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Case 7:21-cv-00394 Document9 on 12/07/21in TXSD Pag
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UNITED STATES DISTRICT COURT
Webbemz 2021
SOUIHERN DISTRICT 0F TEXAS LAURmfmaanegm
MCALLEN DIVISION Distri ida oCounty
Deputy#15
By
MACARIO SAENZ,
Plaintiff,
VS. mmmmmmmwm
CIVIL ACTION NO. 7:21-cv-00394
STATE FARM LLOYDS,
Defendant.
OPINION AND ORDER
The Coun now considers “Plaintiffs Opposed Motion to ReImnd’” and Defendant’s
response? Afier considering the motion, record, and relevant authorities, the Court GRANTS
Plaintifl‘s motion and REMANDSthis case.
I. BACKGROUND AND PROCEJURAL HISTORY
This is an insmance dispute. Plaintiff Macario Saenz alleges that, on or about July 26, 2020,
Hurricane Hanna dannged his insured property.3 Plaintiff alleges that Defendant State Farm
Lloyds fifled to properly inspect Plaintifi’s property and has fiiled to pay under the parties’
.
insurance policy and violated the Texas Insurance Code.4
Plaintifl‘ commenced this case on September 8, 2021,by filing his original petition in Texas
}
state court.5 Aprocess server served Defendant on September 14th6 Thirty days later, Defendant
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Dkt. No. 6.
2
Dkt. N0. 7.
3
Dkt. No. 1-2 at 7, § V.
4
1d. at 7—9, §§ v—VI.
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Dkt. NO. |~2.
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Id. at 13.
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Case 7:21—cv-00394 Document 9 Filed on 12/07/21 in TXSD Page 2 of 6
rermved to this Court? Plaintiff dilatorily filed his instant Imtion to rermnd on November 4,
2021,8 and the motion is ripe for consideration. The Coun th’ns to its analysis.
II. DISCUSSION
a. Legal Standard
The Court must police its own subject matter jurisdiction on its own initiative.9 It is a“well-
settled principle that litigants can mver consent to federal subject matter jurisdiction, and the lack
of subject matter jurisdiction is a defense that cannot be waived.”‘° District courts have limited
jurisdiction and the authority to remove an action fiom state to federal court is solely conferred by
the Constitution or by statute.” “Removal [to federal court] is proper only if that court would have
had original jurisdiction over the claim’“ While the Court has jurisdiction to determine its
jurisdiction,” it cannot exercise any “judicial action” other than dismissal when the Court lacks
jurisdiction” It is also a “long-standing canon of statutory interpretation that removal statutes are
to be construed strictly against removal and for rennnd”” so “any doubt as to the propriety of
removal should be resolved in fivor ofremand.”'6
If the removing party claims federal diversity jurisdiction under 28 U.S.C. § 1332, the
removing party must demonstrate complete diversity: that each defendant is acitizcn ofadifi‘erent
7
Dkt. No. l.
8
Dkt. No. 6.
9
RuhrgasAG v.Marathon Oil Co., 526 U.S. 574, 583 (I999).
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Gonzalez v. Guilbot,255 F. App’x 770, 771 (5th Cir. 2007) (citing Coury v. Prat. 85 F.3d 244, 248 (5th Cir.l996));
see 28 U.S.C. § 1447(c).
” Kokkonen v. Guardian Life Ins. Co. ofAm., 511 U.S. 375, 377 (I994).
'2
Heritage Bank v. Redcom Labs., Inc., 250 F.3d 319, 323 (5th Cir. 2001); accord Halmekangas v. State Farm Fire
& Cas. C0., 603 F.3d 290, 294 (5th Cir. 2010)
'3
United States v. Ruiz, 536 U.S. 622, 628 (2002) (“[I]t is familiar law thata federal court always hasjurisdiction to
determine its own jurisdiction.”).
H Steel Co. v. Citizensfor a Better Env’t, 523 U.S. 83, 94 (1998).
'5
Bosky v. Kroger Texas. LP, 288 F.3d 208, 211 (5th Cir. 2002) (quotation omitted).
'6
Gutierrez v. Flores, 543 F.3d 248, 25] (5th Cir. 2008) (quotation omitted).
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Case 7:21-cv-00394 Document 9 Filed on 12/07/21 in TXSD Page 3 of 6
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state fiom each plaintiff” and the armunt in controversy exceeds $75,000.18 When the armunt in
controversy is at issue, the Court rmkes an arithmetical assessment of the claims and values at
issue as of the moment of removal; subsequent events which purport to change the amount in
controversy do not oust the Com‘t’s jurisdiction” The party invoking federal diversity jurisdiction
“bears the burden ofestablishing the amount in controversy by apreponderance ofthe evidence?”
“The removing defendant can neet its burden if it shows by a preponderance ofthe evidence that:
“(1) it is apparent fiom the fice of the petition that the claims are lflcely to exceed $75,000, or,
alternatively, (2) the [removing party] sets forth ‘summary judgmnt type evidence’ of ficts in
controversy that support a finding of the requisite amount’m such as “afidavits and deposition
“is itself
testhmny.”22 Ifthe plaintiff clairm aspecific amount in the complaint, the amount stated
dispositive ofjurisdiction if the claim is apparently rmde in good fiith’m In other words, ‘Where
the district court is making the ‘ficially apparent’ detemlination, the proper procedure is to look
only at the fice ofthe complaint and ask whether the amount in contoversy was likely to exceed”
‘7
Corfield v. Dall. Glen Hills LP, 355 F.3d 853, 857 (5th Cir. 2003); see McLaughlin v. Miss, Power Co., 376 F.3d
344, 353 (Sth Cir. 2004) (quotation omitted) (“[A]ll persons on one side ofthe controversy [must] be citizens of
difi‘erent states than all persons on the otherside.”).
v. Roche, 546 U.S. 81, 89 (2005) (citing 28 U.S.C. § l332(a)(1)).
‘3
Lincoln Prop. Co.
‘9
Carter Westlex Corp., 643 F. App'x 371, 376 (5th Cir. 2016); see Manguno v. PrudentialProp. & Cas. Ins. Co.,
v.
276 F.3d 720, 723 (5th Cir. 2002) (“To detemfine whetherjurisdiction is presentfor removal, we considerthe
claims in the state court petition as they existed at the time ofremoval.”); Campbellv. Stone lns., lnc., 509 F.3d 665,
668 n.2 (5th Cir. 2007); Pullman Co. v. Jenkins,305 U.S. 534, 537 (1939) (holding thatremoval is to be
“detemfined according to the plaintifl's' pleading at the time ofthe petition for removal.”).
2°
Hartford Ins. Grp. v. Lou-Con Inc., 293 F.3d 908, 910 (5th Cir. 2002); accord Morton v. State Farm Ins. Co., 250
F.R.D. 273, 274 (ED. La. 2008) (citing Luckettv. Delta Airlines, Ina, 171 F.3d 295 (5th Cir. 1999)) (“In order to
remain in federal court, theremoving party must prove by a preponderance ofthe evidence thatthe jurisdictional
minimum exists"); Scarlottv. Nissan N. Am, lnc., 771 F.3d 883, 888 (5th Cir. 2014) (if the plaintiff did notstatea
specific amount in the complaint, “the removing defendant has theburden ofproving. by a preponderance ofthe
evidence, thatthe amount in controversy exceeds" thcjurisdictional threshold ).
2'
Chavez v. State Farm Lloyds, 746 F. App'x 337, 341 (5th Cir. 2018) (alteration in original) (quotation omitted);
see Allen v. R & H Oil & Gas Co., 63 F.3d 1326, 1335 (5th Cir. I995) (citations omitted) (“‘First, a court can
determine thatremoval was properif it is facially apparentthat theclaims are likely above $50,000. If not,a
removing attorney may support federal jurisdiction by setting forth the facts in controversy—preferably in the
removal petition, but sometimes by amdavit—that supportafinding ofthe requisite amount”).
22 239, 247 (5th Cir. 2000).
Hart v. Bayer Corp., 199 F.3d
23 888 (quotation omitted).
Scarlott,77l F.3d at
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the requisite $75,000.24 However, a plaintiff’s bare allegations do not “invest a federal court with
jurisdiction’” The Fifth Circuit exphined,
[w]hile afederal coun must of course give due credit to the good faith clairm ofthe
plaintifi, a court would be remiss in its obligations if it accepted every claim of
darmges at face value, n0 nutter how tn'vial the underlying injury. This is
espec'nlly so when, after jurisdiction has been challenged, a party Ims fiiled to
specify the fictual basis of his clairm. Jurisdiction is not conferred by the stroke of
a lawyer's pen When challenged, it must be adequately founded in fact.“
Therefore, when a plaintiff challenges a defendant’s assertion that the amount in controversy
exceeds $75,000, the defendant must set forth evidence of the amount in controversy.” If the
reimving party carries its burden, the party opposing removal “may avoid removal by showing, to
a legal certainty, that recovery will not exceed the jurisdictional threshold?“
Generally, attorneys’ fees are not includlble in determining the amount in controversy, but
the exceptions are when attorneys’ fees are provided for by contract and when “a statute Imndates
or allows the payment of such fees.”29 For example, when ascertaining the amount in controversy
under an insurance policy, the amount may include the policy limits, potential attorneys’ fees,
penalties, statutory darmges, and meitive darmges, but not interest or costs.”
b. Analysis
2“
Allen, 63 F.3d at I336.
25
Dow AgrosciencesLLC v. Bates, 332 F.3d 323, 326 (5th Cir. 2003), abrogatedon other grounds,544 U.S. 431
(2005).
2°
Diefemhal v. C. A. B., 68] F.2d 1039, 1052 (5th Cir. 1982).
27
Dart Cherokee Basin Operating Co., LLC v. Owens, 574 U.S. 81, 88—89 (2014) (quoting 28 U.S.C.
§ 1446(c)(2)(B) & HR REP.NO. 112-10 at 16 (2011)).
28 it can be demonstrated“to a legal certainty that
App'x at 34]. The amount claimed controls unless
Chavez, 746 F.
the claim is really for less than the jurisdictional amount." Allen, 63 F.3d at 1335 (quoting St. Paul Mercury lndem.
Co. v. Red Cab Co., 303 U.S. 283, 289 (1938)); accordDe Aguilarv. Boeing Co., 47 F.3d 1404, 1409 (Sth Cir.
1995) (holding that, ifthe amount claimed is not in good faith, “[i]t must appear to a legal certainty thatthe claim is
really for less thanthe jurisdictional amount to justify dismissal").
29 Velez v. Crown
Life Ins. Co., 599 F.2d 471, 474 (lst Cir. 1979).
3°
St. Paul Reinsurance Co. v. Greenberg, I34 F.3d 1250, 1253 & nn.6—7 (5th Cir. 1998).
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Plaintiff asserts tint the amount in controversy is less than $75,000 so this Court does not
have diversity jurisdiction and should rermnd this case.“ Defendant disagrees.”
With respect to the amount in controversy, Plaintiff pleads the following:
As required by Rule 47 ofthe Texas Rules ofCivil Procedure, Plaintiff seeks only
momtary relief of $100,000 or less, including damages of any kind, penalties, costs,
expenses, pre-judgnent interest, and attorney fees. Pleading more specifically, the
matter in controversy does not exceed the sum or value 0f $75,000, exclusive of
interest and costs. Plaintiff‘s [sic] is filing this lawsuit related to the Main Dwelling
on the Property. The unpaid damages at this tirm 0n the Main Dwelling are
$46,690.82.”
Defendant State Farm agrees that the actual darmges in controversy are $46,690.82, but argues
that darmges are brought over the threshold by adding “at least $20,000.00 in attorney’s fees to
litigate the case” calculated by multiplying Phintifl’s counsel’s specified hourly rate of $400 per
hour with the bare minimum fifiy hours required to prosecute this case, plus $3,600 in attomey’s
fees to date, plus $8,000 in prompt payrmnt interest urfler the Texas Insurance Code.“ Defendant
asserts that the total amount in controversy is $78,290.82.
Defendant’s estitmtion of the $20,000 minimum fees necessary to prosecute this case is
based on an uncontroverted afidavit ofAttomey Jams H. Hunter, Jr., an attorney not employed
at Defendant’s counsel’s firm” This evidence is relevant to ascertaining the amount in
controversy.“ Attorney Hunter avers, “[w]ith respect to the time necessary to prosecute atypical
hormowners case . .. , it is my experience that the 1w minimum amount 0f tirm required to
prosecute such a case is 50 hours," including tinn spent in “case developrmnt” and settlement
negotiations." However, Defendant is double counting. Defendant already assessed “attomey’s
3'
Dkt. No. 6 at l.
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Dkt. No. 7 at 3, §C.
33
Dkt. No. 1-2 at 6—7.
3‘
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Dkt. No. 7 at 5, W 11—12 (citing Dkt. No. 7-2).
Id.
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See supra notes 21-22.
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Dkt. No. 7-2 a! 2—3.
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fees of $3,600.00 to date,”33 which is included in the $20,000 minimum necessary to prosecute
this case. Subtracting the $3,600 fiom the armunt Defendant asserts is in controversy leaves only
$74,690.82, which is $309.19 less than the threshold of$75,000.01 to Imet diversity jurisdiction.
In sum, taking all of Defendant’s assertions and evidence as true, the threshold amount in
controversy is still not met.
III.HOLDING
For the foregoing reasons, the Court GRANTS Plaintiff’s motion to rermnd.” This case
is REMANDED in its entirety to the 464th District Coun of Hidalgo County, Texas.
IT IS SO ORDERED.
DONE at McAllen, Texas, this 7th day of December 2021.
MicaeMvarez
United States District Judge
38
Dkt. No. 7 at 3, fil 6.
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Dkt. No. 6.
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