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Liberty Mutual Insurance Group v. Panelized Structures Inc.

UNITED STATES DISTRICT COURT DISTRICT OF NEVADA


January 31, 2011

LIBERTY MUTUAL INSURANCE GROUP, PLAINTIFF,
v.
PANELIZED STRUCTURES INC., ET AL., DEFENDANTS.

ORDER

Presently before the court is plaintiff Liberty Mutual Insurance Group's (hereinafter "Liberty Mutual") motion to remand to state court (doc. #6). Defendant Panelized Structures Inc. (hereinafter "PSI") responded (doc. #9), and plaintiff replied (doc. #13). Defendant PSI again replied with a supplemental opposition to plaintiff's motion to remand (doc. #14), and plaintiff made a final reply (doc. #15).

I. RELEVANT FACTS

Plaintiff's filed suit to enforce alleged contractual indemnification and equitable subrogation rights stemming from a worker's compensation insurance policy. This insurance policy and customer agreement existed between Allied Forces Temporary Services Inc. ("AFTS"), and defendant PSI. On May 1, 2004, plaintiff Liberty Mutual issued a worker's compensation insurance policy to AFTS, a foreign corporation qualified to do business in Nevada.

On or about September 1, 2004, defendant PSI entered into a customer agreement with AFTS, through which PSI agreed to indemnify AFTS against claims related to "damages to Company owned vehicles, machinery, or materials to which Allied Forces Temporary Services employees may be assigned." (Doc. #1-1, compl. ¶ 15). Thereafter, an AFTS employee, Thomas Novick, was seriously injured when an agent or employee of defendant PSI ran over Novick with a rough terrain forklift leased by PSI, causing the loss of Novick's leg.

Pursuant to the customer agreement, plaintiff Liberty Mutual filed suit in District Court, Clark County Nevada in 2006 to assert tort statutory subrogation rights pursuant to N.R.S. 616C.215 to recover worker's compensation benefits paid to Novick in excess of $500,000. That case was consolidated with a negligence action filed by Novick, and the consolidated action remains in state court.

Plaintiff Liberty Mutual thereafter filed a second suit, alleging contractual indemnification and equitable subrogation in August of 2010. (Doc. #1-1). Before that case could be consolidated with the first action, the defendant removed the second suit to this court under the doctrine of diversity jurisdiction. (Doc. #1). In response, the plaintiff has filed the instant motion to remand. (Doc. #6).

II. MOTION TO REMAND (doc. #11)

Pursuant to 28 U.S.C. §1332, this court has original jurisdiction over all civil actions where the amount in controversy exceeds $75,000, exclusive of interest and costs, and is between citizens diverse citizenship. Here, the amount in controversy exceeds $500,000 and is between parties of complete diversity. (See doc. #1) (stating that the principal place of business of plaintiff is Massachusetts, while the principal place of business of the defendant is California).

However, the plaintiff argues that the case is non-removable because it arises from a worker's compensation dispute under Nevada law. Pursuant to 28 U.S.C. §1445(c), "a civil action in any state [c]court arising under the workmen's compensation laws of such state may not be removed to any district court of the United States."

The court disagrees and finds that plaintiff's claims arise out of state contract law, rather than from worker's compensation laws. This civil action does not rely on, is not based upon, and does not require interpretation of the workmen's compensation laws of the State of Nevada, as the worker's compensation benefits have already been paid to Mr. Novick. The issue before the court now is a matter of contract interpretation. Although the dispute will be governed by state law, the court finds that it has jurisdiction over this action pursuant to 28 U.S.C. § 1332 and, therefore, removal was proper.

Accordingly,

IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that plaintiff's motion to remand (doc. #6) is DENIED.

UNITED STATES DISTRICT JUDGE

20110131

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