United States District Court, E.D. Pennsylvania
April 7, 2004.
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY
The opinion of the court was delivered by: RICHARD B. SURRICK, District Judge
MEMORANDUM & ORDER
Presently before the Court is Plaintiff's Motion to Remand. (Doc. No.
5.) Defendant removed this case from the Court of Common Pleas of
Philadelphia County. Plaintiff argues that we should remand this case
because Defendant has not shown that the amount in controversy exceeds
$75,000, the amount required for diversity jurisdiction.
28 U.S.C. § 1332(a). For the following reasons, Plaintiff's Motion will
Plaintiff was injured in a motor vehicle accident. (Compl. ¶¶ 3, 5.) She
is undergoing medical treatment and is suing Defendant for benefits under
an insurance policy issued by Defendant. (Id. ¶ 5.) Plaintiff and
Defendant are citizens of different states. (Id. ¶¶ 1-2.) Plaintiff asks
the Court to award her "benefits, plus treble damages, interest, costs,
and counsel fees in a sum in excess of [Pennsylvania's] arbitration
limits."*fn1 (Id. ¶ 13.) Plaintiff's Complaint states that Plaintiff seeks damages in excess of $50,000.*fn2 There is
no other indication in the Complaint as to the amount in controversy.
On February 27, 2004, we denied Plaintiff's motion to remand without
prejudice. (Doc. No. 8.) We concluded that Defendant had not met its
burden of showing to a legal certainty that the amount in controversy
exceeded $75,000. However, instead of remanding the case, we allowed
Defendant to conduct jurisdictional discovery to determine the amount in
controversy. The parties completed jurisdictional discovery and entered
into certain stipulations related to the amount in controversy. After
review of the stipulation we conclude that Defendant still has not met
the burden of showing to a legal certainty that the amount in controversy
exceeds $75,000. Accordingly, we will remand this case to state court.
The removal statute, 28 U.S.C. § 1441, must be strictly construed to
honor Congress' intent to restrict federal diversity jurisdiction.
Samuel-Bassett v. KIA Motors Am., Inc., 357 F.3d 392, 396 (3d Cir.
2004). When the parties are citizens of different states, we will
exercise jurisdiction over a removed case if the amount in controversy
exceeds $75,000. 28 U.S.C. § 1332(a). The removing party bears the burden
of proving to a legal certainty that federal subject matter jurisdiction
exists. Samuel-Bassett, 357 F.3d at 396. All doubts about jurisdiction
must be resolved in favor of remand. Id. at 403.
Plaintiff's Complaint does not seek a precise amount of damages. When a
complaint does not seek a precise damage amount, we may make an
independent appraisal of the value of the claim to determine whether the
requirements for diversity jurisdiction are met. Angus v. Shiley Inc., 989 F.2d 142, 146 (3d Cir. 1993). Besides the complaint, we
may look to the notice of removal, stipulations, and discovery evidence
to determine the value of the claim at issue. The Bachman Co. v.
MacDonald, 173 F. Supp.2d 318, 323 (E.D. Pa. 2001).
Pursuant to our February 27, 2004 Order, the parties engaged in
jurisdictional discovery with respect to the amount in controversy. After
discovery, the parties stipulated to the following facts: (1) the
insurance policy at issue allows a maximum of $25,000 in coverage; (2)
approximately $5,000 to $6,000 has been paid by Defendant against that
limit, leaving about $19,000 to $20,000 in coverage remaining under the
policy; (3) Plaintiff is still receiving treatment for her injuries and
bills for such treatment continue to be submitted to Defendant; (4) few
to none of the bills submitted to Defendant remain unpaid.*fn3 (Letter
of Moira Clare Duggan, dated March 31, 2004.)
Though there are few or no unpaid medical bills in dispute, Defendant
argues that the amount in controversy exceeds $75,000. Defendant claims
that the $19,000 to $20,000 in coverage remaining under the policy is in
dispute. When that amount is added to the amount that could be awarded in
punitive damages, attorneys' fees, and costs, Defendant claims the
jurisdictional threshold is met. We disagree. First of all, exclusive of
punitive damages, attorneys' fees, and costs, very little or no money
seems to be in dispute in this case. The parties agree that there are few
or no unpaid medical bills in dispute. Furthermore, there is no
indication that Defendant will refuse to pay any future bills submitted
to it on behalf of Plaintiff. Thus, it appears that punitive damages,
attorneys' fees, and costs will make up the bulk of any recovery to Plaintiff. In such a case, we must closely scrutinize the claims to
see if the jurisdictional threshold is met. See Wal-Mart Stores,
116 F. Supp.2d at 570 ("As with claims for attorneys' fees, [claims for
punitive damages] are subject to close scrutiny when, in order to satisfy
the [jurisdictional] threshold, they need to represent a large share of
any possible recovery.") (citing Meritcare Inc. v. St. Paul Mercury
Ins. Co., 166 F.3d 214, 222-23 (3d Cir. 1999)).
Defendant offers no evidence as to the amount of attorneys' fees and
punitive damages that could be awarded in this case. For example,
Defendant offers no evidence that this case is so complex that
Plaintiff's attorneys' fees will be substantial. Defendant also offers no
evidence that a substantial punitive damage award might be appropriate.
In short, Defendant asks that we conclude that a potential award of
punitive damages, attorneys' fees, and costs will exceed $75,000, without
any evidence that it will exceed that amount. It is the Defendant's
burden to show to a legal certainty that the amount in controversy
exceeds $75,000. "If this Court has to guess, defendant has not proved
its point." Irving v. Allstate Indem. Co., 97 F. Supp.2d 653, 656 (E.D.
Pa. 2000) (remanding case because the defendant presented no evidence
that the potential punitive damages, attorneys' fees, interests and costs
would combine with other damages to exceed the jurisdictional
threshold); Wal-Mart Stores, 116 F. Supp.2d at 570-71 (remanding case
because defendant did not meet its burden to show that the potential
damages would exceed the jurisdictional threshold). Defendant is asking
us to guess. Accordingly, we will remand this case to the state court.
An appropriate Order follows. ORDER
AND NOW, this 7th day of April, 2004, upon consideration of
Plaintiff's Motion to Remand (Doc. No. 5), it is ORDERED that Plaintiff's
Motion is GRANTED. It is further ORDERED that this matter shall be
REMANDED to the Court of Common Pleas of Philadelphia County.
IT IS SO ORDERED.