Beginning Next Week: InsideCounsel will become part of Corporate Counsel. Bringing these two industry-leading websites together will now give you comprehensive coverage of the full spectrum of issues affecting today's General Counsel at companies of all sizes. You will continue to receive expert analysis on key issues including corporate litigation, labor developments, tech initiatives and intellectual property, as well as Women, Influence & Power in Law (WIPL) professional development content. Plus we'll be serving all ALM legal publications from one interconnected platform, powered by, giving you easy access to additional relevant content from other InsideCounsel sister publications.

To prevent a disruption in service, you will be automatically redirected to the new site next week. Thank you for being a valued InsideCounsel reader!


SCOTUS grants case that will provide clarity to class action forum changes

Case could have wide-ranging effects on class action suits

The U.S. Supreme Court granted one new case on April 7, and it’s one that in-house counsel should pay attention to for its implications on class action lawsuits.

In Dart Cherokee Basin Operating Company, LLC v. Owens, a group of royalty owners sued Dart Cherokee over unpaid royalties on the company’s oil and gas wells. The plaintiffs originally filed suit in Kansas state court, where the wells were located, but the Michigan-based Dart Cherokee sought to have the case moved to federal court.

Here’s where the Supreme Court ruling comes in: The Class Action Fairness Act (CAFA) of 2005 allows transfers of cases involving more than $5 million in damages from state to federal court. The plaintiffs did not seek a specific damage amount in their initial filing, but the defendant claimed that damages would be well over $5 million in its filing to change forum.

The district court ruled against Dart Cherokee’s motion to move the case to federal court, and the 10th Circuit upheld that decision, saying in a split en banc decision that the company did not offer enough evidence to back up its $5 million claim.

However, Judge Harris L. Hartz of the 10th Circuit said in a dissent, joined by three other judges, that the burden of proof the courts were imposing sets “an evidentiary burden on the notice of removal that is foreign to federal-court practice and, to my knowledge, has never been imposed by a federal appellate court (Owens does not cite to any such case). Unfortunately, this may be the only opportunity for this court to correct the law in our circuit.” He went on to argue that “a defendant seeking removal under CAFA need only allege the jurisdictional amount in its notice of removal and must prove that amount only if the plaintiff challenges the allegation.”

Now, the Supreme Court will get its shot at the case. If the Court rules in Dart Cherokee’s favor, then defendants of class action lawsuits may only need to prove damages north of $5 million if the plaintiff challenges their bid to move to federal court. If a case is being tried in an unfavorable forum, this ruling could be a godsend to in-house counsel looking for a leg up.


For more Supreme Court cases to know, check out these recent articles:

Supreme Court decision to have major implications for state and local campaign finance

Alice was asked aplenty

Lack of legislation and a surplus of case law are changing class action lawsuits

SCOTUS tackles when a statement of opinion is actionable under the 1933 Act

Assistant Editor

author image

Zach Warren

Zach Warren is Assistant Editor of InsideCounsel magazine, where he oversees online content submissions and administers InsideCounsel's enewsletters. Zach specializes in new media and multimedia...

Bio and more articles

Join the Conversation

Advertisement. Closing in 15 seconds.