Williams v. Safeway Insurance Company
Filing
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Memorandum Opinion and Order Denying Plaintiff Tracy Williams' Motion to Amend Complaint 9 and Motion to Remand 10 . Signed by District Judge Halil S. Ozerden on August 14, 2018. (BGL)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
SOUTHERN DIVISION
TRACY WILLIAMS
PLAINTIFF
v.
CIVIL NO. 1:17cv296-HSO-JCG
SAFEWAY INSURANCE COMPANY
DEFENDANT
MEMORANDUM OPINION AND ORDER DENYING
PLAINTIFF TRACY WILLIAMS’ MOTION TO AMEND
COMPLAINT [9] AND MOTION TO REMAND [10]
This matter is before the Court on Plaintiff Tracy Williams’ Motion to Amend
Complaint [9] and Motion to Remand [10]. The Motions are fully briefed. Having
considered the parties’ submissions, the related pleadings, and relevant legal
authority, the Court is of the opinion that Plaintiff’s Motions should be denied.
I. BACKGROUND
On or about May 20, 2016, Plaintiff Tracy Williams (“Plaintiff”) was involved
in an automobile accident at the intersection of Three Rivers Road and Highway
605 in Gulfport, Mississippi. Compl. [1-2] at 1-2. Plaintiff alleges that the collision
was caused by the negligence of Jessica L. Ramirez (“Ramirez”), who was insured by
USA Insurance Company with policy limits of $25,000.00. Id. Plaintiff avers that
because of the extensive nature of the injuries she suffered, her damages are in
excess of Ramirez’ policy limits. Id. at 3. She therefore filed a claim under her own
underinsured insurance policy with Safeway Insurance Company (“Defendant”),
seeking the policy limits of $50,000.00. Id. According to Plaintiff, Safeway has
“wrongfully and in bad faith withheld benefits due to the [P]laintiff.” Id. at 3-4.
Plaintiff originally filed her Complaint on September 14, 2017, in the County
Court of Harrison County, Mississippi, First Judicial District, Cause No. D2401-171440, naming Safeway as the Defendant and seeking an unspecified amount of
compensatory and punitive damages. Id. at 3-4. Defendant removed the case to
this Court invoking federal diversity jurisdiction pursuant to 28 U.S.C. §§ 1332,
1441, and 1446. Notice of Removal [1] at 1-3. Defendant contends that because
Plaintiff is seeking a judgment for an unspecified amount of compensatory damages,
plus an unspecified amount of punitive damages, her claims exceed $75,000.00,
crossing the jurisdictional threshold for diversity of citizenship cases. Id.
Plaintiff has filed both a Motion to Amend Complaint [9] and a Motion to
Remand [10]. Plaintiff seeks leave to amend her Complaint to clarify that the
damages she is seeking “do not exceed $75,000, inclusive of the $25,000.00 (sic) in
uninsured motorist’s benefits available under the applicable Safeway policy,
compulsory and punitive damages, attorney fees and costs.” Proposed First Am.
Compl. [9-1] at 4. Simultaneously, Plaintiff asks that this case be remanded since
the amount in controversy is less than the statutory minimum of $75,000.00. Mot.
to Remand [10] at 2.
Defendant responds that federal jurisdiction attached at the time of removal,
and cannot be defeated through a subsequent motion to amend the complaint to
reduce the damages sought below the jurisdictional amount. Resp. in Opp’n to
Remand [13] at 1-3; Resp. in Opp’n Am. Compl. [12] at 1-2.
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II. DISCUSSION
A.
Removal standard
28 U.S.C. § 1441 provides for the removal of civil actions brought in a state
court of which the district courts have original jurisdiction. 28 U.S.C. § 1441(a)
(2012). Under 28 U.S.C. § 1332, “[t]he district courts shall have original jurisdiction
of all civil actions where the matter in controversy exceeds the sum or value of
$75,000, exclusive of interest and costs, and is between . . . citizens of different
States . . . .” 28 U.S.C. § 1332(a)(1).
Federal courts are courts of limited jurisdiction, having subject-matter
jurisdiction only over those matters specifically designated by the Constitution or
Congress. Halmekangas v. State Farm Fire & Cas. Co., 603 F.3d 290, 292 (5th Cir.
2010) (citing Epps v. Bexar-Medina-Atascosa Counties Water Improvement Dist. No.
1, 665 F.2d 594, 595 (5th Cir. 1982)). For this reason, removal statutes are subject
to strict construction. Hood ex. rel. Miss. v. JP Morgan Chase & Co., 737 F.3d 78,
92 (5th Cir. 2013); Willy v. Coastal Corp., 855 F.2d 1160, 1164 (5th Cir. 1988).
Doubts about whether federal jurisdiction exists following removal must be resolved
against a finding of jurisdiction. Acuna v. Brown & Root, Inc., 200 F.3d 335, 339
(5th Cir. 2000) (citing Willy, 855 F.2d at 1164). The party seeking removal bears
the burden of establishing federal jurisdiction over the state court suit. Boone v.
Citigroup, Inc., 416 F.3d 382, 388 (5th Cir. 2005); Willy, 855 F.2d at 1164.
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B.
Diversity jurisdiction under 28 U.S.C. § 1332(a)
The record reflects, and the parties do not dispute, that they are of diverse
citizenship. At issue is whether the amount in controversy is satisfied. According to
§ 1446(c)(2),
[i]f removal of a civil action is sought on the basis of the jurisdiction
conferred by section 1332(a), the sum demanded in good faith in the
initial pleading shall be deemed to be the amount in controversy . . .
except that—
(A) the notice of removal may assert the amount in controversy
if the initial pleading seeks—
(i) nonmonetary relief; or
(ii) a money judgment, but the State practice either does
not permit demand for a specific sum or permits recovery
of damages in excess of the amount demanded; and
(B) removal of the action is proper on the basis of an amount in
controversy asserted under subparagraph (A) if the district
court finds, by the preponderance of the evidence, that the
amount in controversy exceeds the amount specified in
section 1332(a).
28 U.S.C. § 1446(c)(2).
Under § 1446, “a defendant’s notice of removal need only include 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).
Generally, “when a defendant seeks federal court adjudication, the defendant’s
amount-in-controversy allegation should be accepted when not contested by the
plaintiff or questioned by the court.” Id. at 553. When questioned, § 1446(c)(2)(B)
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dictates the procedure to follow: “both sides submit proof and the court decides, by a
preponderance of the evidence, whether the amount-in-controversy requirement has
been satisfied.” Id. at 554.
Jurisdictional facts, including the amount in controversy, are judged as of the
time of removal. Gebbia v. Wal-Mart Stores, Inc., 233 F.3d 880, 883 (5th Cir. 2000);
see also Toney v. State Farm Lloyds, 661 F. App=x 287, 290 (5th Cir. 2016). When an
insurance policy is at issue, under certain circumstances the policy limit will
establish the amount in controversy. See, e.g., Hartford Ins. Grp. v. Lou-Con Inc.,
293 F.3d 908, 911 (5th Cir. 2002). “[I]f an insurance policy limits the insurer=s
liability to a sum below the jurisdictional threshold, the fact that a claimant wants
more money does not increase the amount in controversy.” Id. However, in
ascertaining the amount in controversy, a court may also include punitive damages
and other items for which an insurer could be liable under state law. St. Paul
Reinsurance Co. v. Greenberg, 134 F.3d 1250, 1253 (5th Cir. 1998); see also Toney,
661 F. App’x at 290. Under Mississippi law, “[a] punitive damages claim should be
decided by a jury if 1) there was no arguable or legitimate basis for denying
coverage, and 2) the insurance company acted with malice or gross and reckless
disregard for the rights of the insured.” United States Fid. & Guar. Co. of
Mississippi v. Martin, 998 So. 2d 956, 970 (Miss. 2008).
“[I]f it is facially apparent from the petition that the amount in controversy
exceeds $75,000 at the time of removal, post-removal affidavits, stipulations, and
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amendments reducing the amount do not deprive the district court of jurisdiction.”
Gebbia, 233 F.3d at 883. A court may consider a post-removal affidavit when the
jurisdictional amount was ambiguous on the face of the state petition and the
affidavit helps clarify the jurisdictional facts as of the time of removal. St. Paul
Reinsurance Co., 134 F.3d at 1254 n.18.
C.
Analysis
1.
The amount in controversy was satisfied at the time of removal.
Plaintiff did not request a specific amount of damages in her Complaint, but
did state that her underinsured insurance policy “provides in excess of $50,000.00 in
underinsurance coverage per occurrence,” Compl. [1-2] at 3, and demanded
judgment “in an amount within the jurisdictional limit of this [c]ourt but not limited
to the amount of the uninsured coverage available under the applicable Safeway
policy, compensatory damages, interest and costs of suit and punitive damages,” id.
at 4. Therefore, at the time of removal Plaintiff was seeking compensatory damages
up to the $50,000.00 policy limit plus an unspecified amount of punitive damages,
all not to exceed the $200,000.00 jurisdictional limit of the County Court. See
Mississippi Code § 9-9-21 (providing in pertinent part that the county courts of
Mississippi “have jurisdiction concurrent with the circuit and chancery courts in all
matters of law and equity wherein the amount of value of the thing in controversy
shall not exceed, exclusive of costs and interest, the sum of Two Hundred Thousand
Dollars ($200,000.00)”).
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As for the punitive damages claim, the Complaint charges that in denying
Plaintiff’s claims under the insurance policy, Safeway’s conduct was “deliberately
undertaken, intentional, wanton, willfull, and in reckless disregard of the rights
and well-being of [P]laintiff, and by reason thereof, [P]laintiff requests that a jury
be allowed to determine the appropriateness and amount of punitive damages for
said behavior.” Compl. [1-2] at 4. The Complaint set forth facts which, if proven,
could justify an award of punitive damages under Mississippi law, in addition to the
compensatory damages sought.
Reviewing the Complaint as a whole, the Court finds that it is facially
apparent that Plaintiff was demanding damages in excess of $75,000.00 at the time
of removal. Safeway has carried its burden of demonstrating that, at the time of
removal, the amount in controversy in this particular case exceeded the sum or
value of $75,000.00, exclusive of interest and costs. See 28 U.S.C. ' 1332(a).
Therefore, this Court possessed subject-matter jurisdiction at the time of removal
and Plaintiff=s Motion to Remand should be denied.
2.
Because this Court possessed subject-matter jurisdiction at the time of
removal, neither Plaintiff’s post-removal Affidavit nor her Motion to
Amend Complaint can deprive the Court of jurisdiction.
In an attempt to have this case remanded to state court, where Plaintiff
attests she “desire[s] to litigate this claim,” Plaintiff has submitted both a postremoval Affidavit and a Motion to Amend Complaint to clarify that she is seeking
less than $75,000.00 in damages. Mot. to Amend Compl. [10] at 1-2; Pl. Aff. [18] at
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1-2. Because it was facially apparent at the time of removal that Plaintiff was
demanding in excess of $75,000.00, these post-removal filings attempting to reduce
the amount in controversy do not “deprive the district court of jurisdiction.” Gebbia,
233 F.3d at 883. Based upon the foregoing, the Court finds that Plaintiff’s Motion
to Amend Complaint should be denied without prejudice.
III. CONCLUSION
After review of the Complaint, the record as a whole, and relevant legal
authority, the Court finds that Plaintiff’s Motion to Remand should be denied and
Plaintiff’s Motion to Amend Complaint should be denied without prejudice.
IT IS, THEREFORE, ORDERED AND ADJUDGED that Plaintiff Tracy
Williams’ Motion to Remand [10] is DENIED and Plaintiff’s Motion to Amend
Complaint [9] is DENIED WITHOUT PREJUDICE.
SO ORDERED AND ADJUDGED, this the 14th day of August, 2018.
s/ Halil Suleyman Ozerden
HALIL SULEYMAN OZERDEN
UNITED STATES DISTRICT JUDGE
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