United States v. 2020-11-13 | 20-16767 | LEVONE HARRIS V. KM INDUSTRIAL, INC. | precedential | opinion |

FOR PUBLICATION

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

LEVONE HARRIS, on behalf of
himself and all others similarly
situated,
Plaintiff-Appellee,

v.

KM
INDUSTRIAL, INC., a Delaware
corporation,
Defendant-Appellant.
No. 20-16767

D.C. No.
3:19-cv-07801-
WHO

OPINION

Appeal from the United States District Court
for the Northern District of California
William Horsley Orrick, District Judge, Presiding

Argued and Submitted October 16, 2020
San Francisco, California

Filed November 13, 2020

Before: Kim McLane Wardlaw and Daniel P. Collins,
Circuit Judges, and Richard K. Eaton,
*
Judge

Opinion by Judge Eaton;
Dissent by Judge Collins

*
Richard K. Eaton, Judge of the United States Court of International
Trade, sitting by designation.

2 HARRIS V. KM INDUSTRIAL

SUMMARY
**

Class Action Fairness Act

The panel affirmed the district court’s order remanding
a class action back to state court because the defendant did
not establish the requisite $5 million amount in controversy
under the Class Action Fairness Act (“CAFA”).

Levone Harris filed his class action complaint in
California state court against his former employer KM
Industrial, Inc. (“KM”) alleging violations of the California
Labor Code. KM removed the case to federal court under
CAFA, alleging an amount in controversy of $7,163,325,
which it calculated by totaling the value it assigned to five
of the eight causes of action, plus attorney’s fees.

Because Harris contested the truth of KM’s factual
allegations, the panel held that Harris’s motion to remand to
state court raised a factual challenge to KM’s assumptions
that all 442 Hourly Employee Class members worked shifts
long enough to be eligible for meal and rest periods.
Accordingly, KM had the burden of proving by a
preponderance of the evidence that its jurisdictional
allegations were reasonable. The panel held that KM did not
carry this burden because it relied on assumptions regarding
the meal period and rest period subclasses that were
unreasonable.

**
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.

HARRIS V. KM INDUSTRIAL 3

The panel held that because both parties were afforded
the opportunity to place evidence on the record supporting
their respective positions as to the amount in controversy,
the district court did not err in granting Harris’s motion to
remand to state court. The panel further held that a remand
to the district court for further factfinding was not required.

Judge Collins dissented. In his view, the district court’s
reasons for remanding the case to state court were flawed,
and he would reverse and remand for further proceedings in
the district court. At the very least, the district court should
have given KM an opportunity to address the court’s specific
concern before remanding to state court.

COUNSEL

Bradley J. Hamburger (argued), Katherine V.A. Smith, and
Megan Cooney, Gibson Dunn & Crutcher LLP, Los
Angeles, California; Carlos Jimenez, Littler Mendelson
P.C., Los Angeles, California; for Defendant-Appellant.

Shaun Setareh (argued), Setareh Law Group, Beverly Hills,
California, for Plaintiff-Appellee.

OPINION
EATON, Judge:
In order to remove a case commenced as a class action
in a state court, the Class Action Fairness Act of 2005
(“CAFA”) requires that the removing defendant allege that
the amount in controversy exceeds $5 million. 28 U.S.C.
§ 1332(d)(2). Here, the plaintiff factually attacked the

4 HARRIS V. KM INDUSTRIAL

defendant’s allegations regarding the amount in controversy.
After the parties had an opportunity to submit evidence, the
district court remanded the case to state court because it
found that the defendant based the claimed amount in
controversy on unreasonable assumptions. We affirm.
I.
On October 24, 2019, Levone Harris filed a class action
complaint in California state court against his former
employer KM Industrial, Inc. (“KMI”). Harris alleged that
KMI had violated several provisions of the California Labor
Code including failing to provide meal and rest breaks, pay
overtime wages, furnish compliant wage statements,
indemnify expenditures and losses, and timely pay all final
wages.
Harris brought suit on behalf of several putative classes
and subclasses of employees for the “Relevant Time
Period,” commencing “four years prior to the filing of this
action until judgment is entered.” The complaint contained a
cause of action for labor violations suffered by an “Hourly
Employee Class,” described as “[a]ll persons employed by
[KMI] and/or any staffing agencies and/or any other third
parties in hourly or non-exempt positions in California
during the Relevant Time Period.” Harris also brought
causes of action based on subclasses of the Hourly Employee
Class. Two of these subclasses are important here: (1) the
“Meal Period Sub-Class” and (2) the “Rest Period
Sub-Class.”
In his complaint, Harris defined the Meal Period Sub-
Class as “[a]ll Hourly Employee Class members who
worked a shift in excess of five hours during the Relevant
Time Period.” Harris alleged that KMI “maintained a policy
or practice of not providing [Harris] and members of the

HARRIS V. KM INDUSTRIAL 5

Meal Period Sub-Class with uninterrupted, duty-free meal
periods for at least thirty (30) minutes for each five (5) hour
work period, as required by Labor Code section 512 ad [sic]
the applicable Wage Order.” The Rest Period Sub-Class was
defined as “[a]ll Hourly Employee Class members who
worked a shift of at least three and one-half (3.5) hours
during the Relevant Time Period.” Harris alleged that KMI
“maintained a policy or practice of not providing [Harris
and] members of the Rest Period Sub-Class with net rest
period [sic] of at least ten minutes for each four hour work
period, or major fraction thereof, as required by the
applicable Wage Order.”
KMI timely filed a notice of removal on November 27,
2019, asserting that CAFA vested the federal district court
with original subject matter jurisdiction because the amount
placed in controversy by the claims in Harris’s complaint
exceeded $5 million.
1
28 U.S.C. § 1332(d)(2). KMI alleged
that the amount in controversy was $7,163,325, which it
calculated by totaling the value it assigned to five of the eight
causes of action, plus attorney’s fees. KMI represented that
this calculation was based on the allegations set forth in the
complaint, employee and payroll data, and KMI’s own
assumptions regarding the frequency of violations as applied
to the relevant class or subclass. To support its calculation,
KMI also submitted evidence in the form of a declaration by

1
Neither party contests the jurisdictional requirements of class
numerosity or minimal diversity on appeal. Accordingly, the sole dispute
is whether the amount in controversy exceeds the $5 million
jurisdictional threshold required under CAFA.

6 HARRIS V. KM INDUSTRIAL

Julian Lopez (“First Lopez Declaration”), the corporate
human resources director for KMI’s parent company.
2

In his declaration, Lopez estimated that, in the four-year
period prior to the filing of the complaint, KMI had
“employed approximately 442 putative class members” who
“worked an aggregate of 39,834 workweeks.” He based the
declaration on his own personal knowledge and information
taken from KMI’s “computer system which, among other
things, tracks certain personnel and payroll information of
[KMI’s] employees.” The First Lopez Declaration made no
mention of the number or length of shifts worked by the
Hourly Employee Class members during the 39,834
workweeks. Nor did it define the length of a workweek itself
with respect to what constituted a fulltime week or shift.
Importantly, KMI assumed, for purposes of calculating
the amount in controversy, that all of the individuals in the
putative Hourly Employee Class—442—were also all
members of the Meal Period Sub-Class and the Rest Period
Sub-Class for the duration of the Relevant Time Period.
Thus, for Harris’s meal period claim, KMI assumed that the
entire Hourly Employee Class of 442 employees missed one
meal period per workweek across an aggregate of 39,834
workweeks. Similarly, for the rest period claim, KMI
assumed that all 442 members of the Hourly Employee Class
were also members of the Rest Period Sub-Class and had
missed two rest periods per workweek across an aggregate
of 39,834 workweeks. Thus, KMI assumed that the

2
The First Lopez Declaration addressed four factual matters: (1) the
Hourly Employee Class consists of approximately 442 putative class
members; (2) of those 442 putative class members, 237 resigned or were
terminated during the Relevant Time Period; (3) putative class members
worked an aggregate of 39,834 workweeks; and (4) the median rate of
pay for putative class members was $20.00 per hour.

HARRIS V. KM INDUSTRIAL 7

442 Hourly Employee Class members worked shifts long
enough to qualify for one meal period and two rest periods
during each week of the 39,834 workweeks during the four-
year Relevant Time Period.
Harris filed a motion to remand the case to state court on
the grounds that the district court lacked subject matter
jurisdiction because KMI “ha[d] failed to establish by a
preponderance of the evidence that the amount in
controversy exceeds $5 million, as required under CAFA.”
In his brief supporting his remand motion, Harris contended
that KMI’s calculations “improperly inflate the amount in
controversy” by relying on “unfounded assumptions.”
Specifically, Harris objected to KMI’s assumption that the
violation rate of one missed meal period and two missed rest
periods, suffered by the Meal Period and Rest Period
subclasses, was suffered by the entire Hourly Employee
Class. Harris found unreasonable KMI’s assumption that
“every [Hourly Employee Class member] missed [one] meal
period every week [and] two rest periods every week,”
without considering “other relevant factors, including shift
length, the number of days the [Hourly Employee Class
members] worked per week, or whether they took vacations
or leaves of absence.” Harris thus maintained that KMI’s
“removal is predicated upon misinterpretations of the class
definitions and allegations asserted in the complaint[,]” by
assigning meal period and rest period damages to the entire
Hourly Employee Class.
KMI opposed Harris’s motion to remand and provided
additional evidence in the form of a second declaration by
Julian Lopez (“Second Lopez Declaration”). While the
Second Lopez Declaration responded to some of Harris’s

8 HARRIS V. KM INDUSTRIAL

attacks on the allegations underlying the assumptions,
3
it did
not address the frequency with which Hourly Employee
Class members worked shifts that would have made them
eligible for meal or rest breaks. Thus, in response to Harris’s
challenge, KMI did not provide specific evidence to support
its assumption that all 442 individuals that composed the
Hourly Employee Class were also members of the Meal
Period Sub-Class and the Rest Period Sub-Class throughout
the Relevant Time Period.
The district court granted Harris’s motion to remand to
the state court, finding that KMI had “failed to establish the
amount-in-controversy by a preponderance of the evidence”
because “no evidence support[ed]” KMI’s assumption “that
the 442 potential class members regularly, or at least more
often than not” worked the requisite number of hours that
would have entitled them to meal or rest periods. That is, the
district court found that KMI did not support with competent
evidence its assumption that the 442 Hourly Employee Class
members worked shifts sufficient to make them members of
both subclasses during the 39,834 individual workweeks.
The district court held that, without more, it could not credit
KMI’s calculations “because [KMI’s] potential damages
calculations rely on these assumptions.” Given the lack of
evidence on the record showing “how many putative [Hourly
Employee Class] members worked shifts that would entitle
them to a meal or rest break,” the district judge found that
KMI’s assumptions were unreasonable because they

3
The Second Lopez Declaration essentially repeats the information
from the First Lopez Declaration. However, it does address two new
factual matters: (1) the average hourly rate of pay for Hourly Employee
Class members ($22.94), and (2) the number of weeks worked by each
individual member of one of the other putative subclasses described in
the complaint, the Wage Statement Penalties Sub-Class.

HARRIS V. KM INDUSTRIAL 9

increased the likelihood that “KMI’s [amount in
controversy] calculation would be grossly exaggerated.”
II.
We have jurisdiction pursuant to 28 U.S.C. § 1453(c),
and we review district court “remand orders in CAFA cases
de novo.” Greene v. Harley-Davidson, Inc., 965 F.3d 767,
771 (9th Cir. 2020) (quoting Arias v. Residence Inn by
Marriott, 936 F.3d 920, 924 (9th Cir. 2019)). The sole
jurisdictional dispute here is whether KMI sufficiently
demonstrated below that it met CAFA’s requirement that the
amount in controversy exceed $5 million.
A.
In his complaint, Harris does not enumerate the putative
class’s claimed damages. Where this allegation is lacking, a
removing defendant need only allege in its notice of removal
that the amount in controversy requirement is met. See Dart
Cherokee Basin Operating Co., LLC v. Owens, 574 U.S. 81,
88–89 (2014).
Thereafter, the plaintiff can contest the amount in
controversy by making either a “facial” or “factual” attack
on the defendant’s jurisdictional allegations. See Salter v.
Quality Carriers, 974 F.3d 959, 964 (9th Cir. 2020). “A
‘facial’ attack accepts the truth of the [defendant’s]
allegations but asserts that they ‘are insufficient on their face
to invoke federal jurisdiction.’” Id. (quoting Leite v. Crane
Co., 749 F.3d 1117, 1121 (9th Cir. 2014)). A factual attack
“contests the truth of the . . . allegations” themselves. Id.
(citation omitted). When a plaintiff mounts a factual attack,
the burden is on the defendant to show, by a preponderance
of the evidence, that the amount in controversy exceeds the
$5 million jurisdictional threshold. Ibarra v. Manheim

10 HARRIS V. KM INDUSTRIAL

Investments, Inc., 775 F.3d 1193, 1197 (9th Cir. 2015)
(citing Dart, 574 U.S. at 88–89). Both parties may submit
evidence supporting the amount in controversy before the
district court rules. Salter, 974 F.3d at 963; Ibarra, 775 F.3d
at 1197.
In Salter, as here, the plaintiff filed a putative class action
asserting a set of wage and labor violations, which the
defendant then removed to federal court, invoking CAFA
jurisdiction. Salter, 974 F.3d at 961. In response, the plaintiff
moved to remand the case but did not contest the factual
assertions in the defendant’s notice of removal, or “assert
that [the defendant] misinterpreted the thrust of his
complaint,” or “offer any declaration or evidence that
challenged the factual bases of [the defendant’s] plausible
allegations.” Id. at 964. Nonetheless, the district court
granted the plaintiff’s motion to remand after finding that the
defendant had “failed to adequately show that the amount in
controversy exceeded $5 million.” Id. at 961. On appeal, we
concluded that the plaintiff “challenged the form, not the
substance, of [the defendant’s] showing” and accordingly
had “mounted only a facial attack, rather than a factual
attack.” Id. at 961, 964. In doing so, we rejected the view
that a defendant “must support its jurisdictional allegations
with competent proof, under the same evidentiary standard
that governs in the summary judgment context” where a
plaintiff only mounts a facial attack. Id. at 964 (cleaned up).
KMI maintains that Harris similarly made only a facial
challenge because he “did not contest the truth of [KMI’s]
jurisdictional allegations.” We disagree. Because Harris
directly challenged the truth of KMI’s allegation that all
442 Hourly Employee Class members worked shifts long
enough to qualify for meal and rest periods, we find that
Harris made a factual attack. See id. at 964.

HARRIS V. KM INDUSTRIAL 11

In his brief accompanying the motion to remand, Harris
claimed that KMI unreasonably “assumed every type of
injury alleged in the complaint was suffered by each
[putative class member],” even though “the causes of action
alleged in the [c]omplaint are alleged on behalf of specific
classes or are based on allegations that are applicable to
members of the class that were injured.” Harris insisted that
KMI unreasonably assumed that the Hourly Employee Class
members missed meal and rest periods in each of the 39,834
workweeks. For Harris, KMI’s assumption was
unreasonable because the company failed to provide any
“further description of any other relevant factors, including
shift length, the number of days the [Hourly Employee Class
members] worked per week, or whether they took vacations
or leaves of absence” despite this evidence being available
to KMI. For Harris, because KMI provided nothing to show
whether, or how often, Hourly Employee Class members
worked shifts long enough to make them eligible for meal or
rest periods, it failed to meet its burden to produce evidence
supporting its assumption that all members of the Hourly
Employee Class were also members of the two subclasses,
and that they worked long enough shifts in each of the
39,834 workweeks to qualify for meal and rest periods.
Harris did not introduce evidence outside the pleadings.
A factual attack, however, need only challenge the truth of
the defendant’s jurisdictional allegations by making a
reasoned argument as to why any assumptions on which they
are based are not supported by evidence. See Salter, 974 F.3d
at 964; Ibarra, 775 F.3d at 1199 (holding that it is sufficient
to “contest[ an] assumption” without “assert[ing] an
alternative [assumption] grounded in real evidence”). Here,
Harris sufficiently disputed the factual basis of KMI’s
assumption that all Hourly Employee Class members had
suffered one meal and two rest period violations per

12 HARRIS V. KM INDUSTRIAL

workweek across 39,834 workweeks by attacking the
assumption’s factual underpinnings. Notably, Harris
contested KMI’s failure to demonstrate that all members of
the Hourly Employee Class worked shifts long enough to
qualify for meal and rest periods. Cf. Salter, 974 F.3d at 964.
Moreover, KMI treated Harris’s attack as a factual one by
submitting proof in the form of the Second Lopez
Declaration supporting some of its assumptions following
the motion to remand. The Second Lopez Declaration,
however, did not support KMI’s assumption that the Hourly
Employee Class members were all members of the two
subclasses.
Because Harris “contest[ed] the truth of the
[defendant’s] factual allegations,” we conclude that Harris’s
motion to remand raised a factual challenge to KMI’s
assumptions that all 442 Hourly Employee Class members
worked shifts long enough to be eligible for meal and rest
periods. Id. Accordingly, when given the opportunity to
present evidence, following Harris’s motion to remand, KMI
had the burden of supporting its “jurisdictional allegations
with competent proof.” Id.
B.
Once Harris contested the reasonableness of KMI’s
assumptions, KMI had the burden of proving by a
preponderance of the evidence that its assumptions were
reasonable. A defendant may rely on reasonable assumptions
to prove that it has met the statutory threshold. See Ibarra,
775 F.3d at 1197; see also Arias, 936 F.3d at 922. A
defendant need not make the plaintiff’s case for it or prove
the amount in controversy beyond a legal certainty. See
Dart, 574 U.S. at 88–89; see also Arias, 936 F.3d at 925.
Nonetheless, the burden of demonstrating the
reasonableness of the assumptions on which the calculation

HARRIS V. KM INDUSTRIAL 13

of the amount in controversy was based remained at all times
with KMI.
The preponderance standard does not require a district
court to perform a detailed mathematical calculation of the
amount in controversy before determining whether the
defendant has satisfied its burden. Rather, “CAFA’s
requirements are to be tested by consideration of real
evidence and the reality of what is at stake in the litigation,
using reasonable assumptions underlying the defendant’s
theory of damages exposure.” Ibarra, 775 F.3d at 1198. The
district court should weigh the reasonableness of the
removing party’s assumptions, not supply further
assumptions of its own. After considering any evidence put
forth by the parties, and assessing the reasonableness of the
defendant’s assumptions, “the court then decides where the
preponderance lies.” Id. (citation omitted).
KMI did not carry this burden because it relied on
assumptions regarding the Meal Period and Rest Period
subclasses that were unreasonable. As the district court
found, KMI has failed to provide any evidence to support its
assumption that all 442 Hourly Employee Class members
were the same as the members of the Meal Period Sub-Class
or the Rest Period Sub-Class or that they all worked shifts
long enough to qualify for meal or rest periods.
In his complaint, Harris alleged causes of action on
behalf of specific classes and subclasses, each with its own
eligibility criteria derived from particular California Labor
Code provisions. The complaint defined the Hourly
Employee Class more broadly than the two subclasses.
Nothing in the complaint indicated that all members of the
Hourly Employee Class were members of the Meal Period
Sub-Class or the Rest Period Sub-Class or that the Hourly
Employee Class members worked shifts that would qualify

14 HARRIS V. KM INDUSTRIAL

them as members of the two subclasses. KMI’s initial
submission did not provide proof that would support either
assumption. When given the opportunity to support the
reasonableness of its assumptions, i.e. after Harris factually
attacked them, KMI produced the Second Lopez
Declaration, which provided additional evidence for some of
KMI’s allegations but still failed to address class
membership or shift length. By doing so, KMI failed to
produce any proof that the members of the Hourly Employee
Class and the two subclasses were the same and that they all
worked shifts long enough to qualify for meal and rest
periods, and this failure rendered KMI’s assumptions
unsupported and unreasonable. Furthermore, given that
KMI’s second declaration supplemented some of its amount
in controversy allegations, it also could have been the
vehicle to provide evidence supporting the assumptions
contested here, but was not.
We thus agree with the district court that relying on the
factually unsupported and unreasonable assumption that the
442 Hourly Employee Class members worked shifts long
enough to entitle them to meal and rest periods would
exaggerate the amount in controversy. The district court
found that “KMI did not provide any evidence, either in
support of its motion to remove or in opposing the motion to
remand, regarding the 442 potential class members’ shifts or
the number of employees that worked full time.” Thus, KMI
offered no proof that all of the 442 Hourly Employee Class
members worked sufficient shifts during the 39,834
workweeks to qualify them for meal and rest periods.
Therefore, KMI has failed to carry the burden of proving the
statutory amount in controversy by a preponderance of the
evidence.

HARRIS V. KM INDUSTRIAL 15

III.
Finally, because both parties were afforded the
opportunity to place evidence on the record supporting their
respective positions as to the amount in controversy, the
district court did not err in granting Harris’s motion to
remand the case to state court, and a remand to the district
court for further factfinding is not required. Ibarra is not to
the contrary. There, we remanded the case to the district
court to give the parties, for the first time, the opportunity to
submit evidence as to the statutory threshold. See Ibarra,
775 F.3d at 1195.
4
Because in Ibarra only the parties’ briefs
and evidence submitted with the defendant’s notice of
removal were on the record, and no opportunity had been
provided to either party to submit evidence after the amount
in controversy had been contested, remand was appropriate.
Id. at 1196. Unlike Ibarra, here we are not dealing with an
“open record” or a situation where the defendant lacked
notice of its need to submit additional evidence. Id. at 1199.
Here, the parties had an adequate opportunity to place
evidence on the record following the motion to remand, as
shown by the fact that KMI took advantage of that
opportunity, but only in support of some, not all, of the
contested jurisdictional allegations. Our precedent does not
direct that KMI should be given another chance to make its

4
Although this was Ibarra’s second appeal to this court after having
been twice remanded to state court, we did not reach the merits in the
first. Instead, we simply remanded the case to the district court based on
our controlling decision in Rodriguez v. AT&T Mobility Services LLC,
728 F.3d 975, 977 (9th Cir. 2013), which we decided while the appeal in
Ibarra was pending and which clarified the proper burden of proof for a
removing defendant. Ibarra, 775 F.3d at 1196.

16 HARRIS V. KM INDUSTRIAL

case. See Ibarra, 775 F.3d at 1199; see also Dart, 574 U.S.
at 88–89.
AFFIRMED.

COLLINS, Circuit Judge, dissenting:
I disagree with the majority’s conclusion that the district
court properly remanded this case to state court after
Defendant-Appellant KM Industrial, Inc. (“KMI”) removed
it to federal court under the Class Action Fairness Act of
2005 (“CAFA”), 28 U.S.C. § 1332(d).
1
I therefore
respectfully dissent.
I
“CAFA provides the federal district courts with ‘original
jurisdiction’ to hear a ‘class action’ if the class has more than
100 members, the parties are minimally diverse, and the
‘matter in controversy exceeds the sum or value of
$5,000,000.’” Standard Fire Ins. Co. v. Knowles, 568 U.S.
588, 592 (2013) (quoting 28 U.S.C. § 1332(d)(2)); see also
28 U.S.C. § 1332(d)(5). Under 28 U.S.C. § 1453(b), such
class actions may be removed to federal court upon the

1
KMI’s notice of removal also relied on federal question
jurisdiction, based on Plaintiff’s assertion of a claim under the Fair
Credit Reporting Act (“FCRA”), 15 U.S.C. §§ 1681b(b)(2)(A),
1681d(a), 1681n, 1681o. However, the parties agreed that Plaintiff
lacked Article III standing to assert such a claim, and the district court
therefore concluded that there was no federal-question jurisdiction. KMI
does not challenge this conclusion on appeal. And because the district
court found CAFA jurisdiction lacking, it did not address KMI’s
argument that, if CAFA jurisdiction exists, then the FCRA claim should
not be remanded but presumably should be dismissed.

HARRIS V. KM INDUSTRIAL 17

timely filing by any defendant of a notice of removal in
accordance with 28 U.S.C. § 1446. Because § 1446(a) only
requires a notice of removal to “contain[] a short and plain
statement of the grounds for removal,” id., a notice of
removal under CAFA need only include “a plausible
allegation that the amount in controversy exceeds the
jurisdictional threshold” of $5,000,000. Dart Cherokee
Basin Operating Co. v. Owens, 574 U.S. 81, 89 (2014). In
removing this putative class action asserting wage-and-hour
claims to federal court under CAFA, KMI’s notice of
removal set forth in detail how it calculated the amount in
controversy with respect to each of the major claims in the
complaint filed by Plaintiff-Appellee Levone Harris
(“Plaintiff”), and it also attached a declaration from Julian
Lopez, the Corporate Human Resources Director of KMI’s
parent company, to support some of those assertions.
In later remanding the case, the district court specifically
found fault only with respect to KMI’s calculations
concerning two of Plaintiff’s claims—viz., the complaint’s
claims that KMI failed to provide its employees with the
meal breaks and rest breaks required by California law—and
those are the only calculations at issue in this appeal.
2
In

2
Although an appellee can argue, without filing a cross-appeal, that
the district court’s judgment should be affirmed on the ground that the
court erred in rejecting the appellee’s other arguments, I see no basis to
apply that rule here. Although Plaintiff’s principal appellate brief repeats
(at times almost verbatim) many of the arguments he made below, that
brief makes no effort to address the district court’s reasons for rejecting
many of those alternative arguments, much less to explain why the
district court’s reasoning was incorrect. Indeed, that brief’s only
mention of those alternative rulings occurs in the course of explaining
what the district court “found” in “properly determin[ing]” that the case
should be remanded (emphasis added). Under these circumstances, I
consider Plaintiff’s alternative arguments that the district court rejected
to be forfeited. See United States v. Dreyer, 804 F.3d 1266, 1277 (9th

18 HARRIS V. KM INDUSTRIAL

describing the amounts at issue for these two claims, KMI
relied on Lopez’s assertion that, in the four-year period prior
to the filing of the complaint, KMI “employed
approximately 442 putative class members” who “worked an
aggregate of 39,834 workweeks.” For Plaintiff’s missed-
meal-periods claim, KMI assumed one violation per week
per employee and then multiplied $20.00 per hour (the
amount due for one violation, based on the median rate of
pay) by the aggregate 39,834 workweeks, for a result of
$796,680. For Harris’s missed-rest-break claim, KMI
assumed two violations per week per employee and then
multiplied $40.00 (twice the median rate of pay of $20.00
per hour) by the aggregate 39,834 workweeks, for a result of
$1,593,360. These numbers, coupled with the calculations
for the other claims, amounted to just under $7 million.
In remanding this case, the district court held that “no
evidence” supports KMI’s assumption that “the
442 potential class members regularly, or at least more often
than not, worked over 3.5 or 8 hours.” The order refers to
shifts “over 3.5” because that is the shift length that the
complaint alleges is sufficient to trigger the requirement to
provide a rest break under the applicable California law. The
requirement to provide a meal break is triggered by a shift
length of five hours, not eight hours, but the district court’s
reference to “the number of employees that worked [a] full
time” shift of “8 hours” was presumably attributable to how
the court resolved the parties’ arguments about Plaintiff’s
separate overtime claims. Specifically, the district court held
that KMI’s assumptions about Plaintiff’s overtime claim
would be reasonable if KMI had shown that its assumptions

Cir. 2015) (en banc). As to the remaining alternative issues raised by
Plaintiff that the district court did not address, I would decline to reach
those issues in the first instance on appeal.

HARRIS V. KM INDUSTRIAL 19

about how many class members worked “over 3.5 or
8 hours” were valid. Accordingly, if KMI properly relied on
the premise that the class members regularly worked eight-
hour shifts, then KMI’s conclusions as to both meal breaks
and overtime would, in the district court’s view, be valid.
And because eight is larger than 3.5, the same would be true,
in that circumstance, of KMI’s conclusion as to the rest
break claims. As a result, the district court’s dispositive
holding is that KMI failed to carry its burden to show CAFA
jurisdiction because it failed to establish that all 442 putative
class members regularly worked full-time shifts.
II
In my view, the district court’s reasons for remanding the
case were flawed, and I would therefore reverse and remand
for further proceedings.
A
Where, as here, a plaintiff challenges a defendant’s
notice of removal by filing a motion to remand, the
defendant’s obligation in responding to that motion depends
on whether the plaintiff has brought a “‘facial’ [or] ‘factual’
attack[] on [the defendant’s] jurisdictional allegations.”
Salter v. Quality Carriers, Inc., 974 F.3d 959, 964 (9th Cir.
2020) (quoting Leite v. Crane Co., 749 F.3d 1117, 1121 (9th
Cir. 2020)). As we explained in Salter:
A facial attack accepts the truth of the
[defendant’s] allegations but asserts that they
are insufficient on their face to invoke federal
jurisdiction. For a facial attack, the court,
accepting the allegations as true and drawing
all reasonable inferences in the defendant’s
favor, determines whether the allegations are

20 HARRIS V. KM INDUSTRIAL

sufficient as a legal matter to invoke the
court’s jurisdiction. A factual attack, by
contrast, contests the truth of the
[defendant’s] factual allegations, usually by
introducing evidence outside the pleadings.
When a factual attack is mounted, the
responding party must support her
jurisdictional allegations with competent
proof under the same evidentiary standard
that governs in the summary judgment
context.
Id. (simplified). Thus, in addressing a facial attack on the
notice of removal, a court would apply the same familiar
standards for evaluating the adequacy of any pleading—viz.,
whether the notice’s well-pleaded allegations raise a
plausible inference that the amount in controversy exceeds
$5,000,000. Ashcroft v. Iqbal, 556 U.S. 662, 682 (2009); see
also Dart Cherokee, 574 U.S. at 89 (notice of removal need
only include a “plausible allegation” that the amount in
controversy is met). But in the context of a factual attack,
the removing defendant ultimately has the burden to
establish the amount in controversy by a preponderance of
the evidence. See 28 U.S.C. §§ 1446(c)(2)(B); id. § 1453(b)
(procedures set forth in § 1446 generally apply to CAFA
removals).
3

3
Section 1453(b) explicitly states that CAFA removals must be “in
accordance with section 1446,” subject to several exceptions that are
expressly set forth in the statute. See 28 U.S.C. § 1453(b). Because the
preponderance requirement is not among the exemptions from § 1446
that are listed in § 1453(b), it is clear that § 1453(b)’s incorporation of
§ 1446’s procedural rules into CAFA cases carries with it, mutatis
mutandis, the preponderance requirement that § 1446(c)(2) applies to
cases removed under § 1332(a). Cf. Dart Cherokee, 574 U.S. at 88 n.1

HARRIS V. KM INDUSTRIAL 21

On appeal, the parties sharply dispute whether Plaintiff’s
motion to remand properly asserted a factual attack or should
instead be understood as asserting only a facial attack. I do
not think that we need to resolve that issue because, even
assuming that the remand motion here properly raised a
factual attack, the district court’s reasons for remanding the
case were clearly erroneous.
4

B
In reviewing the district court’s remand order, I begin by
first clearly identifying the specific grounds on which that
order was based. Then, having identified those grounds, I
will explain why they did not warrant remand.
1
In a CAFA case, the ultimate “fact” that a removing
defendant must plead or prove is not that the defendant is
actually liable for more than $5,000,000, but rather that the
amount in controversy exceeds $5,000,000. See Arias v.
Residence Inn by Marriott, 936 F.3d 920, 927 (9th Cir. 2019)
(rejecting any requirement that the defendant must “prove it
actually violated the law” in the manner alleged). Because
the ultimate thing to be proved by the removing defendant is

(assuming, without deciding, that the preponderance standard that
§ 1446 applies to ordinary diversity removals under § 1332(a) also
applies to CAFA removals); Ibarra v. Manheim Investments, Inc.,
775 F.3d 1193, 1199 (9th Cir. 2015) (applying preponderance standard
to CAFA based on precedent predating the enactment of the
preponderance requirement in § 1446(c)(2)).
4
At the very least, the issue of whether Plaintiff’s motion properly
asserted a factual attack is sufficiently murky that, were I not inclined to
reverse outright, I would remand the case for further factual
development. See infra at 28.

22 HARRIS V. KM INDUSTRIAL

the amount that the plaintiff’s allegations place in
controversy, we have recognized that, even in the context of
a factual attack, the manner in which a removing defendant
proves the value of what a plaintiff alleges necessarily
differs from the way in which an ordinary purely factual
issue is proved.
In particular, determining the amount in controversy may
require putting an appropriate construction on what may in
some respects be vague and general allegations in the
complaint. For example, if (as here) the plaintiff alleges that
a particular violation of law “regularly” occurred, the
defendant will have to make a “reasonable assumption” as to
what that allegation should be taken to mean. Arias,
936 F.3d at 922, 925. Defendant may well think that the
actual rate of violation is zero, but some reasonable
construction must be given, for amount-in-controversy
purposes, to a plaintiff’s generalized allegation that there
were routine violations. Accordingly, even in responding to
a factual attack, a removing defendant may rely upon “a
chain of reasoning that includes assumptions” about what the
allegations of the plaintiff’s complaint mean. Ibarra,
775 F.3d at 1199 (emphasis added); see also Arias, 936 F.3d
at 925. We have cautioned, however, that such “assumptions
cannot be pulled from thin air but need some reasonable
ground underlying them.” Ibarra, 775 F.3d at 1199. But we
have also clearly held that the required reasonable grounding
may be “founded on the allegations of the complaint” itself
and does not necessarily have to be based on extrinsic
evidence presented by the defendant. Arias, 936 F.3d at 925.
In calculating the amount at issue in Plaintiff’s meal-
break claim, KMI pointed to the complaint’s allegations that
“Plaintiff and the putative class consistently worked through
their meal periods” and “were regularly not provided with

HARRIS V. KM INDUSTRIAL 23

uninterrupted meal periods” (emphasis added), and KMI
assumed that the complaint should thereby be understood as
asserting a violation rate of at least 20 percent—i.e., that
Plaintiff and the class were denied at least one out of five of
the meal breaks to which they were entitled. Likewise, the
complaint alleged that “Plaintiff and the putative class were
regularly not provided with uninterrupted rest periods”
because they “were constantly working through their rest
periods to complete their daily tasks on time” (emphasis
added), and KMI again assumed that that these allegations
should be taken as asserting a violation rate of at least
20 percent. The district court agreed with KMI that these
assumptions were reasonable, and it rejected Plaintiff’s
arguments to the contrary. Indeed, in my view, those
assumptions were unduly conservative.
The only respect in which the district court found fault
with KMI’s calculation relates to whether the assumed
20 percent violation rate was applied to the correct
multiplicand, which in this case would be the total number
of meal and rest breaks that should have been granted to class
members according to Plaintiff’s complaint. In determining
that latter number, KMI first calculated the “aggregate”
number of “workweeks” for all putative class members
during the relevant time-period as being 39,834. A
20 percent violation rate, KMI reasoned, would mean one
meal-break violation and two rest-break violations for every
full workweek. (Because the complaint asserts that it takes
only 3.5 hours to earn a rest break, see supra at 18, an
employee working a full workweek would be entitled to five
meal breaks and ten rest breaks.) KMI therefore calculated
39,834 as the number of alleged meal-break violations, and
it calculated double that number (i.e., 79,668) as the number
of alleged rest-break violations. KMI then applied the
median hourly pay of $20.00 in calculating the premium

24 HARRIS V. KM INDUSTRIAL

payment due per alleged violation. See United Parcel Serv.
Wage & Hour Cases, 125 Cal. Rptr. 3d 384, 393 (Cal. Ct.
App. 2011) (California Labor Code generally allows “up to
two premium payments per workday—one for failure to
provide one or more meal periods, and another for failure to
provide one or more rest periods”).
5

The district court’s sole criticism of this calculation was
that, in determining the total number of meal breaks and rest
breaks that should have been provided to class members
during the relevant time period, KMI should not have
calculated the number of full-time shifts at issue simply by
taking the aggregate number of workweeks and multiplying
by five. If some of the shifts included in the 39,834
workweeks were less than 3.5 hours or five hours, then
KMI’s resulting calculations as to the aggregate number of
meal breaks and rest breaks that should have been provided
“would be grossly exaggerated.” Accordingly, the district
court reasoned, KMI should have presented more granular

5
Neither party has raised the issue of whether United Parcel Service
limits a class member to one premium payment when two rest violations
occur on the same day and whether, if so, that would require a
corresponding adjustment in KMI’s calculations. I therefore do not
address the point either. Plaintiff does contend, however, that KMI
should have calculated the relevant payments by applying the average
hourly rate rather than the median rate. The district court did not address
this point, however, and neither will I. See supra note 2. But even if
Plaintiff is correct, any resulting error would be harmless, because the
uncontested evidence shows that the average rate of pay was higher than
the median rate (meaning that any error on this score was in Plaintiff’s
favor).

HARRIS V. KM INDUSTRIAL 25

numbers that showed the actual respective total numbers of
full-time shifts and part-time shifts.
6

2
In my view, the district court erred in remanding this
case based on KMI’s failure to provide, in its opposition to
the remand motion, the more exacting calculation of actual
shifts that the district court demanded.
By insisting on this level of up-front precision, the
district court lost sight of the applicable standard of proof.
“The amount in controversy is simply an estimate of the total
amount in dispute,” and a removing defendant carries its
burden to establish the amount in controversy by a
preponderance if it presents evidence that “‘explain[s]
plausibly how the stakes exceed $5 million.’” Lewis v.
Verizon Commc’ns, Inc., 627 F.3d 395, 400–01 (9th Cir.
2010) (emphasis added) (citation omitted); see also Arias,
936 F.3d at 927. Although it is theoretically possible that
there may not be an exact equivalence between (1) the total
number of workweeks multiplied by five and (2) the total
number of full-time shifts calculated more precisely on a
shift-by-shift basis, there is no basis in the record for
concluding that the potential difference between these two
numbers is material to the ultimate jurisdictional
determination in this case. In Rea v. Michaels Stores Inc.,
742 F.3d 1234 (9th Cir. 2014), we rejected as “clearly
erroneous” a comparable flyspecking in which “the district
court faulted Michaels for only showing that the managers

6
Whether the membership of each sub-class was exactly the same,
see Maj. Opin. at 11, 14, is ultimately beside the point—what matters is
whether the 39,834 workweeks consisted of full-time shifts. If they did,
then KMI’s calculations were valid.

26 HARRIS V. KM INDUSTRIAL

were expected to work 45 hours or more each week rather
than showing they actually worked that amount.” Id.
at 1239. We noted that some managers had testified that
“they did work 45 hours or more each week,” and more
broadly we stated that “[t]here was no evidence that the
expectation of 45 hours or more was not met.” Id. Just as
there was “no evidence” in Rea that the asserted theoretical
gap in the evidence made a difference, so too here. Id.; see
also Scott v. Cricket Commc’ns, LLC, 865 F.3d 189, 196–97
(4th Cir. 2017) (estimating the amount in controversy does
not require the exactitude of “‘nuclear science,’” and district
court erred by requiring defendant to “tailor its evidence to
exactly match [the plaintiff’s] proposed class” (citation
omitted)).
Moreover, in considering the significance of what the
district court deemed a “blank[]” in KMI’s evidence that
needed to be “fill[ed] in,” I think it is critical to keep in mind
that the ultimate thing to be proved here is the overall amount
in controversy, and not the precise number of full-time
shifts. The fact that determining the amount in controversy
requires multiplying the total estimated number of shifts by
the assumed violation rate, see supra at 23, greatly reduces
the significance of the sort of additional granular detail the
district court demanded. No one disputes that the assumed
20 percent violation rate is not (and need not be) a very
precise estimate, and here, the use of a 20 percent rate is, if
anything, much too conservative; in my view, a violation
rate of 40 percent or even 50 percent would be a reasonable
estimate of what it means to say that violations “regularly”
and “constantly” occur. As a result, the substantial range of
reasonable violation-rate estimates introduces a significant
built-in margin of error in the overall calculation of the
amount in controversy: it means that, unless KMI’s
calculation of the relevant aggregate number of full-time

HARRIS V. KM INDUSTRIAL 27

shifts is off by a factor of 100 percent or more, KMI’s use of
“workweeks” to estimate “shifts” would not make a
difference. Put another way, unless there is some reasonable
basis to suspect that half or more of the shifts worked by
KMI’s employees were part-time shifts, the additional
precision the district court demanded in determining the total
number of shifts would not have made a difference.
Here, Plaintiff’s own allegations about the nature of the
class members’ work make it simply unreasonable to think
that the class consists mostly of part-time workers. In
contrast to the hospitality-industry workers at issue in Arias,
936 F.3d at 925 & n.3, KMI’s employees are alleged to have
performed “[i]ndustrial [s]ervices” at “refineries,” which
sometimes entailed “suit[ing] up” in appropriate “gear” to
“clean the tankers.” The complaint further alleges that KMI
“chronically understaff[ed] each work shift with not enough
workers” and “impos[ed] so much work on each employee”
that it was hard for them “to finish their work on time.”
Given the nature of the employment described in Plaintiff’s
complaint, it is unreasonable to suspect that any very
substantial proportion of the putative class consists of part-
time employees—much less that the class members here
work part-time to such a significant degree as to make a
material difference in the overall calculation of the amount
in controversy.
Accordingly, I conclude that the sole reason given by the
district court for remanding this case was clearly erroneous.
Rea, 742 F.3d at 1239. I would reverse the remand order and
remand for further proceedings to resolve any remaining
issues. See supra note 2.

28 HARRIS V. KM INDUSTRIAL

III
At the very least, I think that the district court should
have given KMI an opportunity to address the court’s
specific concern before remanding.
Because Plaintiff’s remand motion rested largely on the
premise that KMI’s removal notice and accompanying
declaration were insufficient to establish CAFA jurisdiction,
it was at least “ambiguous” as to “whether [that] motion
posed a facial or a factual attack,” Wichansky v. Zoel
Holding Co., 702 F. App’x 559, 560 (9th Cir. 2017).
Moreover, it was Plaintiff’s reply brief below that most
clearly flagged the point that KMI had not examined shift-
by-shift eligibility for rest breaks and meal breaks, as the
district court implicitly noted in citing only the reply brief on
that point. As a result, KMI did not receive adequate notice
that Plaintiff’s remand motion was raising a factual
challenge as to this specific point, cf. Katz v. Children’s
Hosp. of Orange County, 28 F.3d 1520, 1534 (9th Cir. 1994)
(summary judgment motion must sufficiently identify the
disputed issues, so as to put opposing party “on notice that
[it] is required to adduce facts” with respect to those issues),
and I would therefore at least remand the matter “to allow
both sides to submit evidence related” to the disputed issue.
Ibarra, 775 F.3d at 1199.
7

7
Contrary to what the majority contends, Ibarra did not involve a
situation in which the parties had not had an opportunity to present
evidence beyond what was “submitted with the defendant’s notice of
removal.” See Maj. Opin. at 28. Just as in this case, the plaintiff in
Ibarra made a “motion to remand the class action to state court, [the
defendant] opposed [the] plaintiffs’ motion, and [the] plaintiffs filed a
reply in support of their remand motion.” Ibarra, 775 F.3d at 1196. In
fact, the parties in Ibarra had even more opportunity to place evidence

HARRIS V. KM INDUSTRIAL 29

I respectfully dissent.

in the record, given that the case had already been remanded twice to
state court, appealed to this court, and remanded back to the district court
prior to the plaintiffs’ filing of their renewed motion to remand. Id.
Moreover, the Ibarra plaintiffs’ remand motion “contested [an]
assumption” without “assert[ing] an alternative violation rate grounded
in real evidence,” id. at 1199—which is exactly what the majority says
that Plaintiff did here. In short, none of the majority’s grounds for
distinguishing Ibarra are valid. Our remand in Ibarra can only be
understood as resting on the notion that the defendant had not been given
sufficient notice of the need to present evidence concerning the
particular issue that we identified as dispositive, id. at 1199, and the
same is true here.