Summary
finding that, pursuant to 42 PA. CONS. STAT. § 7361, total damages were capped at $50,000 where plaintiff sought damages "not in excess of $50,000"
Summary of this case from Augustine v. Chubb Group of Insurance CompaniesOpinion
Civil Action No. 03-CV-5442.
May 20, 2004
MEMORANDUM AND ORDER
Plaintiffs Daniel and Carolyn O'Toole originally commenced this action in the Court of Common Pleas of Philadelphia County. Based on diversity jurisdiction, Defendant removed the case to this Court. Plaintiffs now move to remand to the Court of Common Pleas because the amount in controversy does not exceed $75,000. For the reasons that follow, the Motion will be granted.
I. Background
In Count One of their Complaint, Plaintiffs claim that Defendant breached its contractual obligations to pay benefits for a loss covered under their insurance policy, and demand judgment in an amount "not in excess of $50,000" together with costs, interest and damages for delay. In Count Two, Plaintiffs assert that Defendant engaged in bad faith conduct in violation of 42 Pa. Cons. Stat. § 8371 and seek a sum "not in excess of $50,000" for punitive damages, counsel fees, costs and interest.
II. Legal Standard
Under § 1441(a), "any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending." 28 U.S.C. § 1441(a). The defendant bears the burden of showing that removal is appropriate. See Abels v. State Farm Fire Casualty Co., 770 F.2d 26, 29 (3d Cir. 1985); Schnable v. Drexel University, 1995 WL 412415, at *3 (E.D. Pa. 1995). Removal statutes are strictly construed against removal and any doubts must be resolved in favor of remand Abels, 770 F.2d at 29. A case should be remanded if it is apparent to a legal certainty that the plaintiff cannot recover the jurisdictional amount. Samuel-Bassett v. KIA Motors America, Inc., 357 F.3d 392, 398 (3d Cir. 2004).
III. Analysis
Since each of the counts in the Complaint specifically seeks damages "not in excess of $50,000," the case was designated for compulsory arbitration in the Court of Common Pleas, where the total amount of damages recoverable is capped at $50,000 pursuant to 42 Pa. Cons. Stat. § 7361. Plaintiffs argue that because of this statutory cap on damages, the amount in controversy does not exceed the $75,000 threshold for federal jurisdiction. InWestside Check Cashing and Pawn Shops, Inc. v. Wedderbern, 1994 WL 50308, *2 (E.D. Pa. Feb. 16, 1994), the district court faced this exact situation and held that the plaintiff's claim failed to meet the jurisdictional threshold. Accord Connelly v. Schleef, 2002 WL 192569, *2 (E.D. Pa. 2002) (holding that the theoretical possibility that plaintiff could recover an amount in excess of $50,000 on appeal from arbitration was too remote to confer federal jurisdiction); Gottehrer v. State Farm Ins. Co., 1996 WL 210808, *1 (E.D. Pa. Apr. 30, 1996) (finding no federal jurisdiction where plaintiff, in filing his case as an arbitration case in state court, limited his recovery to below the federal diversity threshold). Because it appears to a legal certainty that Plaintiffs' claim is for less than the jurisdictional amount, the Court must remand this matter to the Court of Common Pleas of Philadelphia County.
IV. Conclusion
For the foregoing reasons, this Court will grant Plaintiffs' Motion for Remand An appropriate Order follows.