Opinion
CIVIL ACTION NO. 03-2044 SECTION "K" (5)
October 23, 2003
ORDER AND REASONS
Before the Court is a Motion to Remand (Rec. Doc. No. 6) brought by plaintiff Lance Turkish ("Turkish") pursuant to 28 U.S.C. § 1447. Having reviewed the pleadings, memoranda, exhibits and the relevant law, the Court finds that this Court has diversity jurisdiction over this matter. Thus, the Motion to Remand must be DENIED.
1. Background
Plaintiff is a medical doctor specializing in Ophthalmology who maintains a practice in Orleans Parish, Louisiana. Over a twenty year career, he had secured a professional liability policy issued by defendant St. Paul Fire Marine Insurance ("St. Paul"). Plaintiff remained a client of defendant despite cheaper alternatives because defendant offered "tail coverage," which covered alleged acts or omissions that may have occurred during plaintiffs practice years, but for which claims were not initiated until after retirement. Defendant St. Paul Fire Marine Insurance Company allegedly notified plaintiff in early 2002 that it was withdrawing from the medical malpractice insurance market in Louisiana and that it would not, therefore, provide plaintiff with "tail coverage." Consequently, plaintiff obtained an alternative "tail coverage" plan at a cost of 518,135 with incidental costs of $2,500.
On June 5, 2003, plaintiff filed a Petition for Damages in Civil District Court for the Parish of Orleans. Defendant filed a Notice of Removal with this Court on July 16, 2003 (Rec. Doc. No. 1). On August 8, 2003, plaintiff filed the instant Motion to Remand.
2. Standard for Removal and Remand
Any civil action brought in a state court of which the district courts have original jurisdiction maybe removed to the proper district court. 28 U.S.C. § 1441(a). District courts have original jurisdiction of all civil actions where the matter in controversy exceed the sum or value of 575,000, exclusive of interest and costs, and is between citizens of different States. 28 U.S.C. § 1332(a)(1). "Because plaintiffs in Louisiana state courts, by law, may not specify the numerical value of claimed damages, 3 La. Code Civ. P. art 893 (West Supp. 2000), the removing defendant must prove by a preponderance of the evidence that the amount in controversy exceeds 575,000.00." Gebbia v. Wal-Mart Stores, Inc., 233 F.3d 880, 882 (5th Cir. 2000) citing Luckett v. Delta Airlines, Inc., 171 F.3d 295, 298 (5th Cir. 1999). To do so, a defendant may demonstrate that the claims are likely above $75,000 in sum or value, or by setting forth the facts in controversy that support a finding of the requisite amount. Id.
Once a defendant has established, by a preponderance of the evidence, that the amount in controversy is sufficient to confer jurisdiction to the federal courts, the burden shifts back to the plaintiff to show, to a legal certainty, that the claim is really for less than the jurisdictional amount. DeAguilar v. Boeing Co., 47 F.3d 1404, 1412 (5th Cir. 1995) (`DeAguilar II"). Where state law prevents a party from pleading a specified amount of damages (as Louisiana's law does), and the claim is for unliquidated damages, one way for a plaintiff to satisfy the legal certainty test is to "Tile a binding affidavit with the complaint.' " Robinson v. Delchamps, Inc., 1998 WL 352131 (E.D. La.) (citing DeAguilar II, 47 F.3d at 1412).
Federal jurisdiction is determined at the time of removal. Federal Savings Loan Ins. Corp. v. Griffon, 935 F.2d 691, 696 (5th Cir. 1991), cert. denied sub nom, Griffen v. First Gibralter Bank, 502 U.S. 1092, 112 S.Ct. 1163, (1992). "`Litigants who want to prevent removal must file a binding stipulation or affidavit with their complaints; once a defendant has removed the case . . . later filings [are] irrelevant.'" DeAguilar II at 1412. The affidavit must be filed along with the complaint. Id. Subsequent events that reduce the amount in controversy to less than the required jurisdictional amount do not divest the court of diversity jurisdiction. St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 58 S.Ct. 586 (1938). Pallet v. Travelers Prop, and Cas. Ins. Co., 2002 WL 253204 (E.D.La. 2002).
3. Analysis
In paragraphs XI and XII of the Petition for Damages, plaintiff alleges that defendant is liable for `all losses which he has sustained under theories of breach of contract, unjust enrichment or detrimental reliance" and he demands "all sums which he has incurred in replacing tail coverage, the costs associated with obtaining and locating same and all damages as may be available at law or equity" specifically alleging that his damages are no greater than $74,999. (emphasis added)
Plaintiff admits that the cost of replacing "tail coverage" alone could be as high as $53,599 with rate increases. Plaintiffs Memorandum at 9. Plaintiffs potential recovery for unjust enrichment is much higher. According to the Petition, plaintiff purchased insurance from the defendant for twenty years at a higher price than competitors offered. Petition ¶ II. Plaintiff paid St. Paul 5351,830 in premiums during that time, or 5114,428 more than competitors would have likely charged. Defendant's Memorandum at 4-5. By asserting a claim for unjust enrichment in the Petition, plaintiff created a controversy well in excess of the 575,00 jurisdictional amount.
Relying on Robinson, plaintiff attempted through sworn Declaration to limit recovery sought to the enforcement of "tail coverage" provisions or, in the alternative, the cost of replacing tail coverage. However, plaintiffs Declaration purporting to limit the unjust enrichment claim was filed along with the Motion to Remand after removal. Post-removal limitations such as plaintiff produced are irrelevant under Griffen, DcAguilar II, Red Cab Co., and Pallet. Plaintiff also notes that the Petition specifically limits recovery to $74,999 in ¶ XII. However, Louisiana law does not bind a plaintiff to his ad damnum clause as pled and thus, the statement that damages are less than $74,999 is riot binding. Manguno v. Prudential Prop. Cas. Ins. Co., 276 F.3d 720, 724 (5th Cir. 2002).
Plaintiff failed to prove prior to removal that the amount in controversy does not exceed 574,999 to a legal certainty. Therefore,
IT IS ORDERED that plaintiffs Motion for Remand (Rec. Doc. No. 6) is hereby DENIED.