Shelton v. Volkswagen Group of America, Inc.

Filing 12

ORDER granting 3 Motion to Remand to State Court; denying 4 Motion to Stay. Signed by Judge Michael R. Barrett on 12/28/15. (Copy of this Order has been sent by regular U.S. mail to Clermont County Court of Common Pleas) (ba)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
SARA M. SHELTON,

Case No.: 1:15-CV-733

Plaintiff,

Judge Michael R. Barrett

v.
VOLKSWAGEN GROUP OF
AMERICA, INC.,
Defendant.
OPINION AND ORDER
This matter is before the Court on Plaintiff Sara Shelton’s Motion to Remand. (Doc. 3).
Defendant Volkswagen Group of America, Inc. has filed a response in opposition. (Doc. 7).
Plaintiff has filed a reply. (Doc. 9).
Also before the Court is Defendant’s Motion to Stay. (Doc. 4). Plaintiff has filed a
response in opposition to the Motion to Stay (Doc. 5). Defendant has filed a reply. (Doc. 6).
I.

FACTUAL SUMMARY
On October 14, 2015, Plaintiff filed her Complaint in the Clermont County Court of

Common Pleas, asserting causes of action against Defendant for violation of the Ohio Consumer
Sales Practices Act, fraudulent concealment, breach of implied warranty, rescission and
restitution, and punitive damages. Her claim concerns a “Defeat Device” employed on a 2015
Jetta TDI diesel vehicle purchased by Plaintiff. Defendant is alleged to manufacture such
vehicles through its affiliates Volkswagen AG and Audi AG. In the Complaint, Plaintiff states:
Plaintiff, in this action, seeks damages, costs, attorney’s fees and prejudgment
interest, and hereby stipulates that the cumulative amount that she seeks for all
forms of damages, costs, attorney’s fees and prejudgment interest will not
exceed $74,000.00. Plaintiff further stipulates that any judgment that may be
entered by the court herein should not, under any circumstances, cumulatively
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total more than $74,000.00. Plaintiff is willing that this stipulation be binding
throughout the course of this litigation until its conclusion.
(Doc. 2, PageId 59). Plaintiff’s demand seeks money damages, including treble damages, or in
the alternative, rescission and restitution. (Id., PageId 63). She further seeks costs and attorney’s
fees, and punitive damages. (Id., PageId 63-64). She indicates that the total recovery she seeks
should be limited to “not a penny more than $74,000.” (Id., PageId 64).
II.

ANALYSIS
A. Motion to Stay
Defendant seeks a stay of the proceedings, including any ruling on the motions to

remand, pending the Multidistrict Litigation Panel’s ruling on whether to transfer this action to a
multidistrict action. This Court finds that it is in the interest of efficiency and economy to rule
upon the pending motions in this Court prior to any decision by the MDL.

Accordingly, the

motion to stay shall be denied.
B. Motion to Remand
Generally, a civil case brought in state court may be removed by a defendant to federal
court only if the action is one over which the federal court could have exercised original
jurisdiction. 28 U.S.C. §§ 1441, 1446. A federal district court has original jurisdiction over civil
actions where the parties are completely diverse and the amount in controversy exceeds $75,000,
exclusive of interest and costs. 28 U.S.C. § 1332. Here, there is no dispute that the parties are
completely diverse. The parties disagree, however, as to whether the amount-in-controversy
requirement is satisfied. Specifically, the parties dispute whether Plaintiff’s statement in her
Complaint that she would not seek or accept an award in excess of $74,000.00 is sufficient to
destroy diversity jurisdiction and whether Defendant has shown that the reasonable value of
Plaintiff’s claims exceeded $75,000 at the time of removal.
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A defendant seeking to remove a case bears the burden of satisfying the amount-incontroversy requirement by a preponderance of the evidence. 28 U.S.C. § 1446(c)(2); see also
Everett v. Verizon Wireless, Inc., 460 F.3d 818, 822 (6th Cir. 2006). Courts generally are to
view the claims from the vantage point at the time of removal. Everett, 460 F.3d at 822. “‘[A]ll
doubts as to the propriety of removal are resolved in favor of remand.’” Smith v. Nationwide
Prop. & Cas. Ins. Co., 505 F.3d 401, 405 (6th Cir. 2007) (quoting Jacada, Ltd. v. Int’l Mktg.
Strategies, Inc., 401 F.3d 701, 704 (6th Cir. 2005)) (additional quotations omitted).
1. Damages Limitation
When a notice of removal is based upon 28 U.S.C. § 1332(a), “the sum demanded in
good faith in the initial pleading shall be deemed to be the amount in controversy” unless the
initial pleading either seeks non-monetary relief, or seeks a money judgment, but the State
practice either does not permit a demand for a specific sum or permits recovery of damages in
excess of the amount demanded. 28 U.S.C. § 1446(c)(2). Under the Ohio Rules of Civil
Procedure, a plaintiff is precluded from stating in her complaint the specific amount she seeks to
recover. Ohio R. Civ. P. 8(a) (stating that the party “shall not specify in the demand for
judgment the amount of recovery sought”). Instead, “[a]t any time after the pleading is filed and
served, any party from whom monetary recovery is sought may request in writing that the party
seeking recovery provide the requesting party a written statement of the amount of recovery
sought.” Ohio R. Civ. P. 8(a). The Ohio Rules of Civil Procedure further allow a plaintiff to
recover more in damages than what she seeks in her complaint. See Ohio R. Civ. P. 54(C)
(“every final judgment shall grant the relief to which the party in whose favor it is rendered is
entitled, even if the party has not demanded the relief in the pleadings”). .

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Under these rules, Plaintiff’s demand is not controlling and does not preclude Defendant
from seeking removal. Plaintiff contends, however that the statement in the Complaint labeled
“Stipulation” that limits the recoverable amount constitutes a binding stipulation that destroys
diversity jurisdiction.
Courts have permitted a plaintiff to stipulate to a limitation on damages and destroy
diversity jurisdiction by doing so when the stipulation is unequivocal. Standard Fire Ins. Co. v.
Knowles, 133 S. Ct. 1345, 1348 (2013); Egan v. Premier Scales & Sys., 237 F. Supp. 2d 774, 778
(W.D. Ky. 2002). Courts have found language to be unequivocal when it indicates that the
plaintiff neither seeks, nor will accept, damages in an amount exceeding $75,000. Jefferson v.
Hyatt, No. 3:14-cv-601, 2015 U.S. Dist. LEXIS 46837, at *9 (W.D. Ky. Apr. 9, 2015) (“[he] will
not seek or accept an award of damages in excess of $74,999.00 inclusive of punitive damages,
attorneys’ fees, and the fair value of any injunctive relief”); see also Martin v. UPS Supply Chain
Solutions, No. 3:14-cv-342, 2015 U.S Dist. LEXIS 19007, at *7-8, *10-11 (W.D. Ky. Feb 13,
2015) (same as Jefferson); Tankersley v. Martinrea Heavy Stampings, Inc., 33 F. Supp. 3d 775,
776, 781 (E.D. Ky. 2014) (“Plaintiff expressly asserts in the above cause of action, any
subsequent action(s), that Plaintiff will not seek or accept an award of damages in excess of
$74,999.00 inclusive of punitive damages, attorneys’ fees, and the fair value of any injunctive
relief.”); Van Etten v. Boston Scientific Corp., No. 3:09-cv-442, 2009 U.S. Dist. LEXIS 99079
(W.D. Ky. Oct. 23, 2009) (“he ‘hereby certifies to the Court that he will not be making a claim
nor pursuing damages in amount equal to or exceeding the sum of $75,000’”); Spence v.
Centerplate, 931 F. Supp. 2d 779, 781-82 (W.D. Ky. 2013) (“Plaintiff expressly asserts . . . that
Plaintiff will not seek or accept an award of damages in excess of $74,999.00 inclusive of
punitive damages, attorneys’ fees, and the fair value of injunctive relief”); Agri-Power, Inc. v.

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Majestic JC, LLC, No. 5:13-cv-46, 2013 U.S. Dist. LEXIS 90410 (W.D. Ky. June 17, 2013)
(“[Plaintiff] seeks to recover . . . $24,000 in compensatory damages, together with punitive
damages not to exceed $24,000 [and] will not accept an award of damages that exceeds
$50,000.00 in total, exclusive of interest and costs”). The statement of stipulation in Plaintiff’s
Complaint utilizes language analogous to the language used in those cases. While the Court
acknowledges that caselaw cited by the parties generally has rejected the notion that a statement
as to the limitation of damages in a complaint is sufficient, those cases each involved a
generalized demand for damages that limited the amount in controversy rather than the type of
unequivocal stipulation as is present in this case. See Jefferson, 2015 U.S. Dist. LEXIS 46837, at
*5; Martin, 2015 U.S Dist. LEXIS 19007, at *5-6; Cook v. Estate of Moore, No. 3:12-cv-485,
2012 U.S. Dist. LEXIS 157486 (W.D. Ky. 2012); Ambrozich v. ConAgra Foods, Inc., No. 7:07107, 2007 U.S. Dist. LEXIS 86448, at *7-8 (E.D. Ky. Aug. 2, 2007). Given that the Court is
convinced that Plaintiff will be bound by the stipulation made in the Complaint throughout the
course of the litigation, it resolves any doubts or ambiguities in the law in favor of remand.
2. Attorneys’ Fees and Costs
“An order remanding the case may require payment of just costs and any actual expenses,
including attorney fees, incurred as a result of the removal.” 28 U.S.C. § 1447. “Absent unusual
circumstances, courts may award attorney's fees under § 1447(c) only where the removing party
lacked an objectively reasonable basis for seeking removal.” Paul v. Kaiser Found. Health Plan,
701 F.3d 514, 523 (6th Cir. 2012) (quoting Martin v. Franklin Capital Corp., 546 U.S. 132, 140
(2005)). “The objective reasonableness standard, however, does not require a showing that the
defendant's position was ‘frivolous’ or ‘without foundation.’” Kent State Univ. Bd. of Trs. v.
Lexington Ins. Co., 512 F. App'x 485, 489 (6th Cir. Jan. 22, 2013) (citing Martin, 546 U.S. at

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138-39)). Rather, the “appropriate test for awarding fees under § 1447(c) should recognize the
desire to deter removals sought for the purpose of prolonging litigation and imposing costs on
the opposing party, while not undermining Congress' basic decision to afford defendants a right
to remove as a general matter, when the statutory criteria are satisfied.” Martin, 546 U.S. at 140.
Here, the Court finds that an award of attorneys' fees and costs is not appropriate. While
Defendant did not ultimately succeed in avoiding remand, the basis for removal was not, in this
Court's view, objectively unreasonable. As such, attorneys’ fees and costs will not be awarded in
this instance.
III.

CONCLUSION
For the foregoing reasons, Defendant’s Motion to Stay (Doc. 4) is DENIED, and

Plaintiff’s Motion to Remand (Doc. 3) is GRANTED. This case shall be REMANDED to the
Clermont County Court of Common Pleas.
IT IS SO ORDERED.
s/Michael R. Barrett
JUDGE MICHAEL R. BARRETT
UNITED STATES DISTRICT COURT

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