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Manibhadra, Inc. v. Aspen Insurance Uk Ltd.

United States District Court, D. Kansas

December 17, 2014

MANIBHADRA, INC., Plaintiff,
v.
ASPEN INSURANCE UK LTD., Defendant.

MEMORANDUM AND ORDER

SAM A. CROW, Senior District Judge.

This case comes before the Court on Plaintiff's motion to remand. Plaintiff contends Defendant's removal is improper because it was untimely and the federal court lacks jurisdiction. The Court agrees that it lacks jurisdiction.

Facts

The facts are undisputed. Plaintiff filed its breach of insurance contract action in state court in September of 2014. That Petition seeks $19, 425.00 in damages, plus attorney fees pursuant to K.S.A. §40-256. Defendant received a copy of the Petition and Summons on October 6, 2014, which was Defendant's first actual notice of the lawsuit. Defendant filed its Notice of Removal on November 5, 2014, within the thirty days thereafter. But Plaintiff had served the Kansas Insurance Commissioner with process in the same state case earlier, on October 2nd. If the 30-day clock started ticking on that date, Defendant's removal was untimely. But the Court declines to reach the timeliness issue in light of its lack of jurisdiction.

Amount in Controversy

To remove a case based on diversity, the defendant must demonstrate that all of the prerequisites of diversity jurisdiction in 28 U.S.C. § 1332 are satisfied. See Huffman v. Saul Holdings Ltd. Partnership, 194 F.3d 1072, 1079 (10th Cir. 1999). A defendant seeking to remove a case to a federal court must file in the federal forum a notice of removal "containing a short and plain statement of the grounds for removal." §1446(a). A defendant's notice of removal must include "a plausible allegation that the amount in controversy exceeds the jurisdictional threshold, " but does not need to incorporate evidence supporting that allegation. Dart Cherokee Basin Operating Co. v. Owens, 574 U.S. ___, 2014 WL 7010692, (Dec.15, 2014) slip op. at p. 7. ( Dart ).[1]

Plaintiff contests Defendant's allegation that the amount in controversy exceeds $75, 000, so contends diversity jurisdiction under 28 U.S.C. § 1332(a) is lacking. Where, as here, the plaintiff contests the defendant's allegation, "§1446(c)(2)(B) instructs:

[R]emoval... is proper on the basis of an amount in controversy asserted" by the defendant "if the district court finds, by the preponderance of the evidence, that the amount in controversy exceeds" the jurisdictional threshold.

Dart, slip op. at p. 6. "Evidence establishing the amount is required by § 1446(c)(2)(B) only when the plaintiff contests, or the court questions, the defendant's allegation." Dart, slip op. at p. 7.

The Supreme Court recently clarified the procedure when the plaintiff challenges the defendant's assertion of the amount in controversy.

In such a case, both sides submit proof and the court decides, by a preponderance of the evidence, whether the amount-in-controversy requirement has been satisfied. As the House Judiciary Committee Report on the JVCA observed:
"[D]efendants do not need to prove to a legal certainty that the amount in controversy requirement has been met. Rather, defendants may simply allege or assert that the jurisdictional threshold has been met. Discovery may be taken with regard to that question. In case of a dispute, the district court must make findings of jurisdictional fact to which the preponderance standard applies." H. R. Rep. No. 112-10, p. 16 (2011).

Dart, at p. 6.

In that respect, Dart does not change established Tenth Circuit law. "The amount in controversy is ordinarily determined by the allegations of the complaint, or, where they are not dispositive, by the allegations in the notice of removal." Laughlin v. Kmart Corp., 50 F.3d 871, 873 (10th Cir. 1995). When that amount is challenged, the party alleging federal jurisdiction has the burden to prove by a preponderance of the evidence, facts sufficient to establish "that the amount in controversy may exceed $75, 000." McPhail v. Deere & Co., 529 F.3d 947, 953 (10th Cir. 2008); See Martin v. Franklin Capital Corp., 251 F.3d 1284, 1290 (10th Cir. 2001). Where "a state court complaint does not identify a specific amount that the plaintiff seeks to ...


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