Charles et al v. GEICO General Insurance CO

Filing 12

Order on Motion to Remand

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ALASKA

JACK CHARLES and
BERNADETTE CHARLES,
Plaintiffs,

Case No. 4:06-cv-0004-RRB

vs.
GEICO GENERAL INSURANCE
COMPANY,

ORDER DENYING MOTION TO REMAND

Defendant.

I.

INTRODUCTION
Before

the

Court

are

Plaintiffs

Jack

Charles

and

Bernadette Charles with a Motion to Remand to State Court (Docket
No. 1) pursuant to 28 U.S.C. § 1447.

In particular, Plaintiffs

argue there is a local defendant in this action that defeats
diversity jurisdiction.

Defendant GEICO General Insurance Company

opposes at Docket No. 9 and argues removal is proper because: (1)
the State Court bifurcated the bad faith claims against it; and (2)
the bifurcated claims generally do not involve the local defendant.
The Court agrees.

ORDER DENYING MOTION TO REMAND - 1
4:06-CV-0004-RRB

II.

FACTS
This case involves an automobile collision which occurred

on May 3, 2004, in Bethel, Alaska.1
Complaint

for

Damages,

filed

on

Plaintiffs’ State Court

February

14,

2005,

alleged

Uninsured Motorist/Under Insured Motorist (UM/UIM) benefits against
Defendant. The uninsured driver, Valerie Joe (“Joe”), was added as
a party on May 31, 2005.2
case

by

Defendant

for

Plaintiffs as a party.3
bifurcated

Plaintiffs’

She was originally brought into this

subrogation

claims

and

then

added

by

Sometime thereafter, the State Court
claims

against

Joe

from

Plaintiffs’

contractual and statutory claims against Defendant.4
III. STANDARD OF REVIEW
A defendant removing a case to federal court has the
burden of establishing that the removal is proper.5

A suit may be

removed if removal jurisdiction pursuant to 28 U.S.C. § 1441 exists
and the procedures for removal at 28 U.S.C. § 1446 are followed.
Nevertheless, courts must strictly construe the removal statutes

1

Clerk’s Docket No. 2 at 1 (citation omitted).

2

Id. (citations omitted).

Plaintiffs and Joe are Alaska

citizens.
3

Id. at 3.

4

“[Joe] is not a party to the bifurcated claims against
[Defendant].” Clerk’s Docket No. 9 at 2 (emphasis added).
5

Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992).

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4:06-CV-0004-RRB

against removal and must reject removal jurisdiction if there is
any doubt as to whether the removal is proper.6
IV.

DISCUSSION
Citing American Car & Foundry Co. v. Kettelhake, 236 U.S.

311, 316 (1915)(holding that “[t]he resident defendants must have
so completely disappeared from the case as to leave the controversy
one

entirely

corporation.”);

between
and

the

Lemos

v.

plaintiff
Fencl,

828

and
F.2d

a

non-resident
616

(9th

Cir.

1987)(where a question of law similar to the one presented in this
matter was deemed “interesting” but not resolved), Plaintiffs argue
28 U.S.C. § 1332 plainly bars removal because “[t]his case does not
involve a dismissal of . . . Joe, nor does it involve, as is
required, a resident defendant who completely disappeared from the
case.”7

However, despite Plaintiffs’ argument, the Court notes

that it has the ability to ignore the citizenship of “nominal or
formal parties who have no interest in the action.”8
In determining whether Joe is a nominal or formal party
without interest, “the Court examines, among other things, the
substantiality of her stake in this action and her level of control
6

Id.

7

Clerk’s Docket No. 2 at 4 (emphasis added).

8

“Defendants who are nominal parties with nothing at stake
may be disregarded in determining diversity, despite the propriety
of their technical joinder.” Strotek Corp. v. Air Transport Ass’n.
of America, 300 F.3d 1129, 1133 (9th Cir. 2002)(citations omitted).
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4:06-CV-0004-RRB

over the course of the litigation.”9

Having done so, the Court

concludes Joe “is named only as a means to a more substantial end,
namely the establishment of her liability for resulting damages to
[Plaintiffs] so as to trigger Defendant’s inchoate obligation to
pay on its [UM/UIM] coverage.”10

Accordingly, the Court further

concludes Joe is a nominal party - at best - whose “citizenship can
be disregarded for purposes of the jurisdictional inquiry.”
V.

CONCLUSION
For

this

reason,

and

because

the

Court

concludes

Defendant’s notice of removal was timely, see Clerk’s Docket No. 8,
Affidavit of Karen S. Burns, Plaintiffs’ Motion to Remand to State
Court (Docket No. 1) is hereby DENIED.
ENTERED this 24th day of April, 2006.
/s/ RALPH R. BEISTLINE
UNITED STATES DISTRICT JUDGE

9

Kidd v. Gilfilen, 170 F. Supp. 2d 649, 651 (S.D. W. Va.
2001).
Although not authoritative, the Kidd decision is
particularly persuasive.
10

Id. at 652 (citation omitted).

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