Roman, Jr. et al v. Travelers Home and Marine Insurance Company et al

Filing 24

ORDER: IT IS ORDERED denying Plaintiffs' Motion to Dispute, Oppose and Dismiss Defendant's Petition for Removal of Action from State Court (Arizona), (Doc. #7 ). IT IS FURTHER ORDERED denying Plaintiffs' Motion for Entering a Default Judgment, (Doc. #15 ). IT IS FURTHER ORDERED denying Plaintiffs' Motion for Court Order to Secure Appearance of a Pro Per Prisoner to Attend Court Ordered Scheduling Conference, (Doc. #14 ) IT IS FURTHER ORDERED granting Plaintiffs' Motion for Leave to Appear Telephonically (Doc. #23 ) at the Rule 16 conference, but Plaintiff will be responsible for arranging the call himself as specified above. Plaintiff shall give a copy of this Order permitting his telephonic appearance to the appropriate staff at the prison to allow his access to the Court. IT IS FINALLY ORDERED that Plaintiff's request to file an independent case management plan (Doc. #22 ) is denied; the parties may exchange and approve a joint case management plan by mail [see attached Order for details]. Signed by Senior Judge James A Teilborg on 9/11/17.(MAW)

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1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Jose Roman, Jr., et al., Plaintiffs, 10 11 ORDER v. 12 No. CV-17-08151-PCT-JAT Travelers Home and Marine Insurance Company, et al., 13 Defendants. 14 15 Pending before the Court are Plaintiffs Jose Roman, Jr. and Stacy Roman’s 16 Motion to Dispute, Oppose and Dismiss Defendant’s Petition for Removal of Action 17 from State Court (Arizona), (“Motion to Remand,” Doc. 7), Motion for Entering a 18 Default Judgment, (“Motion for Default Judgment,” Doc. 15), and Motion for Court 19 Order to Secure Appearance of a Pro Per Prisoner to Attend Court Ordered Scheduling 20 Conference, (“Motion to Attend,” Doc. 14). Defendant Travelers Home and Marine 21 Insurance Company (“Travelers”) has filed responses to Plaintiffs’ Motion to Remand, 22 (Doc. 13), and Motion for Default Judgment, (Doc. 16). Plaintiffs have also filed a 23 Supplement and Affidavit related to their Motion for Default Judgment, (Doc. 17), and 24 Defendant Travelers has filed its Response to the Supplement, (Doc. 18). Finally, 25 Plaintiffs filed a Reply regarding their Motion for Default Judgment. (Doc. 19). The 26 Court now rules on Plaintiffs’ Motions. 27 I. 28 BACKGROUND Plaintiffs, proceeding pro se, filed the instant Complaint in the Superior Court of 1 Arizona in and for the County of Navajo on or around July 6, 2016. (Doc. 1-1 at 2–14). 2 On July 27, 2017, Defendant Travelers removed the case to this Court, asserting diversity 3 jurisdiction under 28 U.S.C. §§ 1332, 1446 (2012). (See Doc. 1). 4 Plaintiffs’ Complaint appears to allege state law claims for breach of an insurance 5 contract and insurance bad faith against Defendants. (Doc. 1-1 at 2–14). Plaintiffs seek 6 damages against Defendants “[f]or the total principal amount of $77,763.03.” (Id. at 13– 7 14). Defendant Travelers alleges that Plaintiffs are domiciled in Arizona. (Doc. 1 at ¶ 11). 8 Defendant Travelers is “organized and existing under the laws of the State of Connecticut 9 with its principal place of business in the State of Connecticut.” (Id. at ¶ 12). Defendant 10 Alan D. Schnitzer is a resident of New York, and Defendant Brian W. MacLean is a 11 resident of Connecticut. (Doc. 6 at 1). Plaintiffs do not dispute Defendants’ allegations 12 regarding residency or domicile. 13 Following removal, on August 9, 2017, Defendant Travelers filed a Motion to 14 Extend Time to Answer the Complaint. (Doc. 8). In its Motion, Defendant Travelers 15 admitted it had failed to timely respond to Plaintiffs’ Complaint. (See id. at 2). On the 16 same day, the Court denied Defendant Travelers’s Motion, and Defendant Travelers filed 17 its Answer on August 10, 2017. (Doc. 10). 18 II. MOTION TO REMAND 19 Plaintiffs move to remand this action to state court, where it was initially filed. In 20 support of the Motion to Remand, Plaintiffs argue the following: (1) “Defendant[s] failed 21 to cite in their petition [Federal Rule of Civil Procedure (“Federal Rule”)] 81 as the 22 basis” for removal, (Doc. 7 at 2–3); (2) “The State of Arizona Court[s] have jurisdiction 23 on this [C]omplaint,” (id. at 3–4); (3) Removal to federal court is a hardship because 24 Plaintiff Jose Roman, Jr. is currently incarcerated with the Arizona Department of 25 Corrections, (id. at 7–10, 12–13); and (4) Plaintiffs have reevaluated their claimed 26 damages and now only seek $60,000.00 in damages, (id. at 10–12). Defendant Travelers 27 asserts that removal was proper. (Doc. 13). 28 /// -2- 1 A. 2 Plaintiffs first argue that the Court should grant their Motion to Remand because 3 Defendant Travelers failed to cite Federal Rule 81 in its Notice of Removal. (Doc. 7 at 2– 4 3). Defendant Travelers argues that Federal Rule 81 does not affect a defendant’s right to 5 remove a case. (Doc. 13 at 1–2). The Court agrees with Defendant Travelers. Federal Rule 81 6 Federal Rule 81 “specifies the action and proceedings to which the [Federal] Rules 7 do or do not apply or to which they apply only to a limited extent.” 12 Charles A. Wright, 8 Arthur R. Miller & Richard L. Marcus, Federal Practice & Procedure § 3131, at 542 9 (3d ed. 2014). While Federal Rule 81(c) covers the procedure used for cases following 10 removal to federal court, Federal Rule 81 does not provide the basis for removal. See Fed. 11 R. Civ. P. 81(c). 12 Here, Defendant Travelers’s right to remove the instant case to this Court was not 13 impeded by its failure to cite Federal Rule 81. Because Federal Rule 81 details the 14 procedure involved in a case after it is removed to federal court, Plaintiffs are incorrect in 15 arguing that Federal Rule 81 provides a basis for removal. Even if the Court construes 16 Plaintiffs’ assertions as an argument that Defendant Travelers has failed to follow Federal 17 Rule 81 following removal, Plaintiffs have failed to identify any particular deficiency; 18 furthermore, a failure to follow Federal Rule 81 does not provide a basis to remand a case 19 to state court. Thus, Plaintiffs’ argument involving Federal Rule 81 fails. 20 B. 21 Next, Plaintiffs argue that because Arizona state courts have jurisdiction over this 22 matter, Defendant Travelers is prohibited from removing the case to federal court. 23 (Doc. 7 at 3–4). In other words, Plaintiffs argue that federal court diversity jurisdiction 24 does not exist. State Court Jurisdiction 25 By federal statute, “any civil action brought in a State court of which the district 26 courts of the United States have original jurisdiction, may be removed by the defendant 27 or the defendants, to the district court of the United States for the district and division 28 embracing the place where such action is pending.” 28 U.S.C. § 1441(a). United States -3- 1 district courts “have original jurisdiction of all civil actions where the matter in 2 controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is 3 between . . . [c]itizens of different States.” 28 U.S.C. § 1332(a)(1). 4 Here, diversity jurisdiction exists for this case. Plaintiffs have alleged over 5 $75,000.00 in damages, and the opposing parties are citizens of different states. To the 6 extent Plaintiffs argue that complete diversity of citizenship does not exist because 7 Defendant Travelers “had an office located in Phoenix,” (Doc. 7 at 5), an office in a state 8 does not mean that a corporation is a citizen of that state. See Hertz Corp. v. Friend, 9 559 U.S. 77, 80–81 (2010) (holding that a corporation’s “principal place of business” for 10 diversity jurisdiction purposes “will typically be found at a corporation’s headquarters”). 11 Thus, the Court finds Plaintiffs’ arguments unpersuasive. 12 C. 13 Plaintiffs next argue that because Plaintiff Jose Roman, Jr. is incarcerated in a 14 state prison located in Northern Arizona, both Plaintiffs and the federal government will 15 face a hardship. (Doc. 7 at 7–10, 12–13). In particular, Plaintiffs assert that Plaintiff Jose 16 Ramon, Jr. “is a chronic care medical patient and the cost of medical services are able to 17 be reimbursed by the state to the Navajo County Sheriff’s Office” pursuant to state law. 18 (Id. at 8–9). Plaintiffs also cite unspecified “problems that will result in prisoner 19 transport, housing for months or years[,] . . . and medical costs that will be placed upon 20 the federal court.” (Id. at 9–10). Economic Hardships 21 Plaintiffs have failed to cite—and the Court is unaware of—any authority allowing 22 a federal court’s diversity jurisdiction to be defeated by allegations of hardship litigating 23 in federal court. Rather, federal courts have held the contrary. See, e.g., Weinrib v. 24 Greenspan, No. 85 C 6079, 1985 WL 3751, at *2 n.3 (N.D. Ill. Nov. 8, 1985) 25 (“[E]conomic hardship in no way shows a lack of diversity jurisdiction and is not itself 26 grounds for dismissal. (It can support a motion to transfer, but not where the movant is a 27 resident of the forum.)”). Here, purported economic hardships related to the costs of 28 transportation, housing, and medical costs are insufficient to defeat this Court’s diversity -4- 1 jurisdiction. 2 D. 3 Finally, Plaintiffs argue that they have reevaluated their asserted damages and 4 Amount in Controversy purport to lower “their sought sum of $77,763.03 to . . . $60,000.00.”1 (Doc. 7 at 11). 5 “In measuring the amount in controversy, a court must assume that the allegations 6 in the complaint are true and assume that a jury will return a verdict for the plaintiff on all 7 claims made in the complaint.” Forever Living Products U.S. Inc. v. Geyman, 8 471 F. Supp. 2d 980, 986 (D. Ariz. 2006) (citations omitted). Further, courts refuse to 9 entertain “post hoc attempt[s] to disavow some of the damages alleged in [a] 10 [c]omplaint.” Id. 11 Here, Plaintiffs—albeit inconsistently—make a post hoc attempt to disavow some 12 of the damages they alleged in the Complaint. Plaintiffs’ Complaint seeks damages of 13 $77,763.03, which is the sum of the $41,763.03 that Defendants allegedly underpaid 14 Plaintiffs related to the “dwelling policy limit” and $36,000.00 for boarding fees. (See 15 Doc. 1-1 at 4, 8). Because Plaintiffs’ alleged damages are greater than $75,000.00, this 16 case meets the amount-in-controversy requirement for diversity jurisdiction. 17 Because this case meets the requirements for diversity jurisdiction and Defendant 18 Travelers properly removed this case to this Court, the Court denies Plaintiffs’ Motion to 19 Remand. 20 III. MOTION FOR DEFAULT JUDGMENT 21 Plaintiffs also filed a Motion for Default Judgment, which argues that Defendant 22 Travelers’s failure to timely answer the Complaint following removal to federal court 23 demonstrates “good cause” for the Court to enter default judgment against Defendant 24 Travelers.2 (Doc. 15 at 2–3). Defendant Travelers argues Plaintiffs have failed to follow 25 1 26 27 The Court notes that, after filing their response stating they seek to lower the amount of damages sought in this action, Plaintiffs filed an affidavit, in which Plaintiff Jose Ramon, Jr. reasserts that Plaintiffs seek $77,763.03 from Defendants. (Doc. 17 at 6). 2 28 The Court notes that it is unclear, but Plaintiffs do not appear to seek a default judgment against Defendants Schnitzer and MacLean. (See Doc. 15). Plaintiffs admit— and the Court’s record reflects—Plaintiffs have not yet served Defendants Schnitzer and -5- 1 Federal Rule 55(a), Plaintiffs have not alleged prejudice, and default judgment is an 2 “extreme remedy.” (Doc. 16). 3 Federal Rule 55(b)(2) provides the two-step process for the Court to enter default 4 judgment against a party. See Eitel v. McCool, 782 F.2d 1470, 1471 (9th Cir. 1986). 5 Before a party can obtain a default judgment from the Court under Federal Rule 55(b), 6 the Clerk of the Court must enter default as provided in Federal Rule 55(a). 10A, Charles 7 A. Wright, Arthur R. Miller & Mary K. Kane, Federal Practice & Procedure § 2682, 8 at 10–11 (4th ed. 2016); see also Skinner v. Ryan, No. CV-12-1729-PHX-SMM (LOA), 9 2014 WL 99030, at *1 (D. Ariz. Nov. 15, 2008) (“Before a default judgment can be 10 entered by the court, the party must move the court to direct the entry of default in 11 accordance with [Federal] Rule 55(a) and default must be entered by the clerk.” 12 (quotation marks and citation omitted)). 13 Here, Plaintiffs failed to seek an entry of default when Defendant Travelers failed 14 to timely answer Plaintiffs’ Complaint. Rather, Plaintiffs moved directly for default 15 judgment. Because Plaintiffs failed to secure an entry of default before moving for 16 default judgment, the Motion for Default Judgment is inappropriate. Moreover, although 17 it is within the Court’s discretion to enter default judgment, Aldabe v. Aldabe, 18 616 F.2d 1089, 1092 (9th Cir. 1980), the Court declines to enter default judgment now 19 that Defendant Travelers is fully participating in the litigation. Thus, the Court denies 20 Plaintiffs’ Motion for Default Judgment. 21 IV. MOTION TO ATTEND 22 Finally, Plaintiffs filed a Motion to Attend, asking the Court to “secure” Plaintiff 23 Jose Roman, Jr.’s appearance for the September 27, 2017 Federal Rule 16 scheduling 24 conference. (Doc. 14). Plaintiffs alternatively ask the Court to “order the Arizona 25 Department of Corrections (central office or administrative office) to facilitate” the 26 ability for Plaintiff Jose Roman, Jr. to appear telephonically at the scheduling conference. 27 28 MacLean with process. (See Doc. 7 at 3–4). Therefore, even if Plaintiffs move for entry of a default judgment against Defendants Schnitzer and MacLean, such a motion is improper. -6- 1 (Id. at 4). 2 Stacy Roman will be required to attend the Rule 16 conference. Jose Roman may 3 appear at the Rule 16 conference telephonically by calling into the Court at 602-322-7560 4 at the time of the conference; but Mr. Roman will be responsible for making his own 5 arrangements to make such call. The Court will not have Mr. Roman transported for the 6 conference. 7 V. CONCLUSION 8 Based on the foregoing, 9 IT IS ORDERED denying Plaintiffs’ Motion to Dispute, Oppose and Dismiss 10 11 12 Defendant’s Petition for Removal of Action from State Court (Arizona), (Doc. 7). IT IS FURTHER ORDERED denying Plaintiffs’ Motion for Entering a Default Judgment, (Doc. 15). 13 IT IS FURTHER ORDERED denying Plaintiffs’ Motion for Court Order to 14 Secure Appearance of a Pro Per Prisoner to Attend Court Ordered Scheduling 15 Conference, (Doc. 14) 16 IT IS FURTHER ORDERED granting Plaintiffs’ Motion for Leave to Appear 17 Telephonically (Doc. 23) at the Rule 16 conference, but Plaintiff will be responsible for 18 arranging the call himself as specified above. Plaintiff shall give a copy of this Order 19 permitting his telephonic appearance to the appropriate staff at the prison to allow his 20 access to the Court. 21 IT IS FINALLY ORDERED that Plaintiff’s request to file an independent case 22 management plan (Doc. 22) is denied; the parties may exchange and approve a joint case 23 management plan by mail. 24 Dated this 11th day of September, 2017. 25 26 27 28 -7-

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