BRIAN K. EPPS, Magistrate Judge.
Based on the evidence introduced at the September 3, 2013 hearing, and for the reasons set forth below, the Court
The amended complaint asserts nine claims for (1) tortious interference with business relations; (2) vandalism; (3) malicious prosecution; (4) harassment; (5) conspiracy; (6) fraudulent inducement, (7) intentional misrepresentation; (8) trespass; (9) and civil RICO violations. (
This lawsuit arises out of the lease by Plaintiff of a house in McRae, Georgia to Defendants. (Doc. no. 30, pp. 2-3.) Plaintiff entered into the lease on December 8, 2014, in reliance upon Defendants' representations that Debra Ellis was Debra McCrimmon, that Debra Ellis was the wife of Billy McCrimmon, and that the married couple was interested in buying the house at some unspecified date in the future. (
Plaintiff next asked Defendants for permission to place a "For Sale" sign in the window of the rental house, which Defendants refused while also threatening Plaintiff. (
The next day, Plaintiff conducted an inspection and found damage that included a smashed wall at the head of the bathtub, cracked tile in the hall, damaged screen doors, a bent garage lock, and tears and marks in the linoleum. (
Plaintiff alleges that the bulk of her damages relates to her claim for tortious interference with business relations, caused by her inability to place a "For Sale" sign in the window of the rental house. (Court's recording system, For The Record, (hereinafter "FTR"), 11:57:15-11:58:33.) Defendants' obstruction of this attempt to sell the rental house precluded Plaintiff from completing her plan of selling two rental houses, as part of a tax-deferred exchange under 26 U.S.C. § 1031, to acquire a house owned by her father in New Jersey worth approximately $200,000. (
Plaintiff testified that her damages for the vandalism claim are approximately $4,300 in repairs performed by two contractors to remedy the damage inflicted by Defendants at the rental house. (FTR 12:10:45-12:16:05; FTR 12:02:00-12:02:10; FTR 12:12:30-12:14:31; Exhibit 2.)
As to the malicious prosecution claim, Plaintiff testified that her damages are $1,000 in travel expenses incurred to attend court hearings concerning the arrest warrant and personal injury lawsuit. (FTR 12:17:55-12:18:49.) Plaintiff also testified that the criminal charges caused her to suffer emotional distress that manifested itself as high blood pressure, depression, fatigue, and inertia. (FTR 12:18:49-12:25:35.) Plaintiff's harassment claim is redundant of the malicious prosecution claim, except that she also alleges Debra Ellis threatened her. (FTR 12:27:16-12:27:49.) Plaintiff did not testify or introduce any evidence as to damages for this claim. (
As to the Georgia RICO claim, Plaintiff stated her intent to drop this claim because of her belief that it is frivolous, and she stated that there are no damages associated with this claim. (FTR 12:28:04-12:28:14.) As to the conspiracy claims, Plaintiff initially appeared to claim damages of $8,000 from the personal injury lawsuit but then testified that this amount has been "disproved" and that damages for the conspiracy claims are the same as for the malicious prosecution claim. (FTR 12:28:14-12:30:30.)
Concerning the fraudulent inducement and intentional misrepresentation claims, Plaintiff claims $40,000 in damages caused by her inability to sell the rental house and complete the § 1031 exchange. (FTR 12:32:43-12:33:01.) This amount is equal to the value of the rental house. (
Federal courts are courts of limited jurisdiction and possess only that power authorized by Constitution and statute.
Plaintiff claims that her damages from the tortious interference claim are $200,000 because of her inability to buy her father's house in New Jersey with a list price of that amount. (FTR 11:57:15-11:58:33.) Under Georgia law, a defendant is liable for all damages proximately caused by its tortious interference with a potential business relationship.
Plaintiff's damages from the tortious interference claim are, in all likelihood, nothing because she still owns the rental house in McRae, Georgia, the potential of a § 1031 exchange still exists for her, and the house in New Jersey owned by her father is still available to her for $200,000. However, fully crediting Plaintiff's belief that a § 1031 exchange is permanently lost to her, her damages would be the capital gains tax that she will now be forced to realize upon the sale of the rental house as a result of her alleged inability to perform a § 1031 exchange. Her damages would not be $200,000, the list price of the New Jersey house, because it cannot reasonably be said that the benefit of such a transaction to her would be the full amount paid for the house.
Plaintiff testified at the hearing that the total in capital gains she would defer by entering into the § 1031 exchange would be approximately $43,000, the amount of gain she would realize from selling the rental house at issue and another property she wished to include in the § 1031 exchange. (FTR 12:48:50-12:49:20.) Plaintiff also testified that she has owned both properties for approximately ten years. (FTR 12:49:20-12:49:46.) Although Plaintiff could not give her marginal tax rate at the hearing, assuming the highest long-term capital gains rate of 23.8%, the maximum possible benefit to her from the § 1031 exchange, and thus the most in damages she could recover, is $10,234, equal to 23.8% of $43,000.
As to Plaintiff's vandalism claim, she claims repair damages of $4,300. (FTR 12:10:45-12:16:05; Exhibit 2.) Although the evidence shows that most of the repair work was done before Defendants rented the house, the Court will give Plaintiff the benefit of every doubt and include all repairs in the total. In regard to Plaintiff's malicious prosecution and harassment claims, Plaintiff claims $1,000 in travel expenses. (FTR 12:17:55-12:18:49.)
In regards to the fraudulent inducement and intentional misrepresentation claims, Plaintiff testified that her damages are $40,000, the price she believes a buyer would have paid for the rental house. (FTR 12:32:43-12:33:01.) Under Georgia law, the damages from a fraudulent inducement claim are the difference between the deal bargained-for and what was actually received.
In sum, giving Plaintiff the benefit of every doubt, her special damages amount to no more than $15,534, a far cry from the $75,000 required for diversity jurisdiction under 28 U.S.C. § 1332. Although Plaintiff testified that she suffered emotional distress from defending herself in the proceedings relating to the arrest warrant and personal injury lawsuit, she did not introduce any evidence to suggest she suffered a severe degree of distress. (
The Court is not required to divine some amount of emotional distress damages in order to determine whether these damages, aggregated with the damages from her other claims, meet the amount-in-controversy requirement.
Finally, Plaintiff claims punitive damages for Defendants filing a false counterclaim against her in this proceeding. (
In sum, Plaintiff's measurable damages amount to no more than $15,534, a far cry from the $75,000 required for diversity jurisdiction under 28 U.S.C. § 1332. Plaintiff's claims for emotional distress and punitive damages are also woefully inadequate to bridge the gap between her special damages of $15,534 and the jurisdictional requirement of $75,000. Accordingly, the Court lacks jurisdiction over this case, and it should be dismissed.
Based on the reasons set forth above, the Court
SO REPORTED AND RECOMMENDED.