Ledesma v. Phillips et al

Filing 8

ORDER: Defendants are ORDERED to file supplemental evidence and/or briefing demonstrating subject matter jurisdiction on or before 12/13/2024, ase set out. Signed by District Judge William H. Steele on 11/26/2024. (cjr)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
KEILER LEDESMA, etc.,
Plaintiff,
v.
ROBERT J. PHILLIPS, etc., et al.,
Defendants.

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) CIVIL ACTION 24-0419-WS-B
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ORDER

This recently removed action is before the Court upon its sua sponte review of its
subject matter jurisdiction.1 Upon such review, the Court is unable to confirm that such
jurisdiction exists.
Removal is predicated upon diversity of citizenship. As the party seeking a
federal forum, the defendants bear the burden of demonstrating both that the parties are
of diverse citizenship and that the amount in controversy exceeds $75,000, exclusive of
interest and costs. E.g., Adventure Outdoors, Inc. v. Bloomberg, 552 F.3d 1290, 1294
(11th Cir. 2008); Scimone v. Carnival Corp., 720 F.3d 876, 882 (11th Cir. 2013). The
defendants have adequately demonstrated the existence of complete diversity but not the
requisite amount in controversy .
According to the complaint, (Doc. 1-3 at 3-18), the plaintiff was driving his
vehicle south on Interstate 65 when the individual defendant, operating a tractor trailer
and acting within the line and scope of his employment by, or agency for, the corporate

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“Courts have an independent obligation to determine whether subject-matter jurisdiction
exists, even when no party challenges it.” Hertz Corp. v. Friend, 559 U.S. 77, 94 (2010).
Because, “once a federal court determines that it is without subject matter jurisdiction, the court
is powerless to continue,” it “should inquire into whether it has subject matter jurisdiction at the
earliest possible stage in the proceedings.” University of South Alabama v. American Tobacco
Co., 168 F.3d 405, 410 (11th Cir. 1999).

defendant, changed lanes, striking the plaintiff’s vehicle and causing it to land against the
center median. The complaint asserts claims for negligence/wantonness,
negligent/wanton entrustment, respondeat superior, and negligent/wanton hiring, training,
and supervision.
The complaint alleges that the plaintiff experienced physical injuries in the form of
an annular bulge in his lumbar spine, neck pain, and other, unidentified injuries. Under
each count, the plaintiff seeks an award for physical injury, pain and suffering, medical
expenses, out-of-pocket expenses, lost income, property damage and loss, loss of
enjoyment of life, inconvenience, and emotional distress, plus punitive damages under
the wantonness prongs of his claims.
The complaint does not demand a sum certain but only such damages as are
determined by a jury. “[W]here jurisdiction is based on a claim for indeterminate
damages, ... the party seeking to invoke federal jurisdiction bears the burden of proving
by a preponderance of the evidence that the claim on which it is basing jurisdiction meets
the jurisdictional minimum.” Federated Mutual Insurance Co. v. McKinnon Motors,
LLC, 329 F.3d 805, 807 (11th Cir. 2003). “[A] removing defendant must prove by a
preponderance of the evidence that the amount in controversy more likely than not
exceeds the … jurisdictional requirement.” Roe v. Michelin North America, Inc., 613
F.3d 1058, 1061 (11th Cir. 2010) (internal quotes omitted); accord 28 U.S.C. §
1446(c)(2)(B). A defendant may demonstrate that the amount in controversy is facially
apparent from the complaint itself, or it may offer evidence beyond the pleading to meet
its burden. Roe, 613 F.3d at 1061. The defendants, acknowledging their burden, (Doc. 1
at 5-6), rely on both the complaint and external evidence to meet it.
The defendants first argue that the plaintiff’s hard damages are at least $28,000.
They have submitted evidence that there is a hospital lien for $7,364.35, and there are
indications that the plaintiff’s medical bills may be higher, based on physical therapy
ongoing as of October 2024 (eight months after the incident). (Doc. 1 at 7-8; Docs. 1-8,
1-9). However, the defendants’ evidence is ambiguous as to whether the cost of physical
therapy is included in the $7,364.35 figure. Even if it is not, the defendants have
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presented the Court no non-speculative means of estimating the magnitude of such
expense.2
The bulk of hard damages identified by the defendants is in the form of property
damage. They have presented evidence that the plaintiff’s insurer totaled the vehicle and
that its pre-incident actual cash value was $20,722. (Doc. 1-10 at 2). In or before May
2024, the plaintiff and his insurer settled the property damage for an unknown amount.
(Doc. 1-9 at 2). The defendants say it does not matter how much the plaintiff received
from his insurer because, under Alabama law, an insured can recover from a tortfeasor
the full pre-incident value of his totaled vehicle, not just the difference between that value
and what the insured received in insurance benefits. (Doc. 1 at 7-8).
“It is well settled that the amount paid by an insurer to a plaintiff for damage to his
vehicle does not affect his measure of recovery and that evidence of an insurance
payment is not ordinarily admissible.” Jones v. Carter, 646 So. 2d 651, 653 (Ala. 1994).
This proposition represents an application of the collateral source rule. Ex parte Barnett,
978 So. 2d 729, 732 (Ala. 2007). The case on which the defendants rely applied this
principle. Larousse v. Hammond, 2018 WL 1956121 at *4 (S.D. Ala. 2018).
There is, however, a wrinkle that the defendants have not addressed. “Generally,
payment of a loss by an insurer gives that insurer subrogation rights to reimbursement –
either as a matter of law upon full payment of that loss or as a matter of contract when an
insurance policy modifies the full-payment prerequisite – but does not divest the insured
of the legal right to pursue an action against a party responsible for that loss.” Broadnax
v. Griswold, 17 So. 3d 656, 659 (Ala. Civ. App. 2008). However, at least when the
insurer “ma[kes] a payment to fully compensate the owner for her damaged automobile
pursuant to the terms of its policy (less the applicable … deductible),” and when “[t]hat
policy expressly provides that when the insurer makes a payment to or on behalf of a

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The defendants correctly note that a court may review the evidence through the filter of
“judicial experience and common sense.” Roe, 613 F.3d at 1062. The Court, however, “cannot
speculate or hypothesize about facts that are not in the record.” Fox v. Ritz-Carlton Hotel
Company, L.L.C., 977 F.3d 1039, 1048 (11th Cir. 2020).
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person with respect to a covered loss and that person also has rights of recovery from
another with respect to that same loss, those rights are transferred to the insurer,” the
insurer’s payment “divest[s] the owner of any right she might have had to recover
damages from the driver and ma[kes] the insurer the ‘real party in interest’ under Rule
17(a) ….” Id. at 660.
The defendants have not addressed this principle, and the Court has no nonspeculative means of assessing whether the insurer’s payment and policy implicate it.
This is relevant to the jurisdictional analysis because, “[w]hen state law precludes the
recovery of a form of damages demanded by the plaintiff, that form of damages may not
be considered in determining whether the jurisdictional threshold is met.” SUA
Insurance Co. v. Classic Home Builders, LLC, 751 F. Supp. 2d 1245, 1253 (S.D. Ala.
2010).
Even were the Court to assume the full $28,086.35 in hard damages asserted by
the defendants, they have not shown by a preponderance of the evidence that the amount
in controversy exceeds $75,000. The defendants seek to do so principally by invoking a
2:1 or 3:1 ratio of punitive damages to compensatory damages. (Doc. 1 at 8-11). The
Court has rejected such a gambit in the past, Cote v. Emerald Coast RV Center, LLC,
2023 WL 2485783 at *2 (S.D. Ala. 2023), and the defendants neither acknowledge Cote
nor explain why the Court should reconsider it.
In a related vein, the defendants cite McDaniel v. Fifth Third Bank, 568 Fed.
Appx. 729 (11th Cir. 2014), for the proposition that the Court must consider all punitive
damages that “could” be awarded, up to the statutory cap of $500,000. (Doc. 1 at 8, 11).
The Court has previously dismissed McDaniel as an unpersuasive non-binding opinion,
Mosley v. State Farm Fire and Casualty Co., 2022 WL 2287927 at *3 (S.D. Ala. 2022),
and the defendants have neither addressed Mosley nor given the Court grounds to
reconsider it.
Returning to compensatory damages, the defendants argue that the plaintiff’s
listing of soft damages (including pain and suffering, emotional distress, and loss of
enjoyment), plus unquantified hard damages for lost wages, when “aggregated” with the
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purported $28,000 in damages for medical bills and property damage and some
unquantified measure of punitive damages, more likely than not places over $75,000 in
controversy. (Doc. 1 at 11-13). The defendants point to this Court’s decision in Sims v.
Valluzzo, 2016 WL 3211430 (S.D. Ala. 2016), as exemplifying this approach.
The defendants’ proposal – simply to assume from a complaint’s laundry list of
damages that more than $75,000 is in controversy – is not the law. In Williams v. Best
Buy Co., 269 F.3d 1316 (11th Cir. 2001), the complaint alleged that the plaintiff tripped
over a curb, that she suffered permanent physical and mental injuries, incurred substantial
medical expenses, suffered lost wages, experienced a diminished earning capacity, and
that she would continue to suffer these damages in the future, and it demanded both
compensatory and punitive damages. Id. at 1318. The Eleventh Circuit held that, based
on these allegations, “it is not facially apparent from [the] complaint that the amount in
controversy exceeds $75,000.” Id. at 1320. As Williams makes clear, “merely listing
categories of damage does not satisfy the [removing defendant’s] burden.” Robinson v.
Clayton, 2012 WL 6028940 at *2 (S.D. Ala. 2012).
Sims is not to the contrary. What the Court “aggregate[d]” in Sims was not
elements of damage, but “circumstances.” 2016 WL 3211430 at *4. One of those
circumstances was the complaint’s demand for recovery for pain and suffering, emotional
distress/mental anguish, and punitive damages, but there were other circumstances more
salient: (1) the plaintiff’s known hard damages of over $28,000; (2) the plaintiff’s
testimony, given almost two years after the incident, that she continued to be in constant
pain and with restricted motion and that she had foregone medical treatment for lack of
insurance, which was evidence both that the plaintiff’s compensable pain and suffering
was long-term and that addressing her residual physical issues would require “substantial
additional medical treatment”; and (3) a settlement demand for $295,000, made almost
two years after the incident and with full awareness of the details of the case, which
demand was “grounded in a reasonable assessment of how [the plaintiff] valued her
claim.” Id. at *3-4. Nothing in Sims remotely supports the proposition that a complaint’s
laundry list of damages sought, alone or in combination with hard damages of under
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$30,000, establishes by a preponderance of the evidence that the amount in controversy
more likely than not exceeds $75,000.
Finally, the defendants assert that plaintiff’s counsel “has not stipulated that the
damages Plaintiff is seeking will not exceed $75,000.” (Doc. 1 at 12). The defendants
offer no evidence of such a refusal, or even of a request for such a stipulation. In any
event, “[t]here are several reasons why a plaintiff would not stipulate, and a refusal to
stipulate standing alone does not satisfy [a removing defendant’s] burden of proof on the
jurisdictional issue.” Williams, 269 F.3d at 1320.
In sum, the defendants have failed to demonstrate the Court’s subject matter
jurisdiction. They are accordingly ordered to file and serve, on or before December 13,
2024, such supplemental evidence and/or briefing as they deem sufficient to satisfy their
burden, failing which this action will be remanded to state court without further notice.
DONE and ORDERED this 26th day of November, 2024.
s/ WILLIAM H. STEELE
UNITED STATES DISTRICT JUDGE

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