Houston, Dickerson & Dickerson, Inc. v. Nationwide Property and Casualty Insurance Company

Filing 13

AMENDED ORDER as to 12 Order on Motion to Remand. Defendant has (10) days from the Order to file a responsive pleading to Plaintiff's complaint. Signed by Honorable Robert T. Dawson on July 8, 2013. (lw)

IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
FORT SMITH DIVISION

HOUSTON, DICKERSON & DICKERSON, INC.
d/b/a HARVEST FOODS OF CLARKSVILLE
v.

PLAINTIFF

No. 13-2125

NATIONWIDE PROPERTY AND CASUALTY
INSURANCE COMPANY

DEFENDANT

AMENDED ORDER
Currently before the Court are Plaintiff’s First Amended
Motion

for

Remand

and

supporting

Defendant’s Response (doc. 11).

brief

(docs.

9-10),

and

Plaintiff disputes the existence

of jurisdiction as the amount in controversy does not exceed
$75,000.

For the reasons that follow, Plaintiff’s Amended Motion

to Remand (doc. 9) is DENIED.

Plaintiff’s original motion to

remand (doc. 6) is DENIED AS MOOT.
Generally, the district courts of the United States are
“courts of limited jurisdiction.

They possess only that power

authorized by Constitution and statute.”
Allapattah

Servs.,

Inc.,

545

U.S.

546,

Exxon Mobil Corp. v.
552 (2005).

Federal

courts must strictly construe the federal removal statute, and
resolve any ambiguities about federal jurisdiction in favor of
remand.

Transit Casualty Co. v. Certain Underwriters at Lloyd’s

of London, 119 F.3d 619, 625 (8th Cir. 1997).

A defendant in

state court may remove the case to federal court if the defendant
can demonstrate that the federal court has original jurisdiction
over the case.

28 U.S.C. § 1441(a).

This requirement is met in

one of two ways; i.e., (1) the case in question involves a
federal question, or (2) diversity jurisdiction exists.

In a

case where the plaintiff’s pleadings do not allege a federal
question “the matter in controversy [must exceed] the sum or
value of $75,000, exclusive of interest and costs, and [must
involve] citizens of different states.”

28 U.S.C. § 1332(a).

The party invoking federal jurisdiction must prove the requisite
amount by a preponderance of the evidence.

James Neff Kramper

Family Farm P’ship v. IBP, Inc., 393 F.3d 828, 831 (8th Cir.
2005).

This rule applies even in a removed case where the party

invoking jurisdiction is the defendant.

Id.

In the present

case, it is not disputed that diversity of citizenship exists and
the only issue is whether the $75,000 statutory minimum is met.
I.

Procedural History
Plaintiff filed its Complaint against Defendant on or about

March 21, 2013, in the Circuit Court of Johnson County, Arkansas,
(Case No. CV-2013-34) alleging a breach of contract by failure to
pay an alleged indisputable loss under the insurance policy after
a demand had been made; pursuant to Ark. Code Ann. 23-79-208
(2012).

2

Defendant removed the action to this Court asserting the
existence

of

(Doc. 1).

diversity

jurisdiction

under

28

U.S.C.

1332(a).

Plaintiff filed an Amended Motion to Remand (doc. 9)

contending that Defendant failed to demonstrate the amount-incontroversy was satisfied.

Plaintiff contends the contractual

damages of $62,271.79, together with the 12% penalty of $7,472.62
($73,580.47) and stipulated attorneys’ fees of $1,419.50 totals
$74,999.97;

would

be

an

amount

not

in

excess

of

$75,000.00.

Defendant states the stipulated amount of attorneys’ fees has no
legal affect, and when reasonably calculated with all damages
sought, the amount-in-controversy easily exceeds the $75,000.00
threshold.
II.

Amount in Controversy
“As

the

party

seeking

removal

and

opposing

remand,

[defendant] has the burden of establishing federal subject matter
jurisdiction.”

McNutt v. General Motors Acceptance Corp., 298

U.S. 178, 189, (1936); Hatridge v. Aetna Casualty & Surety Co.,
415 F.2d 809, 814 (8th Cir. 1969); In re Business Men’s Assurance
Company of America, 992 F.2d 181, 183 (8th Cir. 1993).

In a

diversity case, where the complaint alleges no specific amount of
damages

or

an

amount

under

the

jurisdictional

minimum,

the

removing party must prove by a preponderance of the evidence that
the amount in controversy exceeds $75,000.

3

See In re Minnesota

Mut. Life Ins. Co. Sales Practices Litig., 346 F.3d 830, 834 (8th
Cir. 2003).

The statutory award of attorney fees does count

toward the jurisdictional minimum for diversity jurisdiction.”
Crawford v. F. Hoffman-La Roche Ltd., 267 F.3d 760, 766 (8th Cir.
2001).
in

Likewise, the 12% statutory penalty may also be included

calculating

exists.

whether

the

requisite

amount

in

controversy

Peacock & Peacock, Inc. v. Stuyvesant Ins. Co., 332 F.2d

499, 502 (8th Cir. 1964).
The United States Supreme Court held that a post removal
stipulation reducing damages below the $75,000.00 threshold may
not defeat federal subject matter jurisdiction.

St. Paul Mercury

Indem. Co. v. Red Cab Co., 303 U.S. 283, 294 (1938).

Powell v.

State Farm Fire and Casualty Insurance Co., 2010 WL 379643 (W.D.
Ark., Jan. 27, 2010).

Therefore, though the Plaintiff is the

“master of his complaint and his choice of forum should not
easily be disturbed,” the Plaintiff may not stipulate fees in
order to defeat subject matter jurisdiction.

St. Paul, 303 U.S.

283, 294.
Plaintiff

contends

the

stipulation

is

merely

a

"clarification" of the unspecified amount of requested attorneys'
fees

and

therefore

falls

established in St. Paul.

under

an

exception

(Doc. 1, pg. 4).

to

the

rule

However, it is clear

that Plaintiff's stipulation is a "change" in the amount sought

4

by the Plaintiff in order to defeat jurisdiction and is therefore
void of legal effect.

Bell v. Hershey Co., 557 F.3d 953 (8th

Cir. 2009); ANPAC v. Dow Quimica de Columbia, 988 F.2d 559, 565
(9th Cir. 1993).
A defendant may defeat the Plaintiff’s Motion to Remand by
establishing that the amount in controversy exceeds $75,000 by a
preponderance of the evidence.

Haynes v. Louisville Ladder Grp.,

LLC, 341 F. Supp. 2d 1064, 1067 (E.D. Ark. 2004).

Defendant must

establish by a preponderance of the evidence that attorneys’ fees
will come to at least $1,419.54.

Fees for services already

rendered must be taken into consideration as well as a reasonable
calculation for future attorneys’ fees.

Feller v. Hartford Life

& Acc. Ins. Co., 817 F. Supp. 2d 1097, 1105 (S.D. Iowa 2010).
Taking

into

consideration

fees

for

services

already

rendered

together with a reasonable estimate of fees for services to be
performed throughout the remainder of the legal proceedings, it
is reasonable to conclude the amount in controversy will exceed
$75,000.00.
III.

Conclusion
The Court finds Defendant has proved by a preponderance of

the evidence that the amount in controversy exceeds $75,000.
Accordingly, Plaintiff’s Amended Motion to Remand (Doc. 9) is
hereby DENIED.

Plaintiff’s original Motion to Remand (doc. 6) is

5

DENIED AS MOOT.

Defendant has (10) days from the Order to file a

responsive pleading to Plaintiff’s complaint.
IT IS SO ORDERED this 8th day of July, 2013.

/s/ Robert T. Dawson
Honorable Robert T. Dawson
United States District Judge

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