United States District Court, N.D. California, San Francisco Division
ORDER DENYING THE PLAINTIFF'S MOTION TO REMAND
RE: ECF NO. 10
BEELER United States Magistrate Judge.
a bad-faith insurance claim for alleged wrongful delays in
paying-out policy benefits.Jamie Koop alleges that, after she
was injured by an underinsured motorist, AMCO wrongfully
denied her claims under the parties' insurance
contract. Ms. Koop sued in California State court
but AMCO removed the case upon learning that Ms. Koop valued
the underlying damages at near or exceeding "six
figures." Ms. Koop now moves to remand the case for
lack of diversity jurisdiction. The court denies the motion.
Koop had a California car insurance policy with
AMCO. The policy covered bodily injuries caused
by underinsured motorists up to a maximum of $500, 000 per
person per accident.This case arises out of AMCO's alleged
dilatory and bad-faith processing of Ms. Koop's claim
under this coverage.
the policy period, in July 2011, "an underinsured driver
negligently . . . collided into [Ms. Koop's] vehicle[, ]
. . . caus[ing] bodily injuries[.]" Because of the
injuries, Ms. Koop had a claim against the driver exceeding
$150, 000 and was entitled to benefits under her AMCO policy
(a fact of which AMCO was allegedly aware). Ms. Koop
accordingly demanded that AMCO compensate her under the
underinsured motorist coverage.
Koop demanded that AMCO pay the policy maximum - $500,
000. AMCO rejected her demand, allegedly
failing to "fully and thoroughly inquire and
investigate" the claim. Ms. Koop also alleges that
AMCO utilized "delays and stall tactics" in dealing
with her claim, "even though it was aware that the delay
in making payment . . . adversely affected her recovery from
and her treatment of [her] injuries." Because AMCO
rejected her demands and utilized delay tactics, Ms. Koop was
"forced to retain the services of an
Ms. Koop retained an attorney, and approximately ten months
after she demanded the policy limits, AMCO offered to settle
her claim for $150, 000. Ms. Koop rejected the offer as
"[un]reasonable in light of the information that [she]
provided to . . . AMCO." AMCO allegedly knew that Ms.
Koop 1) was diagnosed with multiple injuries (including nerve
trauma and knee, back, and neck pain); 2) had received
"almost continuous medical care" since the accident
(including pain medication, physical therapy, injections,
radiofrequency, and psychological treatment) and would need
extensive future treatment; 3) "was taking medication
that impacted her ability to safely get pregnant, which was
in the family plan"; and 4) missed three weeks of
work. After rejecting the $150, 000 offer, Ms.
Koop again requested payment of the policy maximum, AMCO
again refused, and she then demanded arbitration (as required
by the policy).
arbitration, the parties unsuccessfully attended mediation,
during which Ms. Koop incurred approximately $4, 000 in
costs. The parties arbitrated the claim several
months later, and in the end, AMCO paid Ms. Koop a total of
$254, 079: $150, 000 in advance of the mediation and $104,
079 after arbitration. Nevertheless, during the claims
process, Ms. Koop suffered "emotional and mental
distress and anguish, embarrassment, mortification,
humiliation, and indignity[.]" She also racked up
attorney's fees, litigation costs, and medical expenses
as a result of AMCO's "wrongful" and
"unreasonable" conduct. Ms. Koop accordingly sued
AMCO in California state court, alleging three claims: 1)
tortious breach of insurance contract ("bad faith/breach
of the implied covenant"); 2) intentional infliction of
emotional distress; and 3) negligent infliction of emotional
removed the case to this court on the basis of diversity
jurisdiction and Ms. Koop now moves to remand back to state
court. AMCO opposed the motion and Ms. Koop
untimely replied - a tardiness to which AMCO
The court considers Ms. Koop's late reply brief
Koop filed her reply brief three days late in violation of
Civil Local Rule 7-3 and, as a result, AMCO objects to the
court's consideration of her arguments
therein. AMCO does not, however, identify how the
untimeliness will prejudice it, and the court will
accordingly consider the brief and request for judicial
notice. See Morales v. Laborers' Union Local
304, No. C 11-02278 WHA, 2012 WL 70578, at *6 (N.D. Cal.
Jan. 9, 2012) (considering a late brief in part because the
defendant did "not claim that prejudice would flow
from [its] acceptance"). In the future, Ms. Koop must
file her papers on time.
Requests for judicial notice
parties make requests for judicial notice under Federal Rule
of Evidence 201. "[A] court may judicially notice a
fact that is not subject to reasonable disputes because it:
(1) is generally known within the trial court's
territorial jurisdiction; or (2) can be accurately and
readily determined from sources whose accuracy cannot
reasonably be questioned." Fed.R.Evid. 201.
AMCO asks that the court judicially notice three documents:
1) Morello v. AMCO Ins. Co., No. C 11-6623-SI, 2012
WL 628911 (N.D. Cal. Feb. 27, 2012); 2) Allied Group's
Certificate of Standing/Certificate of Existence issued by
the Iowa Secretary of State; and 3) the Iowa Secretary of
State's Business Entity Summary for Allied
Group. The court considers the Morello
order without taking judicial notice. See Fed. R.
Evid. 201 advisory comm. n. (1972); Von Saher v. Norton
Simon Museum of Art at Pasadena, 592 F.3d 954, 960 (9th
Cir. 2010); Toth v. Grand Trunk R.R., 306 F.3d 335,
349 (6th Cir. 2002) ("[J]udicial notice is generally not
the appropriate means to establish the legal principles
governing the case.") And the court takes judicial
notice of the two Iowa Secretary of State documents as public
records. See Lee v. City of Los Angeles, 250 F.3d
668, 688-89 (9th Cir. 2001), overruled on other grounds
by Galbraith v. Cnty. of Santa Clara, 307 F.3d 1119 (9th
Cir. 2002); Farina Focaccia & Cucina Italiana, LLC v. 700
Valencia Street LLC, No. 15-cv-02286-JCS, 2015 WL
4932640, at *4 (N.D. Cal. Aug. 18, 2015) (taking judicial
notice of state secretaries' websites); Shurkin v.
Golden State Vintners, No. C 04-3434 MJJ, 2005 WL
1926620, at *6 (N.D. Cal. Aug. 10, 2005) (taking judicial
notice of certificate of organization). The court therefore
grants AMCO's request.
Ms. Koop requests judicial notice of two website printouts:
1) Allied Group's website listing its office locations,
and 2) an AMCO insurance company profile,
https://www.usacoverage.com/insurance-company-profiles/amco-insurance.html. She argues these webpages
show AMCO is a subsidiary of Allied Group, a company with a
"regional office" in Sacramento,
California. Whether or not the court can judicially
notice these webpages, the request is denied as irrelevant
because (as described below) even if these facts were
accepted as true, they do not establish that AMCO is
domiciled in California.
The court has diversity jurisdiction
state-court defendant, such as AMCO, may remove an action to
federal court based on diversity jurisdiction. 28 U.S.C.
§ 1441(b). For diversity jurisdiction to exist there
must be complete diversity amongst opposing parties, and the
amount in controversy must exceed $75, 000, exclusive of
interest and costs. 28 U.S.C. § 1332(a). Here, Ms. Koop
argues that remand is necessary because these requirements
are not met: she argues the parties are not diverse and the
amount in controversy is not satisfied. The court concludes
that it has jurisdiction.
The parties are diverse
first issue is whether AMCO is a citizen of California,
rendering the parties non-diverse and the court without
jurisdiction. A corporation is "deemed to be a citizen
of every State . . . [in] which it has been incorporated and
of the State . . . where it has its principal place of
business[.]" 28 U.S.C. § 1332(c)(1). The Supreme
Court defined a corporation's "principal place of
business" as its "nerve center":
[A] "principal place of business" is best read as
referring to the place where a corporation's officers
direct, control, and coordinate the corporation's
activities. It is the place that Courts of Appeals have
called the corporation's "nerve center." And in
practice it should normally be the place where the
corporation maintains its headquarters - provided that the
headquarters is the actual center of direction, control, and
coordination, i.e., the "nerve center, "
and not simply an office where the corporation holds its
board meetings (for example, attended by directors and
officers who have traveled there for the occasion).
Hertz Corp. v. Friend, 559 U.S. 77, 92-93 (2010);
see also Harris v. Rand, 682 F.3d 846, 851 (9th Cir.
2012). A corporation's "nerve center" is its
only "principal place of business": "[f]or
example, if the bulk of a company's business activities
visible to the public take place in New Jersey, while its top
officers direct those activities just across the river in New
York, the ‘principal place of business' is New
York." Hertz, 559 U.S. at 96 (reasoning that
the nerve center test provides a necessary "clearer
cases involving a subsidiary corporation, courts generally
"look to the state of incorporation and principal
place of business of the subsidiary, and not its
parent." Danjaq, S.A. v. Pathe Comm'ns
Corp., 979 F.2d 772, 775 (9th Cir. 1992) (internal
quotations omitted). An exception lies where "the
subsidiary is the alter ego of the parent corporation."
the parties are diverse. Ms. Koop is a citizen of
California; AMCO is not, and instead is a citizen of
Iowa and maybe Ohio. Ms. Koop alleges in her complaint that
AMCO is domiciled in Iowa. AMCO's Associate Vice
President and Assistant Secretary, Parag Shah, also declares:
1) AMCO is incorporated in Iowa, 2) "AMCO's
corporate headquarters and principal office" are in
Iowa, and 3) AMCO's officers and directors are located in
Ohio and Iowa, from where they "coordinate the
corporation's activities[.]" By state of
incorporation, AMCO is a citizen of Iowa. By nerve center
location, AMCO is a citizen of Iowa (again) or Ohio.
Recognizing the ambiguity of Mr. Shah's declaration -
i.e. he declares that AMCO headquarters are in Iowa,
but operations are controlled from both Iowa and Ohio - the
court finds this sufficient to establish that diversity
exists between Ms. Koop (California) and AMCO (Iowa/Ohio).
Accord Morello v. Amco Ins. Co., No. C 11-6623 SI,
2012 WL 628911, at *2 (N.D. Cal. Feb. 27, 2012) (finding that
AMCO is a citizen of Iowa).
AMCO's parent company, Allied Group, has a "regional
office" in California does not alone change this
conclusion - it does not, without more, make AMCO a citizen
of California.See Danjaq, 979 F.2d at 775.
Similarly, that AMCO has business operations in the State -
and is subject to personal jurisdiction (as Ms. Koop argues)
- does not alter the conclusion. See Hertz, 449
U.S. at 96. AMCO has satisfied its burden on this element. On
this record, then, the court concludes that the parties are
The amount in controversy is more likely than not greater
than $75, 000
second issue is whether the amount in controversy exceeds the
jurisdictional floor - $75, 000. See 28 U.S.C.
§ 1332. "The amount in controversy includes claims
for general and special damages (excluding costs and
interest), attorney[']s fees if recoverable by statute or
contract, and punitive damages if recoverable as a matter of
law." J. Marymount, Inc. v. Bayer Healthcare,
LLC, No. C 09-03110 JSW, 2009 WL 4150126, at * (N.D.
Cal. Nov. 30, 2009) (quoting Conrad Assocs v. Hartford
Accident & Indem. Co., 994 F.Supp. 1196, 1198 (N.D. Cal.
1998)) (internal quotations omitted).
as here, it is unclear or ambiguous from the face of a
state-court complaint whether the requisite amount in
controversy is pled, the removing defendant bears the burden
of establishing, by a preponderance of the evidence, that the
amount in controversy exceeds the jurisdictional
threshold." Urbino v. Orkin Servs. of Cal.,
Inc., 726 F.3d 1118, 1121-22 (9th Cir. 2013) (internal
quotations and citations omitted). The Ninth Circuit has
"not addressed the types of evidence defendants
may" use to satisfy this burden. Matheson v.
Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 (9th
Cir. 2003). It has, however, endorsed the "practice of
considering facts presented in the removal petition as well
as any summary-judgment-type evidence relevant to the amount
in controversy ...