                              In the

United States Court of Appeals
               For the Seventh Circuit

No. 11-2790

T RAVELERS P ROPERTY C ASUALTY and
T RAVELERS INDEMNITY C OMPANY,
                                                Plaintiffs-Appellants,
                                  v.

R OSS G OOD , individually and on behalf of a class,

                                                 Defendant-Appellee.


             Appeal from the United States District Court
        for the Northern District of Illinois, Eastern Division.
        No. 1:11-cv-00694—Joan Humphrey Lefkow, Judge.



      A RGUED JANUARY 17, 2012—D ECIDED JULY 27, 2012




  Before E ASTERBROOK, Chief Judge, and C UDAHY and
H AMILTON, Circuit Judges.
  H AMILTON, Circuit Judge. This case is an appeal from
the district court’s discretionary decision not to exercise
jurisdiction over a declaratory judgment action because
parallel state court proceedings were pending. We affirm
the dismissal, but on a different ground. After exploring
2                                               No. 11-2790

some of the more arcane borders of federal jurisdiction
based on diversity of citizenship, we conclude that the
district court lacked subject matter jurisdiction. The plain-
tiffs’ small disputes with many claimants cannot be
aggregated to satisfy the amount-in-controversy require-
ment of 28 U.S.C. § 1332(a).


I. Facts and Procedural Background
  The plaintiffs-appellants are two affiliated insurance
companies we will simply call “Travelers.” They filed
this federal action seeking a declaratory judgment that
they had no duty to defend their insured, Rogan Shoes,
Inc., in a class action suit brought against it in Illinois
state court for violations of the federal Fair and Accurate
Credit Transactions Act of 2003, 15 U.S.C. § 1681c(g). That
act prohibits businesses from including on sales receipts
the expiration date or more than the last five digits of the
purchaser’s credit or debit card, authorizing damages of
up to $1,000 per unlawful receipt. § 1681n(a). On behalf
of a class, customer Ross Good sued Rogan Shoes in state
court for violating the act by printing 387,291 receipts
displaying the expiration dates of his and other class
members’ charge cards in 2008 and 2009. Good sought
statutory damages for class members in the staggering
amount of $387 million. Rogan Shoes tendered Good’s
suit to Travelers for defense pursuant to its liability
insurance policies. Travelers denied coverage, leaving
Rogan Shoes to its own devices.
  Rogan Shoes eventually settled with Good and the
class for $16 million, but not in cash, or at least not Rogan
No. 11-2790                                               3

Shoes’ cash. The settlement agreement specified that the
judgment would be satisfied only through proceeds
from Rogan Shoes’ insurance policies with Travelers,
with the exception of an up-front cash payment by Rogan
Shoes of $50,000 to cover Good’s legal costs. As part of the
settlement agreement, Rogan Shoes assigned to the plain-
tiffs all of its “claims against and rights to payments
from Travelers” under the policies, excepting the store’s
claim for attorney fees in defending the suit and its
claim for reimbursement of its $50,000 out-of-pocket
payment. The state trial court approved the settlement
on July 1, 2010.
   On January 4, 2011, Good filed a supplementary action
in the state court to discover Travelers’ assets for the
satisfaction of his judgment against Rogan Shoes. In
Illinois, such actions are called “citation” proceedings.
See 735 ILCS 5/2-1402. The state court citation was
served on Travelers’ agent two days later. The citation
summoned Travelers to court to appear in court on Feb-
ruary 1 to produce several categories of documents rele-
vant to the insurance policies Travelers had issued
to Rogan Shoes. On January 31, Travelers filed this
action in federal district court seeking a declaratory
judgment that insurance policies it had issued to Rogan
Shoes did not cover Good’s statutory claims based on
the credit card receipts. The district court dismissed
Travelers’ complaint on the basis of Wilton/Brillhart ab-
stention, under which a federal district court has
discretion to dismiss a declaratory judgment action
when parallel proceedings are pending in state court. See
Wilton v. Seven Falls Co., 515 U.S. 277 (1995); Brillhart v.
4                                              No. 11-2790

Excess Ins. Co. of America, 316 U.S. 491 (1942). Travelers
has appealed, arguing that the district court abused its
discretion by dismissing its action. During oral argu-
ment we ordered supplemental briefing on the issue of
subject matter jurisdiction. We directed the parties to
address whether the case satisfies the amount-in-contro-
versy requirement for diversity jurisdiction, 28 U.S.C.
§ 1332(a), in light of the fact that Rogan Shoes had
assigned its interests in its Travelers policies to Good
and his fellow class members, none of whom individually
claim a share of more than $75,000.


II. Discussion
   To invoke the diversity jurisdiction of the federal
courts, a party must establish both that diversity of citi-
zenship is complete and that “the matter in controversy
exceeds the sum or value of $75,000, exclusive of
interest and costs.” 28 U.S.C. § 1332(a). Complete
diversity is present in this case. Both Travelers com-
panies are Connecticut corporations that also have their
principal places of business in that state. Good is
a citizen of Illinois, and Rogan Shoes is a Wisconsin
corporation with its principal place of business in Wis-
consin. The amount-in-controversy requirement, how-
ever, bars the exercise of federal jurisdiction here.
We address first the general rule against aggregating
different parties’ claims to meet the amount in con-
troversy and some of its exceptions. We then turn to
issues that arise from the fact that Rogan Shoes assigned
its claims against Travelers to the plaintiff class, and
No. 11-2790                                                5

address how an insurer in Travelers’ position could
obtain a federal forum for such disputes.


  A. The Rule Against Aggregation and its Exceptions
  No individual defendant, including Rogan Shoes, has
a claim for more than $75,000 against Travelers. The
general rule is that the claims of multiple litigants
cannot be aggregated to reach the jurisdictional amount
in controversy. See Snyder v. Harris, 394 U.S. 332, 335
(1969). The anti-aggregation rule applies both to cases in
which multiple plaintiffs seek to combine their claims
against a single defendant, see Thomson v. Gaskill, 315
U.S. 442 (1942), and to those brought by a single
plaintiff against multiple defendants, see Middle
Tennessee News Co. v. Charnel of Cincinnati, Inc., 250 F.3d
1077, 1081 (7th Cir. 2001); see also 14AA Charles Alan
Wright, Arthur R. Miller & Edward H. Cooper, Federal
Practice and Procedure, § 3704, at 566-95 (2011) (hereinafter
“Wright & Miller”) (collecting cases).
  Travelers contends that there is no need for aggrega-
tion in this case because “from Travelers’ perspective,
there is only one claim, by its insured, for the $16 million
judgment entered against it.” In support of this theory,
Travelers cites Meridian Security Insurance Co. v. Sadowski,
441 F.3d 536 (7th Cir. 2006), in which an insurer sought
a declaratory judgment that its liability policy did not
cover a suit under the Telephone Consumer Protection
Act then pending in state court against its insured. We
held that the case satisfied the amount-in-controversy
6                                              No. 11-2790

requirement. The anti-aggregation rule “does not apply
to a federal declaratory-judgment action between a
single plaintiff and a single defendant, just because the
unitary controversy between these parties reflects the
sum of many smaller controversies.” Id. at 539, citing
Hunt v. Washington State Apple Advertising Comm’n, 432
U.S. 333, 347-48 (1977).
   The decisive difference between this case and Meridian
Security is that at the time the insurer filed the declara-
tory judgment action in that case, the insured’s arguable
right to recover under its policy was still completely
its own. No assignment had been made. By the time
Travelers filed this action, however, Rogan Shoes had
already assigned its claims to the members of the Good
class, and no individual class member had a claim for
more than $75,000.
  According to Travelers, the fact of an assignment in
this case is immaterial because the assignment “does not
change whose claim it is.” But that is precisely what an
assignment does. It transfers one person’s property,
interest, or rights to another. Once Rogan Shoes made
the assignment of rights, this was no longer a “unitary
controversy” between the insurer and its insured. It had
become a multi-party dispute between Travelers and
thousands of class claimants. Meridian Security is
inapposite.
  For purposes of this case, the most relevant exception
to the general rule against aggregation is that the claims
of co-parties may be added together when they have a
“common and undivided interest” in a “single title or
No. 11-2790                                                 7

right.” Snyder v. Harris, 394 U.S. 332, 335 (1969). Can the
relatively small claims of these class members be aggre-
gated as “common and undivided” interests in a
“single title or right”? Travelers declined to address this
question in its supplemental memorandum, and it took
that course at its peril. Jurisdictional objections cannot
be forfeited or waived, of course, for this court has an
“independent obligation to satisfy itself that federal
subject matter jurisdiction exists.” Smith v. American
General Life & Accident Ins. Co., 337 F.3d 888, 892 (7th
Cir. 2003). The court need not bend over backwards to
construct alternative theories to persuade itself that
subject matter jurisdiction exists, see Travelers Indem. Co.
v. Dingwell, 884 F.2d 629, 637 (1st Cir. 1989), but since
the district court considered the case and we raised
this issue, we address it here.
  The anti-aggregation rule had its origin in a case in-
volving the appellate jurisdiction of the Supreme Court
rather than the original subject matter jurisdiction of the
district courts. See Oliver v. Alexander, 31 U.S. (6 Pet.) 143
(1832). Much later, in 1893, “the original Alexander con-
struction of [the Court’s] appellate jurisdiction was
applied to the jurisdictional-amount requirement for
federal trial courts.” Zahn v. International Paper Co., 414
U.S. 291, 294 n.3 (1973), citing Walter v. Northeastern R.R.
Co., 147 U.S. 370, 373 (1893). Apparently, little thought
was given to whether “different aggregation policies
might be of greater importance for original federal
court jurisdiction than for appellate jurisdiction.” 14AA
Wright & Miller § 3704, at 596. By 1916, however, the
Court was able to describe the anti-aggregation principle
8                                                   No. 11-2790

as a “settled rule” of diversity jurisdiction, Pinel v. Pinel,
240 U.S. 594, 596 (1916), and it certainly is so now. The
rule is:
    When two or more plaintiffs, having separate and
    distinct demands, unite for convenience and economy
    in a single suit, it is essential that the demand of each
    be of the requisite jurisdictional amount; but when
    several plaintiffs unite to enforce a single title or
    right, in which they have a common and undivided
    interest, it is enough if their interests collectively
    equal the jurisdictional amount.
Zahn, 414 U.S. at 294 (emphases added), quoting Troy
Bank v. G. A. Whitehead & Co., 222 U.S. 39, 40-41 (1911).1
  The anti-aggregation rule thus distinguishes between
“separate and distinct interests,” which cannot be aggre-
gated to reach the jurisdictional minimum, and “common
and undivided interests,” which can be aggregated.
The Supreme Court has opined that the “lower courts
have developed largely workable standards for deter-
mining when claims are joint and common, and
therefore entitled to be aggregated, and when they are


1
   The general rule in Zahn has been modified in respects not
material here. For example, under the supplemental jurisdic-
tion statute, 28 U.S.C. § 1367, if one plaintiff’s claim satisfies
the amount-in-controversy requirement, the smaller claims of
other plaintiffs can be joined as long as diversity of citizenship
remains complete and all claims are part of the same case
or controversy. Exxon Mobil Corp. v. Allapattah Services, Inc.,
545 U.S. 546, 549 (2005); Stromberg Metal Works, Inc. v. Press
Mechanical, Inc., 77 F.3d 928, 930-32 (7th Cir. 1996).
No. 11-2790                                                 9

separate and distinct and therefore not aggregable.”
Snyder, 394 U.S. at 341. Other courts and commentators
have taken a less sanguine view. See, e.g., Morrison v.
Allstate Indem. Co., 228 F.3d 1255, 1262 (11th Cir. 2000)
(noting “pervasive criticism of the ‘separate and distinct’
versus ‘common and undivided’ distinction as arcane
and confusing”); Eagle v. American Tel. and Tel. Co., 769
F.2d 541, 546 (9th Cir. 1985) (“The dividing line is not
clear.”); Local Div. No. 714, Amalgamated Transit Union, v.
Greater Portland Transit Dist., 589 F.2d 1, 10 (1st Cir. 1978)
(“The distinction between ‘a common and undivided
interest’ and ‘separate and distinct’ claims is not entirely
clear.”), overruled on other grounds by Jackson Transit
Auth. v. Local Div. 1285, Amalgamated Transit Union,
457 U.S. 15 (1982); Aetna Cas. & Sur. Co. v. Graves,
381 F. Supp. 1159, 1162-63 (W.D. La. 1974) (“We also
realize that the rules on aggregation of claims to satisfy
the requirements of minimum amount in controversy ‘. . .
turn on a mystifying conceptual test.’ ”) (ellipsis in origi-
nal), quoting Wright, Law of Federal Courts § 36, at 121;
14AA Wright & Miller § 3704, at 600-01 (“terms such
as ‘common’ and ‘several’ are poor words for a
subject matter jurisdiction test — or anything else for
that matter — since they have little or no clear and ascer-
tainable meaning.”) (some internal quotations omitted).
  The dichotomy between common and undivided inter-
ests and separate and distinct interests is workable in
the easy, paradigm cases. For example, where there is a
“single indivisible res, such as an estate” or “a piece
of property (the classic example),” it makes sense to
think of co-parties’ claims to the res as “common and
10                                              No. 11-2790

undivided.” Gilman v. BHC Sec., Inc., 104 F.3d 1418, 1423
(2d Cir. 1997), quoting Bishop v. General Motors Corp., 925
F. Supp. 294, 298 (D.N.J. 1996). Conversely, where the
plaintiffs’ claims are “cognizable, calculable, and correct-
able individually,” Gibson v. Chrysler Corp., 261 F.3d 927,
945 (9th Cir. 2001), — say, personal injuries arising from
mass torts — they are clearly “separate and distinct”
and may not be aggregated to meet the amount in con-
troversy. Thus in the foundational Troy Bank case, the
two plaintiffs could not aggregate their claims under
separate promissory notes made payable by the de-
fendant, but they could aggregate their claims based on
a vendor’s lien that they owned jointly. 222 U.S. at 41.
  In closer cases, the distinction between common and
undivided interests and separate and distinct interests
is less useful. It has proven particularly slippery in cases
involving insurance claims. For example, in Motorists
Mutual Ins. Co. v. Simpson, 404 F.2d 511 (7th Cir. 1968), an
insured had caused an accident that resulted in damage
to a rental vehicle and the death of its driver. The
insured had been found liable to both the deceased
driver’s widow and the owner of the rented vehicle. The
insurer then sought a declaratory judgment that it was
not required to cover liability to the widow for the
death or to the owner for the property damage. Under
the policy, neither type of liability was sufficient alone
to meet the amount-in-controversy requirement, but if
they were combined, they would exceed the minimum.
The district court found that aggregation of the relief
sought against two claimants was appropriate be-
cause both claims arose under the same instrument. We
No. 11-2790                                                11

reversed, reasoning that the claims of the widow and
the vehicle owner were separate and distinct, so that
the insurer’s potential liability to them would have been
several rather than joint. Id. at 513, quoting Thomson v.
Gaskill, 315 U.S. 442, 447 (1942) (“Aggregation of plaintiffs’
claim cannot be made merely because the claims are
derived from a single instrument.”); accord, e.g., Crenshaw
v. Great Central Ins. Co., 482 F.2d 1255, 1259-60 (8th Cir.
1973) (denying aggregation of claims against insurance
company on uninsured motorist policy by parents of
deceased for wrongful death and by their daughter for
her own personal injuries); Eagle Star Ins. Co. v. Maltes,
313 F.2d 778, 781-82 (5th Cir. 1963) (denying aggregation
to three plaintiffs who sued insurer after obtaining sepa-
rate judgments against insured); Jeffrey L. Rensberger,
The Amount in Controversy: Understanding the Rules of
Aggregation, 26 Ariz. St. L.J. 925, 945 & n.134 (1994)
(“Courts also will not aggregate claims when an in-
sured sues for coverage on a loss or an insurer sues for a
declaration of non-coverage.”) (collecting cases).
  Other courts have taken different approaches. In
Phoenix Ins. Co. v. Woolsey, 287 F.2d 531, 532 (10th Cir.
1961), for example, the court allowed aggregation of
claims of nine creditors to whom an insured had
separately assigned proceeds of a fire insurance policy,
presumably because the creditors cross-assigned to one
another their interests in the proceeds “so that each
might share pro rata in the recovery against the de-
fendants and . . . agreed to waive against each other any
priorities which might exist between them.” See also
Manufacturers Casualty Ins. Co. v. Coker, 219 F.2d 631, 633
12                                                No. 11-2790

(4th Cir. 1955) (in declaratory judgment action brought
by auto insurer for declaration of non-liability, allowing
aggregation of claims of 23 children injured in school
bus accident on ground that all claims “arise out of a
single instrument”).
  Confronting the aggregation question in the insurance
context, several circuits have attempted to distill some
consistent meaning from the confusion. In a class action
brought by automobile insureds against their insurers
to recover the diminished value of their vehicles after
they were repaired, the Eleventh Circuit held that the
plaintiffs’ claims could not be aggregated because they
were “asserting rights arising from their individual
insurance policies, and if successful, they [would] recover
the amount of excessive premiums each paid under
his own policy.” Morrison v. Allstate Indem. Co., 228 F.3d
1255, 1264 (11th Cir. 2000). The court adopted a formula-
tion of the distinction between “separate and distinct”
interests and “common and undivided” interests first
articulated in Eagle Star by Judge Tuttle for the Fifth
Circuit. Under this test, aggregation is permitted “only
in those situations where there is not only a common
fund from which the plaintiffs seek relief, but where
the plaintiffs also have a joint interest in that fund,
such that if plaintiffs’ rights are not affected by the
rights of co-plaintiffs, then there can be no aggregation.” Id.
at 1262-63, quoting Eagle Star, 313 F.2d at 781. In other
words, the Eagle Star rule is that the claims of co-parties
are “common and undivided” — and thus can be aggre-
gated — only where each claim (1) is part of a “common
fund” and (2) could not be adjudicated on an individual
basis without affecting the interests of the other claimants.
No. 11-2790                                               13

   At least five other circuits have endorsed the Eagle Star
formulation or its functional equivalent. See Everett v.
Verizon Wireless, Inc., 460 F.3d 818, 824 (6th Cir. 2006)
(“Aggregation is permitted ‘where there is not only a
common fund from which the plaintiffs seek relief, but
where the plaintiffs also have a joint interest in that fund,
such that if plaintiffs’ rights are not affected by the
rights of co-plaintiffs then there can be no aggregation.
In other words, the obligation to the plaintiffs must be
a joint one.’ ”) (emphasis in original), quoting Eagle
Star, 313 F.2d at 781; In re Ford Motor Co./Citibank (South
Dakota), N.A., 264 F.3d 952, 959 (9th Cir. 2001) (claims
of cardholder plaintiffs against credit card companies
arising out of the termination of a purchase rebate
program could not be aggregated as common and undi-
vided interests because they “do not implicate a
‘single indivisible res,’ and could be adjudicated on an
individual basis because the consolidated plaintiffs
(and putative class members) have no common and
undivided interest in accruing rebates under the pro-
gram.”); Martin v. Franklin Capital Corp., 251 F.3d 1284,
1292 (10th Cir. 2001) (“[A] common interest in a pool of
funds is not the type of interest that permits aggregation
of claims under the ‘common fund’ doctrine. Each class
member could sue separately for punitive damages
and have his right to recovery determined without im-
plicating the rights of every other person claiming
such damages.”) (citation and some quotation marks omit-
ted); Gilman, 104 F.3d at 1423 (holding that claims of
plaintiff-investors against defendant-brokerage for
illegally charging “order flow payments” on securities
14                                               No. 11-2790

transactions could not be aggregated because they “do not
implicate a ‘single indivisible res,’ and could be ad-
judicated on an individual basis”); Dierks v. Thompson,
414 F.2d 453, 456 (1st Cir. 1969) (approving aggregation
of multiple plaintiffs’ claims to reach jurisdictional
amount because they “are seeking to establish a trust
fund as distinguished from individual cash claims
against the defendants” and the “fact that the individual
plaintiffs’ beneficial interests may be of fixed proportion
does not vary the fact that the existence of a single trust
res is of common importance”).
   In accord with our colleagues in these other circuits,
we adopt the Eagle Star rule: we “allow aggregation only
in those situations where there is not only a common
fund from which the plaintiffs seek relief, but where the
plaintiffs also have a joint interest in that fund, such
that . . . plaintiffs’ rights are . . . affected by the rights
of co-plaintiffs.” 313 F.2d at 781. Unlike the more
abstract terminology from Troy Bank and Zahn, it has
the virtue of making this case fairly easy to resolve.
First, the potential proceeds from the Travelers policies
do not qualify as a “common fund.” The existence of a
“common fund” depends on the “nature of the right
asserted, not whether successful vindication of the
right will lead to a single pool of money that will be
allocated among the plaintiffs.” Gilman, 104 F.3d at 1427.
Thus, a common fund exists when “plaintiffs share[ ] a pre-
existing (pre-litigation) interest in the subject of the
litigation.” Id. In this case, the Good class members did
not share a pre-existing interest in recovery against
Rogan Shoes or its insurers. The class members’ claims
No. 11-2790                                              15

all arose from separate transactions. As the Second
Circuit said in Gilman: “There is no fund. The claim
remains one on behalf of separate individuals for the
damage suffered by each due to the alleged conduct of the
defendant.” Id. (ellipses omitted), quoting Rock Drilling
Local Union No. 17 v. Mason & Hanger Co., 217 F.2d 687,
695 (2d Cir. 1954).
  Even if Travelers could meet the common fund element
of the Eagle Star formulation, the claims of the Good
class members also fail the second element because
each claimant’s “rights are not affected by the rights
of co-plaintiffs.” 313 F.2d at 781.
  Under the terms of the settlement agreement between
Good and Rogan Shoes, each class member would
receive a pro rata (per receipt) share of the $16 million
recovery that is sought, with a maximum award of
$1,000 regardless of the number of unlawful receipts
that Rogan Shoes issued any individual. After attorney
fees are deducted, roughly $10.67 million would remain
in the pot. Because of the $1,000 cap on individual
awards, in order for any one class member’s claim to
be affected by the claims of other class members, at least
10,667 claimants would have to submit viable claims.
Is that likely? We do not know.
  In all cases, the party asserting federal jurisdiction has
the burden of proof to show that jurisdiction is proper.
E.g., McNutt v. General Motors Acceptance Corp., 298 U.S.
178, 189 (1936). The “proponent of jurisdiction may be
called on to prove facts that determine the amount in
controversy,” and must do so by a preponderance of the
16                                              No. 11-2790

evidence. Meridian Security, 441 F.3d at 541. Here, Travelers
has not done so. On the basis of the settlement agree-
ment alone, we cannot conclude that it is more likely
than not that the class will produce more than 10,667
claimants and, if so, that “if one plaintiff cannot or does
not collect his share, the shares of the remaining
plaintiffs [would be] increased.” See Sellers v. O’Connell,
701 F.2d 575, 579 (6th Cir. 1983) (“Where a group of
plaintiffs litigate individual cash claims the amount of
which remain unaffected by the results obtained by
fellow plaintiffs, the litigants may not aggregate their
claims when alleging jurisdiction.”) (citations omitted);
Kopff v. World Research Group, LLC, 298 F. Supp. 2d 50, 56
(D.D.C. 2003) (“plaintiffs’ claims can be aggregated
when they make an integrated claim — in other words,
if the right is a collective right pursuant to which one
plaintiff’s failure to collect his or her share increases the
remaining plaintiffs’ damages”) (internal quotation
marks omitted). The claims of the Good class to Rogan
Shoes’ potential insurance proceeds are not “common
and undivided” and therefore cannot be aggregated
to reach the jurisdictional minimum.


  B. Assignment Affecting Jurisdiction
  When assignments of rights seem to have the effect
of creating diversity jurisdiction, federal courts give them
close scrutiny for signs of attempts to manipulate the
choice of forum. Congress has provided: “A district court
shall not have jurisdiction of a civil action in which any
party, by assignment or otherwise, has been improperly
No. 11-2790                                               17

or collusively made or joined to invoke the jurisdiction
of such court.” 28 U.S.C. § 1359; see also Kramer v.
Caribbean Mills, Inc., 394 U.S. 823, 828-29 (1969) (affirming
dismissal for lack of jurisdiction: “If federal jurisdiction
could be created by assignments of this kind, which are
easy to arrange and involve few disadvantages for the
assignor, then a vast quantity of ordinary contract and
tort litigation could be channeled into the federal courts
at the will of one of the parties. Such ‘manufacture of
Federal jurisdiction’ was the very thing which Congress
intended to prevent when it enacted § 1359 and its prede-
cessors.”); Airlines Reporting Corp. v. S and N Travel, Inc.,
58 F.3d 857, 862 (2d Cir. 1995) (“We give careful scrutiny
to assignments which might operate to manufacture
diversity jurisdiction . . . .”).
  It is less clear how closely federal courts should scruti-
nize assignments that have the effect of defeating
federal diversity jurisdiction. Compare Miller v. Perry,
456 F.2d 63, 67, 66 (4th Cir. 1972) (reading Kramer as
“injecting a new note of realism into the determination
of diversity jurisdiction” and carefully scrutinizing at-
tempts to defeat diversity jurisdiction, as well), with
Messer v. American Gems, Inc., 612 F.2d 1367, 1375 (4th Cir.
1980) (“28 U.S.C. § 1359 attaches no consequences to
steps taken to defeat diversity jurisdiction.”). In any
event, we do not see in this case any indication that
Rogan Shoes and Good negotiated the assignment of
the former’s insurance proceeds for the purposes of
thwarting Travelers’ right to a federal forum.
 We reach this conclusion in part because the assign-
ment did not have the effect of preventing Travelers from
18                                               No. 11-2790

securing a federal forum to resolve this controversy. First,
it could have sought a declaratory judgment of non-
coverage immediately after Rogan Shoes tendered Good’s
claims to it. Before the assignment, the amount-in-contro-
versy requirement would have been met. See Meridian
Security, 441 F.3d at 539.
  Second, even after the assignment, Travelers could
have removed the state court proceeding to fed-
eral court once Good filed that action seeking to
discover Travelers’ assets. The state court citation pro-
ceeding on behalf of the Good class would have
been subject to the Class Action Fairness Act, so that
removal would not have been barred by the one-
year limit on removal in diversity cases. See 28 U.S.C.
§ 1453(b). (The Class Action Fairness Act does not apply
in this declaratory judgment action, however, because
the act applies only where there is a plaintiff class, not
a defendant class. See 28 U.S.C. § 1332(d)(2).)
  To counter that argument, Travelers argues that the
removal option was foreclosed by another decision
from the district where this case was filed. The facts and
posture of that case, Eclipse Manufacturing Co. v. United
States Compliance Co., No. 05 C 5406, 2006 WL 42395
(N.D. Ill. Jan. 4, 2006), were strikingly similar to this one.
Although the case is not binding precedent, one could
expect the decision to influence practice in the district,
and it deserves our close attention. The plaintiff in
Eclipse Manufacturing had filed a putative class action
against a company for allegedly sending unsolicited
advertisements by facsimile in violation of the Telephone
No. 11-2790                                             19

Consumer Protection Act, 47 U.S.C. § 227, and state
law. The parties agreed to a $4 million judgment that,
as here, could be executed only on money received from
the defendant’s liability insurer. The state trial court
entered a judgment approving the settlement, after
which the class members filed a citation to discover
assets under 735 ILCS 5/2-1402, naming the liability
insurer as a “third-party respondent.” Instead of seeking
a federal declaratory judgment of non-liability, as
Travelers did here, the Eclipse Manufacturing insurer
removed the citation action to the federal district court.
  The district court ordered remand, finding for the
plaintiff class on two separate grounds: First, it held
that the Illinois citation proceeding was not removable
under 28 U.S.C. § 1441(a) because it was not a “separate
and independent action” from the underlying suit it-
self. Eclipse Mfg., 2006 WL 42395, at *3. Second, the
court held that even if the citation proceeding were
separately removable, “removal would still be improper
because the jurisdictional amount requirement for
diversity is not satisfied.” Id. at *4. The court explained
that each class member’s pro rata share of the settle-
ment was less than $300, and aggregation was not per-
mitted because the judgment “cannot be viewed as
an undivided lump sum.” Id.
   We disagree with the Eclipse Manufacturing court’s
first conclusion that the citation proceeding was not a
removable action. Section 1441 permits removal of “civil
action[s] brought in a State court” over which federal
district courts “have original jurisdiction.” 28 U.S.C.
20                                              No. 11-2790

§1441(a). The statute has long been interpreted to allow
removal only of “independent suits” but not ancillary
or “supplementary” proceedings. See Federal Sav. & Loan
Ins. Corp. v. Quinn, 419 F.2d 1014, 1018 (7th Cir. 1969);
see also Barrow v. Hunton, 99 U.S. 80, 83 (1878) (explaining
that a supplementary action so connected with an
original action as to form a mere incident or continua-
tion of it is not removable as a separate suit). This pruden-
tial doctrine seeks to avoid the waste of having federal
courts “entertain[ ] ‘satellite elements’ of pending state
suits and judgments.” Armistead v. C & M Transp., Inc.,
49 F.3d 43, 46 (1st Cir. 1995), quoting 14A Wright &
Miller § 3721.
  Whether a particular state judicial procedure qualifies
as a separate action is not an all-or-nothing proposition.
It depends on the context of each case in which it
arises. See Quinn, 419 F.2d at 1018-19. Removability is
a question of federal law, so the state’s own characteriza-
tions of the proceeding are not decisive. See Chicago, Rock
Island & Pac. R.R. Co. v. Stude, 346 U.S. 574, 580 (1954);
Quinn, 419 F.2d at 1018.
  No bright-line formula exists for separating the inde-
pendent and removable sheep from the ancillary and non-
removable goats. But one nineteenth century judge
offered this helpful distinction: “where the supple-
mental proceeding is not merely a mode of execution
or relief, but where it, in fact, involves an independent
controversy with some new and different party, it may
be removed into the federal court.” Buford v. Strother,
10 F. 406, 407 (C.C.D. Iowa 1881) (Love, J.). A citation pro-
No. 11-2790                                                 21

ceeding (or a garnishment proceeding, as it is called in
most jurisdictions) may often be “merely a mode of
execution of relief.” Id.; see, e.g., Vukadinovich v. McCarthy,
59 F.3d 58, 62 (7th Cir. 1995) (“Garnishment is a
standard, often essential, step in the collection of a judg-
ment, and the party holding the judgment . . . ought to
be able to take this step without having to start a
new lawsuit in a different court system.”).
  Consistent with Judge Love’s distinction, however,
when garnishment proceedings present genuine dis-
putes with new parties and raise new issues of fact
and law, courts overwhelmingly treat them as in-
dependent and removable actions. See 14B Wright &
Miller § 3721, at 28-30 & n.58 (“For example, proceedings
for garnishment . . . are considered civil actions within
the meaning of the federal removal statute.”) (collecting
cases); see, e.g., Butler v. Polk, 592 F.2d 1293, 1295-96
(5th Cir. 1979) (garnishment action against third-party
insurer was removable); Swanson v. Liberty Nat’l Ins. Co.,
353 F.2d 12, 13 (9th Cir. 1965) (same); Randolph v.
Employers Mut. Liab. Ins. Co. of Wis., 260 F.2d 461, 464-65
(8th Cir. 1958) (same); Adriaenssens v. Allstate Ins. Co., 258
F.2d 888, 890 (10th Cir. 1958) (same).
  The reason is clear: when the garnishment action
brings in a new party and raises new and distinct
disputed issues, the proceeding is not “substantially a
continuation of a prior suit.” See Quinn, 419 F.2d at 1018.
Judicial economy concerns about “satellite” issues no
longer apply. This is not to say that any garnishment ac-
tion that involves a third party is a separate and re-
movable action. But “[w]here the garnishment procedures
22                                                No. 11-2790

allow for adversarial litigation of disputed issues, and
where the garnishment action involves a new party and
disputed rights and issues not decided by the state
court, removal should be permitted.” Harding Hosp. v.
Sovchen, 868 F. Supp. 1074, 1078 (S.D. Ind. 1994) (denying
remand after Travelers removed garnishment action that
sought to resolve insurance coverage issue); accord,
Johnson v. Wilson, 185 F. Supp. 2d 960, 964-65 (S.D. Ind.
2002) (denying remand where garnishment proceeding
involved new parties and raised legal and factual issues
not decided in the state court litigation); see also Stewart v.
EGNEP (Pty) Ltd., 581 F. Supp. 788, 790 (C.D. Ill. 1983)
(denying remand of garnishment proceedings raising
interests and defenses separate from those of judgment
creditors).
  In light of these principles, the citation proceeding
against Travelers was separate from the underlying suit
between Rogan Shoes and Good. It could have been
removed if the requirements of diversity jurisdiction
were satisfied. Travelers was brought into state court
under a law allowing the court to “[a]uthorize the judg-
ment creditor to maintain an action against any person or
corporation that, it appears upon proof satisfactory to the
court, is indebted to the judgment debtor, for the recovery
of the debt.” 735 ILCS 5/2-1402(c)(6) (emphases added).
We need not specify here the precise time that the cita-
tion proceeding might have been removable (apart
from amount-in-controversy issues), and the removal
statute allows a little play in the joints when it may not
be apparent at the outset that a proceeding can be re-
moved. See 28 U.S.C. § 1446(b)(3). If not with the
No. 11-2790                                             23

initial citation, which on its face demanded only
discovery of documents, then later as the dispute over
insurance coverage crystallized in the state court, the
citation proceeding became an “action . . . for the re-
covery of the debt.”
   This new action was an “independent controversy
with some new and different party” and was quite
distinct from the underlying case between Rogan
Shoes and Good. See Buford, 10 F. at 407. In that initial
litigation, the issues were whether Rogan Shoes violated
the federal statute on credit card receipts, and if so,
how many times, and what damages should be
awarded. The opposing parties were Rogan Shoes
against Good on behalf of a class. In the citation pro-
ceeding, the principal issue is whether Rogan Shoes’
liability insurance policies with Travelers covered the
claims for its alleged violations of the federal law, with
Rogan Shoes and the Good class members allied together
against a new party, Travelers. The citation proceeding
thus features a new party, a new and distinct legal claim,
new issues of fact and law, and even a realignment of
the original litigants. Aside from the citation action’s
origination in the underlying suit, it became for all
intents and purposes a separate case. We believe the
Eclipse Manufacturing court erred in concluding other-
wise on nearly identical facts.
  We take no issue, however, with the Eclipse Manufac-
turing court’s remand in that case based on the alternative
holding that aggregation was not permitted to satisfy the
amount-in-controversy requirement. The court’s holding
24                                                No. 11-2790

on that point is consistent with our analysis of anti-aggre-
gation principles above. But that holding would have
posed no obstacle to Travelers’ ability to remove the
citation action against it to federal court, thanks to the
Class Action Fairness Act of 2005. That act modified
diversity jurisdiction rules so as to permit federal
diversity jurisdiction where diversity is only minimal
but the matter in controversy exceeds $5,000,000. 28
U.S.C. § 1332(d). Section 1332(d)(6) relaxes the gen-
eral diversity rule against aggregation and “explicitly
provides for aggregation of each class member’s claims
in determining whether the amount of controversy is
at least $5,000,000.” Blockbuster, Inc. v. Galeno, 472 F.3d 53,
59 (2d Cir. 2006). The $16 million settlement that the
Good class sought to collect exceeded the aggregate
amount-in-controversy threshold, so the federal dis-
trict court could have had subject matter jurisdiction.
The deadline for removal, however, was 30 days after
Travelers’ receipt of the citation or such other documents
that would have made it ascertainable that the case was
removable. See 28 U.S.C. § 1446(b). That deadline has
passed.
  The district court’s judgment of dismissal is A FFIRMED
AS  M ODIFIED to reflect that the dismissal is for lack of
jurisdiction.




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