Costin v. Ally Bank Corp.

Filing 19

ORDER DENYING 12 Plaintiff's Motion to Remand, and DENYING 15 Plaintiff's Motion to Defer Briefing on the Motion for Costs. Parties are ordered to proceed in briefing the motion for payment of costs. The matter may proceed in its entirety. Signed by US District Judge Terrence W. Boyle on 9/9/2013. (Fisher, M.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
EASTERN DIVISION
NO. 7:13-CV-113-BO
IN ADMIRALTY
)
)
)
)
)
)
)
)
)
)
)

TERESA ANN COSTIN, Administrator for
the Estate of LINWOOD NASH COSTIN,
deceased,
Plaintiff,
V.

ALLY BANK CORP.,
Defendants.

ORDER

This matter is before the Court on the plaintiff's motion to remand this action to state
court for lack of subject matter jurisdiction pursuant to 28 U.S.C. § 1332 [DE 12] and on the
plaintiff's motion to defer the briefing on the motion for costs [DE 15]. For the reasons stated
herein, the plaintiff's motion to remand is DENIED and the plaintiff's motion to defer the
briefing on the motion for costs is DENIED as moot. The matter may proceed in its entirety.

BACKGROUND
Plaintiff, Teresa Ann Costin, is the daughter of decedent, Linwood Nash Costin.
Defendant, Ally Bank, was the lienholder on a 2004 GMC Z71 truck (the "Vehicle") Mr. Costin
owned. Mr. Costin made timely payments on the lien until February 2011, when he contacted
defendant to request deferral of payments because of some financial difficulties he experienced.
Defendant agreed to have Mr. Costin miss the March and April 2011 payments and Mr. Costin
supplied a check for the interest on those two months. When defendant did not receive the May
payment, it contacted Mr. Costin, indicating that the account was in default and the Vehicle

1

would be repossessed. Defendant informed Mr. Costin he would avoid repossession by wiring a
$578.00 payment, which Mr. Costin did on the afternoon of June 7, 2011. However, the Vehicle
was repossessed that evening. Plaintiff alleges Mr. Costin suffered a heart attack on June 9, 2011
as a result of the stress caused by the repossession of the Vehicle by defendant. Mr. Costin was
hospitalized until June 24, 2011 and died on July 5, 2011.
This is the second filing of plaintiffs lawsuit. Plaintiff initially filed a complaint against
defendant in Pender County Superior Court on July 5, 2012 (the "Original Action"). The factual
allegations in the Original Action were substantially identical to those in this action. Defendant
removed the Original Action to this Court on August 3, 2012. Defendant filed a Rule 12(b)(6)
motion to dismiss all but one of plaintiffs claims. Plaintiff requested and received multiple
extensions of time to respond, but, instead of responding in opposition to the motion, plaintiff
filed an amended complaint without leave of the Court. Defendant moved to strike the amended
complaint and plaintiff then filed a notice of voluntary dismissal without prejudice.
Plaintiff brought suit on April 17, 2013 alleging violations of Article 9 of the Uniform
Commercial Code, and the North Carolina Debt Collection Practices Act; unfair and deceptive
practices; breach of contract; negligent infliction of emotional distress; and intentional Infliction
of emotional distress. This matter was originally filed in Pender County Superior Court. The
defendant filed a timely notice of removal pursuant to 28 U.S.C. § 1447 on May 28, 2013
alleging that federal diversity jurisdiction exists. Plaintiff now seeks to have this matter
remanded to state court.
On May 31, 2013 defendant filed a motion for payment of costs and to stay. Defendant
filed this motion to recover costs from the Original Action that was voluntarily dismissed and to
stay the present proceeding until plaintiff pays those costs pursuant to Rule 41 (d) of the Federal

2

Rules of Civil Procedure. On June 27, 2013, plaintiff filed a motion to defer briefing on
defendant's motion for payment of costs and to stay. Plaintiff seeks to have the briefing deferred
until the Court rules on plaintiffs motion to remand.
DISCUSSION

I.

PLAINTIFF'S MOTION TO REMAND.

An action is removable to federal court only if it could have been brought in federal
court. 28 U.S.C. § 1441(a) (2012). A civil action may be brought in federal court "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) (2012). The burden of establishing
federal jurisdiction is on the party seeking removal. Mulcahey v. Columbia Organic Chems. Co.,
Inc., 29 F.3d 148, 151 (4th Cir. 1994). Removal jurisdiction must be strictly construed and if
federal jurisdiction is doubtful, remand is necessary. !d.
Defendant contends that removal was proper based on this Court's diversity jurisdiction
pursuant to 28 U.S.C. § 1332. Plaintiff alleges that removal was improper because the amount in
controversy does not exceed $75,000 thereby destroying diversity jurisdiction. The motion to
remand should be denied if the Court finds, by a preponderance of the evidence that the amount
in controversy exceeds $75,000. 28 U.S.C. § 1446(c) (2012). Although the amount in
controversy is normally determined from the face of the pleadings, where no specific amount is
alleged in the complaint, the Court may consider affidavits and other evidence outside of the
complaint to determine amount in controversy. See Aerial Images, Inc. v. Anderson, 5:99-CV320-B0(3), 2000 WL 33682689 at *2 (E.D.N.C. Feb. 21, 2000) (noting the Court will make its
determination based on the record). The Court may also use its judicial experience and common
sense. Roe v. Michelin N Am., Inc., 613 F.3d 1058, 1062 (11th Cir. 2010). In determining the

3

amount in controversy, the merits of the claim are not considered. Candor Hosiery Mills, Inc. v.
Int'l Networking Group, Inc., 35 F. Supp. 2d 476,479 n.2 (M.D.N.C. 1998).

Plaintiffs complaint does not specify the amount of damages sought. The only claim for
which plaintiff has specified an amount of damages sought is her claim for violations of Article 9
of North Carolina's Uniform Commercial Code. She asserts that the maximum recovery on this
claim would be in the amount of $9,402.04. However, multiple other losses have been alleged
and plaintiffs non-valued claims could easily result in a recovery of more than $75,000. By
opposing this Court's jurisdiction but refusing to specifically value the remaining claims in her
complaint, plaintiff seeks to return to state court while avoiding placing a cap on her potential
recovery.
Plaintiffs claim of intentional or negligent infliction of emotional distress alone is
sufficient to take the amount in controversy well beyond the $75,000 threshold. Plaintiff alleges
that defendant's actions caused severe and disabling emotional distress to Mr. Costin and caused
Mr. Costin to suffer a heart attack. She claims entitlements to damages for the infliction of
emotional distress as well as compensation for Mr. Costin's medical expenses and mental
suffering. Citing several decisions, defendant notes that courts have routinely found personal
injury claims, alleging less harm than plaintiff alleges, have an amount in controversy exceeding
$75,000. Defendant looks to data from the Centers for Medicare & Medicaid Services to
determine the costs of a hospitalization for a heart attack in North Carolina ($31 ,268.43), notes
the other costs associated with a heart attack including ambulance services, cardiologists,
anesthesiologists and other doctors not employed by the hospital, and arrives at a special cost
figure that reaches well into the tens of thousands at minimum. Conservatively estimating special
damages at $50,000 and conservatively estimating general damages for mental suffering and

4

emotional distress at two times the special damages, defendant estimates a total amount in
controversy of $150,000 for this claim alone. Defendant also values each of the remaining claims
based on research and a realistic expectation of results.
Defendant values plaintiffs breach of contract claim at $1300. Defendant arrived at this
value by adding the claimed $500 in stolen property to the replacement vehicle rental cost for the
14 days Mr. Costin is alleged to have lost the use of the Vehicle. Defendant values plaintiffs
claim for unfair and deceptive trade practices at a minimum of $40,000. Plaintiff seeks $10,000
in damages and seeks to have these damages trebled. Additionally she seeks attorney's fees, a
reasonable approximation of which is $10,000. These are properly included in determining the
amount in controversy. Aerial Images, Inc. at* 2 n.2. Defendant values plaintiffs claim for three
violations of the Unfair Debt Collection Practices Act to be $12,000. This is based on up to
$4,000 in statutory damages per each violation in addition to actual damages. Finally there is
plaintiffs stated claim for $9,402.04 for violations of Article 9 of North Carolina's Uniform
Commercial Code.
All told, the value of plaintiffs claims exceeds $200,000. Defendant has carried its
burden of supporting this Court's jurisdiction by a preponderance of the evidence. Accordingly
plaintiffs motion to remand is denied.
II.

PLAINTIFF'S MOTION TO DEFER BRIEFING ON THE MOTION FOR
COSTS.

Plaintiffs motion to defer briefing on the motion for costs has been mooted by this order.
The motion is, accordingly, denied as moot.

5

CONCLUSION

For the foregoing reasons, the plaintiffs motion to remand is DENIED; and plaintiffs
motion to defer briefing on the motion for costs is DENIED. Parties are ORDERED to proceed
in briefing the motion for payment of costs. The matter may proceed in its entirety.

SO ORDERED.
This the_!_ day of September, 2013.

UNITED STATES DISTRIC JUDGE

6