Harvey v. Shelter Insurance Company et al

Filing 20

ORDER & REASONS denying 6 Motion to Remand. Signed by Judge Martin L.C. Feldman on 4/24/2013. (caa, )

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
SHARON D. HARVEY

CIVIL ACTION

v.

NO. 13-392

SHELTER INSURANCE COMPANY, ET AL.

SECTION "F"

ORDER AND REASONS
Before the Court is the plaintiff's motion to remand. For the
reasons that follow, the plaintiff’s motion to remand is DENIED.
Background
This personal injury lawsuit arises from a car accident in
Orleans Parish.
On February 22, 2012 Sharon Harvey was riding as a guest
passenger in a car owned and operated by Kevin Kerwin when it was
involved in a rear-end collision with a car owned and operated by
Martin Zentner.

Kerwin had been driving his car on St. Charles

Avenue when he stopped at a red light at the intersection of St.
Charles Avenue and Louisiana Avenue.

While stopped at the red

light, Kerwin's car was struck from the rear by Zentner's car.
Ms. Harvey, a Florida resident, sued Zentner (a Louisiana
resident), along with Zentner's insurer, Shelter General Insurance
Company (a Missouri resident), Ms. Harvey's insurance carrier,

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GEICO

Insurance

Company

(a

Maryland

resident),

and

Kerwin's

insurance carrier, Progressive Insurance Company (an Ohio resident)
in state court.

On March 1, 2013, Shelter removed the lawsuit to

this Court, invoking the Court's diversity jurisdiction.
Ms. Harvey now seeks to remand the lawsuit to state court.
I.
A.
Although the plaintiff challenges removal in this case, the
removing defendant carries the burden of showing the propriety of
this Court's removal jurisdiction.

See Jernigan v. Ashland Oil,

Inc., 989 F.2d 812, 815 (5th Cir.), cert. denied, 510 U.S. 868, 114
S. Ct. 192, 126 L.Ed.2d 150 (1993); Willy v. Coastal Corp., 855
F.2d

1160,

1164

(5th

Cir.

1988).

“Because

removal

raises

significant federalism concerns, the removal statute is strictly
construed.” Gutierrez v. Flores, 543 F.3d 248, 251 (5th Cir. 2008).
Further, “any doubt as to the propriety of removal should be
resolved in favor of remand.”

Id.
B.

Federal Courts are courts of limited jurisdiction, possessing
only the authority endowed by the United States Constitution and
conferred by the United States Congress. Howery v. Allstate Ins.
Co., 243 F.3d 912, 916 (5th Cir. 2001), cert. denied, 534 U.S. 993,
122 S.Ct. 459, 151 L.Ed.2d 377 (2001).

Federal law allows for

state civil suits to be removed to federal courts that have
original jurisdiction over the action. 28 U.S.C. § 1441(a). Suits
2

not brought under federal law “may not be removed if any of the
parties in interest properly joined and served as defendants ...
[are] citizen[s] of the State in which such action is brought." 28
U.S.C. § 1441(b)(2). For a defendant to invoke the Court's removal
jurisdiction

based

on

diversity,

"the

diverse

defendant

must

demonstrate that all of the prerequisites of diversity jurisdiction
contained in 28 U.S.C. § 1332 are satisfied" including that the
citizenship of every plaintiff is diverse from the citizenship of
every defendant.

Smallwood v. Illinois Cent. R.R. Co., Inc., 385

F.3d 568, 572 (5th Cir. 2004)(en banc).
Shelter invokes this Court's diversity jurisdiction under 28
U.S.C. § 1332, which requires that complete diversity exists
between the plaintiff and all properly joined defendants, and that
the amount in controversy exceeds $75,000.
The plaintiff is a citizen of Florida.

The defendants that

had been served at the time of removal are completely diverse:
Shelter is a citizen of Missouri; GEICO is a citizen of Maryland;
Progressive is a citizen of Ohio.1

Zentner, who had not be served

at the time of removal, but was recently served on April 16, 2013,
is a citizen of Louisiana.

The parties are completely diverse.

1

The plaintiff suggested in her reply papers that perhaps
Progressive is domiciled in Florida, pointing to correspondence
from plaintiff's counsel to the Louisiana Secretary of State asking
that Progressive be served at an address in Florida.
However,
Shelter's sur-reply papers submits evidence that confirms that,
while Progressive is registered to do business in Florida, it is so
as a foreign corporation, and it is domiciled in Ohio.
3

With respect to the jurisdictional amount in controversy, Shelter
has demonstrated that it exceeds $75,000.

According to the state

court petition, the plaintiff alleges that she has suffered severe
and permanently disabling injuries including herniated disc; she
seeks lost wages and lost earnings capacity, medical expenses,
damages for physical pain and suffering and mental anguish, as well
as loss of enjoyment of life.

According to the Notice of Removal,

the plaintiff has "demand[ed] Shelter's policy limits", which
provides coverage for bodily injury in the amount of $250,000 per
person/$500,000 per accident bodily injury limits.

Thus, the

amount in controversy exceeds the jurisdictional threshold of
$75,000.

The Court has diversity jurisdiction over this lawsuit.
C.

The plaintiff raises one final issue that she contends defeats
this Court's exercise of its removal jurisdiction:
defendant rule.

the forum

The applicable removal statute incorporating the

forum defendant rule provides:
A civil action otherwise removable solely on the basis
of the jurisdiction under section 1332(a) of this title
may not be removed if any of the parties in interest
properly joined and served as defendants is a citizen of
the State in which such action is brought.
28 U.S.C. § 1441(b)(2)(emphasis added). Failure to comply with the
forum defendant rule renders removal procedurally defective.

See

In re 1994 Exxon Chem. Fire, 558 F.3d 378, 392-94 (5th Cir. 2009).
Although the plaintiff concedes that the local defendant,

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Zentner, had not yet been served at the time this lawsuit was
removed by Shelter Insurance, the plaintiff contends that "the
insurance carrier for the tortfeasor cannot remove a case from
state court when its insured is a citizen of that jurisdiction."
But the plaintiff invokes no authority to support this assertion.
It is the plaintiff's position that the mere presence of a forum
state defendant in the lawsuit, whether served or unserved, bars
removal by a served, non-forum defendant under § 1441(b)(2).

The

Court disagrees.
The forum defendant rule codified in § 1441(b)(2) plainly
provides that a civil action may not be removed if any defendant
that has been joined and served is a forum defendant.

But, here,

at the time of removal, Zentner had not been served. The plaintiff
is frustrated by this rule and complains that Zentner "has been
avoiding service in a forum shopping effort."

But the plain

language of the statute must prevail over the plaintiff's policy
arguments to the contrary.2

The statutory forum defendant rule

2

There is little opportunity for appellate courts to
consider the "properly joined and served" language of the forum
defendant rule in light of the reality that orders that remand a
case to state court are statutorily non-reviewable on appeal. See
28 U.S.C. § 1447(d); see also Hkolmstrom v. Peterson, 492 F.3d 833
(7th Cir. 2007)(holding that the failure to comply with the forum
defendant rule is a defect in the removal that bars appellate
review).
Even so, in addition to the plain language of §
1441(b)(2), there is support for the result reached here, as well
as some scholarly debate.
See, e.g., Ott v. Consolidated
Freightways Crop. of Delaware, 213 F. Supp. 2d 662 (S.D. Miss.
2002); Evans v. Rare Coin Wholesalers, Inc., No. 09-259, 2010 WL
595653 (E.D. Tex. Jan. 28, 2010); Stewart v. Auguillard Constr.
5

simply does not support plaintiff's position.
Accordingly, the plaintiff's motion to remand is DENIED.

New Orleans, Louisiana, April 24, 2013
______________________________
MARTIN L. C. FELDMAN
UNITED STATES DISTRICT JUDGE

Co., Inc., No. 09-6455, 2009 WL 5175217 (E.D. La. Dec. 18, 2009);
see also 14B Wright & Miller, Federal Practice and Procedure, §
3723 (4th ed. 2009)(noting that the 1948 amendment to section
1441(b) inserted the language "and served", "which implies that a
diverse, but resident defendant who has not been served may be
ignored in determining removability."); see generally Saurabh
Vishnubhakat, Pre-Service Removal in the Forum Defendant's Arsenal,
47 Gonz. L. Rev. 147 (2011-12).
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