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Crawford v. Allstate Insurance Co.

August 31, 2009

CRYSTAL CRAWFORD PLAINTIFF,
v.
ALLSTATE INSURANCE COMPANY, AND HUGH DONAGHUE, ESQ., DEFENDANTS.



The opinion of the court was delivered by: Buckwalter, S. J.

MEMORANDUM

Presently before this Court are two separate Motions to Dismiss-one filed by Defendant Allstate Insurance Company ("Allstate"), and the other by Defendant Hugh Donaghue ("Donaghue"). Plaintiff, Crystal Crawford, responded to Donaghue's Motion to Dismiss, and both Defendants replied accordingly. For the reasons discussed below, this Court determines that it does not have jurisdiction over the claims filed against Defendant Donaghue. The claims against Defendant Allstate are dismissed as they identical to the claims asserted in Crawford's prior filing with this Court.

I. PROCEDURAL BACKGROUND

"On or about October 31, 2008," Crawford filed suit against the Defendants in the Philadelphia Court of Common Pleas. (Allstate's Notice of Removal ¶ 1.) This Complaint ("Common Pleas Complaint") largely mirrors the Complaint she filed with this Court in September 2007 ("Federal Complaint").*fn1 The only difference is that the Common Pleas Complaint included a claim against Defendant Donaghue while the Federal Complaint did not.

Allstate removed the Common Pleas suit to the Eastern District of Pennsylvania,*fn2 and subsequently filed a Motion to Dismiss the Common Pleas Complaint. (Docket Nos. 1 & 4.) Donaghue thereafter filed a Motion to Dismiss. (Docket No. 6.) Crawford responded to Donaghue's Motion to Dismiss. (Docket Nos. 8, 11, 13, & 14.) Allstate replied to Crawford's Responses. (Docket Nos. 9 & 13.)

II. FACTUAL BACKGROUND

Crawford's suit arises from her efforts to resolve an insurance claim with her insurer, Allstate. On September 8, 2005, Crawford was injured when the car she was driving was rear-ended. (Compl. ¶¶ 4-6.) The driver of the other vehicle was not insured. As a result, Crawford sought to recover the entire $100,000 UM and $5,000 in wage loss limits contained in her Allstate policy. When Allstate indicated that it was unable to determine if it was a "policy limits" case, Crawford demanded arbitration. (Id. at ¶ 7.) Allstate made Crawford a $75,000 settlement offer which she refused. (Id. at ¶¶ 12-13.)

Crawford sought to learn the basis for Allstate's decision to offer less than the full policy amount by obtaining "medical reports and records of the plaintiff in the possession of the defendant" including "requests for records which pre-existed the auto accident in question. Additionally, the plaintiff requested the defendant to admit, deny, or object to various Requests for Admissions, including the fact that the other motorist lacked insurance." (Id. at ¶ 9.) Subsequently, "plaintiff filed a motion with arbitrators to compel the production of the medical records, including the medical records upon which the defendant was relying to show prior injuries. After the defendant made it necessary to file a Motion to compel production, the defendant provided the records on June 22, 2007." (Id. at ¶ 15.) Eventually, Allstate offered Crawford both the $100,000 UM policy limit and the $5,000 wage loss policy limit. She accepted both offers. (Id. at ¶ 17.)

III. JURISDICTION

Before examining the merits of Defendants' Motions to Dismiss, this Court must determine whether it possesses jurisdiction over this suit. There is no question that this Court has jurisdiction over Crawford's Federal Complaint as the amount in controversy exceeds $75,000 and there is complete diversity. See 28 U.S.C. § 1332. But it is less certain that this Court possesses jurisdiction over the Common Pleas Complaint given the absence of complete diversity between Crawford and Donaghue, both of whom reside in the Commonwealth of Pennsylvania. See Strawbridge v. Curtis, 7 U.S. (3 Cranch) 267 (1806); Carden v. Arkoma Assoc., 494 U.S. 185, 199 (1990)

Assuming complete diversity, state court suits may be removed to federal court if the federal courts could have exercised original jurisdiction over the matter.*fn3 The removing party bears the burden of proving that federal subject matter jurisdiction exists. Samuel-Bassett v. Kia Motors Am., Inc., 357 F.3d 392, 396 (3d Cir. 2004). A case removed to federal court will be remanded to state court "[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction" over the claim. 28 U.S.C. § 1447(c).

Allstate avers that removal is appropriate as "the amount in controversy exceeds $75,000 exclusive of interest and costs, and the proper parties to this action are citizens of different states." (Allstate's Notice of Removal ¶ 4) (emphasis added.) Allstate's emphasis on "the proper parties" is made clear by its assertion that "Defendant Donaghue is a citizen of the Commonwealth of Pennsylvania who has been fraudulently joined in this case solely for the purpose of defeating diversity and preventing removal of this cause to this Court." (Id. at ¶ 8.)

Fraudulent joinder does not refer to "fraud" in the traditional, legal sense. Rather, joinder is fraudulent "'where there is no reasonable basis in fact or colorable ground supporting the claim against the joined defendant, or no real intention in good faith to prosecute the action against the defendants or seek a joint judgment.'" Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990), cert. denied, 498 U.S. 1085 (1991) (quoting Abels v. State Farm Fire & Cas. Co., 770 F.2d 26, 29 (3d Cir. 1985)).*fn4 The removing party carries a "heavy burden of persuasion" in making a showing of fraudulent joinder. Steel Valley Auth. v. Union Switch & Signal Div., 809 F.2d 1006, 1012 n.6 (3d Cir. 1987). Further, "'[i]f there is even a possibility that a state court would find that the complaint states a cause of action against any one of the resident defendants, the federal court must find that joinder was proper and remand the case to state court.'" Boyer, 913 F.2d at 111 (quoting Coker v. Amoco Oil Co., 709 F.2d 1433, 1440-41 (11th Cir. 1983)). District courts must "focus on the plaintiff's complaint at the time the petition for removal was filed. In so ruling, the district court must assume as true all factual allegations of the complaint." Steel Valley, 809 F.2d at 1010 (citation omitted).

Further, a district court's analysis must be carefully cabined as examination of a fraudulent joinder claim is not as exacting as when reviewing a motion to dismiss. See Batoff v. State Farm Ins. Co., 977 F.2d 848, 852 (3d Cir. 1992) (stating that "inquiry into the validity of a complaint triggered by a motion to dismiss under Rule 12(b)(6) is more searching than that permissible when a party makes a claim of fraudulent joinder."); see also 5B Wright and A. Miller, FEDERAL PRACTICE AND PROCEDURE ยง 1350, n.39 (2009) ("When a Rule 12(b)(6) motion is joined with a motion ...


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