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Albright v. R. J. Reynolds Tobacco Co.

decided: February 13, 1976.

CHARLES M. ALBRIGHT, ADMINISTRATOR OF ESTATE OF CHARLES ALBRIGHT, DECEASED, APPELLANT IN NOS. 75-1606 AND 75-2188
v.
R. J. REYNOLDS TOBACCO COMPANY, A CORPORATION (D.C. CIVIL ACTION NO. 74-607); CHARLES M. ALBRIGHT, ADMINISTRATOR OF ESTATE OF CHARLES ALBRIGHT, DECEASED, APPELLANT IN NOS. 75-1607 AND 75-2189 V. R. J. REYNOLDS TOBACCO COMPANY, A CORPORATION. (D.C. CIVIL ACTION NO. 74-608)



APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA.

Aldisert, Hunter and Garth, Circuit Judges.

Author: Aldisert

ALDISERT, Circuit Judge.

The principal question for decision is whether a diversity case, originated in state court and otherwise properly removed to federal court pursuant to 28 U.S.C. § 1441*fn1 must be remanded because of a prior determination in a parallel case, originated in federal court, that an identical claim did not satisfy the $10,000 federal jurisdictional threshold of 28 U.S.C. § 1332.*fn2 The district court denied plaintiff's motion to remand, exercised federal jurisdiction, and dismissed the case as barred by the state statute of limitations. We affirm.

The litigation arises out of the claim of Charles Albright*fn3 that R. J. Reynolds Tobacco Company is liable to him for cancer and related sicknesses allegedly caused by the company's products. The controversy has been in litigation for more than 10 years; claims have been asserted in state and federal courts; and the matter has been in this court before. Albright v. R. J. Reynolds Tobacco Co., 350 F. Supp. 341 (W.D. Pa. 1972), aff'd, 485 F.2d 678 (3d Cir. 1973), as modified, 3d Cir., No. 72-2105, Nov. 23, 1973, cert. denied, 416 U.S. 951, 40 L. Ed. 2d 301, 94 S. Ct. 1961 (1974). Factual details are set forth in the district court opinion, supra, and need not be repeated here.

Plaintiff commenced three actions in 1965, two in the Pennsylvania state court and one in federal court. Because Pennsylvania practice did not permit joinder of tort and contract in one complaint, plaintiff filed two actions in the Court of Common Pleas of Allegheny County, Pennsylvania -- one in trespass and one in assumpsit -- by filing praecipes for writs of summons. Although plaintiff had the writs reissued once, in 1967, the writs were not served and plaintiff took no further action in the state court until 1974, seven years later. Shortly after initiating the state court action in 1965, plaintiff filed a complaint in the United States District Court for the Western District of Pennsylvania, alleging diversity of citizenship and an amount in controversy in excess of $10,000. He lost in federal court: the district court dismissed the complaint, inter alia, because the court was "convinced to a legal certainty that the evidentiary material submitted will not support a claim in excess of the jurisdictional minimum of $10,000." 350 F. Supp. at 352. We affirmed on that ground, 485 F.2d 678 (3d Cir. 1973), as modified, 3d Cir., No. 72-2105, Nov. 23, 1973, and certiorari was denied on April 15, 1974, 416 U.S. 951, 94 S. Ct. 1961, 40 L. Ed. 2d 301. See Nelson v. Keefer, 451 F.2d 289 (3d Cir. 1971). Thereafter plaintiff sought to rejuvenate his action in the state court.

On May 15, 1974, plaintiff had the original writs of 1965 reissued; they were served on defendant on May 22. Praecipes to reissue the writs alleged that the amount in controversy exceeded $10,000. Based on this allegation, and diversity of citizenship, defendant removed to the United States District Court for the Western District of Pennsylvania on June 20, 1974. Four days later plaintiff filed complaints in trespass and assumpsit in the state court, each complaint demanding judgment in excess of $3,000 only. It is undisputed that these complaints state the identical claim previously considered by the federal court and adjudged insufficient as a matter of law to meet the $10,000 jurisdictional requirement. Plaintiff asserts that his evidence is also the same. Appellant's Brief at 8.

In the district court, the plaintiff moved to remand to the state court, arguing in essence that the district court was bound to be consistent: having previously determined as a matter of law that the identical claim did not satisfy the $10,000 jurisdictional requirement, the court could not now take jurisdiction of the case on removal. Furthermore, plaintiff argued, the complaints subsequently filed in the removed cases sought recovery in excess of $3,000 only. The defendant, for its part, opposed the motion to remand and moved for summary judgment on the grounds that the claim was barred by the statute of limitations, prior accord and satisfaction, and res judicata.

The district court denied plaintiff's motion to remand and dismissed the claim as barred by the statute of limitations without considering the other grounds of defendant's motion. Plaintiff has appealed from the final judgment pursuant to 28 U.S.C. § 1291, but challenges only the denial of his motion to remand. Brief for Appellant at 2. A denial of a motion to remand is properly reviewable on appeal from a final judgment. American Fire & Casualty Co. v. Finn, 341 U.S. 6, 95 L. Ed. 702, 71 S. Ct. 534 (1951); C. WRIGHT, FEDERAL COURTS § 41, at 147 (2d ed. 1970).

I.

We agree with the district court that St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 82 L. Ed. 845, 58 S. Ct. 586 (1938), properly controls the calculation of jurisdictional amount, and that the $10,000 requirement was satisfied. It may seem anomalous that a court can say a claim is not worth $10,000 and then say it is. However, the determination in one instance was made in a case originated in federal court; in the other instance the determination was made in an action removed to federal court. St. Paul Mercury Indemnity makes clear the very different standards applicable. In an action originated in federal court, the court must strike a difficult balance where unliquidated damages are involved: a plaintiff's frivolous claim cannot be decisive to establish the jurisdiction of the court, yet jurisdiction cannot be made to depend on the final outcome of the case. C. WRIGHT, FEDERAL COURTS § 33, at 111 (2d ed. 1970). St. Paul Mercury Indemnity Co. explains why the determination of the amount in controversy in a removed case is not so difficult:

In a cause instituted in the federal court the plaintiff chooses his forum. He knows or should know whether his claim is within the statutory requirement as to amount. His good faith in choosing the federal forum is open to challenge not only by resort to the face of his complaint, but by the facts disclosed at trial, and if from either source it is clear that his claim never could have amounted to the sum necessary to give jurisdiction there is no injustice in dismissing the suit. . . . In such original actions it may also well be that plaintiff and defendant have colluded to confer jurisdiction by the method of the one claiming a fictitious amount and the other failing to deny the veracity of the averment of amount in controversy. Upon disclosure of that state of facts the court should dismiss.

A different situation is presented in the case of a suit instituted in a state court and thence removed. There is a strong presumption that the plaintiff has not claimed a large amount in order to confer jurisdiction on a federal court or that the parties have colluded to that end. For if such were the purpose suit would not have been instituted in the first instance in the state but in the federal court. It is highly unlikely that the parties would pursue this roundabout and troublesome method to get into the federal court by removal when by the same device the suit could be instituted in that court. Moreover, the status of the case as disclosed by the plaintiff's complaint is controlling in the case of a removal, since the defendant must file his petition before the time for answer*fn4 or forever lose his right to remove. Of course, if, upon the face of the complaint, it is obvious that the suit cannot involve the necessary amount, removal will be futile and remand will follow. But the fact that it appears from the face of the complaint that the defendant has a valid defense, if asserted, to all or a portion of the claim, or the circumstance that the rulings of the district court after removal ...


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