The opinion of the court was delivered by: Reed, Senior District Judge.
Plaintiff Jerome M. Irving ("Irving") filed this action in the
Court of Common Pleas of Delaware County, Pennsylvania, claiming
breach of contract and bad faith by his insurer, defendant
Allstate Insurance Company ("Allstate"),*fn1 due to Allstate's
failure to indemnify Irving following the 1997 theft of his
custom-built motorcycle. Allstate removed the case to federal
court, and Irving now seeks an order remanding the case on the
ground that the amount in controversy in this case is less than
$75,000, the amount required for a federal court to exercise
jurisdiction in a diversity case. See 28 U.S.C. § 1332(a). For
the reasons set forth below, the motion will be granted.
An action removed to federal court may be remanded to state
court "if at any time before final judgment it appears that the
district court lacks subject matter jurisdiction. . . ."
28 U.S.C. § 1447(c). Removal statutes are to be strictly construed,
and all doubts are resolved in favor of remand. See DeCastro v.
AWACS, Inc., 935 F. Supp. 541, 545-46 (D.N.J. 1996) (citing
Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990),
cert. denied, 498 U.S. 1085, 111 S.Ct. 959, 112 L.Ed.2d 1046
(1991)). "The burden of establishing the amount in controversy in
removal cases rests on the defendant." Meritcare Inc. v. St.
Paul Mercury Ins. Co., 166 F.3d 214, 222 (3d Cir. 1999) (citing
Abels v. State Farm Fire & Cas. Co., 770 F.2d 26, 29 (3d Cir.
Courts in the Third Circuit are unencumbered by consistency in
their characterization of defendant's burden of proving the
amount in controversy on a motion to remand. See Kimmel v.
DeGasperi, eBay, No. 00-143, 2000 WL 420639, *1, 2000 U.S.Dist.
LEXIS 4935, at *5 (E.D.Pa. Apr. 7, 2000). The defendant's burden
has been defined in at least three different ways: (1) defendant
must prove to a "legal certainty" that plaintiff could not
recover more than $75,000, see Morris v. Brandeis Univ., No.
99-2642, 1999 WL 817723, *3, 1999 U.S.Dist. LEXIS 15767, at *7
(E.D.Pa. Oct. 8, 1999); (2) defendant must show that the claim
exceeds the amount in controversy requirement by a preponderance
of the evidence, see Werwinski v. Ford Motor Co., No. 00-943,
2000 WL 375260, *1, 2000 U.S.Dist. LEXIS 4602, at *4 (E.D.Pa.
Apr. 11, 2000); (3) defendant need only demonstrate a reasonable
probability that the amount in controversy meets the
jurisdictional amount, see International Fleet Auto Sales v.
National Auto Credit, No. 97-1675, 1999 WL 95258, 1999 U.S.Dist.
LEXIS 1748 (E.D.Pa. Feb. 22, 1999). In prior cases, I have held
that the preponderance of the evidence standard is the most
appropriate of the three, and I reaffirm that conclusion today.
See Mangano v. Halina, No. 97-1678, 1997 WL 697952, *6, 1997
U.S.Dist. LEXIS 17876, at *13-14 (E.D.Pa. Nov. 3, 1997);
Mercante v. Preston Trucking Co., No. 96-5904, 1997 WL 230826,
*1, 1997 U.S.Dist. LEXIS 6129, at *2 (E.D.Pa. May 1, 1997).
In determining whether defendant has met its burden of proof as
to the amount in controversy, the Court may rely on the
pleadings, see Packard v. Provident Nat'l Bank, 994 F.2d 1039,
1045-46 (3d. Cir. 1993); stipulations and discovery evidence such
as affidavits, depositions, and other documents relevant to the
value of the claims, see Meritcare, 166 F.3d at 222; and the
Court's judgment as to the reasonable value of the rights being
litigated, Angus v. Shiley, 989 F.2d 142, 146 (3d
Cir. 1993). See also 14B Charles Alan Wright, Arthur R. Miller,
& Edward H. Cooper, Federal Practice and Procedure, § 3702, at
57 (3d ed. 1998).
Having thoroughly reviewed of the parties' submissions, I
conclude that Allstate has not satisfied its burden of showing by
a preponderance of the evidence that the amount in controversy
Allstate has produced no evidence of the amount in controversy
beyond the pleadings. Its argument rests on the fact that Irving
included in his complaint an ad damnum clause*fn2 that stated
that damages would not exceed $50,000 on either claim, Complaint,
at ¶¶ 19, 23, but later averred that the amount "will exceed
$50,000." Plaintiff's Reply to New Matter and Counterclaim, at ¶
49. The Court of Appeals for the Third Circuit has held on at
least two occasions that pleadings that seek damages "in excess
of" amounts below the jurisdictionally required amount do not
conclusively resolve the amount in controversy question on a
motion to remand. See Meritcare, 166 F.3d at 217 (an ad
damnum clause in a complaint, which stated that the damages
would exceed $25,000, was "little more than an open-ended claim
that fails to answer the amount in controversy inquiry");
Angus, 989 F.2d at 146 (plaintiff's complaint, which stated two
claims seeking damages "in excess of $20,000," was merely "an
open-ended claim," and the amount in controversy was to be
determined by a "reasonable reading of the value of the rights
being litigated") (citations omitted).*fn3 Thus, the mere fact
that plaintiff avers that damages will exceed a figure
substantially less than the jurisdictional amount does not
satisfy defendant's burden.
Allstate also argues that the plaintiff's requests for
additional recovery, including punitive damages, attorneys' fees,
interest, and costs, presumptively nudge the claims in this case
over the jurisdictional amount. However, Allstate has produced no
evidence of the additional amounts possible or likely in this
case. Allstate apparently believes that the Court must infer from
the answer's reference to damages "exceed[ing] $50,000" and
plaintiff's demand for punitive damages, attorneys' fees,
interest, and costs that the jurisdictional amount likely be
exceeded.*fn4 Without any evidence, however, this is an
inference I am not permitted to draw. While such additional
recovery might have some effect
on the amount in controversy,*fn5 determining that effect,
particularly in an open-ended claim with no evidence even as to
the amount of compensatory damages, would be pure guesswork. If
this Court has to guess, defendant has not proved its point.
Allstate need not assume the awkward task of proving the entire
extent of plaintiff's damages, but it must give the Court
something more than tenuous inferences if it hopes to sustain its
burden of proof as to the amount in controversy. Allstate has
produced no affidavits, no declarations, no receipts, no
applications for benefits; no evidence of the value of the
insured property or that costs, interests, fees, and punitive
damages will exceed $75,000 in this case. Thus, there is nothing
on the record by which the Court could determine the reasonable
value of the claims asserted by plaintiff.
"Burdens of proof are meaningful elements of legal analysis,
and occasionally, where the evidentiary record is wanting, the
burden of proof will determine the outcome of a motion." Simon
v. Ward, 80 F. Supp.2d 464, 472 (E.D.Pa. 2000). Such is the case
here. Because Allstate has not carried its burden of proof,
Irving's motion for remand will be granted.
An appropriate Order follows.
AND NOW this 3rd day of May, 2000, upon consideration of
motion of plaintiff Jerome M. Irving to remand this action to the
Court of Common Pleas of Delaware County, Pennsylvania (Document
No. 3), and having concluded, for the reasons stated in the
foregoing memorandum, that the defendant Allstate has not carried
its burden of establishing that the amount in controversy in this
case meets the requisite amount in controversy set forth in
28 U.S.C. § 1132(a), it is hereby ORDERED that the case is hereby
REMANDED to the Court of Common Pleas of Delaware County,
Pennsylvania, Civil Action No. 99-50194, for lack of subject
The clerk of Court shall forthwith return the record to the
Prothonotary of the Court of Common Pleas of ...