Bond v. Veolia Water Indianapolis, LLC

Bond v. Veolia Water Indianapolis, LLC

Opinion

 [*906]  ENTRY ON JOINT MOTION TO REMAND

Plaintiffs Jason Bond and David Lear seek to represent a class of customers of the public utility that provides water service in Indianapolis. Plaintiffs filed the action in state court, and plaintiff Leslie Bridges then filed a parallel action in state court. Defendants removed both cases to federal court based on the Class Action Fairness Act of 2005 ("CAFA"), codified in part as 28 U.S.C. § 1332(d), which dramatically expanded federal diversity jurisdiction over class actions. Plaintiffs have moved to remand both cases to state court. The briefing for both cases has been done in this case. Plaintiffs rely  [**2] on the local controversy, home state controversy, and interests of justice exceptions to CAFA in section 1332(d)(4)(A), (d)(4)(B), and (d)(3), respectively. The applicability of all three exceptions ultimately turns on only one issue -- the citizenship of defendant Veolia Water Indianapolis, LLC. As explained below, that defendant is a citizen of both Indiana and Delaware for purposes of CAFA, so plaintiffs' motion to remand is granted.

I. The Parties and the Claims

In 2002, the City of Indianapolis acquired the assets of what had been a privately owned public water utility serving the Indianapolis area. The city entered into a twenty-year management agreement with a predecessor of defendant Veolia Water North America Operating Services, LLC, for the operation and maintenance of the water utility, including meter-reading, billing, and collection functions. That entity  [*907]  assigned the Indianapolis contract to defendant Veolia Water Indianapolis, LLC. Pl. Ex. G at 4.

Plaintiffs Jason Bond and David Lear are retail customers served by the Indianapolis water works operated by Veolia Water Indianapolis under the management agreement. They allege that the management agreement requires defendants  [**3] to read meters at least every two months so that bills are based on actual water usage. Plaintiffs allege further that defendants have deliberately chosen to read meters less often and to over-estimate water use, so that bills are based for several months at a time on excessive estimates of water use. The effect of this practice, according to plaintiffs, is that defendants save on operating expenses and receive small interest-free loans from all of their customers. Plaintiffs' complaint alleges claims arising under state law: for breach of contract, negligence, violations of the Indiana deceptive practices act, Ind. Code § 24-5-0.5-3, and constructive fraud. No class has been certified at this point. ¹ 

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