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Neumayer v. Allstate Insurance Co.

United States District Court, C.D. California

August 9, 2016

Maria Neumayer
v.
Allstate Insurance Company

          Present: The Honorable ANDRÉ BIROTTE JR., United States District Judge

          IN CHAMBERS ORDER DENYING MOTION FOR REMAND (DKT. NO. 15) AND GRANTING MOTION TO DISMISS (DKT. NO. 6)

          Honorable ANDRÉ BIROTTE JR., United States District Judge

         Before the Court are Plaintiff Maria Neumayer’s (“Plaintiff”) Motion for Remand (Dkt. No. 15) and Defendant Allstate Insurance Company’s (“Defendant”) Motion to Dismiss First Cause of Action for Breach of Contract (Dkt. No. 6). Oppositions and Replies were filed as to both motions. The Court previously took the motions under submission. For the following reasons, the Court DENIES the motion for remand and GRANTS the motion to dismiss.

         I. BACKGROUND

         Plaintiff asserts claims against her insurance company arising out of a claim she made on her policy’s uninsured motorist coverage. Plaintiff alleges that pursuant to the policy, she submitted her claim for arbitration, and Defendant “refused to settle Plaintiff’s claim for $15, 000.00 and offered only $9, 000.00 to settle general damages claim, barely more than Plaintiff’s medical expenses.” Compl. ¶ 17. Plaintiff also alleges that her claim was worth less than what Defendant paid to arbitrate it, and that Defendant knew she could not afford her $4, 925 share of the arbitration cost (the Complaint suggests Plaintiff is indigent and could not afford to advance the fee). Id. Plaintiff also alleges that the arbitration was a “sham” in that it was conducted without her participation or agreement. Id. at ¶ 18. The Complaint also alleges that Plaintiff and her counsel attempted to negotiate a way to for her to pay the fee, but Defendant did not cooperate. Id. at ¶¶ 19-23.

         Based on these allegations, Plaintiff asserts claims for breach of contract and breach of the implied covenant of good faith and fair dealing, and seeks “unpaid Policy benefits in the approximate amount of $70, 000, ” plus attorneys’ fees, general damages including anxiety and other emotional damages, and punitive damages. Id. pp. 10-11. Plaintiff asks in the alternative for the court to “set aside the sham arbitration award and order Plaintiff’s original [uninsured motorist] claim to be tried at a superior court. . .” Id. p. 11.

         II. DISCUSSION

         A. Plaintiff’s Motion for Remand is DENIED.

         Defendant removed the action to federal court based on diversity jurisdiction. Plaintiff argues that the case should be remanded because the amount in controversy is not satisfied.

         Federal jurisdiction founded on 28 U.S.C. § 1332 requires that the parties be in complete diversity and the amount in controversy exceed $75, 000. See 28 U.S.C. § 1332. Pursuant to 28 U.S.C. § 1441, a defendant may remove an action from state court to federal court if the diversity and amount in controversy requirements of 28 U.S.C. § 1332 are satisfied and if “none of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.” 28 U.S.C. § 1441.

         The amount in controversy, for purposes of diversity jurisdiction, is the total “amount at stake in the underlying litigation.” Theis Research, Inc. v. Brown & Bain, 400 F.3d 659, 662 (9th Cir. 2005). “[I]n assessing the amount in controversy, a court must ‘assume that the allegations of the complaint are true and assume that a jury will return a verdict for the plaintiff on all claims made in the complaint.’” Campbell v. Vitran Exp., Inc., 471 Fed.Appx. 646, 648 (9th Cir. 2012) (quoting Kenneth Rothschild Trust v. Morgan Stanley Dean Witter, 199 F.Supp.2d 993, 1001 (C.D. Cal. 2002)).

         Plaintiff suggests that amount in controversy is established by her $15, 000 settlement demand, so the amount in controversy does not exceed $75, 000. This is not persuasive. The Complaint expressly seeks $70, 000 in compensatory damages, plus attorneys’ fees, emotional distress damages, and punitive damages. It is obvious that expressly claiming $70, 000 in compensatory damages in addition to these other categories of damages puts the amount in controversy above $75, 000. Defense counsel also states in her declaration that while discussing this motion, she asked Plaintiff’s counsel if he would stipulate to cap damages at $75, 000, and he responded that he would cap compensatory damages at $75, 000, but would seek punitive damages beyond that amount. See Badawi Decl. ¶ 3. This reinforces the conclusion that the amount in controversy is satisfied. The motion for remand is therefore DENIED.

         B. The Motion to Dismiss Plaintiff’s Breach of ...


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