CARLSON v. UNITED SERVICES AUTOMOBILE ASSOCIATION et al

Filing 11

ORDER granting 3 Motion to Remand. Ordered by U.S. District Judge CLAY D LAND on 03/30/15. (CGC)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
COLUMBUS DIVISION
CHRISTOPHER CARLSON,
individually and on behalf of
all others similarly situated,
Plaintiff,

*
*
*

vs.

*
CASE NO. 4:15-cv-6 (CDL)

UNITED SERVICES AUTOMOBILE
ASSOCIATION, USAA CASUALTY
INSURANCE COMPANY, and USAA
GENERAL INDEMNITY COMPANY,

*
*
*

Defendants.
*
O R D E R
Plaintiff

Christopher

Carlson

was

insured

under

an

automobile insurance policy issued by Defendants United Services
Automobile

Association,

USAA

Casualty

Insurance

Company,

USAA General Indemnity Company (collectively, “USAA”).

and

Carlson

alleges that after his 2013 Toyota Prius V was damaged due to a
flood in 2013, USAA paid to have the car repaired but denied
Carlson’s request for diminution in value.

Carlson claims that

he was entitled to $9,750 for diminution in value under his
insurance policy.

Carlson filed this action in the Muscogee

County Superior Court, seeking to represent a class of Georgia
USAA insureds who suffered a non-total loss due to water damage
and did not receive a payment for diminution in value.

USAA

removed the action to this Court under the Class Action Fairness

Act of 2005.

Carlson now asks the Court to remand this action

to the state court.

As discussed below, USAA did not prove by a

preponderance of the evidence that the amount in controversy
requirement is met, so Carlson’s Motion to Remand (ECF No. 3) is
granted, and this action is remanded to the Superior Court of
Muscogee County, Georgia.
DISCUSSION
Under
original

the

Class

Action

jurisdiction

diverse,

million.

28 U.S.C. § 1332(d)(2), (d)(5)(B).

however,

the

contend

first
that

the

two
the

100

amount

members,
in

Court

the

the

cannot

are

has

putative

parties

controversy

requirements
Court

this

where

minimally

and

least

actions

class

that

at

class

Act,

plaintiff

dispute

has

over

Fairness

exceeds

are
$5

Carlson does not
met.

exercise

He

does,

jurisdiction

over this matter because the amount in controversy requirement
is not met.
In determining whether the amount in controversy exceeds $5
million, “the claims of the individual class members shall be
aggregated.”

28

U.S.C. §

1332(d)(6).

Where

the

plaintiff

contests the defendant’s amount in controversy, the defendant
must prove “by a preponderance of the evidence that the amount
in controversy exceeds the jurisdictional minimum.”

Dudley v.

Eli Lilly & Co., 778 F.3d 909, 913 (11th Cir. 2014).

The Court

“may rely on evidence put forward by the removing defendant, as

2

well as reasonable inferences and deductions drawn from that
evidence.”

Id. (internal quotation marks omitted).

In his Complaint, Carlson alleged: “Under no circumstances
would

the

relief

total

and

amount

monetary

of

relief,

damages,

aggregate for the class.”

including

exceed

both

equitable

$5,000,000.00

Compl. ¶ 8, ECF No. 1-1.

in

the

Carlson

argues that the Court should consider this limitation and find
that the amount in controversy requirement is not met.

But the

United States Supreme Court squarely rejected that argument in
Standard Fire Insurance Co. v. Knowles, 133 S. Ct. 1345, 1347
(2013).

In fact, the Supreme Court instructed district courts

to ignore such limitation provisions in evaluating the amount in
controversy.

Id. at 1350.

The Court therefore ignores the

limitation provision.
Carlson contends that even if the Court cannot consider his
limitation provision, the action should be remanded because USAA
did not prove by a preponderance of the evidence that the amount
in controversy requirement is met.
USAA

presented

evidence

that

more

The Court agrees.
than

900

While

policyholders

experienced a non-total loss caused by water damage during the
relevant time period, Bush Aff. ¶¶ 4-5, ECF No. 6-1, USAA did
not point to any evidence of the amount of potential diminution
in

value

claims

for

these

policyholders.

In

Dudley,

the

Eleventh Circuit affirmed a district court’s decision to remand

3

in spite of much more specific evidence regarding the value of
the potential plaintiffs’ claims.

There, the plaintiff sought

to represent a class of former employees who did not receive one
or more types of incentive payments.

The employer submitted an

affidavit explaining (1) how many employees were eligible to
receive

each

type

of

incentive

payment

potential incentive payment amounts.

and

(2)

a

range

of

Dudley, 778 F.3d at 915.

But the employer did not “establish even generally the dollar
amounts that each of the [employees] may have been denied in
payment incentives.”

Id. at 916.

“Thus, it was impossible for

the district court to ascertain with any degree of confidence
how many class members were denied which payments.”

Id.

And

even though the employer provided “midpoint” numbers for each
range of possible incentive payments, the employer “provided the
district court with no way of judging whether these ‘midpoint’
numbers

are

realistic.”

Commc’ns,

Inc.,

(rejecting

the

592

F.

Id.;
App’x

defendant’s

see
780,

argument

also
783
that

Porter
(2014)
the

v.

MetroPCS

(per

curiam)

district

court

should have considered its entire revenue stream in determining
the amount in controversy for the potential plaintiff class’s
rescission claim: “Without any breakdown of MetroPCS’s revenue,
the district court would have to engage in hopeless speculation
in assessing what amount may be subject to rescission; this it
cannot do.”)

4

Here, USAA did not point to any evidence of the amount of
the

potential

diminution

in

value

claims

of

its

900

policyholders who experienced non-total losses caused by water
damage during the relevant time period.

For example, USAA did

not point to any evidence that it had evaluated the potential
diminution claims based on each potential plaintiff’s vehicle
make, model, and model year.

Instead, USAA asks the Court to

extrapolate the value of all potential claims based solely on
Carlson’s allegation that his diminution in value claim is worth
$9,750.

But it would be sheer speculation to assume that all

the diminution claims are worth $9,750.

Carlson’s diminution in

value claim is based on the fact that his nearly new Prius was
flooded.

The Court cannot just assume that every potential

class member had a new car that was worth as much as or more
than Carlson’s Prius or that the extent of the water damage to
each car was the same.
USAA’s theory for determining the amount in controversy is
particularly problematic given that USAA could likely point to
an alternative, less speculative way to determine the amount in
controversy.

For example, uniform formulas have been used in

other diminution in value cases.
definitively

establish

diminution

While these formulas may not
damages,

they

likely

would

lead to a less speculative estimate of the amount in controversy
than the approach taken here by USAA.

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But USAA did not proffer

a uniform formula for evaluating the claims and did not make any
calculations based on Plaintiff-specific information that should
be

within

USAA’s

control.

Instead,

the

Court

is

left

with

USAA’s speculative suggestion that the dollar amount of each
potential claimant’s claim is the same.

Federal jurisdiction

cannot be based on such speculation.
CONCLUSION
For the reasons explained in this order and based on the
rationale articulated in Dudley, the Court concludes that USAA
failed to carry its burden of establishing that the amount in
controversy exceeds $5 million. Carlson’s Motion to Remand (ECF
No. 3) is therefore granted, and this action is remanded to the
Superior Court of Muscogee County, Georgia.
IT IS SO ORDERED, this 30th day of March, 2015.
S/Clay D. Land
CLAY D. LAND
CHIEF U.S. DISTRICT COURT JUDGE
MIDDLE DISTRICT OF GEORGIA

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