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Gitlin v. Amco Insurance Co.

United States District Court, N.D. California

July 3, 2019




         The Court lacks subject-matter jurisdiction over this case, and therefore REMANDS it to state court.

         I. BACKGROUND

         Plaintiff Robert Gitlin (“Gitlin”) initiated an insurance claim after his property was among the more than 500 homes destroyed by the Redwood Valley Complex Fire in October 2017. Mtn. for Declaratory Relief (dkt. 17) at 2-3. At the time, Gitlin had a fire insurance policy with Defendant AMCO Insurance Company (“AMCO”). Id. AMCO's investigation into Gitlin's losses included taking a recorded statement, or interview, from Gitlin soon after the fire occurred. Compl. (dkt. 1 Ex. A) ¶¶ 6-8; Def. Opening Brief (dkt.16) at 2. Gitlin subsequently asked AMCO to provide him with copies of all claim-related documents pursuant to California Insurance Code §§ 2071 and 2071.1, which require that insurers produce copies of most claim-related documents upon request. Cal. Ins. Code § 2071; Compl. ¶ 8. AMCO produced some documents but refused to turn over a copy of the recorded statement. Compl. ¶ 8.

         Gitlin brought suit against AMCO in state court, seeking declaratory and injunctive relief based on violations of California Insurance Code §§ 2071 and 2071.1. Id. ¶¶ 10-22. Gitlin does not seek damages. Rather, he asks for a declaration that the recorded interview is either a “claims-related document” or an “examination under oath” to which he is statutorily entitled, injunctive relief consisting of AMCO producing the recorded interview before it can examine him, and attorneys' fees. Id. at 6-7. Defendants removed the case to this Court, asserting that there is diversity jurisdiction. See Notice of Removal (dkt. 1) at 1, 3-6. There is no other litigation underway between these parties. Def. Reply to OSC (dkt. 23) at 4.

         On May 16, 2019, this Court ordered AMCO to show cause as to why this suit should not be remanded to state court because of an inadequate amount in controversy. OSC (dkt. 19) at 3. AMCO responded. See Def. Reply to OSC. Gitlin also responded. See Pltf. Reply to OSC (dkt. 24).


         A defendant who seeks to remove a case to federal court must file a notice of removal “containing a short and plain statement of the grounds for removal.” 28 U.S.C. § 1446(a). This “short and plain statement” requirement mirrors the one found in Rule 8(a)(1) of the Federal Rules of Civil Procedure, the general pleading rule for cases filed in federal court. The use of the same language is “[b]y design, ” the Supreme Court has explained: “Congress, by borrowing the familiar ‘short and plain statement' standard from Rule 8(a), intended to ‘simplify the “pleading” requirements for removal' and to clarify that courts should ‘apply the same liberal rules to removal allegations that are applied to other matters of pleading.'” Dart Cherokee Basin Operating Co. v. Owens, 135 S.Ct. 547, 553 (2014) (quoting H.R. Rep. No. 100-889, at 71 (1988)).

         At issue in this case is diversity jurisdiction. See Notice of Removal at 1. District courts have subject-matter jurisdiction over civil cases where (1) the matter “is between . . . citizens of different States, ” and (2) the amount in controversy “exceeds the sum or value of $75, 000, exclusive of interest and costs.” 28 U.S.C. § 1332(a)(1). Consistent with the framework outlined above, “[t]he party seeking to invoke the district court's diversity jurisdiction always bears the burden of both pleading and proving diversity jurisdiction.” NewGen LLC v. Safe Cig, LLC, 840 F.3d 606, 613-14 (9th Cir. 2016).

         Subject-matter jurisdiction must exist when a case is first filed. A federal court that is considering whether it has jurisdiction on the basis of diversity must therefore evaluate “the state of things at the time of the action brought.” Rockwell Int'l Corp. v. United States, 549 U.S. 457, 473 (2007) (quoting Mullan v. Torrance, 22 U.S. 537, 539 (1824)). This means examining whether the parties' citizenship was diverse, and whether the amount in controversy exceeded $75, 000 at the time the case was originally filed.


         A. Diversity of Citizenship

         Diversity jurisdiction requires “complete diversity”: “each plaintiff must be of a different citizenship from each defendant.” Grancare, LLC v. Mills ex rel. Thrower, 889 F.3d 543, 548 (9th Cir. 2018). Plaintiff Gitlin is a citizen of California, because that is the place of his domicile. See Compl. ¶ 1. Defendant AMCO is a citizen of Delaware and Iowa, because it is incorporated in Delaware and has its principal place of business in Iowa. See 28 U.S.C. § 1332(c)(1); Pardini Decl. (dkt. 1, Doc. 1-2, Ex. A) ¶ 2. Thus, the parties to this case are not citizens of the same state. Complete diversity of citizenship exists.

         B. Amount ...

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