more than the jurisdictional amount may waive part of it and bring a nonremovable action in a state court for less than the statutory minimum and thereby prevent removal." 21 Charles A. Wright, et al., Federal Practice and Procedure § 3725 at 418-19 (1985). But in states that do not recognize an ad damnum clause as an enforceable limit on plaintiff's ultimately recovery, "the principle that a party may defeat removal by limiting the claim to less than the required amount would have no application." Id. § 3725 at 425.
The removal statute must be strictly construed against removal jurisdiction. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). "Federal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance." Id.
The "general federal rule has long been to decide what the amount in controversy is from the complaint itself, unless it appears or is in some way shown that the amount stated in the complaint is not claimed 'in good faith.'" Horton v. Liberty Mut. Ins. Co., 367 U.S. 348, 352, 353, 6 L. Ed. 2d 890, 81 S. Ct. 1570 (1961). Both parties in the instant matter root their arguments in the complaint: Pepsi relies on the damage allegations, Dunn the ad damnum clause. Resolution of this issue then, hinges, not on good faith, but whether either portion of the complaint would act as a ceiling on plaintiff's recovery.
California lacks case law addressing specifically the binding effect of a prayer that purports to limit plaintiff's recovery below the damages alleged. Instead, "the 'well settled' rule . . . that a plaintiff may secure relief different from or greater than that demanded in the complaint" is derived from cases in which plaintiffs sought to enlarge their recoveries beyond the prayers of their complaints. Damele v. Mack Trucks, Inc., 219 Cal. App. 3d 29, 267 Cal. Rptr. 197, 202 (1990); see also Castaic Clay Mfg. Co. v. Dedes, 195 Cal. App. 3d 444, 240 Cal. Rptr. 652, 655 (1987) ("It is not the prayer of a pleading which is controlling; it is the averment contained in the pleading which determines the maximum sum which may be awarded the claimant."). Nonetheless, the general rule has been fashioned broadly enough to encompass the facts of the instant case. Thus, the Court concludes that Dunn's recovery would be limited not by her ad damnum clause, but rather, by the damages she alleges.
Facing remarkably similar circumstances, the District Court for the Middle District of Florida also denied a motion to remand to state court. In Practice Management Assocs., Inc. v. Walding, 138 F.R.D. 148 (M.D. Fla. 1991), plaintiff sued for breach of contract. Although a liquidated damages clause would have entitled plaintiff to $ 72,000 in damages, Id. at 150, plaintiff's ad damnum clause requested "damages that exceed $ 10,000.00, but do not exceed $ 49,999.99," Id. at 149. The court observed that "while it has generally been recognized that a binding waiver will defeat removal to federal court, such a waiver will not suffice if it is unenforceable under state law." Id. at 150 (citations omitted). Finding "no precedent under Florida law requiring awards to be limited to the amount cited in the complaint," the court denied the motion to remand. Id. Because under California law, Dunn's attempt to limit her recovery would be similarly unavailing,
and because Dunn alleges damages exceeding the jurisdictional minimum, Dunn's motion to remand is denied.
Dated: April 19, 1994.
William H. Orrick
United States District Judge