Realty Co., 71 F.3d 1, 3 (1st Cir. 1995). The facts pertinent to this
appeal are undisputed. However, as the party seeking to invoke
jurisdiction, Spielman has the burden of showing that he has met the
statutory requirements. Id. at 4.
As we have noted before, competing interests are at stake
when federal courts determine whether they may hear a case. Id.; 14B
Charles A. Wright, Arthur R. Miller & Edward H. Cooper, Federal
Practice and Procedure § 3702 at 16 (1998). On the one hand, the
Constitution limits the jurisdiction of federal courts, see U.S. Const.
Art. III, and Congress has further narrowed our jurisdiction by
periodically increasing the amount-in-controversy minimum for diversity
cases. This means that we have a responsibility to police the border
of federal jurisdiction. Pratt Cent. Park Ltd. P'ship v. Dames &
Moore, Inc., 60 F.3d 350, 352 (7th Cir. 1995). On the other hand,
determining whether a case belongs in federal court should be done
quickly, without an extensive fact-finding inquiry. "To make the
-7- 'which court' decision expeditiously and cheaply, a judge must simplify
the inquiry. . . ." Id.
With these competing interests in mind, we apply the Supreme
Court's longstanding test for determining whether a party has met the
amount-in-controversy minimum. St. Paul Mercury Indemnity Co. v. Red
Cab Co., 303 U.S. 283 (1938) states that:
The rule governing dismissal for want of jurisdiction in cases brought in the federal court is that, unless the law gives a different rule, the sum claimed by the plaintiff controls if the claim is apparently made in good faith. It must appear to a legal certainty that the claim is really for less than the jurisdictional amount to justify dismissal.
Id. at 288-89 (footnotes omitted). Under St. Paul, a plaintiff's
general allegation of damages that meet the amount requirement suffices
unless questioned by the opposing party or the court. See Dep't of
Recreation and Sports v. World Boxing Ass'n, 942 F.2d 84, 88 (1st Cir.
1991). Once the damages allegation is challenged, however, "the party
seeking to invoke jurisdiction has the burden of alleging with
sufficient particularity facts indicating that it is not a legal
certainty that the claim involves less than the jurisdictional amount."
Id.; see also Barrett v. Lombardi, 239 F.3d 23, 30-31 (1st Cir. 2001).
"A party may meet this burden by amending the pleadings or by
submitting affidavits." Dep't of Recreation and Sports, 942 F.2d at
88.
-8- Courts determine whether a party has met the amount-in-
controversy requirement by "looking to the circumstances at the time
the complaint is filed." Coventry Sewage, 71 F.3d at 4; Wright &
Miller § 3702 at 28-29 n.31. Thus St. Paul's legal certainty standard
does not mean that jurisdiction is ousted because of the eventual
"inability of plaintiff to recover an amount adequate to give the court
jurisdiction," or because "the complaint discloses the existence of a
valid defense to the claim." Coventry Sewage, 71 F.3d at 5. In
addition, "[e]vents occurring subsequent to the institution of suit
which reduce the amount recoverable below the statutory limit do not
oust jurisdiction." St. Paul, 303 U.S. at 289-90. On the other hand,
and importantly for this case,
if, from the face of the pleadings, it is apparent, to a legal certainty, that the plaintiff cannot recover the amount claimed or if, from the proofs, the court is satisfied to a like certainty that the plaintiff never was entitled to recover that amount . . . the suit will be dismissed.
Id. at 289 (emphasis added).
After Genzyme challenged his damages allegation, Spielman
tried in two ways to meet the burden of showing that his claim met the
legal certainty test for the amount-in-controversy minimum. First, he
submitted an affidavit itemizing $50,402.95 in damages and claiming
total damages of $61,673.77. Spielman says that the damages
allegations in the affidavit meet St. Paul's legal certainty test
- 9 - because they represent his good-faith claim at the time he filed suit.
According to Spielman's theory, the state Tax Board's ruling that his
tax liability was only $10,820 was a "subsequent event" under St. Paul,
and thus unrelated to the facts as they existed at the time he filed
his complaint. Alternately, Spielman sought to meet the amount-in-
controversy minimum by amending his complaint to include a claim for
attorney's fees under Chapter 93A. He argues that the fees claim
boosts his damages allegation over $50,000 because it encompasses not
only the fees anticipated for his individual case, but also the fees
that will be generated on behalf of other members of the class. We
address each of Spielman's arguments in turn.
III.
A. Spielman's Individual Damages Claim
Invoking St. Paul, Spielman argues that the Tax Board's
ruling was a "subsequent event" that cannot be factored into the
court's amount-in-controversy analysis. Here Spielman attempts to draw
an analogy between the facts in this case and those in our own
precedent, Coventry Sewage Assoc. v. Dworkin Realty Co., 71 F.3d 1 (1st
Cir. 1995). In Coventry Sewage, the defendant refused to pay the
plaintiff for sewer-main usage after a service-fee increase. The
plaintiff sued for approximately $75,000, basing that amount on
invoices provided by the local county water authority. After the
complaint was filed, the water authority discovered that it had misread
- 10 - the defendant's water meters. Correction of this error left less than
$10,000 in dispute. Id. at 3.
We found that the water authority's correction of its meter-
reading error was a "subsequent event" under St. Paul. In summarizing
the rationale for this holding, we said:
In the instant case, an independent third party with otherwise no connection to the case made an apparently non-obvious error so that the amount- in-controversy at the time of filing, in fact, exceeded the jurisdictional minimum. Coventry had no reason to know that its claimed amount of damages was in error. Moreover, the reduction of the amount in controversy resulted from acts occurring wholly after the action commenced.
Id. at 8. Spielman argues that we should exercise jurisdiction here
based on a similar rationale. We decline.
Coventry Sewage is inapposite. Unlike the water authority
in Coventry Sewage, the Tax Board did not reduce an initial assessment
of the damages amount that exceeded the jurisdictional minimum. Here
there was considerable question at the outset as to whether Spielman's
damages amount met the jurisdictional minimum--a question that the
trial judge raised but deferred resolution of when he issued the stay.
Spielman included as damages $10,820 in taxes that he owed
independently of any act or omission by Genzyme Development, and he
boosted his claim over the $50,000 jurisdictional minimum by adding
$11,270.82 from a source he never identified. The state Tax Board
ruling thus confirmed what had been apparent earlier: Spielman's
- 11 - attempt to meet the jurisdictional minimum was in vain from the
beginning.4 B. Spielman's Chapter 93A Attorney's Fees Claim
Spielman argues that his attorney's fees should be included
as part of his anticipated damages. Normally, attorney's fees are
excluded from the amount-in-controversy determination because "the
successful party does not collect his attorney's fees in addition to
or as part of the judgment." Velez v. Crown Life Ins. Co., 599 F.2d
471, 474 (1st Cir. 1979) (citing 1 Moore's Federal Practice 0.99(2)).
There are two exceptions to this rule: when the fees are provided for
by contract, and when a statute mandates or allows payment of the fees.
Id. The second exception applies here. Chapter 93A of the
Massachusetts Consumer Protection Act allows plaintiffs to collect
attorney's fees as part of their damages. See Mass. Gen. Laws ch. 93A,
§ 9(4). We thus must decide whether Spielman met the amount-in-
controversy minimum by amending his complaint to include a Chapter 93A
4In Coventry Sewage, we discussed the argument raised by the appellee in that case that there is a meaningful distinction between "subsequent events that change the amount in controversy and subsequent revelations that, in fact, the required amount was or was not in controversy at the commencement of the action." 71 F.3d at 8 (quoting Jones v. Knox Exploration Corp., 2 F.3d 181, 183 (6th Cir. 1993)). Whatever merit that distinction may have as a framework for analysis, it is not helpful here because the Tax Board's ruling does not fit into either category. As we have explained, the ruling was not a "subsequent event" within the meaning of St. Paul because the plaintiff was never in fact at risk of harm in excess of the jurisdictional amount. Nor was the ruling a revelation. There was good reason to believe from the beginning of this action that Spielman's damages fell well below the amount-in-controversy minimum, and the Tax Board's ruling merely confirmed that fact.
- 12 - claim. Spielman does not allege, however, that his individual
attorney's fees are high enough to boost his damages claim over the
amount-in-controversy minimum. Rather he seeks, for jurisdictional
purposes, to aggregate the attorney's fees that he anticipates will be
needed to press the claim of the entire class for which he is named
plaintiff. Because of Supreme Court precedent, this is a difficult
argument to make.
As we have noted, the statute that provides for federal
court diversity jurisdiction, 28 U.S.C. § 1332(a), requires that the
"matter in controversy" exceed the jurisdictional minimum. Based on
this language, "[t]he traditional judicial interpretation . . . has
been from the beginning that the separate and distinct claims of two
or more plaintiffs cannot be aggregated in order to satisfy the
jurisdictional amount requirement." Snyder v. Harris, 394 U.S. 332,
335 (1969) (citing earlier cases). In Snyder, the Court rejected the
argument that this rule should not apply to class action plaintiffs,
whose claims, the argument goes, should instead be aggregated for
jurisdictional purposes. The Court said:
To overrule the aggregation doctrine at this late date would run counter to the congressional purpose in steadily increasing through the years the jurisdictional amount requirement. That purpose was to check, to some degree, the rising caseload of the federal courts, especially with regard to the federal courts' diversity of citizenship jurisdiction.
- 13 - Id. at 339-40. The Court reaffirmed this holding in Zahn v.
International Paper Co., 414 U.S. 291 (1973), adding, "Neither are we
inclined to overrule Snyder v. Harris nor to change the Court's long-
standing construction of the 'matter in controversy' requirement of §
1332."5 Id. at 301.
The Supreme Court has not discussed whether the named
plaintiff in a class action may aggregate the attorney's fees of the
class to satisfy the jurisdictional amount requirement when a state
statute like Massachusetts's Chapter 93A authorizes the awarding of
fees to a successful litigant. Two circuits have addressed this
question. Reviewing a claim made under a California statute that
5 Zahn held that courts may not exercise supplemental jurisdiction over the claims of class action plaintiffs who do not separately meet the jurisdictional minimum. Zahn, 414 U.S. at 301. There is a question about whether this holding remains good law after the enactment of the Judicial Improvements Act of 1990, 28 U.S.C. § 1367. See Packard v. Provident Nat'l Bank, 994 F.2d 1039, 1045 n.9 (3d Cir. 1993) (discussing extensive academic literature). The circuits have split over whether the Act intended to overrule Zahn and allow courts to exercise such supplemental jurisdiction. Compare Stromberg Metal Works, Inc. v. Press Mech., Inc., 77 F.3d 928 (7th Cir. 1996) and In re Abbott Labs., 51 F.3d 524, 529 (5th Cir. 1995) (holding that supplemental jurisdiction may exist after the Judicial Improvement Act), with Meritcare Inc. v. St. Paul Mercury Ins. Co., 166 F.3d 214, 219 (3d Cir. 1999) and Leonhardt v. Western Sugar Co., 160 F.3d 631, 640 (10th Cir. 1998) (holding that Congress did not intend to change the rules set by Zahn). Since we find that the court lacked jurisdiction over Spielman, we do not reach his contention that it should exercise supplemental jurisdiction over the other members of the class even though their individual claims do not meet the amount requirement. The Judicial Improvements Act does not call into question Zahn's reaffirmance of Snyder's holding that individual damages claims may not be aggregated to satisfy the jurisdictional minimum.
- 14 - authorizes attorney's fees, the Ninth Circuit held that aggregating
anticipated fees to the named plaintiff to allow her to meet the
amount-in-controversy requirement "would conflict with the policy of
Zahn . . . in which the Supreme Court reaffirmed that the 'matter in
controversy' requirement must be satisfied by each member of the
plaintiff class." Goldberg v. CPC Int'l, Inc., 678 F.2d 1365, 1367
(9th Cir.), cert. denied, 459 U.S. 945 (1982). The court thus held
that "potential" attorney's fees could not be used to satisfy the
amount-in-controversy minimum. Id. at 1367. Several district courts
have followed this approach. See, e.g., Karofsky v. Abbott Labs., 921
F. Supp. 18 (D. Me. 1996); Ratliff v. Sears, Roebuck & Co., 911 F.
Supp. 177 (E.D.N.C. 1995); Quebe v. Ford Motor Co., 908 F. Supp. 446
(W.D. Tex. 1995); Visintine v. Saab Auto. A.B., 891 F. Supp. 496, 499
(E.D. Mo. 1995); Gilman v. Wheat, First Sec., Inc., 896 F. Supp. 507
(D. Md. 1995).
The Fifth Circuit considered the question of whether
attorney's fees may be aggregated to obtain federal jurisdiction under
a Louisiana statute that specifically authorizes the awarding of
attorney's fees in a class action. In re Abbott Labs., 51 F.3d 524,
526 (5th Cir. 1995), determined that there was federal jurisdiction for
a class action claim governed by Article 595 of the Louisiana Code of
Civil Procedure. Article 595 provides: "The court may allow the
representative parties their reasonable expenses of litigation,
- 15 - including attorney's fees, when as a result of the class action a fund
is made available, or a recovery or compromise is had which is
beneficial, to the class." La. Code Civ. Proc. art. 595. The Fifth
Circuit said that Article 595 entitled class representatives to
anticipated attorney's fees, and that the phrase "representative
parties" referred to the named plaintiff or plaintiffs in a class
action. The court rejected the argument that Zahn precluded
attributing the fees of the class to the named plaintiff when that is
what a state statute provides. See Abbott Labs., 51 F.3d at 527. The
court distinguished Goldberg on the ground that it "sheds little light
on the distinct policy choices behind Louisiana's decision regarding
rights of recovery by class members." Id. at 526. An evenly divided
Supreme Court recently affirmed the Fifth Circuit's decision under the
name of Free v. Abbott Labs., Inc., 529 U.S. 333 (2000).
Spielman argues that the attorney's fees provision of
Chapter 93A, like Article 595 of the Louisiana code as construed in
Abbott Labs., allows him to aggregate the anticipated fees of his class
toward the amount-in-controversy minimum. Chapter 93A provides in
relevant part:
If the court finds in any action commenced hereunder that there has been a violation of section two, the petitioner shall, in addition to other relief provided for by this section and irrespective of the amount in controversy, be awarded reasonable attorney's fees and costs incurred in connection with said action.
- 16 - Mass. Gen. Laws ch. 93A, § 9(4). Spielman urges us to read
"petitioner" in the same way that the Fifth Circuit read
"representative parties" in Article 595. We have reservations about
the correctness of Abbott Labs. Even if that were not the case,
however, we would decline to adopt the parallel reading that Spielman
advocates.
To begin with, § 9(4) does not refer to class actions or to
named class action plaintiffs. Nor do other sections of Chapter 93A
specifically discuss multiple-party lawsuits. The statute simply
offers a cause of action to a consumer or a group of consumers who
claim that a business has defrauded them. Thus in contrast to Article
595 of the Louisiana code, which explicitly provides that attorney's
fees may be awarded to the "representative parties . . . when as a
result of the class action a fund is made available . . . to the class"
(emphasis added), nothing in Chapter 93A suggests that the legislature
intended "petitioner" to refer to the named plaintiff in a class action
rather than to each of the members of the class.
As the Massachusetts district court pointed out recently,
"petitioner" is a generic term in Massachusetts law. See Ciardi v. F.
Hoffmann-La Roche, Ltd., No. Civ. A. 99-11936-GAO, 2000 WL 159320, at
*2 (D. Mass. Feb. 7, 2000). In rejecting the same aggregation argument
that Spielman makes here, Ciardi ably explained: "The term 'petitioner'
- 17 - is one historically used in Massachusetts as the equivalent in equity
of the term 'plaintiff' at law. While petitioners might from time to
time have been representatives, they were not necessarily so, and the
terms in Massachusetts are not interchangeable." Id. at *2. We agree.
The text of § 9(4) does not support Spielman's argument that the
statute uses the word "petitioner" as the equivalent of the term
"representative" in the Louisiana statute.
We also reject Spielman's contention that the Massachusetts
Supreme Judicial Court's statement in Coggins v. New England Patriots
Football Club, Inc., 550 N.E.2d 141 (Mass. 1990) ( Coggins II), about
the award of attorney's fees from a common fund controls the
jurisdictional outcome here. That case began with Coggins v. New
England Patriots Football Club, Inc., 492 N.E.2d 1112 (Mass. 1986)
(Coggins I), in which a group of non-voting shareholders brought a
corporate derivative action to challenge a merger, and the SJC ordered
the calculation of rescissory damages. Id. at 1115-16. The parties
then settled. Following settlement, the plaintiffs filed a motion for
attorney's fees and costs to be assessed against the defendants. The
superior court rejected that argument on the ground that in Coggins I ,
"the higher court ordered the derivative claim 'reinstated' . . .
solely to permit a reconstructive calculation of rescissory damages,
and not as a calculation of corporate damages." Coggins II, 550
N.E.2d at 142. Reasoning that the plaintiffs thus had not succeeded
- 18 - in garnering funds on the corporation's behalf, the superior court
ruled that their attorney's fees should come from a common settlement
fund rather than from the defendants. Id. In affirming the lower
court's ruling, the Massachusetts Supreme Court said that attorney's
fees may be awarded from a common settlement fund, but emphasized the
discretionary nature of such an award. "Where a party has at his or
her own expense, been successful in creating, preserving or enlarging
a fund in which other parties have a rightful share, a court may order
the payment of attorneys' fees and expenses out of the fund as part of
the damages award. . . . Such an allowance is discretionary and not a
matter of strict right." Id. at 143 (citations omitted).
Even if a court were to apply the rule set forth in Coggins
II in a Chapter 93A class action like this one, and exercise its
discretion to award the named plaintiff attorney's fees from a common
settlement fund, the award would simply be the unremarkable result of
an exercise of the equitable discretion of the trial court rather than
the mandated result of any language in Chapter 93A. Indeed, Chapter
93A does not, by its terms, address the aggregation/allocation issue
in a class action suit. The possibility of an aggregated award through
the exercise of the court's discretion does not justify disregarding
- 19 - the anti-aggregation principles of Snyder and Zahn. See Snyder, 394
U.S. at 339-40; Zahn, 414 U.S. at 301.6
In sum, we reject Spielman's argument that Chapter 93A's
authorization of attorney's fees requires that such fees be aggregated
to the named plaintiff for purposes of determining federal
jurisdiction. For the reasons we have stated, we find that Spielman's
amended complaint fails to meet the amount-in-controversy minimum.
Having found no basis for the exercise of federal diversity
jurisdiction, we affirm the district court's dismissal of Spielman's
case.
Affirmed.
6 Nor do the Massachusetts cases that are the source of the language quoted in Coggins II help Spielman. These cases involve three narrow exceptions in equity practice to the general rule that a litigant must pay for his own lawyers. In Commissioner of Insurance v. Massachusetts Accident Co., 61 N.E.2d 137 (Mass. 1945), the court said that one of the exceptions applied when "a litigant" at his own expense created or increased "a fund in which others have a right to share." Id. at 139-40. Examples of such funds were those controlled by the executor of a will or a receivership. See, e.g., Boynton v. Tarbell, 172 N.E. 340 (Mass. 1930); Davis v. Bay State League, 33 N.E. 591 (Mass. 1893).
- 20 -