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Jackson v. Johnson

United States District Court, D. Maryland

February 20, 2014

JAMES T. JOHNSON, et al., Defendants.


ELLEN L. HOLLANDER, District Judge.

On or about June 10, 2013, plaintiff Barbara Jackson filed suit in the Circuit Court for Washington County, Maryland, against defendants James Johnson and Young Manufacturing Co., Inc. ("YMCI"), alleging damages of $75, 000 arising out of a motor vehicle accident on June 9, 2010. See ECF 2 ("Complaint"). Defendants removed this action to the United States District Court for the District of Maryland on January 3, 2014, asserting subject matter jurisdiction on the basis of diversity of citizenship. See ECF 1 ("Notice of Removal") ¶¶ 8, 11; 28 U.S.C. § 1332(a). The question now before the Court is whether the amount allegedly in controversy ($75, 000) satisfies the jurisdictional requirement or, instead, whether a remand to state court is required.

Two motions are now pending: plaintiff's Motion to Remand to State Court (ECF 18, "Motion to Remand") and defendants' response, titled "Consent to Motion to Remand to State Court" (ECF 20, "Consent Motion"). No hearing is necessary to resolve the motions. See Local Rule 105.6. For the reasons that follow, I conclude that this Court lacks subject matter jurisdiction. Accordingly, I will grant plaintiff's Motion to Remand and remand the case to the Circuit Court for Washington County.

A. Legal Standard

Federal courts are courts of limited jurisdiction and "may not exercise jurisdiction absent a statutory basis." Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 552 (2005). "A court is to presume, therefore, that a case lies outside its limited jurisdiction unless and until jurisdiction has been shown to be proper." United States v. Poole, 531 F.3d 263, 274 (4th Cir. 2008) (citing Kokkonen v. Guardian Life Ins. Co., 511 U.S. 375, 377 (1994)).

The "burden of establishing subject matter jurisdiction is on... the party asserting jurisdiction." Robb Evans & Assocs., LLC v. Holibaugh, 609 F.3d 359, 362 (4th Cir. 2010); accord McBurney v. Cuccinelli, 616 F.3d 393, 408 (4th Cir. 2010). Thus, "[i]f a plaintiff files suit in state court and the defendant seeks to adjudicate the matter in federal court through removal, it is the defendant who carries the burden of alleging in his notice of removal and, if challenged, demonstrating the court's jurisdiction over the matter." Strawn v. AT&T Mobility LLC, 530 F.3d 293, 296 (4th Cir. 2008). Even in the absence of a challenge to jurisdiction, federal courts "have an independent obligation to determine whether subject-matter jurisdiction exists...." Hertz Corp. v. Friend, 559 U.S. 77, 94 (2010).

B. Background

Suit arises from a motor vehicle accident that occurred on June 9, 2010, when a truck driven by defendant Johnson and owned by defendant YMCI collided with plaintiff's vehicle. See ECF 2. Plaintiff's Complaint contains three state law claims: "Negligence" against Johnson (Count I); "Agency" against YMCI (Count II); and "Negligent Entrustment" against YMCI (Count III). Plaintiff seeks damages of $75, 000, jointly and severally, plus costs. See id.

As noted, defendants removed the case to this Court on January 3, 2014, asserting subject matter jurisdiction on the basis of diversity of citizenship. See Notice of Removal ¶¶ 8, 11. By statute, diversity jurisdiction applies "where the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs, and is between.... citizens of different States." 28 U.S.C. § 1332(a)(1).

In the Notice of Removal, defendants explain that, in the circuit court, they moved for partial summary judgment in November 2013, arguing at that time that because the Complaint's ad damnum clause sought damages of exactly $75, 000, plaintiff should be limited to damages of $75, 000. ECF 1 ¶¶ 6-7; see ECF 5 (Defendants' Motion for Partial Summary Judgment). Plaintiff opposed defendants' partial summary judgment motion, asserting that such a determination was premature, and further arguing that, if a jury awarded plaintiff more than $75, 000 in damages, she could "file a post-trial motion to amend her complaint to the amount of the rendered verdict." See ECF 7 ("Plaintiff's Response to Defendants' Memorandum in Support of Their Motion for Summary Judgment"). By Order of December 4, 2013, the circuit court denied defendants' motion, without articulating the basis for its decision. ECF 10. Removal followed on January 3, 2014.[1]

In a Memorandum to Counsel docketed January 13, 2014, I indicated that, based upon my review of relevant authority, it appeared that the jurisdictional amount-in-controversy requirement was not satisfied, because plaintiff sought damages of exactly $75, 000, and not damages in excess of $75, 000. See ECF 17. Further, I explained the Court's independent obligation to verify subject matter jurisdiction, and set forth authority in support of my concerns. Nevertheless, I invited the parties to submit supplemental memoranda and responses, addressing whether this Court has subject matter jurisdiction.

Subsequently, plaintiff filed the Motion to Remand, in which she reiterated her view that the amount in controversy does not exceed $75, 000 for purposes of diversity jurisdiction. ECF 18. Plaintiff also incorporated by reference the analysis contained in the Court's Memorandum to Counsel (ECF 17) docketed on January 13, 2014. See ECF 18 ¶¶ 4-5. In response, defendants filed their Consent Motion, in which they agree that remand is warranted. See ECF 20. Notably, in that filing, defendants also take the position that plaintiff has conceded that "the damages prayed do not exceed $75, 000, " which, in defendants' view, is "contrary to the representation and argument made in the State Court...." Id. ¶ 5.

C. Discussion

As an initial matter, there is no apparent barrier to diversity jurisdiction based on the citizenship of the parties. The Complaint states that plaintiff is a "resident" of Pennsylvania. Id. ¶ 1. That allegation does not establish plaintiff's citizenship, because a natural person's "state citizenship for purposes of diversity jurisdiction depends not on residence, but on national citizenship and domicile, and the existence of such citizenship cannot be inferred from allegations of mere residence, standing alone." Axel Johnson, Inc. v. Carroll Carolina Oil Co., Inc., 145 F.3d 660, 663 (4th Cir. 1998) (internal citation omitted). In other words, for "purposes of diversity jurisdiction, residency is not sufficient to establish citizenship." Johnson v. Advance Am., Cash Advance Ctrs. of S.C., Inc., 549 F.3d 932, 937 n.2 (4th Cir. 2008). However, in her Motion to Remand, plaintiff confirms that she is a citizen of Pennsylvania. ECF 18 ¶ 3. As for ...

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