WILLIAM H. STEELE, Chief District Judge.
This matter comes before the Court on plaintiff's Motion to Remand (doc. 5). The Motion has been briefed and is now ripe for disposition.
On November 18, 2010, plaintiff, Land Clearing Co., LLC, filed its Complaint against Navistar, Inc. and certain fictitious defendants in the Circuit Court of Choctaw County, Alabama. The Complaint alleged state-law claims for misrepresentation, breach of warranty, and breach of contract arising from Land Clearing's purchase of a truck from Navistar for $104,941.41. According to plaintiff, that vehicle did not perform as represented, was defective, and was not repaired by Navistar when Land Clearing notified it of these problems. The ad damnum clause of the Complaint stated as follows: "[T]he Plaintiff demands $74,000.00 from the Defendant. Plaintiff does not seek nor will it accept more than $74,000.00." (Doc. 1-1, at 6.)
Nearly a full year later, on November 4, 2011, Land Clearing filed an Amended Complaint in state court, naming Caterpillar, Inc. as an additional defendant, on the theory that Caterpillar had manufactured the truck's diesel engine, had supplied plaintiff with a warranty for that engine, and had been unable to repair it successfully. The Amended Complaint alleged claims against Caterpillar for breach of warranty and against both defendants for failure of the warranty's essential purpose. The ad damnum clause of the Amended Complaint stated that Land Clearing demanded judgment "in such sums of compensatory and punitive damages as a jury may assess after a fair and accurate consideration of the facts of this cause." (Doc. 1-1, at 30.)
On November 16, 2011, Navistar (with the written consent of Caterpillar) removed this action to this District Court pursuant to 28 U.S.C. §§ 1441 and 1446. Federal subject-matter jurisdiction was predicated on 28 U.S.C. § 1332, supported by allegations that there was complete diversity of citizenship and the amount in controversy exceeded $75,000. Navistar's interpretation of the Amended Complaint was that "Plaintiff has now removed the $74,000.00 damages cap and added a demand for punitive damages. Plaintiff has clearly conceded that his initial valuation of the case was incorrect and it is now seeking beyond the minimum jurisdictional requirement necessary to properly remove the case." (Doc. 1, at 9.)
Plaintiff endeavors to remand this action to state court, arguing that the threshold amount in controversy is not satisfied. Navistar (the removing defendant) has consented to such remand, so long as this Court expressly confirms plaintiff's representation that it will not seek to recover in excess of $75,000. (See doc. 8.) Land Clearing readily agrees to that language. (See doc. 11, ¶ 1.) However, Caterpillar objects and insists that removal jurisdiction is proper because the purchase price of the truck was in excess of $104,000 and plaintiff is seeking other categories of damages such as lost production revenue, mental anguish, and punitive damages. (See doc. 10.)
A removing defendant must establish the propriety of removal under 28 U.S.C. § 1441 and, therefore, must demonstrate the existence of federal jurisdiction. See Friedman v. New York Life Ins. Co., 410 F.3d 1350, 1353 (11
There being no federal question presented in the Complaint, Navistar's sole theory of removal was diversity of citizenship. Under 28 U.S.C. § 1332(a), federal courts have original jurisdiction over all civil actions between citizens of different states where the amount in controversy exceeds the sum or value of $75,000, exclusive of interest and costs. See Underwriters at Lloyd's, London v. Osting-Schwinn, 613 F.3d 1079, 1085 (11
As noted, the sole issue presented in Land Clearing's Motion to Remand is whether the § 1332 amount-in-controversy requirement is satisfied.
The removing defendants plainly bear the burden of proof on this issue. Specifically, "[i]f a plaintiff makes an unspecified demand for damages in state court, a removing defendant must prove by a preponderance of the evidence that the amount in controversy more likely than not exceeds the ... jurisdictional requirement." Roe v. Michelin North America, Inc., 613 F.3d 1058, 1061 (11
Plaintiff asserts that Caterpillar (the only defendant contesting the Motion to Remand) cannot meet this burden and that the preponderance of the evidence clearly establishes that plaintiff did not and does not seek damages in excess of the jurisdictional minimum. In support of its position, Land Clearing relies on the following circumstances: (i) specific and detailed $74,000 limit on the face of the original Complaint that was not expressly negated by the Amended Complaint; (ii) counsel's representation that the reference to punitive damages in the Amended Complaint was inadvertent; (iii) plaintiff's pre- and post-removal "initial" settlement demands of $67,500; (iv) plaintiff's filing of a Second Amended Complaint (doc. 6) within days after removal, deleting the punitive damages claim and bearing an ad damnum clause reflecting that "Plaintiff does not seek nor will it accept more than $74,000"; (v) plaintiff's ready acquiescence to Navistar's proposal that any remand order should include "some language restricting the Plaintiff's claims to $74,000" (doc. 11, at ¶ 1); and (vi) plaintiff's counsel's steadfast representations as an officer of the court that "Plaintiff never intended to make any claim in excess of $74,000" (id.).
Plaintiff's showing is compelling. To be sure, Caterpillar is correct that the amount in controversy must be measured as of the date of removal, not afterwards based on ensuing developments. See Adventure Outdoors, Inc. v. Bloomberg, 552 F.3d 1290, 1294-95 (11
But these authorities do not stand for the proposition that post-removal facts must never be considered in evaluating removal jurisdiction. Rather, the law is clear that post-removal developments are properly weighed where they shed light on the amount in controversy at the time of removal. See Pretka, 608 F.3d at 772-73; Sierminski v. Transouth Financial Corp., 216 F.3d 945, 949 (11
Land Clearing's evidence is exactly the sort of clarification that courts examine in ascertaining whether the $75,000 amount-in-controversy threshold was present when the notice of removal was filed. Plaintiff's counsel's insistence that his client does not seek, and will not accept, more than $74,000 from defendants looms large in the jurisdictional inquiry, and merits considerable deference. See, e.g., Federated Mut. Ins. Co. v. McKinnon Motors, LLC, 329 F.3d 805, 808 (11
Taken together, this evidence weaves a persuasive story. From the inception of this case, Land Clearing never sought, nor intended to accept, greater than $74,000 in damages from defendants. The ad damnum clause in the original Complaint unambiguously specified that intention. A subsequently filed Amended Complaint was drafted in a manner that created uncertainty about whether damages sought by plaintiff exceeded the $75,000 threshold. Navistar seized on that ambiguity, removing the action based on its interpretation of the Amended Complaint that Land Clearing "has clearly conceded that his initial valuation of the case was incorrect." (Doc. 1, at 9.) But plaintiff's counsel, as an officer of the court, now represents that "Plaintiff never intended to make any claim in excess of $74,000" (doc. 11, at 1), and bolsters that representation by pointing to pre- and post-removal settlement demands, discovery responses, the original Complaint, and the Second Amended Complaint filed immediately after removal. Viewed in the aggregate, these facts strongly indicate that at the moment of removal, the amount in controversy was below the $75,000 threshold.
Defendant Caterpillar (but not Navistar, the originally removing defendant) opposes remand of this action to state court; however, none of its arguments are sufficient to carry defendants' burden of showing that the § 1332 amount-in-controversy requirement is satisfied. First, Caterpillar asserts that "only the Complaint and Amended Complaint are relevant" (doc. 10, at 2) to the jurisdictional inquiry. This is incorrect, as shown by the authorities cited supra, in which other materials were properly considered. Second, Caterpillar insists that the amount-in-controversy threshold must be satisfied because the Complaint recites the purchase price of the truck as $104,941.41 (Complaint, ¶¶ 8, 12, 16) and the Amended Complaint specifies that the truck is now "virtually worthless" and "has little, if any, value" (Amended Complaint, ¶¶ 4, 9.) Considering these allegations together, Caterpillar reasons that the amount in controversy must be at least $104,941.41, which is plainly in excess of the jurisdictional minimum, no matter what Land Clearing says the value of its claims is. But plaintiff, not defendant, is the master of its Complaint. See Hill v. BellSouth Telecommunications, Inc., 364 F.3d 1308, 1314 (11
Nor can defendant meet its burden of showing removal jurisdiction by hypothesizing "what-if" scenarios in which the verdict might exceed plaintiff's self-imposed cap. If the law were otherwise, then "anytime a plaintiff sued for less than the jurisdictional amount but there remained even a possibility that she would amend her claim or be awarded more than she pleaded, jurisdiction would exist. This approach would unacceptably broaden removal jurisdiction ... [and] allow state rules of procedure to determine when federal jurisdiction existed." Burns, 31 F.3d at 1096-97. No such argument can avail Caterpillar here.
For all of the foregoing reasons, it is the opinion of this Court that the defendants have not met their burden of establishing that it is more likely than not that the amount in controversy at the time of removal exceeded $75,000, as necessary to support federal diversity jurisdiction pursuant to 28 U.S.C. § 1332. What's more, plaintiff's counsel's pre- and post-removal representations and pleadings confirm that plaintiff does not (and never has) sought to recover more than $74,000 in damages in this case. As such, the Court concludes that there is no federal subject-matter jurisdiction over this action and that removal was improper.
Based on plaintiff's counsel's consistent and unequivocal representations to this Court, the state court, and opposing counsel that plaintiff never intended to make any claim in excess of $74,000, that plaintiff does not seek and will not accept damages in excess of $74,000 (exclusive of interest and costs), and that plaintiff will never seek to recover more than that amount, the Motion to Remand (doc. 5) is
DONE and ORDERED.