Opinion
Civil Action No. 02-CV-2541
August 9, 2002
MEMORANDUM AND ORDER
Presently before the Court is Plaintiffs motion to Remand. For the reasons set forth below, upon consideration of Plaintiffs Motion and Defendant's response, Plaintiffs Motion to Remand is denied.
BACKGROUND
On September 7, 2001, Plaintiff Robert J. Murphy commenced a civil action by writ of summons in the Philadelphia County Court of Common Pleas ("Court of Common Pleas") against Defendant Federal Insurance Company ("Federal"), hand delivered on or about that same date, concerning Defendant's alleged mishandling of Plaintiffs insurance claim arising from a hurricane on September 17, 1999. Prior to the filing of the writ of summons, on March 9, 2001, Plaintiff provided Defendant an itemized report and estimate of the losses that were the subject of the aforementioned action. On or about November 15, 2001, the Court of Common Pleas ordered a pretrial conference to be held on December 10, 2001. Counsel for both parties attended the pre-trial conference, and defense counsel entered his appearance on December 12, 2001. From March 9, 2001 until approximately March 1, 2002, the parties exchanged correspondence detailing losses and damages to Plaintiffs residence. On March 13, 2002, Defendant filed a praecipe for the Court of Common Pleas to order Plaintiff to file a formal complaint or dismiss the action. On March 15, 2002, the court ordered Plaintiff to file a complaint within twenty days of service or judgment non-pros would be entered.
Plaintiff also alleges that similar correspondence was sent on October 2, 2001.
On or about March 28, 2002, Plaintiff filed a complaint claiming Defendant insurance company breached its contractual and fiduciary duties and acted in complete bad faith by refusing to evaluate, deny, determine, pay, in whole or in part, the physical losses and damages to plaintiffs property as result of the hurricane on September 17, 1999. On April 29, 2002, Federal provided notice of removal. Plaintiff filed a motion to remand the case on May 29, 2002, alleging a lack of complete diversity between the parties; an amount in controversy below the $75,000 jurisdictional threshold; and untimely and technically deficient notice of removal because additional documents should have been attached. On June 10, 2002, Defendant filed a response in opposition to Plaintiffs motion to remand alleging that complete diversity of citizenship existed; Plaintiffs two count complaint itemized damages that satisfy the jurisdictional amount of $75,000; removal was made within thirty days after Plaintiff served his complaint; and all essential documents were attached to the notice of removal.
Plaintiff argues that Defendant's notice of removal was deficient, and the court should remand the Defendant's petition. The Supreme Court recognizes the right to amend a removal petition to include relevant information previously omitted. Willingham v. Morgan, 395 U.S. 402, 89 S.Ct. 1813, 23 L.Ed.2d 396 (1969). On June 11, 2002, Defendant filed a motion for leave to amend its notice of removal. On June 19, 2002, this court denied Defendant's motion for leave to amend notice because the court found the notice of removal to be sufficient.
Plaintiff is a citizen of the Commonwealth of Pennsylvania, and Defendant is a corporation incorporated in the State of Indiana, with a principal place of business in Warren, New Jersey. Plaintiff, in Count I, seeks damages in excess of $50,000 including costs, counsel fees, and interest under law, and in Count II, Plaintiff seeks compensatory damages including all statutory damages, treble damages as well as interest, costs, and reasonable counsel fees in excess of $50,000 against Defendant.
Count I is Plaintiffs breach of contract and fiduciary duty claim and Count II is Plaintiffs bad faith claim.
LEGAL STANDARD
Generally, a defendant may remove a civil action filed in state court so long as the federal court would have had original jurisdiction over the matter had it been filed in federal court. See 28 U.S.C.A. § 1441. Upon a motion to remand, the defendant has the burden of establishing the propriety of the removal. Viola v. Provident Life and Accident Ins., No. Civ.A.00-1656, 2000 WL 1022894, at *1 (E.D. Pa. July 17, 2000) (quoting Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990)). When considering remand and removal, the removal statute is construed strictly as to resolve all doubts in favor of remand. Id. (quoting Pedrick v. Allstate Ins. Co., No. Civ.A.00-948, 2000 WL 565211, at *1 (E.D. Pa. May 2, 2000)). Furthermore, in deciding a motion to remand, the court is not limited to the plaintiffs complaint, but may instead look to the entire record. Id. (quoting Speight v. Personal Pool of America, Inc., No. Civ.A.93-2055, 1993 WL 276859, *2 (E.D. Pa. July 20, 1993)).District Courts have original jurisdiction where the amount in controversy exceeds the sum of $75,000 and the citizenship of the parties is diverse. See 28 U.S.C.A. § 1332(a). When considering the citizenship of a corporation, a corporation shall be deemed a citizen of any state by which it is incorporated and of the State where it has its principal place of business. See 28 U.S.C.A. § 1332(c).
DISCUSSION
A. Diversity of Citizenship
For the purposes of a diversity action, a corporation can only have one principal place of business. Viola v. Provident Life and Accident Ins., No. Civ.A.00-1656, 2000 WL 1022894, at *1 (E.D. Pa. July 17, 2000) (quoting Menna v. K-Mart, Inc., No. Civ.A.99-5977, 2000 WL 36325 (E.D. Pa. Jan. 18, 2000)). Moreover, Plaintiff has the responsibility of alleging where a corporation's principal place of business is located. The fact that a defendant has a registered office in the same state as the plaintiff does not automatically destroy diversity of citizenship. See Rubin v. Baltimore and Ohio R.R. Co., 324 F. Supp. 204, 205 (E.D. Pa. 1971) (holding that a Pennsylvania resident could not deny diversity of citizenship based on Defendant's registered office in the Commonwealth of Pennsylvania absent proof that the office was the defendant's principal place of business).
In this case, Plaintiff argues that Federal's principal place of business is 1650 Market Street, Philadelphia, PA. In contrast, Defendant argues that its principal place of business is Warren, NJ, and the Philadelphia office is one of several places that it does business throughout the country. In support of Defendant's contention, Defendant has supplied records of the Pennsylvania Insurance Department and a signed declaration of Federal employee, Stephen Esbensen, which provides that Federal's principal place of business is in Warren, NJ. Plaintiff has not offered any evidence to show the Court that the Philadelphia office is Defendant's principal place of business, and under case law, the location of an office in Philadelphia does not automatically equal a corporation's principal place of business. Therefore, the Court finds that the citizenship of the parties is diverse, and Defendant's principal place of business is located in Warren, NJ.
B. Amount in Controversy
The defendant has the burden of persuasion to establish the requisite amount in controversy by a preponderance of the evidence. Earley v. Innovex (North America) Inc., No. Civ.A.02-2130, 2002 WL 1286639, at *2 (E.D. Pa. June 10, 2002) (quoting Mercante v. Preston Trucking Co., No. 96-5904, 1197 WL 230826, at *2 (E.D. Pa. May 1, 1997)). To determine if the defendant's burden has been met, the court must rely on the plaintiffs complaint at the time the removal was filed. Id. (quotingWerwinski v. Ford Motor Co., 286 F.3d 661, 666 (3d Cir. 2002)). Furthermore, the action should not be remanded unless it's apparent to a legal certainty that the plaintiffs claim cannot meet the amount in controversy requirement. Id. (quoting St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 288-89, 58 S.Ct. 586, 82 L.Ed. 845 (1938)). In assessing whether the requisite jurisdictional amount is present, the court first looks to the complaint and then to any materials which clarify the damages. Connelly v. Schleef, No. Civ.A.01-5559, 2002 WL 192569, at *1 (E.D. Pa. Jan. 30, 2002) (quoting Singer v. State Farm Mutual Automobile Ins. Co., 116 F.3d 373, 377 (9th Cir. 1997)).
In Angus v. Shiley, Inc., 989 F.2d 142, 145-146 (3d Cir. 1993), the court held that where a complaint asserts two claims, one for compensatory damages in excess of a certain dollar amount, and one for punitive damages in excess of the same dollar amount, the jurisdictional minimum is likely met if the combined claims reaches the jurisdictional amount. Moreover, the court held that the amount in controversy is not measured by the low end of an open ended claim, but by the reasonable reading of the rights being litigated. Id. (quoting Hunt v. Washington State Apple Advertising Comm'n, 432 U.S. 333, 347, 97 S.Ct. 2434, 2443, 53 L.Ed.2d 383 (1977)).
In this case, Plaintiff argues that his complaint merely alleges damages in the excess of $50,000 against the defendant, which alone would be insufficient to satisfy the jurisdictional amount. In response, Defendant argues that Plaintiff has demanded damages in excess of $50,000 for Count I, breach of contract, and Count II, bad faith. Plaintiff has also supplied itemized damages as follows: (1) Cedar Fencing: $5,815; (2) removal and replacement of concrete, surround pool area: $23,500; (3) Water Damage bedroom: $10,560; (4) Damage to garage roof: $3,500; (5) Damage to ground floor areas: $6,825; (6) Damage to pool preliminarily estimated at $35,000 to $50,000, which estimate cannot be finally determined until repair and replacement of concrete area surrounding pool. The value of the rights being litigated under both counts reasonably exceeds the jurisdictional minimum. Furthermore, the Plaintiff is seeking treble damages, which if awarded would triple the damages. Moreover, Plaintiff has not shown with legal certainty that his claims do not meet the amount in controversy. Therefore, the Court finds that Plaintiffs alleged damages meet and/or exceed the amount in controversy.
Count I, breach of contract, is based on compensatory damages for the cost of repairs. Count II, bad faith, is based on the possibility that if Plaintiff can show that Defendant acted in bad faith, he could receive triple the amount in damages.
C. Timeliness of Filing Removal
The timeliness of a notice of removal is governed by 28 U.S.C. § 1446 (b), which states in part:
The notice of removal of a civil action or proceeding shall be filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based . . .If the case stated by the initial pleading is not removable, a notice of removal may be filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of 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, except that a case may not be removed on the basis of jurisdiction conferred by section 1332 of this title more than one year after commencement of the action. 28 U.S.C. § 1446 (b).
The court's inquiry should be limited to the four corners of the pleading, determining "whether the documents inform the reader, to a substantial degree of specificity, whether all the elements of federal jurisdiction are present." Foster v. Mutual Fire, Marine, Inland Ins. Co., 986 F.2d 48, 53 (3d Cir. 1993). The Defendant would have to be on notice that plaintiff and defendant are citizens of different states, and the amount in controversy exceeds $75,000. Sprague v. American Bar Ass'n, 166 F. Supp.2d 206, 209 (E.D. Pa. 2001). Moreover, the relevant inquiry is not what the defendant purportedly knew, but what the documents said. Foster, 986 F.2d at 54. Furthermore, these documents must be "something of the type filed with the court." Id.
In the present case, Plaintiff argues that Defendant's notice of removal was untimely. The plaintiff concedes that the initial writ of summons filed in September 2001, was not sufficient to alert the defendant to the possibility of removal, but Plaintiff argues that Defendant should have been aware of the amount in controversy and the citizenship of the parties by the writ of summons, discovery, and its own inspection, at the latest by January 11, 2002. Defendant counters that they were not aware of the amount in controversy until the filing of Plaintiffs complaint on March 28, 2002.
The Court concludes, pursuant to 28 U.S.C. § 1446 (b), that the correspondence between January 11, 2002 and the filing of the complaint, included estimates but these estimates were not pleadings setting forth the claim for relief. Although the letters placed the defendant on notice of the estimated cost of damages, the letters were not sufficient to satisfy the pleading requirement. Therefore, the Court finds that the action did not become removable until thirty days after the Plaintiff filed its formal complaint on March 28, 2002. Thus, Defendant's notice of removal on April 29, 2002 was timely under 28 U.S.C. § 1446 (b).
CONCLUSION
For the reasons set forth above, the Plaintiffs motion to remand is denied. The defendant has demonstrated that complete diversity of citizenship exists between Plaintiff and Defendant; the two counts satisfy the $75,000 jurisdictional amount; Defendant filed a timely removal pursuant to 28 U.S.C. § 1446 (b); and Defendant's petition of removal was not deficient. An appropriate order follows.
ORDER
AND NOW, this 9th day of August 2002, upon consideration of Plaintiffs Motion to Remand (Doc. 3) and Defendant's Response thereto (Doc. 5), IT IS HEREBY ORDERED and DECREED that Plaintiffs Motion is DENIED.