United States District Court, D. Maryland
FELIX OSIA, et al.
DeBORAH K. CHASANOW, District Judge.
Defendant, Rent-a-Center, Inc., removed this action from the Circuit Court for Prince George's County, on the basis of diversity jurisdiction. The complaint, brought by Felix Osia, individually, and as parent and next friend for J.O., a minor, and Wendolyn McCaine, also individually, and as parent and next friend for D.M, a minor, seeks $30, 000 in damages for each of the four individuals, because of an alleged bed bug infestation in a couch obtained from Defendant. ( See ECF No. 3). The complaint asserts four counts of product liability and breach of contract by each individual Plaintiff. The notice of removal filed by Defendant recited that the amount in controversy was met by aggregation of the amounts sought by each plaintiff for a total sum of $120, 000. (ECF No. 1, at 3).
Plaintiffs have moved to remand the action, contending that the individual claims may not be aggregated to provide the requisite jurisdictional amount. (ECF No. 10). Apparently abandoning the aggregation argument, Defendant now contends that, despite the $30, 000 claim in the complaint, each plaintiff's claim is in reality larger and it cites to jury awards in other cases that exceed the $75, 000 threshold and the fact that Plaintiffs initially identified their damages as exceeding $100, 000 in their Civil-Non-Domestic Case Information Report filed in the Circuit Court for Prince George's County. ( See ECF No. 12, at 3; ECF No. 12-1).
What is sorely missing from the motion papers is much citation to authority, either statutory, rule, or case law based. Under 28 U.S.C. § 1441, a case may be removed if the district court has original jurisdiction. Diversity jurisdiction requires that "the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs." 28 U.S.C. § 1332(a)(1). Judge Hollander explained in Jackson v. Johnson, Civ. Action No. ELH-14-00011, 2014 WL 689390, at *3 (D.Md Feb. 20, 2014):
In order to establish the amount in controversy for purposes of diversity jurisdiction, "the sum claimed by plaintiff controls if the claim is apparently made in good faith." St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 289 (1938); accord Choice Hotels Intern., Inc. v. Shiv Hospitality, L.L.C., 491 F.3d 171, 176 (4th Cir. 2007) ("The black letter rule has long been to decide what the amount in controversy is from the complaint itself, unless it appears or is in some way shown that the amount stated in the complaint is not claimed in good faith'") ( quoting Horton v. Liberty Mut. Ins. Co., 367 U.S. 348, 353 (1961));... Indeed, "the Supreme Court has held that a plaintiff with a claim potentially exceeding $75, 000 may resort to the expedient of suing for less than the jurisdictional amount, and though [the plaintiff] would justly be entitled to more, the defendant cannot remove.'" Mary L. Martin, Ltd. v. State Auto Property and Cas. Ins. Co., 2013 WL 2181206, at *2 (D.Md. May 17, 2013) ( quoting St. Paul Mercury Indem. Co., 303 U.S. at 294).
Neither party acknowledges that Congress amended the procedure for removing certain civil actions effective January 6, 2012. As amended by the Federal Courts Jurisdiction and Venue Clarification Act of 2011 ("JVCA"), Pub.L.No. 112-63, § 103(b), 28 U.S.C. § 1446(c)(2) sets out the procedural requirements for removal based on diversity jurisdiction:
(2) If removal of a civil action is sought on the basis of the jurisdiction conferred by section 1332(a), the sum demanded in good faith in the initial pleading shall be deemed to be the amount in controversy, except that-
(A) the notice of removal may assert the amount in controversy if the initial pleading seeks -
(i) nonmonetary relief; or
(ii) a money judgment, but the State practice either does not permit demand for a specific sum or permits recovery of damages in excess of the amount demanded; and
(B) removal of the action is proper on the basis of an amount in controversy asserted under subparagraph (A) if the district court finds, by the preponderance of the evidence, that the amount in controversy exceeds the amount specified in section 1332(a).
See Butler v. Target Corp., No. 12-4092-SAC, 2012 WL 5362974, at *2 (D.Kan. Oct. 31, 2012) ("The JVCA establishes now for removal purposes that the sum demanded in good faith in the initial pleading shall be deemed to be the amount in controversy, subject to certain exceptions." (internal quotation marks omitted)). The party invoking federal jurisdiction - here, Defendant - has the burden of demonstrating by competent proof that the amount-in-controversy requirement is met. Hertz Corp. v. Friend, 559 U.S. 77, 96 (2010). The JVCA's legislative history provides the rationale behind the changes in § 1446(c)(2):
Section 103(b)(3)(C) of the bill further amends subsection 1446(c) by inserting two new paragraphs, (2) and (3), to address issues relating to uncertainty of the amount in controversy when removal is sought, e.g., when state practice either does not require or permit the plaintiff to assert a sum claim or allow the plaintiff to recover more than an amount asserted. Although current practice allows defendants to claim that the jurisdictional amount is satisfied and remove, several issues complicate this practice.
First, circuits have adopted differing standards governing the burden of showing that the amount in controversy is satisfied. The "sum claimed" and "legal certainty" standards that govern the amount in controversy requirement when a plaintiff originally files in Federal court have not translated well to removal, where the plaintiff often may not have been permitted to assert in state court a sum claimed or, if asserted, may not be bound it. Second, many defendants faced with uncertainty regarding the amount in controversy remove immediately - rather than waiting until future ...