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Hinkle v. USAA General Indemnity Co.

United States District Court, M.D. Louisiana

September 11, 2017

DONOVAN HINKLE
v.
USAA GENERAL INDEMNITY COMPANY

          NOTICE

          ERIN WILDER-DOOMES, UNITED STATES MAGISTRATE JUDGE.

         Please take notice that the attached Magistrate Judge's Report has been filed with the Clerk of the U.S. District Court.

         In accordance with 28 U.S.C. § 636(b)(1), you have 14 days after being served with the attached report to file written objections to the proposed findings of fact, conclusions of law, and recommendations set forth therein. Failure to file written objections to the proposed findings, conclusions and recommendations within 14 days after being served will bar you, except upon grounds of plain error, from attacking on appeal the unobjected-to proposed factual findings and legal conclusions accepted by the District Court.

         ABSOLUTELY NO EXTENSION OF TIME SHALL BE GRANTED TO FILE WRITTEN OBJECTIONS TO THE MAGISTRATE JUDGE'S REPORT.

         MAGISTRATE JUDGE'S REPORT AND RECOMMENDATION

         Before the Court is a Motion to Remand, filed by plaintiff Donovan Hinkle.[1] The Motion is opposed by defendant USAA General Indemnity Company (“USAA”).[2] For the following reasons, the undersigned recommends[3] that the Motion to Remand be DENIED.

         Factual and Procedural Background

         This suit arises out of an April 23, 2016 motor vehicle accident. On or about February 2, 2017, Plaintiff filed a Petition for Uninsured Motorist Benefits, Penalties, and Attorney Fees (the “Petition”) against USAA in the 18th Judicial District Court for the Parish of Iberville, Louisiana, based upon damages and injuries that Plaintiff incurred as a result of the accident.[4] Plaintiff alleges that on April 23, 2016, he was a guest passenger in a vehicle owned and operated by Hunter J. Clark, which was traveling eastbound on Interstate 10 (“I-10”) in Iberville Parish, Louisiana.[5]Plaintiff asserts that Clark stopped his vehicle on the eastbound right-hand shoulder of I-10 to provide assistance to a stalled vehicle that was owned and operated by Frank C. Stewart. While Plaintiff and Clark were providing assistance to Stewart, Plaintiff asserts that another vehicle operated by James O. Merritt, which was also traveling eastbound on I-10, veered into the shoulder and struck the rear of Clark's vehicle, causing Clark's vehicle to strike Plaintiff and Clark.[6]Plaintiff alleges that he “sustained serious permanent, painful, and disabling injuries, including but not limited to, laceration to the right side of his head, concussion with loss of consciousness, injuries to the right lower extremity, right knee, cervical spine, and contusions.”[7] Plaintiff further alleges that he sustained damages, “including but not limited to, medical expenses, physical pain and suffering, shock, fear, humiliation, mental anguish, emotional distress, loss of wages, and loss of enjoyment of life, all past, present, and future [sic], and all other elements of damages allowed under Louisiana law.”[8]

         Plaintiff also asserts in the Petition that at all times pertinent hereto, Merritt had automobile insurance through National General Insurance Company (“NGIC”) with policy limits of $15, 000 per person and $30, 000 per accident.[9] Although NGIC has offered and/or tendered its policy limits to Plaintiff, Plaintiff asserts that he has not been fully compensated for his injuries and damages and, therefore, Merritt is underinsured/uninsured for the underlying accident.[10] Plaintiff further asserts that at the time of the accident, Clark had uninsured/underinsured motorist (“UM”) coverage through USAA, which provides coverage to Plaintiff “for all such damages for which there exists insufficient insurance.”[11] Despite providing adequate proof of loss from the underlying accident, Plaintiff alleges that USAA has breached its duty of good faith and fair dealing by failing to unconditionally tender the amount on which reasonable minds could not differ.[12] Plaintiff further alleges that because USAA has arbitrarily, capriciously and without any justifiable cause or excuse failed to tender a sufficient amount of its UM liability insurance, Plaintiff is entitled to all statutory penalties, compensatory damages and attorney's fees provided by La. R.S. 22:1973 and/or La. R.S. 22:1892.[13]

         On March 17, 2017, USAA filed a Notice of Removal, asserting diversity jurisdiction under 28 U.S.C. § 1332(a).[14] In the Notice of Removal, USAA asserts there is complete diversity because Plaintiff is a citizen of Louisiana and USAA is a citizen of Texas.[15] With respect to the amount in controversy, USAA asserts that at the time of the accident Clark had automobile insurance and UM bodily injury coverage with limits of $50, 000 per person and $100, 000 per accident, as well as medical payment coverage with a limit of $10, 000.[16] USAA further asserts that before March 16, 2017, it had no documents concerning the nature and extent of Plaintiff's alleged injuries, other than the Petition and Plaintiff's vague allegations of personal injuries. USAA alleges that on March 16, 2017, Plaintiff's counsel informed USAA's counsel that Plaintiff had recently undergone knee surgery as a result of the accident and that Plaintiff is seeking to recover the full limit of USAA's UM coverage. USAA claims the conversation was confirmed in writing via emails exchanged on March 16, 2017 and March 17, 2017, which were submitted with the Notice of Removal.[17] Thus, USAA contends the amount in controversy exceeds $75, 000 because Plaintiff is seeking $50, 000 in UM coverage and may also seek $10, 000 in medical payment coverage, in addition to compensatory damages, penalties and attorney's fees under La. R.S. 22:1892 and La. R.S. 22: 1973. Because the penalty under La. R.S. 22:1892 is 50% of the amount found to be due under the insurance contract, which could be $30, 000 in this case, USAA asserts the amount in controversy clearly exceeds $75, 000.

         On March 24, 2017, Plaintiff filed the instant Motion to Remand, asserting that removal was improper because the Plaintiff has provided a post-removal Stipulation stating that the amount in controversy does not exceed $75, 000.[18] Plaintiff also seeks an award of costs and reasonable attorney's fees incurred in filing the Motion to Remand.

         In opposition, USAA maintains that the matter was properly removed because diversity jurisdiction existed at the time of removal.[19] Although it is not facially apparent from the Petition that Plaintiff's claims exceed $75, 000, USAA argues that the email exchange submitted with the Notice of Removal shows that Plaintiff underwent knee surgery as a result of the accident and that Plaintiff is seeking the $50, 000 limit of USAA's UM coverage.[20] For the same reasons stated in the Notice of Removal, USAA maintains that at the time of removal, the amount in controversy exceeded $75, 000 and this Court had diversity jurisdiction under 28 U.S.C. § 1332(a).

         USAA further asserts that Plaintiff's post-removal unilateral Stipulation does not divest this Court of diversity jurisdiction. USAA acknowledges that the Fifth Circuit has recognized a narrow exception where a unilateral post-removal stipulation can establish that the amount in controversy is not satisfied where three conditions are met, one of which is that the plaintiff timely contests removal with a sworn, unrebutted affidavit indicating that the amount in controversy was not met.[21] USAA argues that the exception does not apply in this case because Plaintiff's unilateral Stipulation is not in affidavit form and is merely an improper post-removal attempt to defeat diversity jurisdiction. As such, USAA urges the Court to deny Plaintiff's Motion to Remand.

         Applicable Law and Analysis

         A. USAA has shown by a preponderance of evidence that the amount in controversy exceeds $75, 000

         A defendant may remove “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). When original jurisdiction is based on diversity of citizenship, the cause of action must be between “citizens of different States” and the amount in controversy must exceed the “sum or value of $75, 000, exclusive of interest and costs.” 28 U.S.C. § 1332(a)-(a)(1). Subject matter jurisdiction must exist at the time of removal to federal court, based on the facts and allegations contained in the complaint. St. Paul Reinsurance Co., Ltd. v. Greenberg, 134 F.3d 1250, 1253 (5th Cir. 1998). The removal statute, 28 U.S.C. § 1441, is strictly construed and any doubt as to the propriety of removal should be resolved in favor of remand. Gasch v. Hartford Acc. & Indem. Co., 491 F.3d 278, 281-82 (5th Cir. 2007). The removing party has the burden of proving federal diversity jurisdiction. Garcia v. Koch Oil Co. of Tex. Inc., 351 F.3d 636, 638 (5th Cir. 2003). Remand is proper if at any time the court lacks subject matter jurisdiction. See, 28 U.S.C. § 1447(c).

         Louisiana law prohibits plaintiffs from specifying a monetary amount of damages in their state court petitions. La. C.C.P. art. 893(A)(1); Luckett v. Delta Airlines, Inc., 171 F.3d 295, 298 (5th Cir. 1999). When a plaintiff has not alleged a specific amount of damages, a removing defendant bears the burden of proving by a preponderance of the evidence that the amount in controversy exceeds $75, 000. Luckett, 171 F.3d at 298 (citing De Aguilar v. Boeing Co., 11 F.3d 55, 58 (5th Cir. 1993)). The defendant may make the requisite showing in either of two ways: (1) by demonstrating that it is facially apparent that the claims are likely above $75, 000, or (2) by setting forth the facts in controversy-preferably in the removal petition, but sometimes by affidavit-that support a finding of the requisite amount. Grant v. Chevron Phillips Chem. Co., 309 F.3d 864, 868 (5th Cir. 2002); Luckett, 171 F.3d at 298.

         Whatever the manner of proof, the jurisdictional facts that support removal must be judged at the time of removal. Gebbia v. Wal-Mart Stores, Inc., 233 F.3d 880, 883 (5th Cir. 2000). If at the time of removal it is facially apparent from the petition that the amount in controversy exceeds $75, 000, post-removal affidavits, stipulations and amendments reducing the amount do not deprive the court of jurisdiction. Id. (citing St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 292, 58 S.Ct. 586, 82 L.Ed. 845 (1938); ANPAC, 988 F.2d at 565). However, post-removal affidavits may be considered in determining the amount in controversy if the basis for jurisdiction is ambiguous at the time of removal. Gebbia, 233 F.3d at 883 (citing ANPAC, 988 F.2d at 565). If the defendant can produce evidence sufficient to show by a preponderance that the amount in controversy exceeds the jurisdictional threshold, the plaintiff can defeat diversity jurisdiction only by showing to a “legal certainty” that the amount in controversy does not exceed $75, 000. Grant, 309 F.3d at 869 (citing De Aguilar v. Boeing Co., 47 F.3d 1404, 1412 (5th Cir. 1995) (quoting St. Paul Mercury Indem., 303 U.S. at 289, 58 S.Ct. at 590)).

         Here, it is not facially apparent from the state court Petition that Plaintiff's claims will exceed the jurisdictional amount of $75, 000, exclusive of interests and costs. In the Petition, Plaintiff alleges injuries to his head, neck, right leg and knee and seeks damages for his medical expenses, physical pain and suffering, shock, fear, humiliation, mental anguish, emotional distress, loss of wages and loss of enjoyment of life.[22] The Court must, therefore consider whether USAA has met ...


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