The opinion
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ALABAMA
NORTHWESTERN DIVISION
OLIVIA TAYLOR GANN, §
§
Plaintiff, §
§
v. § Case No. 3:23-cv-00498-LCB
§
HUUUGE, INC., §
§
Defendant. §
OPINION & ORDER
Plaintiff Olivia Gann brings this action seeking to recover gambling losses of
Alabama citizens pursuant to Alabama Code § 8-1-150(b). In April 2023, Defendant
Huuuge, Inc. removed the action from the Circuit Court of Franklin County,
Alabama, on the basis of diversity jurisdiction under 28 U.S.C. § 1332(a). Gann now
moves to remand the case to state court, claiming that the amount in controversy
does not exceed $75,000, as required by § 1332(a). For the reasons below, the Court
GRANTS Gann’s motion. (Doc. 6.)
I. BACKGROUND
A. STATUTORY FRAMEWORK
Gambling has long been illegal in the state of Alabama. “A person engages in
gambling if he stakes or risks something of value upon the outcome of a contest of
chance or a future contingent event not under his control or influence, upon an
agreement or understanding that he or someone else will receive something of value
in the event of a certain outcome.” Ala. Code § 13A-12-20(4) (1975). In 1852, the
Alabama legislature codified a civil cause of action to recover money paid and lost
in gambling endeavors. Id. § 8-1-150. The statute reads, in relevant part, as follows:
(a) All contracts founded in whole or in part on a gambling
consideration are void. A person who has paid money or delivered
anything of value lost upon any game or wager may recover such
money thing, or its value by an action commenced within six months
from the time of such payment or delivery.
(b) Any person may also recover the amount of such money, thing, or
its value by an action commenced within 12 months after the
payment or delivery thereof for the use of the wife or, if no wife, the
children or, if no children, the next of kin of the loser.
Id. § 8-1-150(a)−(b).
B. FACTS
Huuuge, Inc., a Delaware corporation with its principal place of business in
Nevada, is in the computer game industry. (Docs. 1 at 2; 1-1 at 6.) Specifically, the
company develops and markets games that can be played online or via cellphone
applications. (Doc. 6 at 3.) Several of Huuuge’s products are games of chance, such
as those involving virtual slot machines, card game’s and/or casino themes. (Doc. 1-
1 at 7.) In those games, a player initially receives free virtual coins to spend in order
to play the game. (Doc. 1-1 at 7.) For example, for Huuuge’s slot-machine games, a
player uses coins to “spin” the reel. (Doc. 1-1 at 7.) If the player loses the spin, the
coins he wagered are lost. (Doc. 1-1 at 7.) If the player wins, he receives more coins.
(Doc. 1-1 at 7.) If the player runs out of coins entirely, then he can either stop playing
the game or purchase additional coins. (Doc. 1-1 at 7.) In other words, he can buy
more playing time.
Many Alabama citizens play Huuuge’s games of chance and have purchased
additional playing time. (Doc. 1-2 at 3.) On March 8, 2023, Olivia Gann, an Alabama
citizen, filed this action against Huuuge in the Circuit Court of Franklin County,
Alabama, pursuant to Alabama Code § 8-1-150(b), seeking to recover the money
lost by Alabama citizens on Huuuge’s games of chance between March 2022 and
March 2023. (Doc. 1-1 at 9.) Shortly thereafter, Huuuge removed the action to this
Court, pursuant to 28 U.S.C. §§ 1441, 1446. (Doc. 1 at 1.) Huuuge relied on 28
U.S.C. § 1332 as the grounds for removal, claiming that this Court has subject matter
jurisdiction under the statute’s diversity of citizenship provision. (Doc. 1 at 4.) Along
with its notice of removal, Huuuge attached a declaration of its vice president of
finance, Marek Chwalek. (Doc. 1-3.) Chwalek declared that, after reviewing
Huuuge’s financial reporting system for the period between March 2022 and March
2023, the total amount that Alabama citizens had spent on Huuuge’s games of
chance far exceeded $75,000.1 (Doc. 1-2 at 2.) Gann then filed a motion to remand.
(Doc. 6.)
1 In one of Huuuge’s slot-machine games, Billionaire Casino, Chwalek reported that Alabama
citizens collectively spent more than $400,000. (Doc. 1-3 at 2.)
II. LEGAL STANDARD
Federal courts are courts of limited jurisdiction. Pursuant to 28 U.S.C. §
1441(a), “any civil action brought in a State court of which the district courts of the
United States have original jurisdiction, may be removed by the defendant or the
defendants, to the district court of the United States for the district and division
embracing the place where such action is pending.” Accordingly, “when an action
is removed from state court, the district court first must determine whether it has
original jurisdiction over the plaintiff's claims.” Univ. of S. Ala. v. Am. Tobacco Co.,
168 F.3d 405, 410 (11th Cir. 1999).
A removing defendant has the burden of establishing the propriety of removal
under § 1441 and, therefore, must establish the existence of federal jurisdiction.
Leonard v. Enterprise Rent a Car, 279 F.3d 967, 972 (11th Cir. 2002). Because of
federalism concerns implicated by removal jurisdiction, removal statutes must be
construed narrowly, with all doubts to be resolved in favor of remand. Am. Tobacco
Co., 168 F.3d at 411; Whitt v. Sherman Int'l Corp., 147 F.3d 1325, 1333 (11th
Cir.1998) (noting Eleventh Circuit preference for remand where federal jurisdiction
not “absolutely clear”).
If the alleged basis for federal jurisdiction is diversity of citizenship under 28
U.S.C. § 1332, the removing defendant must prove: (1) that there is complete
diversity of citizenship between the plaintiffs and the defendants; and (2) that the
amount in controversy is greater than $75,000. 28 U.S.C § 1332(a). If the amount in
controversy is not apparent from the face of the complaint, the defendant must prove
by a preponderance of the evidence that “the amount in controversy more likely than
not exceeds . . . the jurisdictional requirement.” Roe v. Michelin N. Am., Inc., 613
F.3d 1058, 1061 (11th Cir. 2010) (citation omitted).
III. DISCUSSION
The only issue before the Court is whether the amount in controversy in this
action exceeds $75,000. It is undisputed that there is complete diversity between the
parties as Gann is a citizen of Alabama, and Huuuge is a citizen of both Delaware
and Nevada.2 (Doc. 1 at 2.) It is also undisputed that, between March 2022 and
March 2023, Alabama citizens collectively spent far more than $75,000 on Huuuge’s
games of chance. (Doc. 1-3 at 2.) But Gann seeks to recover the amount each
Alabama citizen lost and to allow the benefit to accrue to the family of each citizen.
(Doc. 1-1 at 15.) Thus, the crux of the issue is more nuanced than it appears, and
Gann’s motion turns on whether, for the purposes of determining whether the
amount in controversy requirement has been satisfied, the Court can aggregate the
individual monies lost by each Alabama citizen.
2 For purposes of diversity jurisdiction, a corporation is a citizen of both the state where it is
incorporated and the state where it has its principal place of business. 28 U.S.C. § 1332(c)(1).
As a threshold matter, the Court notes that the nature of the underlying dispute
is unusual. Gann appears in a representative capacity as the sole plaintiff, and she
brings this action under Alabama Code § 8-1-150(b) to recover for numerous, and
currently unknown, Alabama citizens. (Doc. 1-1 at 14−15.) The Court has serious
doubt as to whether § 8-1-150(b) permits Gann to bring such an action. See Davis v.
Orme, 36 Ala. 540 (1860).3 But for the purposes of deciding whether this Court has
jurisdiction over Gann’s claims, the Court will analyze the action in the manner in
which it has been pleaded.
Additionally, not only is there a dearth of case law on § 8-1-150(b), but there
is also no controlling precedent from the Eleventh Circuit directly applicable to the
amount in controversy issue. There is, however, case law from the District of
Columbia and the Ninth Circuit where the courts had to determine whether the
amount in controversy threshold was satisfied where there was a single plaintiff
seeking to recover for numerous individuals but in a representative capacity. In those
3 In Davis, Daniel Davis, “suing for the use of Mrs. Julian Davis, wife of James Davis,” brought
an action to recover $400 that Thomas Orme won from James on a bet for a horse race. Davis, 36
Ala. at 540. Receiving the case on appeal, the Supreme Court of Alabama had to decide whether
Julian could still recover because Daniel used a third party to place the wager with Orme. Id. at
545. The Supreme Court of Alabama held that she could still recover, explaining that the policy
of the statute was “that the wife, children, or next of kin, of one who had improvidently lost his
property at the card-table, or on the racecourse, might re-possess themselves thereof.” Id. at 546.
Based on this Court’s understanding of Davis, it appears that the statute permits a one-to-one ratio
for recovery: one person may sue to recover the loss of a gambler and return it to the gambler’s
family. In other words, the wording of the statute does not seem to permit one person to recover
multiple gambling losses for multiple families in the same action, which is what Gann seeks to do
here. In fact, the manner in which Gann has brought this action could be viewed as a means to
avoid filing a class action lawsuit.
opinions, the courts relied upon the non-aggregation doctrine. As such, the Court
will first look to the non-aggregation doctrine and then examine how those courts
applied the doctrine in their analyses.
Under the non-aggregation doctrine, “separate and distinct claims of two or
more plaintiffs cannot be aggregated in order to satisfy the jurisdictional amount
requirement” for the purposes of diversity jurisdiction. Snyder v. Harris, 394 U.S.
332, 335 (1969); see also Troy Bank of Troy, Ind., v. G.A. Whitehead & Co., 222
U.S. 39, 40−41 (1911); Pinel v. Pinel, 240 U.S. 594, 596 (1916). The doctrine is
derived from the Supreme Court’s “interpretation of the statutory phrase ‘matter in
controversy.’” Snyder, 394 U.S. at 335. “Aggregation has been permitted only in
two scenarios: (1) [where] a single plaintiff seeks to aggregate two or more of his
own claims against a single defendant[;] and (2) [where] two or more plaintiffs unite
to enforce a single title or right in which they have a common and undivided
interest.” Id.
The District Court for the District of Columbia applied the non-aggregation
doctrine and granted motions to remand both in Breakman v. AOL LLC, 545 F. Supp.
2d 96 (D.D.C. 2008); and Nat’l Consumers League v. Flowers Bakeries, LLC, 36 F.
Supp. 3d 26 (D.D.C. 2014). In each of those cases, an individual plaintiff brought an
action under the private attorney general provision of the District of Columbia
Consumer Protection Procedures Act (“the DCCPPA”). See D.C. Code § 28-
3905(k)(1)(B) (2021) (“An individual may, on behalf of that individual, or on behalf
of both the individual and the general public, bring an action seeking relief from the
use of a trade practice in violation of a law of the District . . . .”).
In Breakman, the plaintiff alleged that the defendant, AOL, “engaged in
unlawful trade practices” in violation of the DCCPPA. Breakman, 545 F. Supp. 2d
at 99. According to AOL, Breakman’s action would reach “28,451 consumers in the
District of Columbia.” Id. at 100. AOL removed the case to federal court, citing
diversity jurisdiction under § 1332(a) as a ground for removal. Id. Citing the non-
aggregation doctrine and its origins, the court reasoned that “the doctrine still applies
when separate and distinct claims are asserted on behalf of a number of individuals,
regardless of whether an action involves a simple joinder of multiple plaintiffs, or a
representative action.” Id. at 103 (internal citation and quotation marks omitted). The
court concluded that the actual and statutory damages of the consumers represented
by Breakman could not be aggregated to satisfy the amount in controversy
requirement. Id. at 103−04. Thus, the court remanded the action. Id. at 108.
The court reached the same conclusion in Flowers. There, a public interest
organization sued a manufacturer of food products, alleging violations of the
DCCPPA related to the marketing of bread products. Flowers, 36 F. Supp. 3d at 29.
Flowers removed the case, identifying three independent grounds for removal,
including diversity jurisdiction. Id. Flowers argued that there was complete diversity
between the parties and that potential damages would be well beyond $75,000 as the
plaintiff had alleged a minimum of $1,500 in statutory damages for each violation
and that more than 300,000 units had been sold to consumers. Id. at 31−32. The court
rejected Flowers’ framing of the amount in controversy, stating that “[c]alculating
the amount in controversy in [that] way . . . runs afoul of the non-aggregation
principal that ‘[t]he separate and distinct claims of two or more plaintiffs cannot be
aggregated in order to satisfy the jurisdictional amount requirement’ except ‘in cases
in which two or more plaintiffs unite to enforce a single title or right in which they
have a common and undivided interest.’” Id. at 32 (citing Snyder, 394 U.S. at 335)).
Discussing how the doctrine applied to private attorney general actions, the court
held that, “so long as individual consumers are eligible to recover individual
damages, the consumers do not have a ‘common and undivided interest’ that may be
aggregated under the non-aggregation principal announced in Snyder.” Id.; see also
D.C. Code § 28-3905(k)(1)−(2) (stating that damages are “payable to the
consumer”).
The Ninth Circuit Court of Appeals’s analysis in Urbino v. Orkin Servs. of
California, Inc., 726 F.3d 1118 (9th Cir. 2013) mirrors that of Breakman and
Flowers. There, the Ninth Circuit also applied the non-aggregation doctrine when it
vacated and remanded the district court’s denial of a motion to remand for lack of
federal jurisdiction. Urbino, 726 F.3d at 1122. Urbino brought a representative cause
of action under California’s Labor Code Private Attorneys General Act. Cal. Lab.
Code § 2699(a) (2016) (“Notwithstanding any other provision of law, any provision
of this code that provides for a civil penalty to be assessed and collected by the Labor
and Workforce Development Agency or any of its departments, divisions,
commissions, boards, agencies, or employees, for a violation of this code, may, as
an alternative, be recovered through a civil action brought by an aggrieved employee
on behalf of himself or herself and other current or former employees pursuant to
the procedures specified in Section 2699.3.”). Orkin presented evidence that the
alleged labor code violations would give rise to claims involving 811 employees.
Urbino, 726 F.3d at 1121. The issue on appeal was “whether the penalties
recoverable on behalf of all aggrieved employees may be considered in their totality
to clear the [diversity] jurisdictional hurdle.” Id. at 1122 (emphasis in original). The
Ninth Circuit ultimately held that they could not and that the statutory threshold was
not met. Id. at 1123. The Ninth Circuit explained that Orkin’s obligation to the
employees represented by Urbino was to the individuals severally, not as a group.
Id. at 1122. Ergo, the claims were not based on a common and undivided interest
and could not be aggregated. Id.; see also Canela v. Costco Wholesale Corp., 971
F.3d 845, 849−50 (2020) (same).
Guided by the non-aggregation doctrine and the principle that the removal
statute should be construed narrowly in favor of remand, the Court finds the above
analysis persuasive and applicable. The Court acknowledges that this case differs
from Breakman, Flowers, and Urbino, in that Gann does not bring her action
pursuant to a statutory private attorney general action, nor is she pursuing her own
claims against Huuuge. But at the macro level, the framework of the actions is
identical: there is a single plaintiff acting in a representative capacity to recover
damages that would be payable to non-parties.
The Court recognizes that In re Folgers Coffee, Mktg. Litig., 2021 WL
5106457, *1 (W.D. Mo. Aug. 19, 2021)—also a private attorney general action
brought under the DCCPPA—is a case wherein the Western District of Missouri
interpreted the non-aggregation doctrine differently than the District of Columbia
and the Ninth Circuit. Folgers, 2021 WL 5106457 at *1. There, the court considered
the damages payable directly to the plaintiff, along with attorney fees and the cost
of an injunction and held that the amount in controversy threshold was met and thus
that the court had jurisdiction under § 1332(a). Id. at *3−5. The court rejected the
plaintiff’s argument that the non-aggregation doctrine required the court to divide
the attorney fees and cost of the injunction among the entire population of the
District of Columbia. Id. at *3−4.
Notwithstanding the fact that § 8-1-150 does not provide for attorney fees or
equitable relief, the Court finds that the facts in Folgers diverge from those in both
this case and the cases discussed previously. In Folgers, the plaintiff claimed to
represent the general public, not a particular subset of the population. See id. at *3
(“Plaintiff argues that any attorneys’ fees he obtains in this suit must be divided
among the entire population of the District of Columbia.”). Moreover, the plaintiff
in Folgers did not seek to recover damages that would be payable to other
consumers. Id. In contrast, in this case and in those cases discussed above, the
plaintiff represents not the entire population but a particular category of persons, and
the plaintiff looks to recover damages that would be payable to those persons. Thus,
the Court finds the analysis in Folgers unpersuasive.
Accordingly, this Court finds that the non-aggregation doctrine applies here
and precludes aggregation for the calculation of the amount in controversy. By
seeking to recover “for the use of” the losers’ families, Gann asserts numerous
individual claims. But those claims do not share a common and undivided interest.
The family of each Alabama citizen who lost money playing Huuuge’s games of
chance has an individual or separate interest in recovering that loss. To use the
example Gann sets forth in her brief, a wife whose husband lost $40,000 seeks to
recover $40,000, and the next of kin of a citizen who lost $1.99 seeks to recover
$1.99. (Doc. 6 at 11.) Those interests do not overlap and do not affect each other.
Thus, the individual claims cannot be aggregated for the purposes of establishing the
requisite amount for diversity jurisdiction.
Huuuge argues that phrase “for the use of” in § 8-1-150(b) is of no legal
consequence, so the statute does not restrict or otherwise govern how an award could
be used. (Doc. 7 at 4−5.) In other words, Huuuge claims that Gann seeks a single,
undivided recovery. (Doc. 7 at 9.) The Court disagrees. Under Alabama law, “[t]he
fundamental rule of statutory construction is to ascertain and give effect to the intent
of the legislature in enacting the statute.” IMED Corp. v. Systems Eng’g Assocs.
Corp., 602 So. 2d 344, 346 (Ala. 1992). “Statutes are to be considered as a whole,
and every word given effect if possible.” Ex parte Beshears, 669 So. 2d 148, 150
(Ala. 1995). In fact, “[t]here is a presumption that every word, sentence, or provision
of a statute has some force and effect and that no superfluous words or provisions
were used.” Barnett v. Panama City Wholesale Inc., 312 So. 3d 754, 757 (Ala. 2020)
(internal quotations and ellipses omitted). “Words in a statute must be given their
natural, plain, ordinary, and commonly understood meaning, and where plain
language is used a court is bound to interpret that language to mean exactly what it
says.” IMED, 602 So. 2d at 346.
Applying those principles, the Court finds that the phrase “for the use of” in
Ala. Code § 8-1-150(b) has legal significance. While “any person” can bring an
action under the statute, the statute does restrict the recovery in that it must be
returned to family of the one who gambled and lost. See Davis, 36 Ala. at 546
(holding that the wife of the gambler could still recover when a third party placed
the bet and noting that the statute’s policy is “that the wife, children, or next of kin,
of one who had improvidently lost his property at the card-table, or on the
racecourse, might re-possess themselves thereof’). Therefore, Gann, personally,
would not receive a single, undivided recovery to spend at her discretion.
IV. CONCLUSION
Aggregation in this matter would be improper. As such, the amount in
controversy threshold has not been met, and this Court does not have subject matter
jurisdiction over this action. The Court thus GRANTS Gann’s motion to remand,
and this action is REMANDED to the Circuit Court of Franklin County, Alabama.
(Doc. 6.)
DONE and ORDERED August 11, 2023.
th Sh
LILES C. BURKE
UNITED STATES DISTRICT JUDGE
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