ORDER REQUESTING ADDITIONAL BRIEFING

SAMUEL CONTI, District Judge.

Now pending before the Court is Defendants' motion to dismiss Plaintiffs' First Amended Complaint, ECF No. 20 ("FAC"), for lack of subject-matter jurisdiction and failure to state a claim. ECF No. 21 ("Mot."). Plaintiffs have opposed the motion, ECF No. 22, and Defendants have replied. ECF No. 25. The only basis for subject-matter jurisdiction asserted in the FAC is diversity jurisdiction under 28 U.S.C. Section 1332. FAC ¶ 6. That statute invests federal district courts with original jurisdiction over civil actions in which the parties are diverse and the amount in controversy exceeds $75,000. 28 U.S.C. § 1332(a). Defendants do not dispute that diversity exists, but they claim that the amount in controversy does not exceed $75,000.

The amount in controversy in this case will be defined almost exclusively by the fees and costs incurred by Defendants in an underlying lawsuit in California state court. Defendants argue that the amount in controversy does not exceed $75,000 because, at the time the suit was filed, "Travelers had not paid anything in defense fees and costs, and the total defense fees and costs incurred by Centex Homes and Centex Real Estate were only $6,304.33. . . ." Mot. at 16. Plaintiffs retort that they expect the fees in the underlying action to exceed $300,000 before that case is concluded. Opp'n at 18. However, Plaintiffs' pleadings cast doubt on that assertion.

One of Plaintiffs' claims is for equitable reimbursement. FAC ¶¶ 36-40. The parties agree that, to state a claim for equitable reimbursement, an insurer must defend a third-party action in its entirety. See Mot. at 13; Opp'n at 13. The underlying state action is ongoing, but Plaintiffs assert that their duty to defend ceased upon Defendants' alleged breach of the insurance contract. Therefore, Plaintiffs claim, they have honored their duty to defend. According to Plaintiffs, an insurer defends an action in its entirety when it defends until either "the underlying lawsuit is concluded or at any time when it can be shown that there is no potential for coverage under the particular policy or policies." Opp'n at 14 (emphasis added). To that end, Plaintiffs plead in their FAC that "[a]s a result of CENTEX's breach of the insurance policies . . ., TRAVELERS' duty to defend CENTEX has now ceased and any payments made to CENTEX for fees incurred from the date of tender until the date of CENTEX's breach constitute an entire defense." FAC ¶ 38 (emphasis added).

It is unclear to the Court how Plaintiffs' arguments regarding the amount in controversy and the duty to defend can be consistent. On one hand, Plaintiffs allege that their duty to defend has ceased and that there is no potential for coverage under any of Defendants' policies. They also assert that the fees and costs incurred from the date of tender until the date of the alleged breach constitute an entire defense. On the other hand, Plaintiffs' sole argument for subject-matter jurisdiction depends upon fees and costs that will be incurred in the future — after Plaintiffs' duty to defend has ceased, after the point at which there is no potential for coverage, and after Plaintiffs have honored their duty to provide an entire defense. If it is true that Plaintiffs have already honored their duty to defend the underlying litigation in its entirety, the Court does not understand how the amount in controversy could possibly exceed the approximately $6,304.33 incurred to date.

Neither party has briefed this issue. Accordingly, the Court hereby ORDERS Plaintiffs to submit to the Court, within fourteen (14) days of the signature date of this order, a supplemental brief of not more than ten (10) pages explaining how the amount in controversy requirement can be met in this case. Defendants may submit a supplemental response brief on this issue within ten (10) days of Plaintiffs' submission.

IT IS SO ORDERED.