Maria Leticia Monroy et al v. Infinity Insurance Company et al

Filing 15

ORDER REMANDING CASE TO THE SUPERIOR COURT OF CALIFORNIA FOR COUNTY OF LOS ANGELES by Judge S. James Otero. Case Terminated. Made JS-6(SEE DOCUMENT FOR FURTHER DETAILS) (vv)

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL

DATE: November 17, 2016

CASE NO.: CV 16-05296 SJO (GJSx)
TITLE:

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Maria Leticia Monroy et al. v. Infinity Insurance Co. et al.

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PRESENT: THE HONORABLE S. JAMES OTERO, UNITED STATES DISTRICT JUDGE
Victor Paul Cruz
Courtroom Clerk

Not Present
Court Reporter

COUNSEL PRESENT FOR PLAINTIFF:

COUNSEL PRESENT FOR DEFENDANTS:

Not Present

Not Present

========================================================================
PROCEEDINGS (in chambers): ORDER REMANDING CASE TO THE SUPERIOR COURT OF
CALIFORNIA FOR COUNTY OF LOS ANGELES [Docket No. 15]
This matter is before the Court on its own motion. On June 1, 2016, Plaintiffs Maria Leticia
Montoy and Juan Antonio Maldonado Cortes (collectively "Plaintiffs") initiated this breach of
contract action in the Superior Court of California, Los Angeles County. (See generally Notice of
Removal ("Notice") 3-13, Ex. A Compl., ECF No. 1-1.) In the Complaint, Plaintiff alleges that
Defendant Infinity Insurance Co. ("Infinity") and Does 1-10 (collectively "Defendants") failed to
perform their contractual obligations under the automobile insurance agreement entered into
between Plaintiffs and Infinity, thereby constituting breach of contract, breach of the duty of good
faith and fair dealing, and negligence. (See Compl. ¶¶ 17, 22, 25.) On July18, 2016, Defendants
timely removed the action to the United States District Court for the Central District of California.
(See generally Notice.) The case was assigned to this Court on July 25, 2016. (ECF No. 5.)
"If at any time before final judgment it appears that the district court lacks subject matter
jurisdiction," it must remand the case. 28 U.S.C. § 1447(c). The Ninth Circuit has held that "a
court may raise the question of subject matter jurisdiction, sua sponte, at any time during the
pendency of the action." Snell v. Cleveland, Inc., 316 F.3d 822, 826 (9th Cir. 2002). Courts must
"strictly construe the removal statute against removal jurisdiction" and reject federal jurisdiction
"if there is any doubt as to the right of removal in the first instance." Gaus v. Miles, Inc., 980 F.2d
564, 566 (9th Cir. 1992) (citations omitted). "The strong presumption against removal jurisdiction
means that the defendant always has the burden of establishing that removal is proper." Id.
(citation and internal quotation marks omitted). Under the removal statute, an action is removable
to federal court only if it might have been brought there originally. See 28 U.S.C. § 1441(a). Here,
Defendant argues that the Court has diversity jurisdiction over Plaintiff's action. (Notice ¶¶ 10-17.)
Diversity jurisdiction exists when "the matter in controversy exceeds the sum of $75,000, exclusive
of interest and costs, and is between . . . citizens of different States." 28 U.S.C. § 1332(a)(1).
"Where it is not facially evident from the complaint that more than $75,000 is in controversy, the
removing party must prove, by a preponderance of the evidence, that the amount in controversy

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL

DATE: November 17, 2016

CASE NO.: CV 16-05296 SJO (GJSx)

meets the jurisdictional threshold." Matheson v. Progressive Specialty Ins. Co., 319 F.3d
1089,1090 (9th Cir. 2003); accord Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1117 (9th Cir. 2004).
Where there is doubt, the case should be remanded to state court. Matheson, 319 F.3d at 1090
(footnote omitted). Amount in controversy is determined at the time of removal. (See Soto v.
Kroger Co., No. CV 12-00780 DOC, 2013 WL 3071267, at *4 (C.D. Cal. June 17, 2013) ("the
guiding principle is to measure amount in controversy at the time of removal").
Here, it is undisputed that there is complete diversity between the parties. (See Notice 3-4.)
However, it is not facially evident from Plaintiffs' Complaint that the controversy involves more than
$75,000. Plaintiffs in their Complaint seek $7,742.92 for property damage and $26,053.22 for
consequential damages. (Compl. ¶¶ 12, 17.) As such, Plaintiffs' express damages fall well short
of the $75,000 threshold.
In their Complaint, Plaintiffs also seek general damages for mental and emotional distress,
punitive and exemplary damages, costs and attorney's fees. (Compl. 11.) Defendants contend
"[s]ome courts have held that emotional distress damages in a bad faith action by itself could
exceed the minimum $75,000 threshold." (Notice 4.) They add, "[i]n bad faith cases, juries
frequently award emotional distress damages well in excess of the minimum $75,000 amount in
controversy." (Notice 5.) Yet, Defendants make no effort to analogize the facts of the cited cases
to Plaintiffs' case beyond merely noting that one of the cases involved allegations of insurance bad
faith. (Notice 5; see Cable v. Merit Life Ins. Co., 2006 WL 1991664, *3 (E.D. Cal. 2006.)
(Defendant's argument that emotional distress damages exceeded the jurisdictional threshold was
insufficient when "[d]efendant provide[d] no reliable basis for determining the amount of emotional
distress damages likely to be recovered in this case.") Without more, these awards are
speculative and fail to satisfy Defendants' burden. See Soto, 2013 WL 3071267 at *4 (requiring
more than "simply cases where the defendant fired the plaintiff").
It is well established that "punitive damages are part of the amount in controversy in a civil action."
Gibson v. Chrysler Corp., 261 F.3d 927, 945 (9th Cir. 2001), cert. denied, 534 U.S. 1104 (2002).
However, "the mere possibility of a punitive damages award is insufficient to prove that the amount
in controversy requirement has been met." Burk v. Med. Sav. Ins. Co., 348 F. Supp. 2d 1063,
1069 (D. Ariz. 2004). Rather, a defendant "must present evidence that punitive damages will more
likely than not exceed the amount needed to increase the amount in controversy to $75,000." Id.
Here, again, Defendants offer case citations without sufficiently analogizing the facts of those
cases to Plaintiffs' case. Defendants speculate without offering an estimate or formula, that
"recent California cases have upheld punitive damages awards with ratios to compensatory
damages of greater than 1 to 1, even where the compensatory damages were substantial."
(Notice 6.) On these representations, the Court cannot conclude that an award of punitive
damages would be likely, let alone compute an amount. See, e.g., Gamino v. HireRight Solutions,
Inc., No. CV 11-00281 BTM, 2011 WL 1211356, at *3 (S.D. Cal. Mar. 28, 2011).

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JS-6

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL

DATE: November 17, 2016

CASE NO.: CV 16-05296 SJO (GJSx)

Finally, attorney's fees should be part of the amount in controversy calculation. Galt G/S v. JSS
Scandinavia, 142 F.3d 1150, 1156 (9th Cir. 1998). Here, Plaintiffs seek an award of attorneys
fees. (See Compl. 11.) Defendants offer, without any supporting factual or legal authority, that
the attorney's fee in this case could be $10,000. (Notice 7.) As such, Defendants have not
established an amount of attorney's fees that would bring the total amount in controversy over
$75,000.
Accordingly, the Court REMANDS this action to the Superior Court of California for Los Angeles
County. This action shall close.
IT IS SO ORDERED.

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