United States District Court, D. Kansas
SAUDER WEST FARMS, INC. and FARMERS STATE BANK OF ALICEVILLE, Plaintiffs,
SENTRY SELECT INSURANCE CO., Defendant.
MEMORANDUM AND ORDER
D. Crabtree United States District Judge
Sauder West Farms, Inc. (“Sauder”) and Farmers
State Bank of Aliceville (“Farmers State Bank”)
filed this lawsuit against defendant Sentry Select Insurance
Co. in Anderson County, Kansas. Defendant removed the action
to federal court, asserting that diversity jurisdiction
exists over the action. Plaintiffs have filed a Motion to
Remand. Doc. 12. Defendant has filed a Response opposing
remand. Doc. 13. And, plaintiffs have filed a Reply. Doc. 15.
After considering the parties' arguments, the court
denies plaintiffs' Motion to Remand.
Factual and Procedural Background
following facts are taken from plaintiffs' First Amended
Complaint (Doc. 10) or defendant's Notice of Removal
(Doc. 1). Plaintiff Sauder is a Kansas corporation with its
principal place of business in Kansas. Plaintiff Farmers
State Bank is a business organized in Kansas and is a
registered Kansas company in good standing. Doc. 1-2.
Defendant is an insurance company organized under the laws of
Wisconsin with its principle place of business in Wisconsin.
Defendant is authorized to engage in business in Kansas.
Sauder asserts a breach of contract claim against defendant.
Plaintiff Sauder alleges that defendant insured farm
equipment under an insurance policy. Plaintiff Sauder alleges
that the policy provided “$90, 000 for the no-till
drill and $55, 000 for the accompanying cart and designated
[plaintiff] as the named insured.” Doc. 10 at
2. Plaintiff Sauder asserts that defendant breached
the insurance contract by denying its claim for loss of the
no-till drill and cart. Plaintiff asks for a judgment against
defendant “for an amount in excess of $75, 000, and no
less than the full amount of coverage specified in the policy
for the no-till drill and cart.” Id. at 4.
Farmers State Bank asserts a third party creditor beneficiary
claim against defendant. Plaintiff Farmers State Bank alleges
that it held a security interest in the no-till drill and
cart, with an outstanding loan balance on the no-till drill
and cart at the time of loss in the amount of $64, 850.
Id. at 5. Plaintiff Farmers State Bank asserts that
it was entitled to receive timely written notice of any
decision by defendant not to renew or cancel the insurance
policy. Id. Plaintiff Farmers State Bank asserts
that it never received any written notice of such decision,
and this omission wrongfully precluded it “from taking
measures to protect its financial interests.”
Id. at 5-6. Plaintiff Farmers State Bank thus seeks
a judgment against defendant for $64, 850. Id. at 6.
courts are courts of limited jurisdiction; they must have a
statutory basis for their jurisdiction.” Dutcher v.
Matheson, 733 F.3d 980, 984 (10th Cir. 2013) (quoting
Rural Water Dist. No. 2 v. City of Glenpool, 698
F.3d 1270, 1274 (10th Cir. 2012)). Under 28 U.S.C. §
1441, a defendant may remove to federal court “any
civil action brought in a State court of which the district
courts of the United States have original
jurisdiction.” 28 U.S.C. § 1441(a); see also
Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987)
(explaining that “[o]nly state-court actions that
originally could have been filed in federal court may be
removed to federal court by the defendant”).
“This jurisdictional prerequisite to removal is an
absolute, non-waivable requirement.” Hunt v.
Lamb, 427 F.3d 725, 726 (10th Cir. 2005) (quoting
Brown v. Francis, 75 F.3d 860, 864 (3d Cir. 1996)).
federal statutes confer subject matter jurisdiction on
federal district courts: federal question jurisdiction under
28 U.S.C. § 1331, and diversity jurisdiction under 28
U.S.C. § 1332. For a federal court to have federal
question jurisdiction over a lawsuit, plaintiff must assert a
“civil action[ ] arising under the Constitution, laws,
or treaties of the United States.” 28 U.S.C. §
1331. For a federal court to have diversity jurisdiction, the
amount in controversy must exceed $75, 000, and complete
diversity of citizenship must exist between all plaintiffs
and all defendants. 28 U.S.C. § 1332(a).
removed this lawsuit asserting that the court has diversity
jurisdiction under 28 U.S.C. § 1332. Plaintiffs
disagree. Plaintiffs contend no diversity jurisdiction exists
here, and thus ask the court to remand the case.
jurisdiction requires: (1) complete diversity of citizenship;
and (2) an amount in controversy exceeding $75, 000. 28
U.S.C. § 1332. The parties do not dispute that the first
element of diversity jurisdiction is satisfied. For diversity
purposes, plaintiffs are Kansas citizens and defendant is
a Wisconsin citizen. So, complete diversity of citizenship
parties dispute whether the amount in controversy here
exceeds the jurisdictional threshold of $75, 000. As
described, plaintiffs bring two claims against defendant.
Plaintiff Sauder asserts a breach of contract claim, seeking
a judgment against defendant “for an amount in
excess of $75, 000, and no less than the full amount of
coverage specified in the policy for the no-till drill and
cart.” Doc. 10 at 4 (emphasis added). Plaintiff Farmers
State Bank asserts a third party creditor beneficiary claim,
seeking a judgment against defendant for $64, 850.
Id. at 6.
argue that the court lacks jurisdiction over plaintiff
Farmers State Bank's claim because the damages sought in
that claim are limited to $64, 850-an amount below the $75,
000 threshold. Plaintiffs assert that defendant cannot
aggregate the damages sought by each plaintiff's claim to
establish the necessary jurisdictional amount in controversy.
Plaintiff cites Snyder v. Harris, 394 U.S. 332
(1969), to support its argument. But, the facts of
Snyder differ from the facts here. Snyder
was a class action in which no single plaintiff met ...