Barber v. American Family Home Insurance Company
Filing
70
ORDER denying 55 Motion to Remand to State Court by Nancy Barber and granting 67 Motion to Dismiss crossclaims of cross claimant Nancy Barber by Kelly Barber. Crossclaim against Kelly Barber is dismissed. Signed by Honorable Joseph F Anderson, Jr on 4/17/12.(mflo, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
COLUMBIA DIVISION
Nancy Barber,
)
C/A No.: 3:11-cv-2328-JFA
)
Plaintiff,
)
)
vs.
)
ORDER DENYING MOTION TO
) REMAND AND GRANTING MOTION
American Family Home Insurance
)
TO DISMISS CROSSCLAIMS
Company,
)
)
Defendant.
)
)
American Family Home Insurance
)
Company,
)
)
Counter Claimant, )
)
vs.
)
)
Kelly D. Barber and Nancy Barber,
)
)
Counter Defendants. )
)
Nancy Barber,
)
)
Cross Claimant,
)
)
vs.
)
)
Kelly D. Barber,
)
)
Cross Defendant. )
)
This matter comes before the court on Plaintiff/Counter Defendant/Cross Claimant
Nancy Barber’s Motion to Remand. (ECF No. 55). Also before this court is Counter
Defendant/Cross Defendant Kelly D. Barber’s Motion to Dismiss Crossclaims of Cross
1
Claimant Nancy Barber. (ECF No. 67). After reviewing the parties briefs and the
applicable law on these issues, this court denies Nancy Barber’s motion to remand. This
court also grants Kelly Barber’s motion and dismisses the Crossclaim against him.
I.
Factual and Procedural History
This dispute concerns insurance proceeds, which American Family Home
Insurance Company (“American Family”) has issued in checks made out jointly to Nancy
Barber and Kelly Barber. Nancy Barber filed a complaint in state court alleging a
number of causes of action against American Family for issuing the checks jointly to
Nancy and Kelly Barber, rather than to Nancy Barber individually. American Family
removed this case to federal court based on diversity. Since removal, a number of the
causes of action against American Family have been dismissed. The only causes of
action that remain are for breach of contract and bad faith.
American Family filed a counterclaim against Nancy Barber and Kelly Barber
seeking declaratory judgment and interpleader of the disputed insurance proceeds. Nancy
Barber subsequently answered the counterclaim and filed a crossclaim against Kelly
Barber alleging causes of action for assault, battery, intentional infliction of emotional
distress, negligence per se, gross negligence, and unjust enrichment based on an alleged
domestic dispute between Nancy and Kelly Barber.
On January 24, 2012, Nancy Barber filed a Motion to Remand this case to state
court, arguing that diversity no longer exists in this case. (ECF No. 55). American
Family filed its Response in Opposition to the Motion to Remand on February 10, 2012.
(ECF No. 63).
2
On March 7, 2012, Kelly Barber filed a motion asking this court to dismiss the
crossclaims asserted against him by Nancy Barber. (ECF No. 67). Nancy Barber filed a
response in opposition on March 26, 2012. (ECF No. 69).
II.
Legal Standard
A.
Motion to Remand
In general, an action filed in state court may be removed to federal court only if
the action originally could have been brought in federal court. 28 U.S.C. § 1441(a).
Courts should strictly construe removal jurisdiction because of the implications of
federalism. Mulcahey v. Columbia Organic Chemicals Co., Inc., 29 F.3d 148, 151 (4th
Cir. 1994) (citing Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100 (1941)). “If at any
time before final judgment it appears that the district court lacks subject matter
jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c). Moreover, “if federal
jurisdiction is doubtful, a remand [to state court] is necessary.” Id. “The burden of
establishing federal jurisdiction is placed upon the party seeking removal.” Id. (citing
Wilson v. Republic Iron & Steel Co., 257 U.S. 92 (1921)).
One type of federal jurisdiction, called diversity jurisdiction, exists where the
amount in controversy exceeds $75,000 and complete diversity is present. 28 U.S.C. §
1332.
The term “complete diversity” means that “none of the plaintiffs [] share
citizenship with any of the defendants.” Owens-Illinois, Inc. v. Meade, 186 F.3d 435,
440 (4th Cir. 1999).
3
B.
Motion to Dismiss
A motion to dismiss under Federal Rule of Civil Procedure 12(b)(1) examines
whether the complaint fails to state facts upon which jurisdiction can be founded. It is
the plaintiffs’ burden to prove jurisdiction, and the court is to “regard the pleadings’
allegations as mere evidence on the issue, and may consider evidence outside the
pleadings without converting the proceeding to one for summary judgment.” Richmond,
Fredericksburg & Potomac R.R. Co. v. United States, 945 F.2d 765, 768 (4th Cir. 1991).
Under Fed. R. Civ. P. 12(b)(6), a complaint may be dismissed if a plaintiff has
failed to state a claim upon which relief can be granted. When considering a 12(b)(6)
motion to dismiss, the court must accept as true the facts alleged in the complaint and
view them in a light most favorable to the plaintiff. Ostrzenski v. Seigel, 177 F.3d 245,
251 (4th Cir. 1999). The United States Supreme Court has stated, however, that “[t]o
survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted
as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556
U.S. 662, 129 S. Ct. 1937, 1949 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550
U.S. 544, 570 (2007)).
III.
Analysis
A.
Motion to Remand
In her motion, Nancy Barber asserts that remand is proper in this case because the
parties are no longer completely diverse. In her view, American Family’s counterclaim
against Kelly Barber “effectively added Kelly Barber as a defendant.” (ECF No. 55).
Because both Nancy Barber and Kelly Barber are citizens of South Carolina, Nancy
4
Barber asserts that there is no longer complete diversity in this case and that this court
now lacks subject matter jurisdiction.
American Family disagrees with Nancy Barber’s position and submits that its
counterclaims do not destroy diversity. American Family contends that this court has
subject matter jurisdiction pursuant to the supplemental jurisdiction statute, which
provides
Except as provided in subsections (b) and (c) or as expressly provided
otherwise by Federal Statute, in any civil action of which the district courts
have original jurisdiction, the district courts have supplemental jurisdiction
over all other claims that are so related to claims in the same action within
such original jurisdiction that they form part of the same case or
controversy under Article III of the United States Constitution. Such
supplemental jurisdiction shall include claims that involve the joinder or
intervention of additional parties.
28 U.S.C. § 1367 (emphasis added). American Family further points this court to the
Fourth Circuit decision United Capitol Ins. Co. v. Kapiloff, where the court held that the
defendant’s joinder of non-diverse parties as counterclaim defendants did not destroy
complete diversity. 155 F.3d 488 (1998). The Fourth Circuit declared that “[d]espite the
requirement of complete diversity for jurisdiction under 28 U.S.C. § 1332, 28 U.S.C. §
1367(a) confers supplemental jurisdiction over ‘all other claims that are so related to
claims in the action within . . . original jurisdiction that they form part of the same case or
controversy.’” Id. at 492. This is the precise situation now before this court, and the
Fourth Circuit has ruled that subject matter jurisdiction is present. As such, this court
denies Nancy Barber’s Motion to Remand.
5
B.
Motion to Dismiss Crossclaims
Kelly Barber offers two different arguments as to why the crossclaims asserted by
Nancy Barber against him should be dismissed. First, Kelly Barber argues that the tort
crossclaims are prohibited by Fed. R. Civ. P. 13(g) and 14(a)(3) for failing to set forth
allegations that arise out of the same transaction, occurrence, or property that is the
subject matter of the Amended Complaint and Counterclaim. Second, Kelly Barber
argues that this court lacks supplemental jurisdiction over the crossclaims against him in
accordance with 28 U.S.C. § 1367(b). As such, Kelly Barber urges this court to dismiss
all of the crossclaims asserted against him by Nancy Barber.
1.
Federal Rules of Civil Procedure 13(g) and 14(a)(3)
Both Fed. R. Civ. P. 13(g) and 14(a)(3) require that crossclaims, such as those
asserted by Nancy Barber in this case, arise out of the “same transaction or occurrence”
as the claims or counterclaims of the original action. Pursuant to Fed. R. Civ. P. 13(g)
A pleading may state as a crossclaim any claim by one party against a
coparty if the claim arises out of the transaction or occurrence that is the
subject matter of the original action or of a counterclaim, or if the claim
relates to any property that is the subject matter of the original action. The
crossclaim may include a claim that the coparty is or may be liable to the
cross-claimant for all or part of a claim asserted in the action against the
cross-claimant.
See Markel Am. Ins. Co. v. Piggie Park Enterps., Inc., No. 3:09-cv-1631-JFA, 2010 WL
500453 (D.S.C. Feb. 5, 2010) (applying Rule 13(g) to dismiss crossclaims in an insurance
coverage dispute). Similarly, Fed. R. Civ. P. 14(a)(3) provides as follows:
The plaintiff may assert against the third-party defendant any claim arising
out of the transaction or occurrence that is the subject matter of the
plaintiff’s claim against the third-party plaintiff.
6
The Fourth Circuit has provided the following questions to guide courts in their
determination of whether a crossclaim arises out of the same transaction or occurrence:
(1) Are the issues of fact and law raised in the complaint and crossclaim largely the
same? (2) Will substantially the same evidence support or refute the complaint as well as
the crossclaim? (3) Is there any logical relationship between the complaint and the
crossclaim? Painter v. Harvey, 863 F.2d 329, 331 (4th Cir. 1988).
As to the issues of fact and law in the complaint and the crossclaim, this court
finds little commonality. The factual and legal basis for determining Nancy Barber’s and
Kelly Barber’s right to insurance proceeds (subject of the Amended Complaint and
Counterclaim) has no relationship to the tort allegations contained in the crossclaims
asserted against Kelly Barber. As pointed out by Kelly Barber, “[a]lthough some of the
same persons might be witnesses to both the dispute in the Amended Complaint and
Counterclaim, as well as the dispute in the Crossclaim, the use of those witnesses would
be focused on entirely different facts and legal theories.” (ECF No. 67-1).
With regards to the evidence needed to support or refute the complaint and the
crossclaim, there may be some overlap because Nancy and Kelly Barber are involved in
both claims. However, for the most part, “[t]he evidence required to support or refute
claims regarding an insurance contract is entirely different that the evidence required to
support or refute claims centering on an alleged domestic dispute.” (ECF No. 67-1).
Finally, the logical relationship between the Amended Complaint, Counterclaim,
and Crossclaim is not sufficiently meaningful to satisfy Rules 13(g) or 14(a)(3). As
7
pointed out by Kelly Barber, “the focus of the Amended Complaint and Counterclaim is
attenuated from that of the Crossclaim.” (ECF No. 67-1).
In her Response in Opposition, Nancy Barber provides little discussion of the
three inquiries provided by the Fourth Circuit to guide courts in their determination of
whether a crossclaim arises out of the same transaction or occurrence. Rather, she makes
blanket statements that “[i]t is obvious” and “[i]t is apparent” from her pleadings that the
causes of action in her Crossclaim are part of the same transaction or occurrence as the
causes of action in the Complaint and the Counterclaim. (ECF No. 69, p. 9). This court
is not persuaded that the tortious causes of action asserted in the Counterclaim are part of
the same transaction or occurrence as the causes of action in the Amended Complaint and
the Counterclaim.
Because the tortious causes of action asserted in the Crossclaim do not involve the
same transaction or occurrence as the Amended Complaint and Counterclaim, those
causes of action do not fall within the scope of Fed. R. Civ. P. 13(g) and 14(a)(3). As
such this court finds that the assault, battery, intentional infliction of emotional distress,
negligence per se, and gross negligence claims should be dismissed.
2.
Supplemental Jurisdiction Under 28 U.S.C. § 1367
As discussed above with respect to Nancy Barber’s Motion to Dismiss, 28 U.S.C.
§ 1367 confers supplemental jurisdiction over American Family’s counterclaim against
Kelly Barber.
However, 28 U.S.C. § 1367 specifically prohibits supplemental
jurisdiction over Nancy Barber’s Crossclaim against Kelly Barber. To wit, 28 U.S.C. §
1367 states that
8
[T]he district courts shall not have supplemental jurisdiction under
subsection (a) over claims by plaintiffs against persons made parties under
Rule 14, 19, 20, or 24 of the Federal Rules of Civil Procedure . . . when
exercising supplemental jurisdiction over such claims would be inconsistent
with the jurisdictional requirements of section 1332.
In the instant case, Kelly Barber has been made a party pursuant to Fed. R. Civ. P. 13, via
either Rule 19 (compulsory joinder) or Rule 20 (permissive joinder). See Fed. R. Civ. P.
13(h) (“Rules 19 and 20 govern the addition of a person as a party to a counterclaim or
crossclaim.”). Because Nancy and Kelly Barber are both citizens of South Carolina, this
court’s exercise of supplemental jurisdiction over Nancy Barber’s crossclaims against
Kelly Barber would be inconsistent with the jurisdictional requirements of 28 U.S.C. §
1332. Such supplemental jurisdiction is expressly prohibited by 28 U.S.C. § 1367(b),
and, thus, this court is constrained to dismiss all of the causes of action asserted in the
Crossclaim against Kelly Barber.
IV.
Conclusion
Plaintiff/Counter Defendant/Cross Claimant Nancy Barber’s Motion to Remand is
hereby denied, and Counter Defendant/Cross Defendant Kelly Barber’s Motion to
Dismiss is hereby granted.
Accordingly, the Crossclaim against Kelly Barber is
dismissed.
IT IS SO ORDERED.
April 17, 2012
Columbia, South Carolina
Joseph F. Anderson, Jr.
United States District Judge
9
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?