Alsept et al v. Tennessee Gas Pipeline, LLC et al
Filing
12
MEMORANDUM OPINION & ORDER: It is ordered that Plas' 7 MOTION to Remand to State Court is DENIED. Signed by Judge Joseph M. Hood on 9/27/2018.(SCD)cc: COR
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF KENTUCKY
CENTRAL DIVISION at LEXINGTON
DARRICK ALSEPT, SHELBIE
ALSEPT, and DARRICK ALSEPT as
Parent and Next Friend of J.A.
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Plaintiffs,
v.
TENNESSEE GAS PIPELINE, LLC,
KINDER MORGAN OPERATING, L.P.
“A”, KINDER MORGAN G.P., INC.,
A.S.T. ENVIRONMENTAL, INC.,
AMEC FOSTER WHEELER
ENVIRONMENT & INFRASTRUCTURE,
INC., and CLEAN HARBORS
ENVIRONMENTAL SERVICES, INC.
Defendants.
Civil Case No.
5:17-cv-00422-JMH
MEMORANDUM OPINION
AND ORDER
***
This matter is before the Court on Plaintiffs’ Motion to
Remand to State Court.
[DE 7].
Defendants have responded [DE 8]
and Plaintiffs replied [DE 9], thus, Plaintiffs’ motion is ripe
for decision.
and
being
Having reviewed the motion, response, and reply,
otherwise
adequately
advised,
the
Court
will
deny
Plaintiffs’ motion for the reasons set forth below.
Background
This case arises from an incident alleged to have occurred on
August 1, 2016.
station
owned
Plaintiffs allege that a natural gas compression
and
operated
by
Tennessee
Gas
Pipeline,
“discharged natural gas condensate and compressor oil.”
LLC
[DE 1,
Compl. ¶11].
Plaintiffs allege the condensate contained “toxic
compounds including, but not limited to, Benzene, Heptane, and
Decane.” [Id. at ¶18]. This discharge allegedly “created a visible
oily film which settled on Plaintiffs’ persons and Plaintiff’s
physical
and
personal
property”
and
caused
“temporary
and
permanent damage to Plaintiff’s physical and personal property as
well as emotional distress and inconvenience.” (Id. at ¶¶15, 17.)
Plaintiffs
also
claim
personal
injuries
resulted
exposure to the condensate and compressor oil.
from
their
[Id. at ¶18].
Plaintiffs’ complaints against the Tennessee Pipeline and Kinder
Morgan defendants include negligence, negligence per se; product
liability;
temporary
nuisance;
trespass;
battery; and punitive damages.
res
ipsa
loquitor;
Plaintiffs further allege that
A.S.T. Environmental, Inc.; AMEC Foster Wheeler Environment &
Infrastructure, Inc.; and Clean Harbors Environmental Services,
Inc. (collectively referred to by plaintiffs as the “Remediation
Defendants”), engaged in “remediation efforts” at their property
and “were negligent in their efforts to rid Plaintiffs’ home,
personal property and real property of the remnants of the natural
gas condensate and compressor oil discharge.” (Compl., at ¶¶8-10,
46.) Plaintiffs assert counts for negligence and punitive damages
against the Remediation Defendants.
Plaintiffs filed their lawsuit in Powell Circuit Court on
June 20, 2017.
The parties exchanged discovery over the following
2
months.
Defendants
Interrogatories,
and
served
Requests
for
Request
for
Production
of
Admissions,
Documents
on
Plaintiffs in an effort to determine the amount in controversy.
Although Plaintiffs did not initially admit or deny that the amount
in controversy exceeded $75,000 [DE 1, pp. 58-59], after removal
Plaintiffs supplemented their answers to discovery and admitted
that they were not seeking in excess of $75,000 [DE 8, pp. 9-11].
The parties appear to agree that diversity of citizenship is not
at issue in the motion to remand.
Standard
The statute authorizing removal, 28 U.S.C. § 1441, provides
that an action is removable only if it initially could have been
brought in federal court. A federal court has original “diversity”
jurisdiction where the suit is between citizens of different states
and the amount in controversy exceeds $75,000, exclusive of costs
and interest.
28 U.S.C. § 1332(a).
Therefore, a defendant
desiring to remove a case from state to federal court has the
burden of establishing the diversity jurisdiction requirements of
an
original
federal
court
controversy requirement.
action,
including
the
amount
in
Chapman v. Houston Welfare Rights Org.,
441 U.S. 600, 612 n. 28 (1979). That burden is not an insubstantial
one.
McKinney v. ICG, LLC, No. 13-cv-12, 2013 WL 1898632, at *1
(E.D. Ky. May 7, 2013).
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Where, as here, the complaint seeks an unspecified amount of
damages “that is not self-evidently greater or less than the
federal
amount-in-controversy
defendants
evidence.
must
carry
its
requirement,”
burden
by
a
the
removing
preponderance
of
the
Id. at *2 (E.D. Ky. May 7, 2013)(citing Gafford v. Gen.
Elec. Co., 997 F.2d 150, 158 (6th Cir.1993), abrogated on other
grounds
by
Friend,
530
U.S.
77).
The
preponderance-of-the-
evidence test requires defendants to support their claims to
jurisdiction
by
“jurisdictional
producing
facts.”
“competent
Id.
(citing
160)(internal citations omitted).
proof”
of
the
Gafford,
997
necessary
F.2d
at
“Competent proof” can include
affidavits, documents, or interrogatories.
Ramsey v. Kearns, No.
12-cv-06, 2012 WL 602812, at *1 (E.D. Ky. Feb. 23, 2012)(citing
Gentek Bldg. Prods., Inc. v. Sherwin–Williams Co., 491 F.3d 320,
330 (6th Cir. 2007)(internal citation omitted)).
If the defendant does not produce evidence showing it is more
likely than not that the plaintiffs' claims exceed $75,000, the
case must be remanded to state court.
Id.
Federal courts are
courts of limited jurisdiction, therefore, any doubts regarding
federal jurisdiction should be construed in favor of remanding the
case to state court.
Shamrock Oil & Gas Corp. v. Sheets, 313 U.S.
100, 109 (1941); Walsh v. American Airlines, Inc., 264 F. Supp.
514, 515 (E.D. Ky. 1967).
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Discussion
Here, because Defendant removed this case from state court,
it has the burden of proving that the requirements of diversity
jurisdiction, including the amount in controversy, are satisfied
by a preponderance of the evidence.
*2.
McKinney, 2013 WL 1898632, at
“[I]n reviewing the denial of a motion to remand, a court
looks to whether the action was properly removed in the first
place.”
Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868, 871–72
(6th Cir. 2000).
Regarding the amount in controversy, Defendant
states as follows in its Notice of Removal:
14. Upon information and belief based on TGP’s
thorough investigation, including allegations of the
Plaintiffs’ Complaint and Plaintiffs’ discovery
responses, Plaintiff Darrick Alsept seeks compensatory
damages in excess of $44,000.
15. The Plaintiffs also seek punitive damages. Even
applying a conservative ratio of 1:1 punitive damages
to Plaintiff Darrick Alsept’s claimed compensatory
damages, the amount in controversy exceeds $75,000,
the jurisdictional requirement of this Court. See,
e.g., Heyman v. Lincoln National Life Insurance
Company, Civil Action No. 3:16-cv-37-DJH-DW, 2017 WL
3274452, *4 (W.D. Ky. April 27, 2017) (noting that a
1:1 punitive-damages ratio was “minimal”); Proctor v.
Swifty Oil Co., Inc., No. 3:12-CV-00490-TBR, 2012 WL
4593409, *2 (W.D. Ky. Oct. 1, 2012) (acknowledging
that “the Supreme Court has embraced a punitive-tocompensatory damages ratio near 4-to-1,” and holding
that even a “ratio of 2-to-1” was a “restrictive
estimate[] of compensatory and punitive damages.”)
16. Considering the compensatory damages described in
Plaintiff Darrick Alsept’s discovery responses, and
the 1:1 punitive damages ratio, the amount in
controversy with respect to Darrick Alsept’s claims
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exceeds the jurisdictional minimum threshold of this
Court.
17. This Court has supplemental jurisdiction over the
claims of Shelbie Alsept and J.A. pursuant to 28 U.S.C.
§ 1367.
[DE 1, Defendant’s Notice of Removal at ¶¶ 14-17].
Plaintiffs argue that they eventually supplemented their
discovery answers to state that they are not seeking in excess of
$75,000.
Amount-in-controversy, for purposes of removal under 28
U.S.C. § 1441, is assessed at the time of removal, not answers to
discovery a plaintiff may later make.
Notably, Plaintiffs simply
answered that they are not seeking in excess of $75,000; they have
not stipulated to that.
The Court "review[s] the damages sought by Plaintiffs at the
time of removal."
Hayes v. Equitable Energy Resources Co., 266
F.3d 560, 573 (6th Cir. 2001).
Plaintiffs claimed that the amount
in controversy would not exceed $75,000 only after this case had
already been removed.
Events occurring after removal, including
post-removal supplemental answers to discovery, "which reduce the
amount
recoverable
jurisdiction."
below
the
statutory
limit
do
not
oust
St. Paul Mercury Indem. Co. v. Red Cab Co., 303
U.S. 283, 290 (1938).
At the time of removal, Plaintiffs had
provided discovery responses that included more than $44,000 in
property damages alone as related to Darrick Alsept, and refused
to provide any value or limitation on recovery for any other
personal or real property damage, personal injury including past,
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present, and future medical bills, pain and suffering, mental
anguish, lost wages, lost earning capacity, punitive damages, and
consequential damages. Plaintiffs now claim the $44,000 in damages
they attached to their discovery responses were not the actual
value they are seeking; however, again, the determination of
jurisdiction
is
made
at
the
time
of
removal.
At
that
time,
Defendants had information that reasonably supported $44,000 in
property damages alone.
As Defendants noted, a 1:1 ratio of
punitive damages based only on property damages would exceed the
jurisdictional amount of this court.
The law makes clear that a good faith claim
for punitive damages may augment compensatory
damages
in
determining
the
amount
in
controversy unless it can be said to a legal
certainty that plaintiff cannot recover
punitive damages in the action. . . . If
relevant state law permits punitive damages on
the facts alleged, such punitive damages are
part of the amount in controversy for
jurisdictional
amount
purposes.
White v. J.C. Penney Life Ins. Co., 861 F.Supp. 25, 27
(S.D.W.Va.
1994);
citing
Bell
Society, 320 U.S. 238 (1943).
and
punitive
damages
v.
Preferred
Life
Assurance
While it appears property damages
alone
could
reasonably
exceed
the
jurisdictional limit of this court, that does not include any
potential award for medical expenses, lost wages, consequential
damages (such as the later-claimed credit card expenses of $7,000),
or an award of pain and suffering.
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Even small awards for these
claimed damages further supports Defendant’s position that the
amount in controversy in this matter was in excess of $75,000 at
the time of removal.
Thus, the Court finds that at the time of
removal, a realistic assessment of the record establishes the
jurisdictional amount of $75,000.
Accordingly, for the reasons stated herein and the Court being
otherwise sufficiently advised, IT IS ORDERED that Plaintiffs’
Motion to Remand be, and the same hereby is, DENIED.
This the 27th day of September, 2018.
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