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Hayrapetyan v. American International Group

May 18, 2010

DAVID HAYRAPETYAN
v.
AMERICAN INTERNATIONAL GROUP, INC ET AL



The opinion of the court was delivered by: Honorable Gary Allen Feess

CIVIL MINUTES - GENERAL

Proceedings: (In Chambers)

ORDER RE: REMAND

I. INTRODUCTION & BACKGROUND

Plaintiff David Hayrapetyan ("Plaintiff") filed this putative class action against American International Group, Inc. ("AIG"), Granite State Insurance Company ("Granite"), and 21st Century Insurance Company ("21st Century") (collectively "Defendants") for failure to pay car insurance benefits. Plaintiff specifically alleges that "defendants uniformly fail to provide any payments under their automobile insurance policies" for the loss of gasoline remaining in the vehicle after the automobile "suffers a total loss." (Complaint ¶ 1.) Plaintiff seeks to represent a class which includes: "All California individuals or entities who had comprehensive or collision property damage coverage under automobile policies issued by defendants, or any of their affiliates, and whose automobiles suffered a total loss." (Id. ¶ 3.)

Plaintiff filed his initial complaint in Los Angeles County Superior Court on January 27, 2010, and Defendants removed the action to this Court. (Docket No. 1.) Plaintiff now moves to remand and contends that "defendants have not met their burden of proving the amount in controversy meets the jurisdictional minimum by a preponderance of the evidence." (Mem. at 2.) Because the Court agrees with Plaintiff, the motion to remand is GRANTED.

II. DISCUSSION

LEGAL STANDARD

"[A]ny 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 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). As amended by CAFA, 28 U.S.C. § 1332(d) vests district courts with "original jurisdiction of any civil action in which the matter in controversy exceeds the sum or value of $5,000,000, exclusive of interest and costs, and is a class action in which . . . any member of a class of plaintiffs is a citizen of a State different from any defendant . . . ." 28 U.S.C. § 1332(d)(2). "In any class action, the claims of the individual class members shall be aggregated to determine whether the matter in controversy exceeds the sum or value of $5,000,000, exclusive of interest and costs." 28 U.S.C. § 1332(d)(6). Under CAFA, the burden of establishing removal jurisdiction rests with the party seeking removal. Lowdermilk v. U.S. Bank Nat'l Ass'n, 479 F.3d 994, 997 (9th Cir. 2007) (citations omitted).

Ninth Circuit law identifies three different burdens of proof which may be placed on a removing defendant under varying circumstances. Guglielmino v. McKee Foods Corp., 506 F.3d 696, 699 (9th Cir. 2007). Where the plaintiff fails to plead a specific amount of damages, as in the case at bar (Not. Removal ¶ 24.), "the defendant seeking removal 'must prove by a preponderance of the evidence that the amount in controversy requirement has been met." Id. (citing Abrego Abrego v. The Dow Chemical Co., 443 F.3d 676, 685 (9th Cir. 2006) (per curiam). "Under this burden, the defendant must provide evidence establishing that it is 'more likely than not' that the amount in controversy exceeds [the jurisdictional amount]." Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir. 1996) (citation omitted).*fn1 The court may consider facts presented in the removal petition as well as any "summary-judgment type evidence relevant to the amount in controversy at the time of removal." Singer v. State Farm Mut. Auto. Ins. Co., 116 F.3d 373, 377 (9th Cir. 1997) (quoting Allen v. R & H Oil & Gas Co., 63 F.3d 1326, 1335-36 (5th Cir. 1995)).

APPLICATION

1.COMPENSATORY DAMAGES

From 2006 to the present, Granite and 21st Century paid approximately 71,399 automobile total loss claims to personal automobile insurance policyholders in California with Collision or Comprehensive coverage.*fn2 (Weinstein Decl. ¶ 7.) In the removal petition, Defendants argue that, "assuming that the average vehicle holds 16 gallons of gas and had half a tank of gas at the time of total loss, each claim would average $24 (8 gallons x $3/gallon)." (Not. Removal ¶ 27.) Thus, according to Defendants, compensatory damages for gasoline loss alone would equal approximately $1,704,000 ($24 x 71,000 claims). (Id.)

While Plaintiff contends that these calculations are "mere speculation based on unknown and unsupported factual assertions,"(Mem. at 4.), Defendants indicate that their estimates were "reasonable, and in fact, conservative." (Opp. at 3.) ...


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