Erie Insurance Property & Casualty Company, Inc. v. Stricklin

Filing 17

MEMORANDUM OPINION AND ORDER GRANTING 6 MOTION TO DISMISS AND DENYING AS MOOT 9 MOTION TO CONSOLIDATE CASES. The case is to be DISMISSED WITHOUT PREJUDICE and STRICKEN from the active docket of this Court. The Clerk is DIRECTED to enter judgment on this matter. Signed by Senior Judge Frederick P. Stamp, Jr. on 12/4/2013. (copy to counsel of record via CM/ECF) (nmm)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
ERIE INSURANCE PROPERTY &
CASUALTY COMPANY, INC.,
Plaintiff,
v.

Civil Action No. 5:13CV30
(STAMP)

BRYAN A. STRICKLIN,
Defendant.
MEMORANDUM OPINION AND ORDER
GRANTING MOTION TO DISMISS AND
DENYING AS MOOT MOTION TO CONSOLIDATE CASES
I.

Background

The plaintiff, Erie Insurance Property and Casualty Company,
Inc. (“Erie”), filed a complaint seeking a declaratory judgment
that the defendant, Bryan A. Stricklin, is not covered under a
certain insurance policy issued by the plaintiff. Prior to joining
the United State Marine Corps in 2010, the defendant lived with his
grandparents, Bryan H. Stricklin and Ranny L. Stricklin.

The

defendant was insured under his grandparents’ automobile insurance
policy with Erie.

In 2010, however, the defendant’s grandparents

allegedly removed him from this policy once he left for his career
with the Marines.

While visiting his grandparents in 2012, the

defendant was involved in an automobile accident.

After the

accident, the defendant, through his attorneys, made a claim for
underinsured motorist benefits against his grandparents’ automobile
policy with Erie.

Erie now seeks a declaratory judgment and

determination that the defendant does not qualify for inclusion
under the insurance policy so as to be entitled to underinsured
motorist benefits.
After Erie served the defendant with the complaint, the
defendant filed a motion to dismiss or, in the alternative, to stay
proceedings pending the resolution of a breach of contract action
currently pending in the Circuit Court of Ohio County, West
Virginia, which addresses this same issue.

In this motion, the

defendant first argues that Erie has not demonstrated that the
amount in controversy is established so as to allow this Court to
exercise subject matter jurisdiction.

Further, the defendant

asserts that even if this Court determines that the amount in
controversy is established, it should still abstain from exercising
jurisdiction because the insurance coverage issue could and should
be litigated in state court.
Erie filed a response in opposition arguing that the amount in
controversy well exceeds $75,000.00, as evidenced by an email from
the defendant’s counsel indicating that his claims are valued in an
amount far in excess of $70,000.00.

Erie further argues that the

defendant has failed to provide this Court with sufficient evidence
to support a finding that the value of his claim is below the
required amount in controversy. As to the defendant’s argument for
abstention, Erie argues that the factors concerning abstention

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favor

this

Court

retaining

jurisdiction

and

adjudicating

the

coverage issue.
The defendant filed a reply, arguing that Erie made no effort
to demonstrate that the amount in controversy is established, which
he argues is Erie’s burden.

The defendant also states that Erie’s

generalized statements concerning the factors to be considered by
this Court in whether or not to exercise jurisdiction are not
sufficient to counter the defendant’s analysis of those factors.
The

motion

to

dismiss

or

in

the

alternative

proceedings is fully briefed and ripe consideration.

to

stay

For the

reasons that follow, this Court will grant the defendant’s motion
to dismiss.
Prior to the discussion of the motion to dismiss or in the
alternative to stay proceedings, this Court notes that after the
defendant filed his motion, Erie filed a motion to consolidate
cases.

Erie requested that this Court consolidate this action,

with an action which it removed to this Court from the Circuit
Court of Ohio County, West Virginia, concerning the same issues and
involving the same parties.

This Court, however, must deny this

motion as moot, as it has previously remanded the other case to the
Circuit

Court

of

Ohio

County

based

jurisdiction.

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on

a

lack

of

diversity

II.

Applicable Law

A lack of subject matter jurisdiction may be asserted at any
time by any interested party either in the form of the answer or in
the form of a suggestion to the court prior to final judgment.

5A

Charles Alan Wright & Arthur R. Miller, Federal Practice and
Procedure § 1350, at 201-02 (2d ed. 1990).

The burden of proving

subject matter jurisdiction on a motion to dismiss pursuant to
Federal Rule of Civil Procedure 12(b)(1) is on the plaintiff, the
party asserting jurisdiction.

If the plaintiff alleges, in good

faith, an amount in controversy exceeding $75,000.00, the burden
shifts

to

the

defendant

to

prove,

to

the

level

of

a

legal

certainty, that the amount in controversy is not sufficient.

St.

Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 288-90
(1938).

A

trial

court

may

consider

evidence

by

affidavit,

deposition, or live testimony without converting the proceeding to
one for summary judgment.

Adams v. Bain, 697 F.2d 1213, 1219 (4th

Cir. 1982); Mims v. Kemp, 516 F.2d 21 (4th Cir. 1975).

Because the

court’s very power to hear the case is at issue in a Rule 12(b)(1)
motion, the trial court is free to weigh the evidence to determine
the existence of its jurisdiction.
III.

Adams, 697 F.2d at 1219.

Discussion

In the motion to dismiss, the defendant first asserts that
this Court lacks diversity jurisdiction.

While the defendant does

not dispute that the parties are diverse in this action, the

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defendant asserts that Erie has failed to establish that the amount
in controversy is great than $75,000.00.

The defendant asserts

that the amount in controversy in the instant action is actually
$50,000.00, which is the total amount recoverable under the Erie
insurance policy.

Erie argues in opposition that the amount in

controversy is the value of the defendant’s claim and not the face
value

of

the

policy.

Erie

asserts

that

the

defendant

has

maintained that his injuries are severe, permanent, and valued in
an amount in excess of $70,000.00.

Based on this assertion by the

defendant, Erie states that it has established that the amount in
controversy is more than $75,000.00.
This Court finds that while Erie has provided evidence that
the

defendant’s

claimed

damages

may

exceed

$75,000.00,

the

defendant has proven to a legal certainty that the amount in
controversy is not sufficient.

See Payne v. State Farm Mut. Auto.

Ins. Co., 266 F.2d 63, 64 (5th Cir. 1959) (“The sum a [claimant]
claims usually controls the jurisdictional amount. If, however, it
appears to a legal certainty that the claim is for less than the
jurisdictional amount, the complaint should be dismissed.”).

The

amount in controversy for purposes of a declaratory judgment action
is measured by the “value of the object of the litigation.”

Toler

v. State Farm Mut. Auto. Ins. Co., 25 F. App’x 141, 143 (4th Cir.
2001)

(quoting

Hunt

v.

Washington

Commission, 432 U.S. 333, 347 (1977)).

5

State

Apple

Advertising

When the question in a

declaratory judgment action is the applicability of a particular
insurance policy to an underlying claim, rather than the validity
of policy, the amount in controversy is determined by the value of
the underlying claim, not the face value of the policy.

Darbert,

Inc. v. Bituminous Cas. Corp., 792 F. Supp. 487, 489 (S.D. W. Va.
1992).

Thus, the object of the litigation is the claim, not the

policy itself.
The defendant has asserted that his injuries are severe and
permanent and valued in an amount far in excess of $70,000.00. The
policy at issue, however, limits Erie’s liability to $50,000.00 for
underinsured motorist benefits.

Accordingly, even though the

defendant may claim to have been damaged in excess of the policy,
it is apparent from the face of the pleadings, which includes the
policy and an invoice outlining the policy limits, that the
defendant can only recover $50,000.00 if declaratory judgment is
granted in his favor.

Thus, regardless of the value that the

defendant asserts his claim for damages has, his claim can only
possibly be valued at $50,000.00 against Erie.
This Court notes that this action is analogous to a situation
where the claimant seeks to recover the maximum amount of the
policy.

In such cases, “the court can determine the amount in

controversy by reference to the face of the policy.” Allstate Ins.
Co. v. Brown, 736 F. Supp. 705, 707 (W.D. Va. 1990).

As the policy

at issue, insomuch as it concerns underinsured motorist benefits,

6

is limited to $50,000.00, it follows that the amount in controversy
is no more than $50,000.00.
establish

the

jurisdiction

amount
and,

jurisdiction.

in

Such an amount is insufficient to

controversy

thus,

this

Accordingly,

this

Court
Court

required
lacks
need

for

diversity

subject
not

matter

address

the

defendant’s arguments for abstention.
IV.

Conclusion

For the above stated reasons, the defendant’s motion to
dismiss (ECF No. 6) is GRANTED. Further, the plaintiff’s motion to
consolidate cases (ECF No. 9) is DENIED AS MOOT.

The instant case

is to be DISMISSED WITHOUT PREJUDICE and STRICKEN from the active
docket of this Court.
IT IS SO ORDERED.
The Clerk is DIRECTED to transmit a copy of this memorandum
opinion and order to counsel of record herein. Pursuant to Federal
Rule of Civil Procedure 58, the Clerk is DIRECTED to enter judgment
on this matter.
DATED:

December 4, 2013

/s/ Frederick P. Stamp, Jr.
FREDERICK P. STAMP, JR.
UNITED STATES DISTRICT JUDGE

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