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Baker v. State Farm Mutual Automobile Insurance Co.

United States District Court, D. Nevada

January 8, 2015

JULIE A. BAKER, Plaintiff,
v.
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, a Foreign Corporation; DOES 1 through 10; ROE ENTITIES 11 through 20, inclusively jointly and severally, Defendants.

ORDER

GLORIA M. NAVARRO, Chief District Judge.

Pending before the Court is the Motion for Summary Judgment (ECF No. 14) filed by Defendant State Farm Mutual Automobile Insurance Company ("State Farm"). However, because the Court lacks subject matter jurisdiction over the case, the Court remands this case to the Eighth Judicial District Court.

I. BACKGROUND

Plaintiff Julie A. Baker ("Plaintiff") originally filed her complaint in state court on September 16, 2013. See (Compl., ECF No. 1-1). In her Complaint, Plaintiff alleges that on March 22, 2013, she was injured in a motor vehicle collision caused by the negligence of a non-party tortfeasor. ( Id. at ¶¶ 7-10). She further alleges that at the time of the accident, her vehicle was insured by State Farm with a policy that included underinsured motorist ("UIM") coverage and that she could not recover the full amount of her damages from the non-party tortfeasor. ( Id. at ¶¶ 16-24).

On October 18, 2013, State Farm removed the action to this Court asserting that this Court has original jurisdiction under 28 U.S.C. § 1332(a)(1). (Not. of Removal 2:2-6, ECF No. 1). Specifically, State Farm asserts that Plaintiff is domiciled in Nevada and that Defendant State Farm is domiciled in Illinois. ( Id. 2:7-10.) State Farm further asserts that "the matter in controversy exceeds the sum of $75, 000.00." ( Id. 2:4-5). State Farm bases this assertion on the fact that its UIM policy limits are $15, 000 per person and that "the contractual limits of the policies, as well as the claimed punitive and tort damages are sufficient to exceed the limit." ( Id. 2:11-20).

On October 20, 2014, after reviewing State Farm's Notice of Removal (ECF No. 1) and Statement Regarding Removal (ECF No. 6), the Court entered an Order to Show Cause why the case should not be remanded to the state court for lack of subject matter jurisdiction. (Order to Show Cause, ECF No. 19). Specifically, the Court requested that State Farm provide additional basis for its assertion that the case involved the requisite amount in controversy. ( Id. ). Subsequently, on November 3, 2014, State Farm filed a Response to this Court's Order to Show Cause. (ECF No. 21).

II. LEGAL STANDARD

Federal courts are courts of limited jurisdiction, possessing only those powers granted by the Constitution and by statute. See United States v. Marks, 530 F.3d 799, 810 (9th Cir. 2008) (citation omitted). For this reason, "[i]f 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). Furthermore, a court may raise the question of subject matter jurisdiction sua sponte at any time during the action. Fed.R.Civ.P. 12(h)(3); Snell v. Cleveland, Inc., 316 F.3d 822, 826 (9th Cir. 2002).

District courts have jurisdiction in two instances. First, district courts have subject matter jurisdiction over civil actions that arise under federal law. 28 U.S.C. § 1331. Second, district courts have subject matter jurisdiction over civil actions where no plaintiff is a citizen of the same state as a defendant and the amount in controversy exceeds $75, 000. 28 U.S.C. § 1332(a).

A defendant may remove an action to federal court only if the district court has original jurisdiction over the matter. 28 U.S.C. § 1441(a). "Removal statutes are to be strictly construed' against removal jurisdiction. Nevada v. Bank of America Corp., 672 F.3d 661, 667 (9th Cir. 2012) (quoting Syngenta Crop Prot., Inc. v. Henson, 537 U.S. 28, 32 (2002)). The party asserting federal jurisdiction bears the burden of overcoming the presumption against federal jurisdiction. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Specifically, federal courts must reject federal jurisdiction "if there is any doubt as to the right of removal in the first instance." Gaus v. Miles, 980 F.2d 564, 566 (9th Cir. 1992) (quoting Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir. 1979)); see also Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090-91 (9th Cir. 2003) (per curiam) (noting that "[w]here it is not facially evident from the complaint that more than $75, 000 is in controversy, the removing party must prove, by a preponderance of the evidence, that the amount in controversy meets the jurisdictional threshold").

III. DISCUSSION

In this case, State Farm bases its removal of the action solely on diversity of citizenship pursuant to 28 U.S.C. § 1332(a)(1). However, State Farm has failed to carry its burden of establishing that this Court has subject matter jurisdiction over this case. Although State Farm established that the diversity of citizenship requirement is satisfied, it failed to show, by a preponderance of the evidence, that the amount in controversy exceeds $75, 000.

In its Response to the Court's Order to Show Cause (ECF No. 19), State Farm asserts that "it is clear that the cumulative value of Plaintiff's claims as pled far exceed this Court's jurisdictional minimums of $75, 000.00, especially in light of extra-contractual or bad faith claims, and the allegation of punitive damages...." (Resp. to OSC 2:24-26, ECF No. 21). However, the few facts relied upon by State Farm to justify that assertion instead support the exact opposite conclusion.

According to State Farm, Plaintiff has claimed "accident-related expenses in excess of $32, 345.00 and the need of costly future medical care." ( Id. 2:2-5). However, subtracted from the amount of accident-related damages Plaintiff may receive is the amount Plaintiff has already received from the tortfeasor's insurer, which State Farm "believe[s to be] the $50, 000.00 per person limits" of the tortfeasor's policy. ( Id. 2:11-15). Therefore, Plaintiff's accident-related damages here could only be the amount of her future unspecified medical costs that when added to her current costs exceed $50, 000. ...


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