Klein Frank, P.C. v. Miller Weisbrod, LLP et al
ORDER. ORDERED that the Clerk of Court is directed to REMAND this action to the Boulder County District Court from which the case was removed re: 10 by Chief Judge Wiley Y. Daniel on 08/01/12.(jjhsl, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Chief Judge Wiley Y. Daniel
Civil Action No. 12-cv-01859-WYD-MJW
KLEIN FRANK, P.C.,
MILLER, CURTIS & WEISBROD, L.L.P.; and
MILLER WEISBROD, L.L.P.,
ORDER OF REMAND
THIS MATTER is before the Court on the Notice of Removal (ECF No. 1), filed
July 18, 2012. By way of background, this is an action based on “an attorney fee
dispute arising out of a personal injury matter in which the Defendants were terminated
for cause for failing to perform services and for failure to communicate terms of Court
orders and results of such proceedings.” (Compl. ¶ 1). Plaintiff seeks a declaratory
judgment that the Defendants were terminated for cause and not entitled to any fee.
(Compl. ¶ 10).
On July 18, 2012, Defendants filed a Notice of Removal asserting that diversity
jurisdiction exists pursuant to 28 U.S.C. § 1332(a)(1). Defendants asserted therein that
the amount in controversy requirement is satisfied. Further, Defendants assert that at
all relevant times, the Plaintiff is a Colorado corporation while Defendants are Texas
limited liability partnerships.
After carefully reviewing the pleadings, I find that this case must be remanded
based on the failure of the Defendants to show that the amount in controversy is
satisfied. The amount in controversy is ordinarily determined by the allegations of the
complaint, or, where they are not dispositive, by the allegations in the notice of removal.
Martin v. Franklin Capital Corp., 251 F.3d 1284, 1290 (10th Cir. 2001); Laughlin v.
Kmart Corp., 50 F.3d 871, 873 (10th Cir. 1995). If the jurisdictional amount is not
shown by the allegations of the complaint, “[t]he burden is on the party requesting
removal to set forth, in the notice of removal itself, the ‘underlying facts supporting [the]
assertion that the amount in controversy exceeds [$75,000].’” Laughlin, 50 F.3d at 873
(quotation omitted). In other words, the amount in controversy must be affirmatively
established on the face of either the petition or the notice of removal. Id. The removal
statute is construed narrowly. Martin, 251 F.3d at 1289.
In this case, the allegations of the complaint do not show that the amount in
controversy exceeds $75,000, as required to establish diversity jurisdiction. 28 U.S.C.
§ 1332(a)(1). This action, brought in the Boulder County, Colorado District Court, is an
action for a declaratory judgment to determine what fee, if any, the Defendants are
entitled to based on an underlying personal injury matter filed in Texas. The Tenth
Circuit has held that “[i]n cases seeking declaratory and injunctive relief, the amount in
controversy is measured by the value of the object of the litigation.” Lovell v. State
Farm Mut. Auto Ins. Co., 466 F.3d 893, 897 (10th Cir. 2006) (internal quotations and
citations omitted). In evaluating the amount in controversy jurisdictional requirement,
“the Tenth Circuit has followed what has commonly been referred to as the ‘either
viewpoint rule’ which considers either the value to the plaintiff or the cost to defendant of
injunctive and declaratory relief as the measure of the amount in controversy for
purposes of meeting the jurisdictional minimum.” Id.
Here, the complaint alleges that the Defendants, national law firms located in
Texas, entered into a fee agreement with Plaintiff to perform legal services in a personal
injury case arising out of a burn injury in Iraq. The agreement between the parties was
terminated for cause due to the Defendants’ alleged failure to abide by the agreement’s
terms. (Compl. ¶ 7-9). The agreement further states that “[i]n the event that a dispute
arises . . . concerning the construction, performance, or breach of this contract, . . . any
dispute shall be submitted to binding arbitration pursuant to the Uniform Arbitration Act
of 1975 as adopted by Colorado C.R.S. § 13-22-201, et. seq., and as modified by this
agreement.” (Fee Agreement, Ex. A).
In examining the complaint, it appears that Plaintiff is seeking a declaratory
judgment that the Defendants were terminated for cause and not entitled to any fee that
resulted from the personal injury action in Texas. After reviewing the allegations of the
complaint, I find that the Plaintiff’s complaint assigns no monetary value to the action.
In fact, in the complaint, Plaintiff neither references a dollar amount nor makes a
demand for monetary relief other than fees and costs. The amount of money involved
in the Texas action, the status of that case, and any potential contingency fee at issue
are unknown. Thus, I turn to the notice of removal. In the notice of removal, the
Defendants merely state that the “fees payable to Defendants exceed $75,000.00,
excluding interests and costs.” (Notice of Removal at 2). I see no connection between
the amount referenced in the notice of removal to the relief sought by Plaintiff in the
For these reasons, I find that the Defendants have failed to meet their burden of
affirmatively establishing that the amount in controversy on the face of either the
complaint or the notice of removal satisfies the jurisdictional requirement. The notice of
removal’s conclusory reference to the object of the litigation—the value of the fees
payable to Defendants pursuant to the Texas litigation—is not sufficient to establish that
the jurisdictional amount is satisfied. In Lovell, the defendant “presented undisputed
evidence . . . that its costs of compliance with [plaintiffs’] requested injunctive and
equitable relief exceeded $75,000.” Lovell, 466 F.3d at 897. In contrast, here,
Defendants have presented no such evidence that their fees, if any, are valued at more
than $75,000. Therefore, I cannot discern the amount in controversy based on the
contents of both the complaint and the notice of removal. In other words, the
Defendants did not affirmatively establish the amount in controversy in order to satisfy
the narrow requirements set forth in the removal statute.
Guided by the strong presumption against removal of civil actions to federal court
based on diversity jurisdiction and the fact that it appears that the Court lacks subject
matter jurisdiction over this action, I find that this matter must be remanded to the State
Court. See 28 U.S.C. § 1447(c). Accordingly, it is
ORDERED that the Clerk of Court is directed to REMAND this action to the
Boulder County District Court from which the case was removed.
Dated: August 1, 2012
BY THE COURT:
s/ Wiley Y. Daniel
Wiley Y. Daniel
Chief United States District Judge
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