Case Still Sent to Federal Court Despite Missing Required Amount in Controversy
October 29, 2018
A United States district court for the Southern District of Florida determined that an insured was not entitled to have his case against his insurer remanded to state court, even if his case was valued at less than the amount in controversy for federal court diversity jurisdiction. The case is Legos v. Travelers Cas. Co., No. 3:16cv1917, 2018 U.S. Dist. LEXIS 174994 (M.D. Pa. Oct. 11, 2018).
When Hurricane Urma hit the shore in September 2017, Roger Ulloa suffered property damage. In June 2018, after Integon National Insurance Company failed to pay the full amount of insurance proceeds, Ulloa filed a complaint in state court alleging a breach of contract with the amount in controversy exceeding $15,000. The complaint filed by Ulloa listed his damages as $73,963.19, without including attorneys' fees or costs. Integon filed a notice that they wanted to remove the case to federal court on the basis that the pre-trial estimate and proof of loss approximates $100,000. Ulloa moved to remand the case back to state court, arguing that the complaint that he filed cited a precise estimate of damages that amounted to less than $75,000. Ulloa stated that his original demand was just “puffing and posturing” and was not a reasonable assessment of the value of his claim. Integon replied noting that Ulloa's proof of loss form was signed under penalty of perjury, which meant that either his action exceed the amount in controversy or he was guilty of perjury.
The court agreed with Integon, ruling that Integon had met its burden of establishing, by a preponderance of the evidence, that the amount in controversy exceeded $75,000. The court concluded that if they started out with $73,963 and added in attorneys' fees at the time of removal, Ulloa's damages mounted to at least $74,723, which is $277 short of the amount in controversy required for removal.
The court concluded that, if Ulloa's damages were at least $74,723 and Integon's removal of the case was based on a sworn piece of evidence that Ulloa attested to when he valued the damages in his case, Integon had successfully established by a preponderance of the evidence that Ulloa's case was valued at more than $75,000.
Editor's Note:
District courts have original jurisdiction of all civil actions where the damages exceeds $75,000 exclusive of interest and costs. In order for a case to be removed from district court to state court, the parties must all be citizens of different states, and the damages must exceed $75,000. Although the plaintiff is in charge of his complaint, there are minimum requirements for choosing a legal venue for your case. These requirements and thresholds are put in place to prevent forum shopping, which occurs when litigants attempt to have their case heard in a forum that will treat them the most favorably.