Sylvester v. Scottsdale Insurance Company, et al

Filing 14

ORDER denying 8 Motion to Remand to State Court. Signed by Judge Jay C. Zainey. (jrc)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
JIMMY SYLVESTER

CIVIL ACTION

VERSUS

NO: 14-2030

SCOTTSDALE INSURANCE CO., ET AL.

SECTION: "A" (5)

ORDER AND REASONS
Before the Court is a Motion to Remand (Rec. Doc. 5) filed by plaintiff Jimmy
Sylvester. Defendant Scottsdale Insurance Co. opposes the motion. The motion, noticed for
submission on October 22, 2014, is before the Court on the briefs without oral argument.
Plaintiff filed this lawsuit in state court to recover for underpayment of a property
insurance claim. Defendant Scottsdale Insurance issued the policy and defendant AdjustCo,
LLC adjusted the claim. AdjustCo destroys complete diversity of citizenship. Scottsdale1
nonetheless removed the action to this Court alleging that Plaintiff improperly joined
AdjustCo. Plaintiff now moves to remand the case to state court. The sole question is whether
AdjustCo is in fact improperly joined.
The improper joinder doctrine constitutes a narrow exception to the rule of complete
diversity. Cuevas v. BAC Home Loans Serv., LP, 648 F.3d 242, 249 (5th Cir. 2011) (citing
McDonal v. Abbott Labs., 408 F.3d 177, 183 (5th Cir. 2005)). To establish improper joinder,
the removing party must demonstrate that the plaintiff cannot establish a cause of action
against the non-diverse party in state court. Id. (citing Smallwood v. Ill. Cent. R.R. Co., 385
F.3d 568, 575 (5th Cir. 2004)). The test is whether the defendant has demonstrated that there
is no possibility of recovery by the plaintiff against the non-diverse defendant, which stated

The notice of removal also purports to be filed by AdjustCo but as an improperly joined
defendant AdjustCo cannot invoke the jurisdiction of a federal court.
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differently "means that there is no reasonable basis for the district court to predict that the
plaintiff might be able to recover against an in-state defendant." Id.
According to the Petition, Scottsdale sent an adjuster employed by AdjustCo to
estimate the damage to Plaintiff's property. (Rec. Doc. 8-3, Petition ¶ 11). The crux of the claim
against AdjustCo is that its adjuster refused to include certain aspects of damage in the
estimate that Plaintiff contends should have been included, and that the adjuster manipulated
the pricing for repairs so that the claim was underpaid. (Id. ¶¶ 12-14). Under Louisiana law, an
insurance adjuster owes no legal duty to the insured to properly investigate or handle claims.
See Westmoreland v. Wright Nat'l Flood, No. 13-564, 2014 WL 1343387, at *2 (M.D. La. Apr.
3, 2014) (citing numerous consistent decisions). An exception exists, however, where the facts
suggest that the adjuster has acted in some way toward the insured so as to have undertaken a
duty that might not otherwise exist. See Pellerin v. Cashway Pharmacy of Franklin, Inc., 396
SO. 2d 371, 373 (La. App. 1st Cir. 1981).
The facts alleged in this case in no way suggest that AdjustCo's employee assumed any
duty toward the insured. In fact, Plaintiff's complaint regarding the adjuster is that he refused
to adjust the claim the way that Plaintiff wanted it done. Nothing suggests a special
relationship much less a legal duty between Plaintiff and AdjustCo. Plaintiff has no possibility
of recovering against AdjustCo under state law.
Accordingly, and for the foregoing reasons;
IT IS ORDERED that the Motion to Remand (Rec. Doc. 5) filed by plaintiff
Jimmy Sylvester is DENIED.
October 31, 2014
JAY C. ZAINEY
UNITED STATES DISTRICT JUDGE

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