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Gale v. Chicago Title Insurance Co.

United States Court of Appeals, Second Circuit

July 9, 2019

JOHN Q. GALE, JOHN Q. GALE, LLC, FKA Gale & Kowalyshyn, LLC, Plaintiffs-Appellants,
v.
CHICAGO TITLE INSURANCE COMPANY, COMMONWEALTH LAND TITLE INSURANCE COMPANY, FIRST AMERICAN TITLE INSURANCE COMPANY, LAWYERS TITLE INSURANCE CORPORATION, individually and as a successor in interest to Transnation Title Insurance Company, OLD REPUBLIC NATIONAL TITLE INSURANCE COMPANY, STEWART TITLE GUARANTY COMPANY, TICOR TITLE INSURANCE COMPANY, TICOR TITLE INSURANCE COMPANY OF FLORIDA, FIDELITY NATIONAL TITLE INSURANCE COMPANY, UNITED GENERAL TITLE INSURANCE COMPANY, Defendants-Appellees, GALE & KOWALYSHYN, LLC, Plaintiff-Intervenor, TRANSNATION TITLE INSURANCE COMPANY, Defendant.

          Argued: April 30, 2019

          Appeal from the United States District Court for the District of Connecticut No. 6 Civ. 1619 (RNC), Robert N. Chatigny, District Judge, Presiding.

         John Q. Gale, a Connecticut attorney, sued a group of title insurance companies for allegedly violating a Connecticut law that allows only Connecticut attorneys to act as title agents in the state. The original complaint included class- action allegations, and the District Court exercised jurisdiction under the Class Action Fairness Act ("CAFA"), 28 U.S.C. § 1332(d). After a number of years of litigation, Plaintiffs amended the complaint to remove all class-action allegations. The United States District Court for the District of Connecticut (Chatigny, J.) concluded that the withdrawal of the class-action allegations divested it of CAFA jurisdiction and dismissed the amended complaint. We agree and conclude that when jurisdiction-granting class-action allegations are removed from a complaint, a district court is divested of CAFA jurisdiction and the action must be dismissed.

         AFFIRMED.

          Mathew P. Jasinski, Motley Rice LLC, Hartford, CT, for appellants John Q. Gale, John Q. Gale, LLC, FKA Gale & Kowalyshyn, LLC.

          Ross L. Hirsch (Arthur G. Jakoby, on the brief), Herrick, Feinstein LLP, New York, N.Y., for appellees Chicago Title Insurance Company, Commonwealth Land Title Insurance Company, Fidelity National Title Insurance Company, Lawyers Title Insurance Company, Ticor Title Insurance Company, Ticor Title Insurance Company of Florida, Transnation Title Insurance Company.

          Frank J. Silvestri, Jr., Verrill Dana LLP, Westport, CT, for appellee Old Republic National Title Insurance Company.

          Gerard D. Kelly, Kevin M. Fee, Sidley Austin LLP, Chicago, IL, for appellee Stewart Title Guaranty Company.

          Before: PARKER, WESLEY, and CARNEY, Circuit Judges.

          BARRINGTON D. PARKER, Circuit Judge

         Plaintiff-Appellant John Q. Gale is a Connecticut attorney, who, along with John Q. Gale, LLC, FKA Gale & Kowalyshyn, LLC, different iterations of his law firm (collectively "Plaintiffs"), sued Defendants-Appellees, a group of title insurance companies, alleging that they violated a Connecticut law that allows only attorneys admitted to practice in Connecticut to act as real estate title agents. In the original complaint, Plaintiffs included class-action allegations and maintained those allegations through three subsequent amendments to the original complaint. The District Court exercised federal jurisdiction over the initial and the amended complaints under the Class Action Fairness Act ("CAFA"), which confers jurisdiction when, among other things, the case "is a class action." 28 U.S.C. § 1332(d)(2).

         After approximately twelve years of litigation, Plaintiffs filed a Fourth Amended Complaint ("FAC") that removed all class-action allegations and asserted only state law claims on behalf of the individual plaintiffs. The United States District Court for the District of Connecticut (Chatigny, J.) concluded that the withdrawal of the class-action allegations divested it of CAFA jurisdiction and dismissed the FAC without prejudice.

         Plaintiffs appeal, principally contending that the amendment did not divest the District Court of jurisdiction. We agree with Judge Chatigny that when (i) federal jurisdiction in a case filed originally in federal court rests solely on CAFA, (ii) the jurisdiction-granting class-action allegations are eliminated from the complaint, and (iii) no new jurisdiction-granting ...


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