Opinion
CASE NO. 20-60799-CIV-ALTONAGA/Strauss
2020-06-23
PROGRESSIVE EXPRESS INSURANCE COMPANY, Plaintiff, v. LOPEZ TRANSPORT SERVICES, CORP.; et al., Defendants.
Stuart Jeffrey Freeman, Freeman, Goldis & Cash, P.A., St. Petersburg, FL, for Plaintiff. Wayne Timothy Hrivnak, Davis Giardino & Hrivnak, West Palm Beach, FL, for Defendant Lopez Transport Services, Corp. Lawrence Allen Levine, Lawrence A. Levine PA, Plantation, FL, for Defendant Ricardo Valera.
Stuart Jeffrey Freeman, Freeman, Goldis & Cash, P.A., St. Petersburg, FL, for Plaintiff.
Wayne Timothy Hrivnak, Davis Giardino & Hrivnak, West Palm Beach, FL, for Defendant Lopez Transport Services, Corp.
Lawrence Allen Levine, Lawrence A. Levine PA, Plantation, FL, for Defendant Ricardo Valera.
ORDER
CECILIA M. ALTONAGA, UNITED STATES DISTRICT JUDGE
THIS CAUSE came before the Court on Defendant, Lopez Transport Services, Corp.’s ("Lopez[’s]") Motion to Dismiss [ECF No. 12], filed on May 20, 2020. The Court has carefully reviewed Plaintiff, Progressive Express Insurance Company's ("Progressive[’s]") Complaint [ECF No. 1]; Progressive's Response [ECF No. 19]; Progressive's Supplemental Response [ECF No. 26]; Lopez's Reply [ECF No. 28]; Progressive's Second Supplemental Response [ECF No. 34]; the record; and applicable law. For the following reasons, the Motion is denied.
I. BACKGROUND
This case concerns whether an insurer must indemnify its customer in a separate state-court action arising from a car accident. At issue is a Commercial Auto Policy issued by Progressive, the insurer, to Lopez, the insured. (See Compl. ¶¶ 7–9).
On June 12, 2019, Arry Noel, driving a 2018 Dodge Durango, struck a motor vehicle operated by Ricardo Valera, causing Valera serious bodily injuries. (See id. ¶ 10). Valera filed a complaint in the Circuit Court of the 17th Judicial Circuit in Broward County, Florida, naming Lopez as a defendant and alleging Lopez transported Noel's illegally salvaged vehicle prior to the accident. (See id. ¶¶ 11–12, 14). Progressive contends Noel's vehicle is not an insured auto as defined by the Policy, nor are Valera's injuries covered by the Policy's bodily injury liability coverage. (See id. ¶¶ 16–18).
Progressive filed the instant action, requesting the Court declare Progressive has no duty to defend or indemnify Lopez in the underlying state litigation. (See id. ¶ 7). Progressive alleges subject matter jurisdiction under 28 U.S.C section 1332(a)(1), as the parties are of diverse citizenship and the amount in controversy exceeds $75,000. (See id. ¶ 5). Lopez moves to dismiss for lack of subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1), contending the case does not belong in federal court because it does not satisfy the requisite amount in controversy. (See Mot. ¶ 2).
Progressive responds with allegations and affidavits showing an amount in controversy exceeding $75,000. (See generally Resp.). First, Progressive points to the Policy's bodily injury insurance coverage of $300,000. (See Resp. 5; Commercial Auto Ins. Policy Summary [ECF No. 1-1] 2). Second, Progressive provides evidence that Valera is claiming damages in the underlying litigation for "severe and permanent bodily injury resulting in pain and suffering, disability, disfigurement, aggravation of a pre-existing condition, mental anguish, loss of capacity for the enjoyment of life, expense of hospitalization, medical and nursing care and treatment, lost wages, loss of ability to earn money in the future, and other economic damages." (Third Am. Compl. [ECF No. 1-2] ¶ 34). Finally, Progressive shows that after the car accident, Valera had numerous diagnoses from the hospital and medical bills totaling $104,976.19. (See Second Suppl. Resp. 3; see generally Valera's Medical Bills [ECF No. 34-3] ). Undeterred, Lopez argues that Progressive's evidence is insufficient to show subject matter jurisdiction. (See Reply ¶ 3).
The Court relies on the pagination generated by the electronic CM/ECF database, which appears in the headers of all court filings.
The Court considers the parties’ competing arguments in its discussion below.
II. LEGAL STANDARD
A defendant may challenge subject matter jurisdiction under Rule 12(b)(1) facially or factually. See Douglas v. United States , 814 F.3d 1268, 1274–75 (11th Cir. 2016). A facial attack requires the court to examine the complaint, taken as true, to determine whether the plaintiff has sufficiently alleged a jurisdictional basis. See id. at 1274. Conversely, a factual attack requires the court to examine matters outside the pleadings, such as testimony and affidavits, determining whether the plaintiff has sufficiently alleged a basis for the court's jurisdiction. See id. at 1278. Unlike a facial attack, in a factual attack the plaintiff's claims are not taken as true. See Lawrence v. Dunbar , 919 F.2d 1525, 1529 (11th Cir. 1990). Furthermore, a factual challenge places the burden of proving jurisdiction on the plaintiff. See Motta ex rel. A.M. v. United States , 717 F.3d 840, 844 (11th Cir. 2013).
Under 28 U.S.C section 1332(a)(1), district courts have original jurisdiction over a case if the parties are of diverse citizenship and the amount in controversy exceeds $75,000. See id. If a plaintiff seeks declaratory relief, "the amount in controversy is the monetary value of the object of the litigation from the plaintiff's perspective." Cohen v. Office Depot, Inc. , 204 F.3d 1069, 1077 (11th Cir. 2000).
Generally, the plaintiff must prove — with legal certainty — the amount in controversy meets the jurisdictional minimum, or the court will dismiss the case for lack of subject matter jurisdiction. See Federated Mut. Ins. Co. v. McKinnon Motors, LLC , 329 F.3d 805, 807 (11th Cir. 2003). Alternatively, if the case is based on a claim for which there are indeterminate damages, then the party invoking federal jurisdiction must only prove by a preponderance of evidence the amount in controversy will exceed $75,000. See id. Damages are indeterminate when the "complaint does not allege a specific amount of damages." Id. at 808 (quoting St. Paul Reinsurance Co. v. Greenberg, 134 F.3d 1250, 1253 (5th Cir. 1998) (internal quotation marks omitted)).
District courts have original jurisdiction if the minimum jurisdictional amount is stated in or deducible from the complaint. See Co. Prop. & Cas. Ins. Co. v. Metal Roofing Sys. , No. 13-60659-Civ, 2013 WL 5770730, at *3 (S.D. Fla. Oct. 24, 2013) (citing Lowery v. Ala. Power Co. , 483 F.3d 1184, 1211 (11th Cir. 2007) ). Courts may draw reasonable inferences from specific allegations and evidence in determining whether the requisite amount in controversy is met. See Pretka v. Kolter City Plaza II, Inc. , 608 F.3d 744, 754 (11th Cir. 2010).
III. DISCUSSION
The diversity of the parties here is uncontested. (See Compl. ¶ 5; see generally Mot.). The only question before the Court is whether, in fact, the amount in controversy exceeds $75,000. See 28 U.S.C. § 1332(a) ; (Mot. ¶ 5).
Where, as here, an insurer-plaintiff seeks a declaratory judgment regarding its indemnity obligation in underlying litigation, the amount in controversy may be indeterminate. See, e.g. , Federated , 329 F.3d at 807–09. In such cases, courts determine the amount in controversy by reference to the insurer's potential liability in the underlying litigation as limited by the insurance policy. See, e.g. , Homesite Ins. Co. v. Neary , No. 17-cv-2297, 2017 WL 5172294, at *2 (E.D. Pa. Nov. 8, 2017).
Lopez argues for a different approach, asserting the plaintiff in the underlying litigation is so unlikely to succeed that the amount in controversy should be limited to Progressive's underlying litigation defense costs as opposed to Progressive's potential liability in that litigation. (See Mot. ¶¶ 6–7; see also Reply ¶ 9). Lopez's implied argument is that Progressive must prove both the likelihood of success and amount of the underlying litigation claims in order to be able to rely on the underlying litigation's claims to satisfy the jurisdictional amount in controversy. In support of this position, Lopez relies solely on Federated Mutual Insurance Company v. McKinnon Motors, LLC , 329 F.3d 805 (11th Cir. 2003). Lopez's reliance on Federated is misplaced, and the Eleventh Circuit has explicitly rejected his proposed approach. See Tapscott v. MS Dealer Serv. Corp. , 77 F.3d 1353, 1357 (11th Cir. 1996), abrogated on other grounds by Cohen v. Office Depot, Inc. , 204 F.3d 1069, 1072–77 (11th Cir. 2000). In Tapscott — a case relied upon by the Eleventh Circuit in reaching its holding in Federated — the Eleventh Circuit held it too onerous a burden for a plaintiff to "research, state and prove the [underlying litigation plaintiff's] claim for damages." Id. (alteration added). Instead, where the amount in controversy is indeterminate, plaintiffs need merely prove by a preponderance of the evidence that the amount in controversy meets jurisdictional limits, not that the underlying claims will — with legal certainty — exceed the jurisdictional amounts. See id. ; see also Federated , 329 F.3d at 807.
Progressive alleges facts and provides evidence in support of the requisite amount in controversy. By affidavit, Marion Allums, Progressive's litigation insurance adjuster, states that counsel for the plaintiff in the underlying litigation describes the plaintiff's injuries as "catastrophic," including that Valera suffered a traumatic brain injury, a brain bleed, and a C4-5 spinal fracture ; was admitted into a hospital's intensive care; and was subsequently discharged to a rehabilitation facility. (See Allums Aff. [ECF No. 19-1] ¶ 7). Also, Progressive offers documents from the underlying litigation showing Valera had numerous diagnoses and underwent treatment for injuries resulting from the accident. Specifically:
[Valera] suffered a concussion. He was transported to Memorial Regional Hospital where he was admitted into the ICU due to a small subarachnoid hemorrhage, concussion protocol, a C1 fracture with ligamentous injury, a T12 endplate fracture/hyperextension injury, and adrenal hemorrhage.... MRI of his thoracic spine also performed on 6/3/2019 revealed a focal tear of the right paracentral segment of the anterior longitudinal ligament at T11-T12 level associated with known hyperextension injury and known fracture of the superior T12 endplate.
(Second Suppl. Resp. 3 (alterations added; emphasis omitted)). Valera's medical bills total $104,976.19. (See id. ). Finally, Progressive's underlying policy provides a limit of $300,000 coverage for bodily injury liability. (See Commercial Auto Ins. Policy Summary 2).
Homesite Insurance Co. v. Neary is instructive, as it is procedurally on all fours with the matter at hand and factually similar. See 2017 WL 5172294, at *1–2. In Homesite , the underlying litigation involved a traumatic brain injury, psychological trauma, other severe injuries, and a $500,000 insurance policy. See id. at *2. The court determined the alleged serious injuries, combined with a policy limit above the jurisdictional amount, sufficiently showed subject matter jurisdiction. See id.
As in Homesite , so too here. Progressive shows serious claimed injuries in the underlying litigation, including a traumatic brain injury, mental anguish, medical and treatment expenses, and liability coverage exceeding $75,000. Lopez does not dispute these are the claims at issue in the underlying litigation, nor does he provide evidence that the claims will be below the jurisdictional limits. Applying common sense and the Court's experience, as requested by Lopez (see Reply ¶ 9), the Court infers brain injuries are extremely costly to treat and may cause permanent disabilities. Tellingly, Valera's medical bills alone exceed $75,000. Without evidence to the contrary, Progressive has met its burden of demonstrating the amount in controversy exceeds $75,000. IV. CONCLUSION
For the foregoing reasons, it is
ORDERED AND ADJUDGED that Defendant, Lopez Transport Services, Corp.’s Motion to Dismiss [ECF No. 12] is DENIED .
DONE AND ORDERED in Miami, Florida, this 23rd day of June, 2020.