McCloy et al v. Larew et al

Filing 50

ORDER GRANTING PLAINTIFFS' 32 MOTION TO REMAND AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY. Accordingly the Court DENIES AS MOOT 6 , 12 , 16 , and 31 Motions; and REMANDS this case to the Circuit Court of Taylor County, West Virginia. Signed by District Judge Irene M. Keeley on 5/10/2013. (kac) (Copy to counsel; Clerk of Taylor County Circuit Court (w/docket sheet))

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA

ANNA L. MCCLOY, Individually and
as Executrix of the Estate of
Terry Allen McCloy, and
TERRY ALLEN MCCLOY, JR.
Plaintiffs,

v.

//

CIVIL ACTION NO. 1:12CV166
(Judge Keeley)

ERIC JOSHUA LAREW, LOWELL LAREW,
LOWELL LAREW, doing business as
BB&T Auto Crushers, LOWELL LAREW,
doing business as L&L Rebuilders,
LOWELL LAREW, doing business as
Larew Used Cars, BB&T SALVAGE AND
TRUCKING, LLC, NATIONAL CASUALTY
COMPANY, SCOTTSDALE INSURANCE COMPANY,
BLOSS & DILLARD, INC., GEICO INDEMNITY
COMPANY, and JOHN DOE(S),
Defendants.

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
Following

removal

by

the

defendants,

National

Casualty

Corporation (“NCC”) and Scottsdale Insurance Company (“Scottsdale”)
(dkt. no. 32), the plaintiffs, Anna L. McCoy, acting both in her
individual capacity and also as Executrix of the estate of her
deceased husband, Terry Allen McCloy, and Terry Allen McCloy,
Jr.,(collectively “the McCloys” or “the plaintiffs”), filed a
motion to remand this case to the Circuit Court of Taylor County,

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
West Virginia. That motion is now fully briefed and ripe for
review. For the following reasons, the Court GRANTS the McCloys’
motion (dkt. no. 32), and REMANDS this case to the Circuit Court of
Taylor County, West Virginia.
I.
On September 17, 2010, Terry Allen McCloy and his son, Terry
Jr.,

were

riding

their

motorcycles

on

U.S.

Route

50

near

Pruntytown, West Virginia, when a dump truck driven by Eric Larew
(“E. Larew”) swerved into the McCloys’ lane, striking the senior
McCloy and causing injuries from which he ultimately died. (Dkt.
No. 1 at ¶¶ 22-29). E. Larew did not own the dump truck, which was
registered to Larew Used Cars and titled to L&L Rebuilders, sole
proprietorships operated by his father, Lowell Larew (“L. Larew”)
(id. at ¶ 30). L. Larew also owned and operated BB&T Auto Crushers
and BB&T Salvage, other sole proprietorships. (Id. at ¶¶ 5, 9).
On September 14, 2012, the McCloys filed an eight-count
complaint in the Circuit Court of Taylor County, West Virginia
against the Larews, L. Larew’s various sole proprietorships, and
the

insurers

of

those

businesses.

The

McCloys

alleged

(1)

Negligence, (2) Negligence and/or Gross Negligence in Use of
Defective Equipment, (3) Presumptive Negligence for Statutory
2

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
Violation, and (4) Negligent Infliction of Emotional Distress
against the Larews. In Count Five of their complaint, the McCloys
sought a declaration of coverage under the Commercial Auto Policy
(“CTO policy”) and its attendant MCS-90 endorsement (“MCS-90")
issued by NCC to BB&T Auto Crushers. (Dkt. no. 22 at ¶¶ 69 - 74).
In the remaining counts of their complaint, the McCloys sought a
declaration of coverage under E. Larew’s personal auto policy, and
damages stemming from the alleged failure of defendants NCC,
Scottsdale, and Bloss & Dillard, Inc. (“B&D”), all insurers of L.
Larew’s various sole proprietorships, to adequately insure those
businesses.
Defendants NCC and Scottsdale timely removed the case to this
Court pursuant to 28 U.S.C. §§ 1441(c) and 1331. They relied on the
allegations in Count Five of the Complaint regarding the MCS-90
endorsement to BB&T Auto Crusher’s CTO policy to establish federal
question jurisdiction. Count Five alleges:
COUNT V – DECLARATORY JUDGMENT
(National Casualty Company)
70. The defendant Lowell Larew d/b/a BB&T Auto Crushers
was insured through National Casualty Company for
commercial auto (business auto or truckers) coverage
under Policy No. CTO0128573 (hereafter "CTO policy").
71. The defendant Lowell Larew d/b/a Larew Used Cars &
L&L Rebuilders was insured through National Casualty
3

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
Company for commercial garage operations as a used car
dealer, among other operations, under Policy No.
CGO0035585 (hereafter "CGO policy")[.]
72. The Plaintiffs tendered a claim to National Casualty
Company for coverage relating to this accident under the
specific terms of both policies of insurance as well as
the MCS-90 endorsement to the CTO policy.
73. National Casualty Company has admitted coverage
under the CGO policy and has offered to tender the policy
limits of said policy unto the Plaintiffs.
74. National Casualty Company, although admitting
coverage under the CGO policy, has denied coverage under
the CTO policy. Accordingly, the Plaintiffs respectfully
request, pursuant to the Uniform Declaratory Judgments
Act, W. Va. Code §55-13-1, et. seq., that the Court
determine the rights and liabilities between the various
parties and find coverage for the Plaintiffs under the
CTO policy relating to their injuries and damages plead
herein.
(Dkt. No. 1 at ¶ 72). While the MCS-90 is not mentioned elsewhere
in the complaint, key phrases which would trigger coverage under
it,

including

“for

hire”

and

“interstate

commerce”,

appear

throughout.
The

MCS-90,

the

putative

basis

of

federal

question

jurisdiction in this matter, is a creation of the Motor Carrier Act
of 1980 (“the MCA”). The MCA requires all motor carriers operating
in interstate commerce to carry liability insurance, Canal Ins. Co.
v. Distribution Servs., Inc., 320 F.3d 488, 489 (4th Cir. 2003),
which in turn must include the MCS-90. Forkwar v. Progressive
4

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
Northern Ins. Co., Inc., - F.Supp.2d -, 2012 WL 6562768, at *8
(D.MD. Dec. 14, 2012) (citing 49 C.F.R. §§ 387.7, 387.9, 387.15).
“The MCS-90 endorsement comes into play . . . only where . . . the
underlying insurance policy to which the endorsement is attached
does not otherwise provide liability coverage . . . .” Carolina
Cas. Ins. Co. v. Yeates, 584 F.3d 868, 881 (10th Cir. 2009). In
other words, “[e]ven if the insured [motor carrier] is not entitled
to coverage due to an exception or exclusion, an injured member of
the public may recover under the [MCS-90] endorsement, and the
insurer may then seek reimbursement from the insured.” Lancer Ins.
Co. v. VIP Limousine Serv., Ltd., No. 3:11cv11, 2013 WL 937735, at
*1 n.1 (N.D.W. Va. March 11, 2013). The MCS-90 at issue in this
matter is no different. (See Dkt. No. 40-7 at 28). Thus, should the
McCloys secure a judgment against Lowell Larew d/b/a BB&T Auto
Crushers that falls outside the scope of the coverage of the CTO
policy, but within the coverage of the MCS-90 endorsement, NCC must
still satisfy that judgment.
In their motion to remand, the McCloys argue that, under
Grable Sons Metal Products v. Darue Engineering & Manufacturing,
545 U.S. 308 (2005), and Empire Healthchoice Assurance v. McVeigh,
547 U.S. 677 (2006), the MCS-90 does not present a substantial

5

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
federal question that would transform their state law claim for a
declaration of insurance coverage into one “arising under” the laws
and Constitution of the United States, and, moreover, that the MCS90 is an alternative avenue of relief to be pursued only if there
is

no

coverage

under

the

policy.1

CTO

In

response,

NCC

and

Scottsdale contend that the McCloys cannot recover under the CTO
policy based upon its plain language, rendering recovery under the
MCS-90 the only source of relief available in Count Five. They
contend that Count Five therefore presents a substantial federal
question, i.e. the interpretation of disputed terms of the MCS-90.
After carefully considering the parties’ arguments, the Court
concludes that Count Five does not present a substantial federal
question.

1

The McCloys moved to remand on the same day the Court
conducted a scheduling conference and motion hearing in this matter.
(Dkt. No. 33). Because the McCloys’ motion addressed this Court’s subject
matter jurisdiction, the Court suspended all deadlines previously set in
this case and scheduled new briefing deadlines to address the McCloys’
motion, as well as NCC’s Motion to Sever and Remand (dkt. no. 16),
Scottsdale’s Motion to Dismiss, or in the Alternative, Motion for Summary
Judgment (dkt. no. 12), and B&D’s Motion to Dismiss (dkt. no. 6). (See
Dkt. No. 34).

6

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
II.
A.
“Typically, an action initiated in a state court can be
removed to federal court only if it might have been brought in
federal court originally.” Sonoco Prods. Co. v. Physicians Health
Plan, Inc., 338 F.3d 366, 370 (4th Cir. 2003). Thus, on removal, a
federal court is generally limited to exercising jurisdiction over
those cases that arise under the Constitution or laws of the United
States, 28 U.S.C. § 1331, or in which the parties are completely
diverse and the statutory amount in controversy is satisfied. 28
U.S.C.

§

1332.

Courts

construe

removal

statutes

narrowly,

Schlumberger Indus., Inc. v. Nat'l Sur. Corp., 36 F.3d 1274, 1284
(4th Cir. 1994), and the party seeking removal bears the burden of
showing that the district court indeed has original jurisdiction.
Mulcahey v. Columbia Organic Chems. Co., 29 F.3d 148, 151 (4th Cir.
1994). When in doubt about the “propriety of removal,” a court
should “resolve all doubts . . . in favor of retained state court
jurisdiction.” Hartley v. CSX Transp., Inc., 187 F.3d 422, 425 (4th
Cir. 1999). Here, the parties are not completely diverse, leaving
federal question, or “arising under” jurisdiction, as the removing
defendants’ only jurisdictional option.
7

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
“Congress has given the lower federal courts jurisdiction to
hear

‘only

those

cases

in

which

a

well-pleaded

complaint

establishes either that federal law creates the cause of action or
that

the

plaintiff’s

right

to

relief

necessarily

depends

on

resolution of a substantial question of federal law.’” Interstate
Petroleum Corp. v. Morgan, 249 F.3d 215, 219 (4th Cir. 2001)
(quoting Franchise Tax Bd. v. Const. Laborers Vacation Trust, 463
U.S. 1, 27 (1983)). Under the well-pleaded complaint rule, “federal
jurisdiction exists only when a federal question is presented on
the

face

of

the

plaintiff's

properly

pleaded

complaint.”

Caterpillar Inc. v. Williams, 482 U.S. 386, 391 (1987). In effect,
the “well-pleaded complaint” rule allows the plaintiff to be the
“master of the claim” and “avoid federal jurisdiction by exclusive
reliance on state law.” Id. at 392; see, e.g., Great North R. co.
v. Alexander, 246 U.S. 276, 282 (1918) (‘(T)he plaintiff may by the
allegations of his complaint determine the status with respect to
removability of a case”).
Nevertheless, in a “small class of cases,” a federal court may
exercise original jurisdiction over a well-pleaded state law claim
“even though the cause of action is not created by federal law,
[because] the case's resolution depends on resolution of a federal

8

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
question sufficiently substantial to arise under federal law within
the meaning of 28 U.S.C.A. § 1331.’” Morgan Cty. War Mem. Hosp. ex.
rel. v. Baker, 314 Fed. App’x. 529, 533 (4th Cir. 2008) (quoting
Ormet Corp. v. Ohio Power Co., 98 F.3d 799, 806 (4th Cir. 1996)).
Thus, this Court may exercise subject matter jurisdiction over a
state law claim such as that raised in Count Five of the McCloys’
complaint only if the claim presents a substantial federal question
– in other words, if the claim “necessarily raise[s] a stated
federal issue, actually disputed and substantial, which a federal
forum may entertain without disturbing any congressionally approved
balance of federal and state judicial responsibilities.” Grable,
545 U.S. at 314. The burden of establishing federal question
jurisdiction under the three-prong Grable analysis is upon the
party seeking removal. See Mulcahey, 29 F.3d at 151.
B.
The Court first must determine whether Count Five “necessarily
raise[s] a stated federal issue.” Grable, 545 U.S. at 314. In
Grable, the question of the required notice prior to the seizure of
property by the IRS for unpaid taxes was found to be necessary to
the plaintiff’s state law, quiet-title action because
whether Grable was given notice within the meaning of the
federal status is thus an essential element of its quiet
9

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
title claim, and the federal statute is actually in
dispute; it appears to be the only legal or factual issue
contested in this case.
Id. at 314-35. Conversely, in Empire Healthchoice, the federallyregulated insurer’s claim for reimbursement did not necessarily
raise a federal issue where “the reimbursement claim was triggered
. . . by the settlement of a personal-injury action in state
court,” and the claim was “fact-bound and specific.” 547 U.S. at
700.
On its face, Count Five seeks a declaratory judgment pursuant
to the Uniform Declaratory Judgments Act, W. Va. Code §§ 55-13-1,
et. seq., as to coverage under the CTO policy issued to BB&T Auto
Crushers. It does not explicitly seek a declaration of coverage
under the MCS-90. In fact, the MCS-90 is mentioned only once in
Count Five, in paragraph 72, in which the McCloys describe a demand
they made to NCC “for coverage relating to this accident under the
specific terms of both policies of insurance [the CTO and another
policy issued by NCC to another Larew-owned business] as well as
the MCS-90 endorsement to the CTO policy.” (Dkt. No. 1 at ¶ 72)
(emphasis added). The MCS-90 is not invoked explicitly in the
remainder of Count Five, nor indeed, elsewhere in the complaint. In
sum, based on the face of the McCloys’ complaint, the MCS-990 is no

10

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
more than a “federal element,” Empire Healthchoice, 547 U.S. at
701, which, in and of itself, does not open the “‘arising under’
door.” Grable, 545 U.S. at 313.
C.
Nevertheless, NCC argues that Count Five “necessarily raise[s]
a stated federal issue,” Grable, 545 U.S. at 314, because “the MCS90 endorsement . . . is the sole basis by which Plaintiffs can
recover under [the CTO policy].” (Dkt. No. 40 at 1-2). That
argument cannot carry the day at this stage in the proceedings,
however, for it depends upon this Court’s ultimate determination as
to the merits of Count Five, i.e., declaring that there is no
coverage available under the CTO policy, and that the MCS-90
thereby has been triggered. See Carolina Cas. Ins. Co., 585 F.3d at
881. As the

Fourth Circuit has explained, “a jurisdictional

inquiry is not the appropriate stage of litigation to resolve []
various uncertain questions of law and fact.” Hartley v. CSX
Trans., Inc., 187 F.3d 422, 425 (4th Cir. 1999); see also Robinson
v. The Government of Malaysia, 269 F.3d 133, 141 (2d Cir. 2001) (“A
district court does not, of course, decide a case on the merits in
order to decide if it has jurisdiction.”); Browning v. Geupel
Const. Co., 891 F.Supp. 275, 277 (S.D.W. Va. 1995) (“A claim of

11

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
federal question jurisdiction is to be resolved on the basis of the
allegations in the [c]omplaint.” (citing Burgess v. Charlottesville
Savings & Loan Ass’n, 477 F.2d 40, 43 (4th Cir. 1973)).
That NCC even argues the MCS-90 is not triggered unless
coverage is found lacking under the CTO policy strongly suggests
Count Five does not necessarily raise a federal issue. Claims
positing alternate theories of relief - one of which supports
federal subject matter jurisdiction2 and one which does not - do
not establish federal subject matter jurisdiction. Mulcahey, 29
F.3d at 153 (citing Christianson v. Colf Indus. Operating Corp.,
486 U.S. 800, 811 (1998)); Whittington et al v. Morgan Stanley et
al, No. 1:12CV112, 2012 WL 4846484, at *4 (W.D.N.C. Oct. 11, 2012)
(same).
As discussed earlier, the McCloys cannot recover under the
MCS-90 unless coverage is lacking under the CTO policy. Therefore,
the McCloys clearly will first seek recovery under the CTO policy,
turning to the MCS-90 only as an alternative means of relief. In
short, recovery under the CTO policy and the MCS-90 is mutually
exclusive. Thus, coverage under the MCS-90 is but one theory of

2

Assuming, arguendo, that the MCS-90 presents a necessary,
substantial federal question.

12

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
relief pleaded by the McCloys in Count Five, and its mere presence
is insufficient to raise a necessary federal question.3
D.
Moreover, despite NCC’s argument to the contrary, Insurance
Corp. of New York v. Monroe Bus Corp., 491 F.Supp.2d 430 (S.D.N.Y.
2007) (“Monroe Bus”), does not resolve the jurisdictional questions
presented here. In Monroe Bus, an insurer sought reimbursement from
its insured, a commercial bus company, pursuant to the terms of the
MCS-90

endorsement

appended

to

the

insured’s

commercial

auto

policy. Id. at 433. In its sua sponte consideration of the question
of subject matter jurisdiction, the district court focused on the
contractual rights the insurer sought to vindicate and concluded
that because the MCS-90, the contract upon which the insurer’s suit
relied, was created by federal law, and federal law prescribed its
very contents, “the reimbursement claim in question is based on

3
In a similar vein, B&D’s response to the McCloys’ motion to
remand argues that the McCloys’ reference to a violation of an unnamed
federal statute in Count VII and VIII establishes federal question
jurisdiction. This argument also fails because those claims allege a
violation of an unnamed state law, as well. Thus, Count VII and VIII
present alternate theories of relief, on predicated on violation of a
state law, and the other predicated on violation of a federal law, that
cannot support federal question jurisdiction. See Dixon v. Coburg Dairy,
Inc., 369 F.3d 811, 817 (4th Cir. 2004) (“In other words, if the
plaintiff can support his claim with even one theory that does not call
for an interpretation of federal law, his claim does not ‘arise under’
federal law for purposes of § 1331.”).

13

ANNA L. MCCLOY, ET AL.

v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
federally-created rights,” and the court therefore could exercise
subject matter jurisdiction over the complaint. Id. at 435-37
(citing Empire, 547 U.S. at 686; Merrell, 478 U.S. at 805-06;
Jackson Trans. Auth. v. Local Div. 1285, Amalgamated Trans. Union,
AFL-CIO-CLC, 457 U.S. 15, 16 (1982)).
In contrast, in Carlson v. American International Group, the
plaintiff sought to satisfy a wrongful death judgment from the
proceeds of a delivery service’s two commercial insurance policies.
No. 11-CV-874-A, 2012 WL 1202193, at *2 (W.D.N.Y. April 10, 2012).
Although the complaint did not mention an MCS-90 endorsement, the
plaintiff referenced the endorsement during oral argument, thus
prompting the defendants to remove the case. Id.; see 28 U.S.C.
§ 1446(b).
In considering the matter on a motion to remand for lack of
subject

matter

jurisdiction,

the

district

court

specifically

distinguished the holding in Monroe Bus, as follows:
The scenario presented here is that the plaintiff alleges
a state-law breach of contract claim that DHL's insurance
covers MVP and Mr. Porter, who are liable to the
plaintiff
for
the
accident,
and
that
the
federally-required MCS-90 endorsement in DHL's insurance
may provide the federal mandatory-minimum recovery.
Unlike the claim for reimbursement of money already paid
pursuant to the MCS-90B endorsement asserted in Monroe
Bus Corp., supra, this is a predominately state law
claim. By inviting the Court's reliance upon Monroe Bus
14

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v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
Corp. to find federal question jurisdiction, see Doc 321, p. 13, the defendants overlook that it takes more
[even] than a federal element to open the ‘arising underdoor’ pursuant to 28 U.S.C. § 1331.
Carlson, 2012 WL 1202193 at *5 (quotations omitted). The court
further observed that, unlike the plaintiff in Monroe Bus, “[t]he
plaintiff [here] may well be able to obtain all the relief which he
seeks without invoking the MCS-90 endorsement in the . . . policy”
because “there is an alternative ground supporting the plaintiff’s
breach of contract and direct recovery claim that is based upon”
the language of the commercial auto policy in issue, and not the
MCS-90. Id. at *7. At bottom, therefore,
the defendants [had] established nothing more than the
mere presence of federal issues in plaintiff Carlson’s
breach of contract and direct recovery claim, a “factbound and situation-specific” claim that should proceed
in the state forum from which it was removed out of
deference to the state forum.
Id. at *10 (quoting Empire, 547 U.S. at 700). (emphasis added.)
The facts here closely track those in Carlson. The McCloys
seek damages stemming from a wrongful death allegedly caused by the
negligence of the insured and its purported agent. Like the
plaintiff in Carlson, the McCloys have sued on a contract of
insurance, the CTO policy, that is decidedly a creature of state,
not federal, law. See, e.g., Seabulk Offshore, Ltd. v. American

15

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v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
Home Assur. Co., 377 F.3d 408, 419 (4th Cir. 2004) (“Questions
concerning the validity, effect, and interpretation of a contract
are resolved according to the law of the state where the contract
was made.”) Those circumstances contrast starkly with the insurerplaintiff in Monroe Bus, who sought reimbursement from its insured
predicated solely on the rights created by the federally-mandated
MCS-90. Cf. Grable, 545 U.S. at 315 (finding subject matter
jurisdiction because “[w]hether Grable was given notice within the
meaning of the federal statute is thus an essential element of its
quiet title claim.”) (emphasis added). Thus, Carlson supports the
conclusion that the MCS-90 attached to B&T Auto Crushers policy
does not create a federal question. Monroe Bus, on the other hand,
is only marginally relevant and is not dispositive of the question
of subject matter jurisdiction presented here.4

4

Because the foregoing analysis is conclusive as to whether the
McCloys’ complaint presents a necessary federal question, it is
conclusive as to this Court’s jurisdiction over the matter. Nevertheless,
it is worth noting that the MCS-90 also does not present a substantial
federal question because state courts are competent to interpret terms
of the MCS-90, see Empire Healthchoice, 547 U.S. at 701, and, in fact,
have done so. See, e.g., Heron v. Transp. Cas. Ins. Co., 650 S.E.2d 699,
700 (Va. 2007). Although the exercise of subject matter jurisdiction

over the McCloys’ complaint would not necessarily disturb “any
congressionally approved balance of federal and state judicial
responsibilities," Grable, 545 U.S. at 315, such a finding will
not, in the end, mandate federal jurisdiction.
16

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v. LAREW, ET AL.

1:12CV166

ORDER GRANTING PLAINTIFFS’ MOTION TO REMAND [DKT NO. 32]
AND REMANDING ENTIRE CASE TO CIRCUIT COURT OF TAYLOR COUNTY
V.
In sum, the McCloys’ complaint does not present a necessary
federal

question.

Therefore,

the

Court

lacks

subject

matter

jurisdiction over the removed complaint. Accordingly, the Court:
1.

GRANTS the plaintiffs’ Motion to Remand to state Court
(dkt. no. 32);

2.

DENIES AS MOOT dkt nos. 6, 12, 16, and 31; and

3.

REMANDS this case to the Circuit Court of Taylor County,
West Virginia.

It is so ORDERED.
The Court directs the Clerk to transmit copies of this Order
to counsel of record and to the Circuit Court of Taylor County,
West Virginia.
DATED: May 10, 2013.
/s/ Irene M. Keeley
IRENE M. KEELEY
UNITED STATES DISTRICT JUDGE

17