Opinion
CASE NO. 2:09-CV-927-WKW [WO].
February 1, 2010
MEMORANDUM OPINION AND ORDER
This cause is before the court on Plaintiff Scott McArdle's ("McArdle") Motion to Remand. (Doc. # 8.) McArdle contends that Defendants James Carter, Carter Tate, P.C., and James E. Carter Associates, LLC (collectively "Defendants") failed to establish the amount in controversy by a preponderance of the evidence as required under 28 U.S.C. § 1332, and seeks remand to the Circuit Court of Montgomery County, Alabama. Defendants oppose the motion (Doc. # 9), arguing that a previous motion filed by McArdle in a related bankruptcy case, "unambiguously establish[es] that at least $136,000.00 is in dispute" in this case, thus meeting the jurisdictional threshold (Doc. # 9, at 4). For the following reasons, McArdle's motion to remand is due to be denied.
I. BACKGROUND
McArdle filed his complaint in the Circuit Court of Montgomery County, Alabama, on August 20, 2009, asserting ten claims arising out of a fee-splitting arrangement between McArdle and Defendants. (Compl. (Doc. # 1, Ex. A).) Specifically, McArdle claims that he and Defendants entered into a binding agreement under which McArdle was entitled to forty percent of attorneys' fees earned from the prosecution of a Georgia civil suit stemming from the death of Justin Hall. (Compl. ¶ 6.) Thereafter, the sole heir to Justin Hall's estate filed for bankruptcy, and the Bankruptcy Trustee hired the attorneys to continue to represent the estate. (Compl. ¶ 10.) McArdle alleges that Defendants subsequently settled a portion of the suit without notifying him, and failed to remit his portion of the fees. (Compl. ¶¶ 12-13.)
II. DISCUSSION
"[F]ederal courts have a strict duty to exercise the jurisdiction that is conferred upon them by Congress." Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 716 (1996). However, "[f]ederal courts are courts of limited jurisdiction." Burns v. Windsor Ins. Co., 31 F.3d 1092, 1095 (11th Cir. 1994). Thus, with respect to cases removed to this court pursuant to 28 U.S.C. § 1441, the law of the Eleventh Circuit favors remand where federal jurisdiction is not absolutely clear. "[R]emoval statutes are construed narrowly; where plaintiff and defendant clash about jurisdiction, uncertainties are resolved in favor of remand." Burns, 31 F.3d at 1095.
Where the complaint alleges unspecified damages, as in this case, the removing party bears the burden of establishing the jurisdictional amount by a preponderance of the evidence. Lowery v. Ala. Power Co., 483 F.3d 1184, 1209-10 (11th Cir. 2007). A removing defendant can predicate jurisdiction either on the initial pleading, or "an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable." 28 U.S.C. § 1446(b) (emphasis added). When a defendant bases removal on a document other than the initial pleading, three specific conditions must be satisfied. There must be "(1) `an amended pleading, motion, order or other paper,' which (2) the defendant must have received from the plaintiff (or from the court, if the document is an order), and from which (3) the defendant can `first ascertain' that federal jurisdiction exists." Lowery, 483 F.3d at 1215 n. 63 (quoting 28 U.S.C. § 1446(b)). The general rule is that evidence "contemplated" by 28 U.S.C. § 1446(b) is evidence "received from the plaintiffs." Id. at 1221. Hence, "the defendant's appraisal of the amount in controversy . . . will ordinarily not provide grounds for his counsel to sign a notice of removal in good faith." Id. at 1215 n. 63; see also Stroh v. Colonial Bank, N.A., No. 4:08-cv-73, 2008 WL 4831752, at *2 (M.D. Ga. Nov. 4, 2008).
The very narrow exceptions to that rule, see Lowery, 483 F.3d at 1215 n. 66, are not argued here.
Here, Defendants attach a copy of McArdle's "Motion to Disgorge All Attorney['s] Fees, Costs, and Expenses Paid to Attorney James E. Carter" (Doc. # 1, Ex. B) to their Notice of Removal. They assert that McArdle's Motion to Disgorge, which was filed in the United States Bankruptcy Court, constitutes "other paper" under 28 U.S.C. § 1446(b), as discussed in Lowery. 483 F.3d at 1215 n. 63. McArdle does not address whether the Motion to Disgorge constitutes "other paper" under Lowery; instead, McArdle contends that the Motion to Disgorge should not be considered because it relates to a "completely separate matter" and because the fees at issue in the bankruptcy motion are not the same fees at issue here. Thus, McArdle appears to contest whether the Motion to Disgorge, along with the Notice of Removal, "unambiguously establish federal jurisdiction." Id. at 1213.
McArdle filed the Motion to Disgorge in the bankruptcy court shortly after receiving notice from Carter that a portion of the wrongful death case had settled for an undisclosed amount. (Motion to Disgorge 6 (Doc. # 1, Ex. B).) According to McArdle, his Motion to Disgorge "sought to have the fees that Defendants earned, which were the product of fraud committed on the United States Bankruptcy Court, returned to that Court." (Pl.'s Reply Br. 1 (Doc. # 12).) Although he contends that this filing relates to a completely separate matter, there is no indication that the fees discussed and quantified in McArdle's Motion to Disgorge are anything other than the fees at issue in this case, i.e., the fees received in connection with the prosecution of a civil suit stemming from the death of Justin Hall.
McArdle argues in his reply brief that the Bankruptcy Judge's inability to determine the value of McArdle's services from the evidence presented with his Motion to Disgorge undermines Defendants' arguments regarding the amount in controversy. (Pl.'s Reply Br. 2.) However, the value of McArdle's services is not the only measure of damages in this case. McArdle's complaint alleges that he is entitled to forty percent of "any attorney's fees earned on the matter concerning the death of Justin Hall." (Compl. ¶ 8.) In addition to demanding judgment "in an amount equal to the value of services rendered" (Compl. ¶ 18, Count I), McArdle demands compensatory damages for, among other things, breach of contract (Counts II and III). Thus, the amount in controversy necessarily relates to the amount of attorney's fees Defendants received, not just the value of McArdle's services.
McArdle's Motion to Disgorge states that "fees in the amount of $340,000.00 and expenses in the amount $35,000.00 were paid to Attorney Carter" from the estate of Justin Hall. (Mot. to Disgorge ¶ 19.) Thus, taking the allegations in the complaint as true, McArdle is entitled to forty percent of $340,000.000, or $136,000, and Defendants have established the amount in controversy by a preponderance of the evidence as required under 28 U.S.C. § 1332.
III. CONCLUSION
For the foregoing reasons, the Motion to Disgorge, attached to Defendants' Notice of Removal, "unambiguously estalish[es] federal jurisdiction," Lowery, 483 F.3d at 1213, and, accordingly, it is ORDERED that McArdle's Motion to Remand is DENIED.
A copy of this checklist is available at the website for the USCA, 11th Circuit at www.ca11.uscourts.gov Effective on April 9, 2006, the new fee to file an appeal will increase from $255.00 to $455.00. CIVIL APPEALS JURISDICTION CHECKLIST1. Appealable Orders : Appeals from final orders pursuant to 28 U.S.C. § 1291: 28 U.S.C. § 158Pitney Bowes, Inc. v. Mestre 701 F.2d 1365 1368 28 U.S.C. § 636 In cases involving multiple parties or multiple claims, 54Williams v. Bishop 732 F.2d 885 885-86 Budinich v. Becton Dickinson Co. 108 S.Ct. 1717 1721-22 100 L.Ed.2d 178LaChance v. Duffy's Draft House, Inc. 146 F.3d 832 837 Appeals pursuant to 28 U.S.C. § 1292(a): Appeals pursuant to 28 U.S.C. § 1292(b) and Fed.R.App.P. 5: 28 U.S.C. § 1292 Appeals pursuant to judicially created exceptions to the finality rule: Cohen v. Beneficial Indus. Loan Corp. 337 U.S. 541 546 93 L.Ed. 1528Atlantic Fed. Sav. Loan Ass'n v. Blythe Eastman Paine Webber, Inc. Gillespie v. United States Steel Corp. 379 U.S. 148 157 85 S.Ct. 308 312 13 L.Ed.2d 199 2. Time for Filing Rinaldo v. Corbett 256 F.3d 1276 1278 4 Fed.R.App.P. 4(a)(1): 3 THE NOTICE MUST BE RECEIVED AND FILED IN THE DISTRICT COURT NO LATER THAN THE LAST DAY OF THE APPEAL PERIOD — no additional days are provided for mailing. Fed.R.App.P. 4(a)(3): Fed.R.App.P. 4(a)(4): Fed.R.App.P. 4(a)(5) and 4(a)(6): Fed.R.App.P. 4(c): 28 U.S.C. § 1746 3. Format of the notice of appeal : See also 3pro se 4. Effect of a notice of appeal : 4
Courts of Appeals have jurisdiction conferred and strictly limited by statute: (a) Only final orders and judgments of district courts, or final orders of bankruptcy courts which have been appealed to and fully resolved by a district court under , generally are appealable. A final decision is one that "ends the litigation on the merits and leaves nothing for the court to do but execute the judgment." , , (11th Cir. 1983). A magistrate judge's report and recommendation is not final and appealable until judgment thereon is entered by a district court judge. (c). (b) a judgment as to fewer than all parties or all claims is not a final, appealable decision unless the district court has certified the judgment for immediate review under Fed.R.Civ.P. (b). , , (11th Cir. 1984). A judg ment which resolves all issues except matters, such as attorneys' fees and costs, that are collateral to the merits, is immediately appealable. , 486 U.S. 196, 201, , , (1988); , , (11th Cir. 1998). (c) Appeals are permitted from orders "granting, continuing, modifying, refusing or dissolving injunctions or refusing to dissolve or modify injunctions . . ." and from "[i]nterlocutory decrees . . . determining the rights and liabilities of parties to admiralty cases in which appeals from final decrees are allowed." Interlocutory appeals from orders denying temporary restraining orders are not permitted. (d) The certification specified in (b) must be obtained before a petition for permission to appeal is filed in the Court of Appeals. The district court's denial of a motion for certification is not itself appealable. (e) Limited exceptions are discussed in cases including, but not limited to: , , , 69S.Ct. 1221, 1225-26, (1949); , 890 F.2d 371, 376 (11th Cir. 1989); , , , , , (1964). Rev.: 4/04 : The timely filing of a notice of appeal is mandatory and jurisdictional. , , (11th Cir. 2001). In civil cases, Fed.R.App.P. (a) and (c) set the following time limits: (a) A notice of appeal in compliance with the requirements set forth in Fed.R.App.P. must be filed in the district court within 30 days after the entry of the order or judgment appealed from. However, if the United States or an officer or agency thereof is a party, the notice of appeal must be filed in the district court within 60 days after such entry. Special filing provisions for inmates are discussed below. (b) "If one party timely files a notice of appeal, any other party may file a notice of appeal within 14 days after the date when the first notice was filed, or within the time otherwise prescribed by this Rule 4(a), whichever period ends later." (c) If any party makes a timely motion in the district court under the Federal Rules of Civil Procedure of a type specified in this rule, the time for appeal for all parties runs from the date of entry of the order disposing of the last such timely filed motion. (d) Under certain limited circumstances, the district court may extend the time to file a notice of appeal. Under Rule 4(a)(5), the time may be extended if a motion for an extension is filed within 30 days after expiration of the time otherwise provided to file a notice of appeal, upon a showing of excusable neglect or good cause. Under Rule 4(a)(6), the time may be extended if the district court finds upon motion that a party did not timely receive notice of the entry of the judgment or order, and that no party would be prejudiced by an extension. (e) If an inmate confined to an institution files a notice of appeal in either a civil case or a criminal case, the notice of appeal is timely if it is deposited in the institution's internal mail system on or before the last day for filing. Timely filing may be shown by a declaration in compliance with or a notarized statement, either of which must set forth the date of deposit and state that first-class postage has been prepaid. Form 1, Appendix of Forms to the Federal Rules of Appellate Procedure, is a suitable format. Fed.R.App.P. (c). A notice of appeal must be signed by the appellant. A district court loses jurisdiction (authority) to act after the filing of a timely notice of appeal, except for actions in aid of appellate jurisdiction or to rule on a timely motion of the type specified in Fed.R.App.P. (a)(4).