Dykema v. Jo Ann Stores, LLC

Filing 9

OPINION and Order remanding case to State Circuit Court; signed by District Judge Paul L. Maloney (Judge Paul L. Maloney, cmc)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
AMEY DYKEMA,
Plaintiff,

)
)
)
-v)
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JO-ANN STORES, LLC,
)
Defendant.
)
____________________________________)

No. 1:16-cv-380
HONORABLE PAUL L. MALONEY

OPINION AND ORDER REMANDING CASE TO STATE CIRCUIT COURT
In June 2013, Plaintiff Amey Dykema suffered “physical injury,” among other alleged
collateral damages, because “Defendant’s employee dropped one of Defendant’s items of
merchandise on Plaintiff’s head, neck, and shoulder.” (ECF No. 1-3 at PageID.12.) Dykema filed
a one-count negligence complaint in Muskegon County Circuit Court on March 14, 2016,
demanding “judgment in her favor in excess of $25,000.” (Id. at PageID.11–12.) Defendant JoAnn Stores, LLC, filed a notice of removal, asserting that it “ha[d] a good faith belief that the
amount in controversy exceeds $75,000, exclusive of costs and interest, if all of Jo-Ann’s defenses
fail and if Plaintiff proves all of the damages alleged in her Complaint.” (ECF No. 1 at PageID.2.)
The Court, after reviewing the Notice of Removal and the Complaint, remained “very
skeptical” that the amount in controversy suffices to confer federal diversity jurisdiction. (See ECF
No. 3 at PageID.17.) Thus, the Court ordered Defendants to show cause “why this case meets the
federal diversity jurisdictional threshold.” (Id.) After reviewing Defendant’s response (ECF No.
9), the Court concludes that no evidence, let alone a preponderance of evidence, was submitted to
establish that the amount in controversy of this dispute exceeds $75,000. Thus, the Court must
remand this action.

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I.

LEGAL FRAMEWORK
“As courts of limited jurisdiction, federal courts may exercise only those powers

authorized by the Constitution and statute.” Fisher v. Peters, 249 F.3d 433, 444 (6th Cir. 2001).
Federal courts have an on-going obligation to examine whether they have subject-matter
jurisdiction over an action and may raise the issue sua sponte. See, e.g., Hertz Corp. v. Friend, 559
U.S. 77, 94 (2010); Arbaugh v Y&H Corp., 546 U.S. 500, 506 (2006); Wisconsin Dep’t of Corr. v.
Schacht, 524 U.S. 381, 389 (1998). When a lawsuit is removed from state court, federal courts
have an obligation to examine whether subject-matter jurisdiction exists. E.g., Nowicki-Hockey v.
Bank of America, N.A., 593 F. App’x 420, 421 (6th Cir. 2014); Williamson v. Aetna Life Ins., 481
F.3d 369, 375 (6th Cir. 2007) (“Jurisdiction is determined at the time of removal.”).
Under 28 U.S.C. § 1332(a), federal courts have original jurisdiction over civil actions
where the amount in controversy exceeds $75,000 and the matter is between citizens of different
states.1 A defendant may remove a civil action filed in state court to a federal district court when
the federal district court would have original jurisdiction. 28 U.S.C. § 1441(a). The party removing
the lawsuit bears the burden of establishing that the federal courts have subject-matter jurisdiction.
Nowicki-Hockey, 593 F. App’x at 421. This burden includes establishing that the amount in
controversy exceeds $75,000. Everett v. Verizon Wireless, Inc., 460 F.3d 818, 822 (6th Cir. 2006).
To meet its burden, a defendant removing a lawsuit to federal court ordinarily “need
include only a plausible allegation that the amount in controversy exceeds the jurisdictional
threshold.” Dart Cherokee Basin Operating Co., LLC v. Owens, 135 S. Ct. 547, 554 (2014). A
defendant’s plausible allegation of the amount in controversy in the notice of removal will be
sufficient “unless contested by the plaintiff or questioned by the court.” Id. at 550 (emphasis

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Defendant states that “Plaintiff is a resident of the State of Michigan,” and “Jo-Ann is a limited liability company,
with its principal place of business in Hudson, Ohio.” (ECF No. 1 at PageID.2.)

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added). When the amount in controversy is questioned, the defendant must provide evidence to
support its allegation that the lawsuit involves an amount in controversy meeting the jurisdictional
threshold. Id. at 554. The defendant’s burden is to prove, by a preponderance of the evidence, that
the amount in controversy exceeds $75,000. 28 U.S.C. § 1446(c)(2)(B); see, e.g., Northrup Props.,
Inc. v. Chesapeake Appalachia, L.L.C., 567 F.3d 767, 769–70 (6th Cir. 2009).
I.

ANALYSIS
The Court’s show-cause order clearly, in relevant part, stated:
In the Notice of Removal, counsel stated in conclusory fashion that “Jo-Ann
has a good faith belief that the amount in controversy exceeds $75,000, exclusive
of costs and interest, if all of Jo-Ann’s defenses fail and if Plaintiff proves all of the
damages alleged in her Complaint.” (ECF No. 1 at PageID.2.) With respect to these
alleged facts, the Court finds Jo-Ann’s “belief,” without more, grossly insufficient
to establish federal subject-matter jurisdiction.
In the Court’s experience, cases like this one, which encompass vaguely
alleged “physical injury” resulting from an accident arising from a store visit, do
not typically implicate damages in excess of $75,000. The Court, therefore,
ORDERS Defendant to SHOW CAUSE why this case meets the federal diversity
jurisdictional threshold. Defendant must establish, by a preponderance of evidence,
that the amount in controversy exceeds $75,000.

(ECF No. 3 at PageID.17.) Thus, Defendant was on notice of the Court’s concerns and the
appropriate evidentiary burden.
In response to the show-cause order, Defendant submitted: a) a three-page brief; b) the
original summons and complaint; and c) a “stipulation as to the diversity jurisdiction of the Court.”
(See ECF Nos. 8, 8-1–8-3.)
First, it is axiomatic that “unsupported assertions of counsel are not evidence.” Camaj v.
Holder, 625 F.3d 988, 991 n.3 (6th Cir. 2010); see, e.g., Duha v. Agrium, 448 F.3d 867, 879 (6th
Cir. 2006) (“Arguments in parties’ briefs are not evidence.”). Thus, all unsupported assertions
relating to an alleged “pre-litigation claim” must be disregarded. (See ECF No. 8 at PageID.31–
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32.) Defendant produced no affidavits, no pre-suit demand letters, no reports, no documents, and
no videos to persuade the Court. The parties have not even identified the “item[] of merchandise”
that an employee allegedly “dropped” on “Plaintiff’s head.” (See ECF No. 1-3 at PageID.12.)
It’s perplexing that a party whose “burden is to prove, by a preponderance of the evidence,
that the amount in controversy exceeds $75,000,” fails to produce any evidence at all. (ECF No. 3
at PageID.17); 28 U.S.C. § 1446(c)(2)(B); see, e.g., Northrup Props., Inc. v. Chesapeake
Appalachia, L.L.C., 567 F.3d 767, 769–70 (6th Cir. 2009).
Defendant did submit a post-removal stipulation signed by Plaintiff’s counsel. (See ECF
No. 8-3.) As an initial matter, “[o]f course, the parties cannot stipulate to jurisdiction where none
exists.” Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003).
Moreover, a post-removal stipulation cannot be relied upon as evidence to establish
jurisdiction, which “is determined at the time of removal.” Williamson, 481 F.3d at 375.
The Seventh Circuit has held that “because jurisdiction is determined as of the instant of
removal, a post-removal affidavit or stipulation is no more effective than a post-removal
amendment of the complaint.” In re Shell Oil Co., 970 F.2d 355, 356 (7th Cir. 1992).
The Sixth Circuit has held the same in the context of a post-removal stipulation to an
amount below $75,000. See, e.g., Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868, 872 (6th Cir.
2000). But the same principle logically applies to post-removal stipulations to an amount above
$75,000. See id. at 873 (“Plaintiff’s post-removal stipulation has no effect because jurisdiction is
decided as of the time of removal.”); Hampton v. Safeco Ins. Co. of Am., 614 F. App’x 321, 323
(6th Cir. 2015) (quoting St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 293 (1938))
(“[S]ubsequent events, ‘whether beyond the plaintiff’s control or the result of his volition, do not
oust the district court’s jurisdiction once it has attached.’”).

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Even if a post-removal stipulation could be considered, the Court would not give the
attached stipulation any weight to satisfy subject-matter jurisdiction. (See ECF No. 8-3 at
PageID.41–42.) In conclusory fashion, the stipulation asserts: “Plaintiff hereby stipulates that the
amount in controversy in this action, including any damages for which Plaintiff seeks recovery
against Jo-Ann, exceeds the sum or value of $75,000.” (ECF No. 8-3 at PageID.42.)
Plaintiff’s stipulation is equally as conclusory as Defendant’s original assertion in its
Notice of Removal, which the Court deemed “grossly insufficient.” (ECF No. 3 at PageID.17.)
(“In the Notice of Removal, counsel stated in conclusory fashion that ‘Jo-Ann has a good faith
belief that the amount in controversy exceeds $75,000, exclusive of costs and interest, if all of JoAnn’s defenses fail and if Plaintiff proves all of the damages alleged in her Complaint.’ (ECF No.
1 at PageID.2.) With respect to these alleged facts, the Court finds Jo-Ann’s “belief,” without
more, grossly insufficient to establish federal subject-matter jurisdiction.”)
In the absence of any evidence, the Court faces the same picture prior to issuance of the
show-cause order. (See ECF Nos. 1-3, 3.) Accordingly, subject-matter jurisdiction does not exist.
ORDER2
For the reasons contained in the accompanying opinion, the Court REMANDS this case
to the Muskegon County Circuit Court. The Clerk of Court should make all appropriate
arrangements.
IT IS SO ORDERED.
Date: May 12, 2016

/s/ Paul L. Maloney
Paul L. Maloney
United States District Judge

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“An order remanding a case to the State court from which it was removed is not reviewable on appeal or
otherwise.” 28 U.S.C. § 1447(d). 

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