Creekmore et al v. State Farm Mutual Automobile Insurance Company et al

Filing 16

ORDER granting 8 Motion to Remand by Judge Benjamin H. Settle.(TG)

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT TACOMA

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8 JOHN CREEKMORE and LARRILEE
WILLIAMS,
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Plaintiffs,
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v.
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STATE FARM MUTUAL
12 AUTOMOBILE INSURANCE
COMPANY and DEBRA DANIELS
13 INSURANCE COMPANY,
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CASE NO. C14-5281 BHS
ORDER GRANTING
PLAINTIFFS’ MOTION TO
REMAND

Defendants.

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This matter comes before the Court on Plaintiffs John Creekmore and Larrilee

17 Williams’ (“Plaintiffs”) motion to remand (Dkt. 8). The Court has considered the
18 pleadings filed in support of and in opposition to the motion and the remainder of the file
19 and hereby grants the motion for the reasons stated herein.
I. PROCEDURAL HISTORY

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On February 25, 2014, Plaintiffs filed a complaint against Defendants State Farm

22 Mutual Automobile Insurance Company (“State Farm”) and Debra Daniels Insurance

ORDER - 1

1 Agency in Mason County Superior Court for the State of Washington. Dkt. 1. Although
2 Plaintiffs only explicitly assert a cause of action for violations of the Washington
3 Insurance Fair Conduct Act, RCW Chapter 48.30 (“IFCA”) (Id., Exh. B, ¶¶ 3.1–3.4), it
4 appears that they also assert causes of action for bad faith, negligence, and breach of
5 contract (id., ¶¶ 4.3, 4.6).
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On April 3, 2013, State Farm removed the matter to this Court. Dkt. 1.

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On May 1, 2014, Plaintiffs filed a motion to remand. Dkt. 8. On May 19, 2014,

8 State Farm responded. Dkt. 9. On May 23, 2014, Plaintiffs replied. Dkt. 14.
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II. DISCUSSION

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In this case, Plaintiffs request remand based on the lack of the jurisdictional

11 minimum in dispute and the lack of complete diversity between the parties. Dkt. 8. The
12 latter issue is dispositive. “Fraudulent joinder is a term of art” and does not require an ill
13 motive. McCabe v. General Foods Corp., 811 F.2d 1336, 1339 (9th Cir. 1987). Joinder
14 will be deemed fraudulent where the plaintiff fails to state a cause of action against the
15 resident defendant, and the failure is obvious according to the settled rules of the state.
16 Ritchey v. Upjohn Drug Co., 139 F.3d 1313, 1318 (9th Cir. 1998). The defendant alleging
17 the fraudulent joinder carries the heavy burden of demonstrating the improper joinder by
18 clear and convincing evidence. Hamilton Materials, Inc. v. Dow Chem. Co., 494 F.3d
19 1203, 1206 (9th Cir. 2007).
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State Farm has failed to show that the joinder of Debra Daniels Insurance Agency

21 should be deemed fraudulent. Although State Farm appears to concede that a policy was
22 in effect when the accident occurred, this is not clear and convincing evidence that

ORDER - 2

1 Plaintiffs can state no possible claim against the agency for negligence. For example, if
2 the policy limit is $100,000, as the parties seem to agree, and Plaintiffs seek $300,000 in
3 damages, the agent may be negligent in failing to secure a policy in the amount Plaintiffs
4 originally requested. It may be that no such claim exists, but until this issue is resolved in
5 state court, this Court does not have jurisdiction. Therefore, the Court grants Plaintiffs’
6 motion because there is a lack of complete diversity.
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III. ORDER
Therefore, it is hereby ORDERED that Plaintiffs’ motion to remand (Dkt. 8) is

9 GRANTED.
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Dated this 3rd day of June, 2014.

A

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BENJAMIN H. SETTLE
United States District Judge

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ORDER - 3