Riley v. State Farm Mutual Automobile Insurance Company et al
MEMORANDUM OPINION AND ORDER: it is ORDERED that the Plff's motion to remand (doc. 9 ) is DENIED, as further set out in order. Signed by Chief Judge Emily C. Marks on 10/7/2021. (es, ) (Main Document 14 replaced on 10/7/2021 to correct typographical error contained in heading of the document) (qc/djy, ).
Case 3:21-cv-00401-ECM-SRW Document 14 Filed 10/07/21 Page 1 of 10
IN THE UNITED STATES DISTRICT COURT FOR
THE MIDDLE DISTRICT OF ALABAMA
OPHELIA RILEY, individually and as
administrator of the Estate of
STATE FARM MUTUAL INS. CO., and
PROGRESSIVE CASUALTY INS. CO.,
) CIVIL CASE NO. 3:21-cv-401-ECM
MEMORANDUM OPINION and ORDER
Now pending before this action is Plaintiff Ophelia Riley’s (“Riley”) motion to
remand (doc. 9) which is opposed by Defendants Progressive Casualty Insurance Company
(“Progressive”) and State Farm Mutual Insurance Company (“State Farm”). (Docs. 11
and 12). The motion is fully briefed, under submission, and ready for resolution without
In this action, Riley alleges that on or about October 20, 2019, she sustained serious
injuries and her husband died in an automobile collision in Jefferson County, Alabama.
(Doc. 1-1, at 2-3). Individually, and as administrator of Tommie Riley’s estate, Riley
initiated this suit on April 30, 2021, by filing a complaint in the Circuit Court of Macon
County, Alabama. (Doc. 1-1). Riley alleges claims of negligence, recklessness and
wantonness, and wrongful death against fictitious defendants as well as claims of
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underinsured/uninsured motorist coverage against Progressive and State Farm. (Id.) She
seeks compensatory and punitive damages against the Defendants. (Id.).
State Farm removed this case from state court on the basis of diversity jurisdiction.
28 U.S.C. §§ 1332 and 1441. Progressive consented to the removal. (Doc. 1-6). Ophelia
Riley is, and Tommie Riley was, a citizen of the State of Alabama. The notice of removal
asserts that State Farm is a foreign corporation organized under the laws of the state of
Illinois with its principal place of business in Illinois, and Progressive is a foreign
corporation organized under the laws of Ohio with its principal place of business in Ohio.
(Doc. 1 at 2).
Although Riley seeks compensatory and punitive damages, her complaint does not
specify an amount of damages. In its notice of removal, State Farm asserts that the Court
has jurisdiction over this matter because the parties are citizens of different states and the
amount in controversy exceeds $75,000.00. Specifically, State Farm asserts that it is
apparent from the complaint that the amount in controversy exceeds the jurisdictional
threshold because the Plaintiff seeks compensatory and punitive damages for the negligent
and/or wanton death of Tommie Riley and for serious injuries she sustained in the collision.
In addition, the “Plaintiff’s counsel submitted a letter dated February 23, 2021
communicating a pre-suit demand of $150,000 to State Farm.” (Id.).
In response to the notice of removal, Riley filed a motion to remand asserting that
the parties are not diverse because State Farm “has not met its burden of proving complete
diversity of citizenship and the amount in controversy exceeds $75,000.” (Doc. 9 at 2).
Specifically, Riley argues that State Farm “has conducted so much business activity in the
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state of Alabama that it can be considered a citizen of Alabama.” (Id. at 4). She further
argues that “it is not ‘facially apparent’ that the amount in controversy exceeds $75,000”
and her demand letter should be “construed as an attempt at posturing” rather than a
measure of damages. (Id. at 6).
Upon consideration of the motion to remand, and for the reasons that follow, the
Court concludes that the motion is due to be DENIED.
Jurisdiction over this action is premised on the Court’s diversity jurisdiction
pursuant to 28 U.S.C. § 1332. Personal jurisdiction and venue are uncontested.
III. STANDARD OF REVIEW
In examining the issue of jurisdiction upon which the Defendants premise removal,
the Court is mindful of the fact that federal courts are courts of limited jurisdiction.
Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994); Burns v. Windsor
Ins. Co., 31 F.3d 1092, 1095 (11th Cir. 1994). “They possess only that power authorized
by Constitution and statute.” Dudley v. Eli Lilley & Co., 778 F.3d 909, 911 (11th Cir. 2014).
However, “[a]ny civil case filed in state court may be removed by the defendant to
federal court if the case could have been brought originally in federal court.” Tapscott v.
MS Dealer Serv. Corp., 77 F.3d 1353, 1356 (11th Cir. 1996) (citing 28 U.S.C. § 1441(a)),
abrogated on other grounds by Cohen v. Office Depot, Inc., 204 F.3d 1069 (11th Cir.
2000)). The removal statute requires the notice of removal to “[contain] a short and plain
statement of the grounds for removal . . . .” 28 U.S.C. § 1446(a). The Supreme Court has
interpreted the provision to have the same liberal pleading standard as that of a complaint
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in federal court. See Dart Cherokee Basin Operating Co. v. Owens, 574 U.S. 81, 87 (2014)
(“Congress, by borrowing the familiar ‘short and plain statement’ standard from Rule 8(a),
intended to ‘simplify the “pleading” requirements for removal’ and to clarify that courts
should ‘apply the same liberal rules [to removal allegations] that are applied to other
matters of pleading.’”) (quoting H.R.Rep. No. 100–889, p. 71 (1988)).
“In a motion to remand, the removing party bears the burden of showing the
existence of federal jurisdiction.” Pacheco de Perez v. AT&T Co., 139 F.3d 1368, 1373
(11th Cir. 1998). Any questions or doubts are to be resolved in favor of returning the matter
to state court on a properly submitted motion to remand. Burns, 31 F.3d at 1095.
The Defendants removed this case solely on the basis of diversity jurisdiction. Riley
argues that because the insurance contract was signed in Alabama, State Farm has initiated
lawsuits in Alabama, and it has a registered agent in Alabama, State Farm should be
considered a citizen of Alabama, and thus there is not complete diversity of citizenship.
(Doc. 9 at 4).
There is no dispute that Ophelia Riley is, and Tommie Riley was, a citizen of
Alabama. Riley also does not dispute that Progressive is considered a citizen of Ohio for
jurisdictional purposes. The first question the Court must answer is whether State Farm is
considered a citizen of Alabama where it conducts some business in the state or whether it
is a citizen of Illinois where it is incorporated and has its principal place of business.
“[A] corporation shall be deemed to be a citizen of every State and foreign state by
which it has been incorporated and of the State or foreign state where it has its principal
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place of business.” 28 U.S.C. § 1332(c)(1). In Hertz Corp. v. Friend, the Supreme Court
determined that, for jurisdictional purposes, a corporation’s principal place of business is
where “a corporation’s officers direct, control, and coordinate the corporation’s activities.”
559 U.S. 77, 92–93 (2010).
And in practice it should normally be the place where the
corporation maintains its headquarters—provided that the
headquarters is the actual center of direction, control, and
coordination, i.e., the “nerve center” and not simply an office
where the corporation holds its board meetings (for example,
attended by directors and officers who have traveled there for
Id. at 93.
In asserting that State Farm should be considered a citizen of Alabama because it
conducts business in the state, the Plaintiff relies on Industrial Tectonics, Inc. v. Aero Alloy,
912 F.2d. 1090 (9th Cir. 1990). (Doc. 9 at 4). Her reliance is misplaced. In Hertz Corp.,
the Court rejected a “business activities” test to determine a corporation’s principal place
of business. Hertz Corp., supra. State Farm asserts that for jurisdictional purposes, its
principal place of business is in Illinois. The Plaintiff presents nothing to dispute that State
Farm is incorporated in Illinois and its corporate headquarters is located there.
Consequently, the Court concludes that State Farm is a citizen of Illinois for the purpose
of establishing diversity jurisdiction, and thus, there is complete diversity between the
The Court does not consider the citizenship of any potential fictitious parties for the purpose of
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The Court turns next to Riley’s contention that the Defendants have failed to
establish the amount of controversy exceeds the jurisdictional threshold. (Doc. 9 at 4).
Relying on the Plaintiff’s pre-suit demand letter dated January 13, 2021, Progressive argues
that the demand letter is sufficient to establish that the amount in controversy exceeds
$75,000. (Doc. 11-3). In addition, Progressive asserts that the demand for the policy limits
of $150,000 demonstrates that the amount in controversy exceeds $75,000. Finally,
Progressive contends that because this case involves claims of negligence, wantonness and
wrongful death, it is apparent from the face of the complaint that the amount in controversy
The complaint does not state an amount of damages.
Where the amount in
controversy is not evident from the face of the complaint, the removing party must
demonstrate by a preponderance of the evidence that the amount in controversy exceeds
the $75,000 jurisdictional minimum set by 28 U.S.C. § 1332. Pretka v. Kolter City Plaza
II, Inc., 608 F.3d 744, 752 (11th Cir. 2010); Lowery v. Ala. Power Co., 483 F.3d 1184,
1207 (11th Cir. 2007). The Plaintiff argues that it is not facially apparent from the
complaint that the amount in controversy exceeds $75,000, the Defendants have not met
their burden of establishing the amount in controversy and the pre-suit demand letter
“should be construed as an attempt at posturing for the purposes of settlement
negotiations.” (Doc. 9 at 6).
Because the Plaintiff did not specify an amount of damages in her complaint, and
because the Defendants removed this case within thirty (30) days of receipt of the
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complaint, the Court concludes that the Defendants must establish by a preponderance of
the evidence that the amount in controversy is met.
In response to the motion to remand, Progressive attached a pre-suit demand letter
from Riley’s counsel dated January 13, 2021, that offers to settle all of Ophelia’s claims
for the policy limits of $150,000. (Doc. 11-3 at 2-3). The letter describes in detail Ophelia’s
injuries, her medical expenses, and the mental anguish she continues to suffer. “As a result
of the crash, Mrs. Riley suffered injuries and unfortunately, her husband lost his life. Mrs.
Riley lives each day with the haunting memories of this fatal crash.” (Id. at 2). Counsel
described Ophelia’s injuries as “right scalp hematoma, left heel laceration, hematoma to
left anterior thigh, and left cuboid (foot) fracture.” (Id.). She continued to suffer pain and
was subsequently diagnosed with “displaced avulsion fracture (chip fracture) of the left
talus.” (Id.). The demand letter enumerated Riley’s medical expenses from seven (7)
medical providers as of the date of the letter as $65,255.44. (Id. at 3). It further stated that
Riley will continue to have pain and suffering from the injuries. Counsel then demanded
the policy limits of $150,000 to compensate Ophelia Riley. (Id.)
After the Defendants removed the case to this Court, and after Riley filed her motion
to remand, on July 8, 2021, counsel sent Progressive another demand letter requesting
$130,000 to “resolve her claim.” (Doc. 11-4 at 2). “Mrs. Riley endured severe injuries and
this accident has been life-changing to say the least.” (Id.).
There is little dispute that “[a] settlement offer can constitute an ‘other paper’ within
the meaning of 28 U.S.C. § 1446(b).” Lowery, 483 F.3d at 1212 n.62. And “[w]hile [a]
settlement offer, by itself, may not be determinative, it counts for something.” Burns, 31
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F.3d at 1097. Riley contends that her pre-suit demand letter was nothing more than “an
attempt at posturing for purposes of settlement negotiations prior to filing the subject
lawsuit.” (Doc. 9 at 6). Relying on Jackson v. Select Portfolio Servicing, Inc., 651 F. Supp.
2d 1279 (S.D. Ala. 2009), Riley suggests that her first letter constituted “puffing and
posturing.”2 (Id. at 6).
When a settlement letter provides little in the way of support or analysis, courts have
afforded such settlement offers little weight --writing them off as “puffing and posturing.”
Jackson, 651 F. Supp. 2d at 1281 (A settlement offer has “little weight” in the amount-incontroversy calculus when it merely “reflect[s] puffing and posturing.”); Perkins v. Merion
Realty Servs., LLC, 2015 WL 998198, *2 (M.D. Ala. 2015) (a settlement letter that “fails
to provide particularized information and a reasonable assessment of value . . . is indicative
of posturing and abstract assessments.”). However, in contrast, “when a settlement offer
provides enough specific information to support the plaintiff’s claim for damages to
indicate that the offer is a reasonable assessment of the value of the plaintiff’s claim, it is
afforded additional weight.” Capps v. Winn-Dixie Stores, Inc., 2019 WL 5688148, *2
(M.D. Ala. 2019) (internal quotations removed); Boland v. Auto-Owners Ins. Co., 2009
WL 4730681, *3 (M.D. Ala. 2009).
The Plaintiff’s demand letter set forth in detail her injuries, medical expenses, and
damages. It explains the nature of Riley’s injuries, and how her injuries would support
damages in the amount of $150,000. This is not a case where the Plaintiff made conclusory
Riley does not reference her second letter. Nor does she mention that Progressive has agreed to pay
uninsured motorist benefits to the Estate of Tommie Riley in the amount of the policy limits of $150,000.
(Doc. 11 at 1).
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and vague assertions about her injuries. The comprehensive description of Riley’s injuries
and medical expenses justifying her damages moves this case from the realm of puffery
and posturing into a concrete assessment of damages. Only after facing the possibility of
having her case remain in federal court does the Plaintiff characterize her settlement
demand as “puffing and posturing.”
So, plaintiff’s claim, when it is specific and in a pleading
signed by a lawyer, deserves deference and a presumption of
truth. We will not assume – unless given reason to do so – that
plaintiff’s counsel has falsely represented, or simply does not
appreciate, the value of his client’s case. Instead, we will
assume that plaintiff’s counsel best knows the value of his
client’s case and that counsel is engaging in no deception. We
will further presume that plaintiff’s counsel understands that,
because federal removal jurisdiction is in part determined by
the amount of damages a plaintiff seeks, the counsel’s choices
and representations about damages have important legal
consequences and, therefore, raise significant ethical
implications for a court officer.
Burns, 31 F.3d at 1095. The Court will take Plaintiff’s counsel at her word and credit her
assessment of her client’s case as valued at $150,000, an amount which more than exceeds
the Court’s jurisdictional requirement.
Furthermore, in Roe v. Michelin N. Am., Inc., the Eleventh Circuit held that, when
a case is removed on the basis of an initial complaint that does not plead a specific amount
of damages, the removing defendant is required to show by a preponderance of the
evidence that more likely than not the amount in controversy exceeds the jurisdictional
minimum. 613 F.3d 1058, 1061 (11th Cir. 2010). Under Roe, this Court can apply “judicial
experience and common sense” to the allegations of the complaint regarding Riley’s
injuries and determine that, more likely than not, when coupled with her mental anguish
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and medical expenses of $65,225.44 in January 2021, Riley’s damages are sufficient to
meet the jurisdictional minimum.
Moreover, Progressive asserts that that the Rileys had insurance policies with bodily
injury liability limits of $100,000 per person, $300,000 per accident and
uninsured/underinsured motorist limits of $50,000 per person, $100,000 per accident.
(Doc. 11-2 at 2). “Put simply, a district court need not “suspend reality or shelve common
sense in determining whether the face of a complaint ... establishes the jurisdictional
amount.” Roe, 613 F3d at 1062. Common sense dictates that the wrongful death claim of
Tommie Riley, and
Ophelia Riley’s claim for damages, each easily exceed the
jurisdictional threshold of $75,000.3
Riley’s motion to remand relies entirely on lack of diversity. Because there is
complete diversity between the parties, and the amount in controversy exceeds $75,000,
the Court concludes that removal was proper.
Accordingly, for the reasons as stated, and for good cause, it is
ORDERED that the Plaintiff’s motion to remand (doc. 9) is DENIED.
DONE this 7th day of October, 2021.
/s/ Emily C. Marks
EMILY C. MARKS
CHIEF UNITED STATES DISTRICT JUDGE
Even if the Court were to apply the heightened “unambiguously established” standard set out in Lowery,
the result would be the same. The Court concludes that the Defendants have established that the amount in
controversy is met.
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