CAFA Mass-Action “Local Event or Occurrence” Exception Is Jurisdictional and Turns on the Injury-Causing Event

1. Introduction

This appeal arises from a major industrial fire in Richmond, Indiana that burned for at least seven days and allegedly dispersed hazardous gases and particulates across hundreds of properties. One hundred fifty plaintiffs sued multiple property owners—including the City of Richmond and private entities—in Indiana state court, seeking compensatory and punitive damages under tort theories including strict liability, negligence, negligence per se, nuisance, trespass, and related claims.

The defendants removed the case to federal court as a “mass action” under the Class Action Fairness Act of 2005 (“CAFA”), invoking 28 U.S.C. §§ 1332(d)(11) and 1453(b). The district court, concerned about subject matter jurisdiction, ordered briefing on whether the case fell within CAFA’s “local event or occurrence” exception, 28 U.S.C. § 1332(d)(11)(B)(ii)(I). Concluding the exception applied, it remanded to state court. The Seventh Circuit granted interlocutory review under 28 U.S.C. § 1453(c) and addressed two first-impression questions for the circuit:

• Whether the “local event or occurrence” exception is jurisdictional (and thus can be raised sua sponte at any time); and
• Whether all claims “arise from” the relevant “event or occurrence” when plaintiffs plead years of allegedly wrongful conduct leading up to a single fire.

2. Summary of the Opinion

The Seventh Circuit affirmed the remand. It held:

• The local event or occurrence exception, § 1332(d)(11)(B)(ii)(I), is jurisdictional because it is built into CAFA’s definitional boundary of what qualifies as a removable “mass action” and therefore determines whether § 1332(d)(2) jurisdiction exists.
• A week-long fire is an “event or occurrence,” and all claims in the action “arise from” that fire because (in the court’s view) tort claims arise from injury; the complaint alleged no pre-fire injuries, and all alleged injuries flowed from the fire.
• Plaintiffs’ allegations of earlier code violations, unsafe conditions, and failures to maintain/remediate are underlying causes pleaded to establish liability and causation, not separate “events or occurrences” from which the claims “arise.”
• The presence of multiple defendants engaging in different conduct does not prevent a single “event or occurrence” where their conduct allegedly culminated in the same injury-causing fire.

3. Analysis

3.1 Precedents Cited

The court’s analysis draws on (i) Seventh Circuit CAFA precedent concerning the nature of CAFA exceptions, (ii) Supreme Court doctrine on jurisdiction and interpretive method, and (iii) out-of-circuit CAFA “event or occurrence” decisions reflecting a recognized split in approach.

A. Seventh Circuit and Supreme Court authorities on jurisdiction and CAFA framework

• Schutte v. Ciox Health, LLC, 28 F.4th 850 (7th Cir. 2022): Cited for de novo review of subject matter jurisdiction and the proposition that “[t]he party asserting federal jurisdiction has the burden of showing that CAFA’s requirements are satisfied.” The court uses Schutte as the baseline for how CAFA jurisdiction is typically litigated, then distinguishes the burden-shifting that applies only to non-jurisdictional exceptions.
• Hart v. FedEx Ground Package Sys. Inc., 457 F.3d 675 (7th Cir. 2006): The key in-circuit comparator. In Hart, the Seventh Circuit held CAFA’s discretionary and local/home-state exceptions in § 1332(d)(3) and (d)(4) are not jurisdictional because they “presuppose jurisdiction” and operate like abstention. Here, the court uses Hart to explain why § 1332(d)(11)(B)(ii) is different: those exceptions define what counts as a “mass action” in the first place, and thus define the reach of CAFA’s jurisdictional grant.
• United States v. Sineneng-Smith, 590 U.S. 371 (2020): Invoked for the “party presentation” principle. Defendants argued the district court’s sua sponte jurisdictional inquiry improperly displaced the parties’ presentation. The Seventh Circuit treats that concern as relevant only if the exception were non-jurisdictional.
• Cont'l Indem. Co. v. BII, Inc., 104 F.4th 630 (7th Cir. 2024) and Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 (1994): Cited for the foundational rule that courts must ensure subject matter jurisdiction and may raise it at any time.
• Graphic Commc'ns Loc. 1B Health & Welfare Fund A v. CVS Caremark Corp., 636 F.3d 971 (8th Cir. 2011): Cited in connection with waiver/timeliness principles for remand motions under 28 U.S.C. § 1447(c), illustrating the defendants’ argument that a late-raised non-jurisdictional defect could be waived.

B. Statutory interpretation methodology

• Dec v. Mullin, 171 F.4th 940 (7th Cir. 2026): Used for the conventional starting point—statutory interpretation begins with text.
• Sandifer v. U.S. Steel Corp., 571 U.S. 220 (2014): Used for “ordinary, contemporary, common meaning” of undefined statutory terms.
• Lackey v. Stinnie, 604 U.S. 192 (2025) and United States v. Hansen, 599 U.S. 762 (2023): Used to justify looking to a term’s “cluster of ideas” when Congress uses words with established legal meanings, and to emphasize context as a “good clue” when terms have both ordinary and legal senses.
• EPA v. Calumet Shreveport Refin., L.L.C., 605 U.S. 627 (2025): Cited for reading words in their statutory context and the overall scheme.
• Azar v. Allina Health Servs., 587 U.S. 566 (2019): Used to state that clear statutory text should be applied without resort to legislative history—an important signal that the Seventh Circuit’s holding is meant to be text-and-structure driven, not policy-driven.

C. Out-of-circuit “event or occurrence” decisions (the circuit split)

• Abraham v. St. Croix Renaissance Group, L.L.L.P, 719 F.3d 270 (3d Cir. 2013): Described as adopting the broadest approach, allowing an “event or occurrence” to encompass a “continuing set of circumstances” (there, ongoing emissions over a decade).
• Rainbow Gun Club, Inc. v. Denbury Onshore, L.L.C., 760 F.3d 405 (5th Cir. 2014): Praises Abraham but narrows it, allowing “a pattern of conduct” only if “contextually connected” and culminating in a “single focused event” forming the basis of liability. The Seventh Circuit relies on Rainbow Gun Club to rebut the defendants’ attempt to treat multiple negligent acts leading up to a failure as separate “events or occurrences.”
• Allen v. Boeing Co., 784 F.3d 625 (9th Cir. 2015): Identified as the narrowest approach, treating “event or occurrence” as a “singular happening” fixed in time and rejecting an expansive “Civil War” example. The Seventh Circuit notes defendants’ reliance on Allen but finds it non-dispositive because a fire qualifies even under Allen.
• Nevada v. Bank of Am. Corp., 672 F.3d 661 (9th Cir. 2012): Cited (via Allen) for the idea that widespread, repeated interactions (e.g., “thousands of borrower interactions”) do not constitute a single event.
• Spencer v. Specialty Foundry Prods. Inc., 953 F.3d 735 (11th Cir. 2020): Adopted the Fifth Circuit’s “contextually connected series culminating in harm” approach; used by the Seventh Circuit to show that multiple defendants acting separately is not dispositive—what matters is whether their conduct contributed to the same injury-causing event.
• Spencer v. Specialty Foundry Prods. Inc. and Rainbow Gun Club, Inc. v. Denbury Onshore, L.L.C. are also cited earlier to show other circuits have “assumed” jurisdictionality of the exception, though without squarely addressing sua sponte raising.

D. Secondary authorities cited on tort and pleading concepts

• RESTATEMENT (SECOND) OF TORTS § 7 (A.L.I. 1965): Cited for the conceptual anchor that tort claims require injury.
• 7 CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE & PROCEDURE § 1653 (5th ed. 2025): Cited to acknowledge ambiguity in what “claim” might mean (formal claim for relief vs. operative facts), while concluding the result is the same under either meaning.

3.2 Legal Reasoning

A. Holding #1: The local event or occurrence exception is jurisdictional

The court’s central move is structural: it ties § 1332(d)(11)(B)(ii) to the definitional boundary of “mass action,” and then ties “mass action” back to the jurisdictional grant.

From this, the Seventh Circuit reasons:

• If the case falls within § 1332(d)(11)(B)(ii), it is not a “mass action.”
• If it is not a “mass action,” it is not “deemed to be a class action” for CAFA purposes.
• If it is not a CAFA-removable class action, federal jurisdiction must come from elsewhere (typically § 1332(a)(1) complete diversity and $75,000 per plaintiff), which was not the removal basis here.

That chain makes the exception jurisdiction-defining, not discretionary. This is why the court distinguishes Hart v. FedEx Ground Package Sys. Inc.: §§ 1332(d)(3) and (d)(4) assume jurisdiction and then allow/require a federal court to step aside, whereas § 1332(d)(11)(B)(ii) determines whether jurisdiction ever attached.

Consequence: the district court may raise the exception sua sponte at any time, and the usual 30-day remand-motion clock in 28 U.S.C. § 1447(c) for non-jurisdictional defects does not control.

B. Holding #2: The fire is the “event or occurrence,” and all claims “arise from” it

The opinion reads “event or occurrence” in the tort-litigation context, leaning on Black’s Law Dictionary’s insurance/tort usage of “occurrence” as an “accident, event, or continuing condition that results in personal injury or property damage.” It then makes two interpretive choices that matter for future cases:

• Injury-centered “arising from”: the court frames “arising from” as tracking the injury-causing incident, not the earlier negligent conduct in the abstract.
• Causation vs. occurrence distinction: earlier negligent acts may be pleaded as “underlying causes” to establish breach and causation, but they do not become separate “events or occurrences” if the actionable injuries all flow from one injury-producing episode.

This becomes the doctrinal fulcrum for rejecting defendants’ “multiple events” theory. Even if there were years of code violations, unsafe-property findings, complaints, and municipal non-remediation, the complaint (as the court reads it) alleged no compensable harms before the fire. Thus, “all claims” arise from the fire.

C. Treatment of the circuit split (and the Seventh Circuit’s careful minimalism)

The court catalogs three approaches to defining “event or occurrence”: broad (Abraham v. St. Croix Renaissance Group, L.L.L.P), middle (Rainbow Gun Club, Inc. v. Denbury Onshore, L.L.C. and Spencer v. Specialty Foundry Prods. Inc.), and narrow (Allen v. Boeing Co.).

But it intentionally avoids choosing among them because a week-long fire qualifies under any approach. Still, the opinion is not entirely agnostic: it endorses the Fifth Circuit’s causation/culmination logic from Rainbow Gun Club, Inc. v. Denbury Onshore, L.L.C. to rebut the “separate negligence incidents” argument, and it rejects the Ninth Circuit’s alternative reasoning in Allen v. Boeing Co. that multiple defendants engaging in different conduct necessarily defeats the exception.

D. Multiple defendants and “independent activities”

Defendants argued the City’s alleged inaction (failure to remediate after a 2021 purchase) and private parties’ alleged misconduct (accumulating hazardous materials/failure to maintain) were “independent activities,” so the claims could not arise from a single occurrence. The court’s answer is straightforward:

• Multiple defendants are not dispositive (Spencer v. Specialty Foundry Prods. Inc.).
• The dispositive question is whether they allegedly contributed to the same injury-causing event; here, all allegedly caused the same fire, which caused the injuries pleaded.

3.3 Impact

A. Jurisdictional policing in CAFA mass actions (practical consequences)

The most consequential holding is jurisdictional: in the Seventh Circuit, § 1332(d)(11)(B)(ii)(I) is not a waivable, party-invoked carveout—it is a limit on the court’s adjudicatory power. This has several practical effects:

• Sua sponte remands become more likely in mass-action removals involving a geographically localized disaster (fires, explosions, plant failures, derailments) where injuries are confined to the forum state or contiguous states.
• Removal strategy must account for jurisdictional fragility: even if plaintiffs do not promptly move to remand, defendants cannot rely on waiver to keep the case in federal court if the exception applies.
• District courts have an affirmative duty to verify that the removed case is truly a “mass action” under the definition as limited by the exceptions.

B. Substantive guidance on “arise from” in localized-disaster litigation

The opinion also supplies a workable, litigation-facing rule: when the pleaded injuries are all traceable to one disaster episode (here, the fire), the “event or occurrence” is the disaster, and earlier negligent acts are typically treated as causal background rather than separate “events.” That framing will tend to:

• Strengthen remand arguments for plaintiffs harmed by a single localized incident even where the negligence timeline is long.
• Constrain defendants’ ability to defeat the exception by recharacterizing “underlying causes” (complaints, citations, inspections, remediation failures) as distinct “events.”

C. Relationship to the existing circuit split

Although the Seventh Circuit does not resolve whether “event or occurrence” can include long-running conditions (as in Abraham) or must be time-fixed (as in Allen), it does deepen the jurisprudence in two ways:

• It squarely holds the exception is jurisdictional—an issue other circuits had largely “assumed.”
• It rejects an overly defendant-centric “multiple actors implies multiple occurrences” approach, aligning more with Spencer than Allen on that point.

4. Complex Concepts Simplified

• CAFA “mass action”: A case with monetary-relief claims of 100+ people proposed to be tried jointly because they share common questions. If it qualifies, it is treated like a class action for CAFA jurisdictional purposes. See 28 U.S.C. § 1332(d)(11)(A), (B)(i).
• “Local event or occurrence” exception: Even if there are 100+ plaintiffs, the case is not a CAFA “mass action” if all claims arise from an event in the filing state and injuries occurred there (or in contiguous states). 28 U.S.C. § 1332(d)(11)(B)(ii)(I).
• Jurisdictional vs. non-jurisdictional: If a rule is jurisdictional, it limits the court’s power; it can be raised at any time, and courts must consider it even if the parties do not. Non-jurisdictional rules can be forfeited/waived and often must be raised within deadlines (e.g., the 30-day rule in 28 U.S.C. § 1447(c) for certain remand motions).
• “Arise from” (in this opinion): The court treats claims as arising from the injury-producing incident (the fire), not from the pre-injury negligence that allegedly set the stage for it.
• “Event” vs. “occurrence”: The court treats the terms as overlapping and flexible in tort context; an “event or occurrence” can include an accident and may extend over some time (here, a fire burning for a week).

5. Conclusion

Tushawn Craig v. City of Richmond, Indiana establishes two important Seventh Circuit principles for CAFA mass-action litigation. First, the “local event or occurrence” exception in 28 U.S.C. § 1332(d)(11)(B)(ii)(I) is jurisdictional, empowering (and obligating) courts to raise it sua sponte and defeating reliance on waiver or remand-motion timing. Second, when a single local disaster is the first pleaded source of injury, all claims “arise from” that injury-causing event even if plaintiffs allege a long history of negligence leading up to it and even if multiple defendants engaged in different contributing conduct. The result meaningfully narrows CAFA’s federal forum for large, localized tort disasters in the Seventh Circuit—precisely where Congress’s mass-action scheme preserves a state-court locus for genuinely local catastrophes.