A recent case from the Seventh Circuit provides a useful
reminder about removal of a case to federal court.
Chicago-based SP Plus operates parking facilities at Dayton
International Airport. Kathryn Collier and Benjamin Seitz used these parking
and received receipts that included the expiration date of their credit or
debit cards. They believed that printing that information violated the Fair and
Accurate Credit Transaction Act (“FACTA”), 15 U.S.C. § 1681c(g)(l).
Collier and Seitz filed a class-action complaint in the
Circuit Court of Cook County alleging that SP Plus willfully violated FACTA.
They requested statutory and actual damages, asserting that actual damages exceeded
$25,000. The complaint did not itemize any concrete harm they had suffered; neither
had experienced credit-card fraud or identity theft.
SP Plus removed the action to federal court, arguing that
the district court had federal-question jurisdiction because the claim arose
under a federal statute. Shortly thereafter, SP Plus moved to dismiss the
complaint under Federal Rule of Civil Procedure 12(b)(1) for lack of Article
III standing because the plaintiffs did not allege an injury in fact, thereby depriving
the court of subject matter jurisdiction. Collier and Seitz moved to remand to state court, arguing that
it was SP Plus’s responsibility to establish subject-matter jurisdiction and
that, without it, 28 U.S.C. § 1447(c)
required the district court to return their case to state court.
The district court denied the motion to remand, but granted
Collier and Seitz leave to amend their complaint. When they failed to do so,
the court dismissed the case with prejudice. Collier and Seitz took an appeal.
As the party invoking federal jurisdiction, SP Plus had to
establish that all elements of jurisdiction—including Article III
standing—existed at the time of removal.
To establish federal subject-matter jurisdiction, SP Plus
also had to show that Collier and Seitz possessed Article III
standing—specifically, that they suffered an injury beyond a statutory
According to the appeals court, Collier and Seitz’s
complaint did not sufficiently allege an actual injury. The mere reference to
“actual damages” in the complaint’s prayer for relief failed to establish
Article III standing.
SP Plus contended that the conclusory request for “actual
damages” was unfair because it would allow Collier and Seitz to clarify what
concrete injury they suffered “after it is too late” for removal.
The court was not persuaded by this argument. If, after
remand Collier and Seitz were to amend their complaint to state an injury in
fact, 28 U.S.C. § 1446(b)(3) would permit SP Plus to then remove the case to
federal court. Even if Collier and Seitz did not amend, SP Plus could still remove
if it received any “paper that affirmatively and unambiguously reveals that the
predicates for removal are present.”
Thus, 28 U.S.C. § 1447(c) required the district court to
remand to state court, because the complaint did not satisfy Article III’s
Additionally, the case should not have been dismissed with
prejudice. As the appeals court noted, a suit dismissed for lack of
jurisdiction cannot also be dismissed ‘with prejudice’ because that is a
disposition on the merits, which only a court with jurisdiction may render.
Nor was dismissal with prejudice warranted as a sanction
under Federal Rule of Civil Procedure 41(b) because Collier and Seitz opted not
to amend their complaint. No finding of willfulness by the plaintiffs justified
a dismissal on the merits.
The court vacated the dismissal and remanded with directions
to return the case to state court.
The case is Collier
and Seitz v. SP Plus Corporation, ___ F. 3d ___, 2018
WL 2186786 (7th Cir. 2018)
Michael R. LiedHoward & Howard Attorneys PLLCOne Technology Plaza, 211 Fulton Street, Suite 600, Peoria, IL 61602(309) 999-6311MLied@howardandhoward.com