Realbook, LLC v. RSUI Indemnity Company

Filing 19

OPINION AND ORDER denying 16 Motion to Remand to State Court. Signed by Judge John E. Steele on 8/30/2024. (RKR)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
REALBOOK, LLC,
Plaintiff,
v.

Case No:

2:24-cv-407-JES-KCD

RSUI INDEMNITY COMPANY,
Defendant.
OPINION AND ORDER
This matter comes before the Court on plaintiff's Motion for
Remand (Doc. #16) filed on May 31, 2024.

Defendant filed a

Response in Opposition (Doc. #170) on June 14, 2024.

For the

reasons set forth below, the motion is denied.
I.
On January 29, 2024, plaintiff Realbook, LLC (Realbook or
plaintiff) filed a Petition for Declaratory Relief (the Petition)
(Doc. #6) in Lee County Circuit Court against RSUI Indemnity
Company
effective

(RSUI
from

or

defendant)

October

2021

regarding
to

October

an
2022

insurance
(the

policy

Policy)

on

property on Fort Myers Beach operated as a branch of the United
States Postal Service (the Property).

(Id. at ¶¶ 3, 7.)

The

state court Petition alleged that on or about September 28, 2022,
flooding caused substantial damage to the insured Property, which
was owned by Realbook and insured under the Policy.

RSUI inspected the Property and calculated the amount of loss.
By letter dated January 5, 2023, RSUI advised Realbook that the
amount of loss to the Property’s building was $2,586,821.48; that
the deductible to be applied to the loss was $500,000; that
pursuant to the Policy the building policy limit was $1,772,892;
and that after applying the deductible the sum of $1,272,892 was
due to plaintiff for the building loss.

(Id. at 16-19.)

By letter dated February 13, 2023, RSUI advised Realbook that
it had determined that the applicable building policy limit was
$1,790,104. RSUI then calculated the amount due to Realbook by
deducting

the

$1,790,104.00.

$500,000

from

the

building

policy

limit

of

This resulted in $1,290,104 being due Realbook for

the building loss.

(Id. at 20-21.)

Realbook disputes this calculation, asserting a conflicting
view of the rights and obligations under the Policy.

Realbook

argues that RSUI’s application of the deductible to the building
limit, rather than the building loss, is contrary to the terms of
the

Policy.

Realbook

asserts

that

it

suffered

damages

that

greatly exceed the amount calculated by RSUI (Id. at ¶ 27), and
that RSUI must pay it at least the full amount of the building
coverage, which is $1,790,104.00.

(Id. at ¶ 31.)

RSUI rejected Realbook’s position regarding the amount of the
loss and refused to pay that full amount.

(Id. at ¶¶ 32-33.)

Realbook asserts that RSUI takes the position that it has no

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current obligations under the Policy.

(Id. at 34.)

Realbook

pointedly seeks no monetary damages (Id. at 37), but only seeks a
declaratory judgment pursuant to Fla. Stat. § 86.011 as to its
rights under the Policy.

(Id. at 40-49.)

On May 1, 2024, RSUI filed a timely Notice of Removal (Doc.
#1) based on the parties’ complete diversity of citizenship and
plaintiff’s allegation that RSUI underpaid Realbook’s insurance
claim by $500,000.00.

The Notice asserted that federal court had

jurisdiction because the state action in the Petition was a civil
action which fell under a federal court’s original diversity
jurisdiction pursuant to 28 U.S.C. § 1332(a).

(Id. at ¶ 7.)

Plaintiff now seeks to remand its declaratory judgment action
back to state court.

Defendant opposes the request to remand.
II.

The basic rule for removal of a state case to federal court
is straightforward.

“[A]ny civil action brought in a State court

of which the district courts of the United States have original
jurisdiction, may be removed” by the defendant.
1441(a).

28 U.S.C. §

The application of this rule in this case is also

straightforward.
Both

plaintiff

and

defendant

agree

that

the

declaratory

judgment cause of action set forth in the Petition is a civil
action for declaratory relief and is proper under Florida law.
(Doc. #16; Doc. #17.)

See Higgins v. State Farm Fire & Cas. Co.,

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894 So. 2d 5, 15 (Fla. 2004) (“This question presents the issue of
whether chapter 86, Florida Statutes (2003), Florida's declaratory
judgments

statute,

authorizes

declaratory

judgments

as

to

insurance policy obligations to defend and coverage for indemnity
when it is necessary to decide issues of fact in order to determine
the

declaratory

judgment.

We

conclude

that

the

declaratory

judgments statutes do authorize a declaratory judgment action to
decide these issues.”)
It is also undisputed that a federal district court has
original jurisdiction over cases where “the matter in controversy
exceeds the sum or value of $75,000, exclusive of interest and
costs”, and the parties are citizens of different States.
U.S.C. § 1332(a)(1).

28

“In a declaratory judgment action, ‘[f]or

amount in controversy purposes, the value of ... declaratory relief
is the value of the object of the litigation measured from the
plaintiff's perspective.’”

First Mercury Ins. Co. v. Excellent

Computing Distributors, Inc., 648 F. App'x 861, 864 (11th Cir.
2016) (citation

omitted).

When

an

insurer

seeks

a

judgment

declaring the absence of liability under a policy, or an insured
seeks a judgment declaring the presence of liability under a
policy, the value of the declaratory relief is the amount of
potential liability under its policy.

See Stonewall Ins. Co. v.

Lopez, 544 F.2d 198, 199 (5th Cir. 1976); First Mercury Ins. Co.
v. Excellent Computing Distributors, Inc., 648 F. App'x 861, 865

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(11th Cir. 2016) (citing Stonewall).

It is the “monetary value

of the object of the litigation” from plaintiff’s perspective.
Fastcase, Inc. v. Lawriter, LLC, 907 F.3d 1335, 1342 (11th Cir.
2018).
The

amount

in

controversy

in

this

case

is

the

$500,000

difference between the loss amount calculated by the insurer and
the loss amount calculated by the insured.

Finally, defendant has

factually shown the complete diversity of citizenship of the
parties, and plaintiff has not challenged that showing.

Thus, the

case was properly removed to federal court.
III.
Realbook nonetheless seeks a remand of the case to state
court.

Realbook argues that upon removal to federal court, its

state-law cause of action must be converted into a federal cause
of action under 28 U.S.C. § 2201-2202.

Viewed as a federal

declaratory judgment action, Realbook argues the cause of action
is insufficient, resulting in a lack of federal jurisdiction.
(Doc. #16 at 5.)
A.
“The Declaratory Judgment Act of 1934, now 28 U.S.C. s 2201,
28 U.S.C.A. s 2201, styled ‘creation of a remedy,’ provides that
in a case of actual controversy a competent court may ‘declare the
rights and other legal relations' of a party ‘whether or not
further relief is or could be sought.’ This is an enabling Act,

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which confers a discretion on the courts rather than an absolute
right upon the litigant.”

Pub. Serv. Comm'n of Utah v. Wycoff

Co., 344 U.S. 237, 241 (1952).
Realbook’s position fails from its inception because there is
no requirement that its state-law declaratory judgment action be
re-characterized as a federal declaratory judgment action upon
removal to federal court.

It is indeed correct that certain state-

law claims must be recharacterized as federal claims when brought
in federal court.

But the state-law claims falling within this

rule have been limited to certain Employee Retirement Income
Security Act (ERISA) claims and certain Labor Management Relations
Act (LMRA) claims based on a pre-emption doctrine.

Blab T.V. of

Mobile, Inc. v. Comcast Cable Communications, Inc., 182 F.3d 851,
855 (11th Cir. 1999).

Such complete pre-emption occurs only when

“the pre-emptive force of a statute is so ‘extraordinary’ that it
converts an ordinary state common-law complaint into one stating
a federal claim for purposes of the well-pleaded complaint rule.”
Id. 854.

The Supreme Court “displays no enthusiasm to extend the

doctrine into areas of law beyond the LMRA and ERISA.”

Id. at

856.
The Eleventh Circuit has stated that “complete pre-emption
occurs only when a federal cause of action features jurisdictional
language that closely parallels that of section 301 of the LMRA as
well as an express statement within the legislative history that

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Congress intends for all related claims to arise under federal law
in the same manner as section 301.”

Id. at 856.

Nothing in the

Federal Declaratory Judgment Act satisfies these requirements for
complete pre-emption of claims brought under a state declaratory
judgment act.

Realbook has cited no binding authority which

requires such complete pre-emption.
B.
Even if the declaratory judgment claim must be analyzed under
federal standards, the claim clearly satisfies those standards.
The Declaratory Judgment Act alone does not provide a basis for
jurisdiction, and a claim must satisfy Article III’s case-orcontroversy
remedy.”

requirement
California

“like
v.

suits

Texas,

for

593

every

U.S.

other

659,

672

type

of

(2021).

“Basically, the question in each case is whether the facts alleged,
under all the circumstances, show that there is a substantial
controversy, between parties having adverse legal interests, of
sufficient immediacy and reality to warrant the issuance of a
declaratory judgment.”
U.S.

118,

127

(2007).

MedImmune, Inc. v. Genentech, Inc., 549
This

requires

a

federal

claimant

to

establish standing by demonstrating that it has “‘(1) suffered an
injury in fact, (2) that is fairly traceable to the challenged
conduct of the defendant, and (3) that is likely to be redressed
by a favorable judicial decision.’” Students for Fair Admissions,
Inc. v. President & Fellows of Harvard Coll., 600 U.S. 181, 199

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(2023) (quoting Spokeo, Inc. v. Robins, 578 U.S. 330, 338 (2016)).
See also Biden v. Nebraska, 143 S. Ct. 2355, 2365 (2023) (an injury
in fact means plaintiff has a ‘personal stake’ in the case).
Realbook clearly has standing as an insured who is suing its
insurer for underpayment of the amount provided in its insurance
policy.
Realbook

alleges

in

the

Petition

that

“[t]he

Insurance

Company's application of the deductible to the building limit,
rather than the building loss as measured, contravenes the terms
of the Policy and applicable law” and “Realbook believes the
Insurance Company's position is inconsistent with the Policy’s
Deductible

Endorsement,

applicable

law.”

declaratory

(Doc.

judgment

is

and
#6

other
at

not

¶¶

terms

of

35.)

RSUI

available

the

under

Policy

argues
the

and

that

a

federal

Declaratory Judgment Act because there is no prospective or future
injury at issue, as required by the federal statute.

But the

Eleventh Circuit has held to the contrary, holding that assessing
the proper methodology for calculating “actual case value” under
Florida law is a proper subject for a federal declaratory judgment.
Signor v. Safeco Ins. Co. of Illinois, 72 F.4th 1223, 1233 (11th
Cir.

2023).

More

generally,

interpretation

of

an

insurance

policy’s coverage is subject to a federal declaratory action.
Travelers Prop. Cas. Co. of Am. v. Talcon Group LLC, 88 F.4th 1371,

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1377 (11th Cir. 2023); Snell v. United Specialty Ins. Co., 102
F.4th 1208, 1217 (11th Cir. 2024).
C.
Here, this case was properly removed to federal court pursuant
to 28 U.S.C. § 1441(a) without reference to the Federal Declaratory
Judgment Act.

But even if its state-law cause of action must be

converted into a federal cause of action under 28 U.S.C. § 22012202, there is no reason which would preclude removal or require
remand.
Accordingly, it is hereby
ORDERED:
Plaintiff's Motion for Remand (Doc. #16) is DENIED.
DONE and ORDERED at Fort Myers, Florida, this
of August 2024.

Copies:
Counsel of Record

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30th

day