Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_15-cv-00051/USCOURTS-azd-2_15-cv-00051-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1441 Petition for Removal- Breach of Contract

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WO 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA

John Anders Linnell, 

 Plaintiff, 

v. 

Allstate Insurance Company, an Illinois 

corporation, 

Defendant. 

No. CV15-0051 PHX DGC

ORDER 

 Plaintiff has filed a motion to remand this case to state court. Doc. 8. At the Case 

Management Conference held on March 5, 2015, the Court addressed the motion with the 

parties. The Court concludes that federal subject matter jurisdiction is lacking and that 

the case must be remanded to state court. 

I. Background. 

 Plaintiffs filed a complaint against Defendant in Arizona state court. The 

complaint asserts claims for breach of contract and bad faith arising out of property 

damage caused by a windstorm. Plaintiffs seek compensatory damages, consequential 

damages, and attorneys’ fees. Doc. 1-2 at 14. 

 Defendant removed the action to this Court. Defendant asserts in its notice of 

removal that the Court has subject matter jurisdiction under 28 U.S.C. § 1332 because the 

parties are diverse and the matter in controversy exceeds $75,000. Doc. 1. 

 

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II. Removal and Remand Standards. 

 Pursuant to the removal statute, any civil action brought in state court over which 

the federal district courts have original jurisdiction may be removed to the federal district 

court for the district where the action is pending. 28 U.S.C. § 1441(a). Courts strictly 

construe the statute against removal jurisdiction. Gaus v. Miles, Inc., 980 F.2d 564, 566 

(9th Cir. 1992). Indeed, there is a “strong presumption” against removal and “[f]ederal 

jurisdiction must be rejected if there is any doubt as to the right of removal in the first 

instance.” Id. “The ‘strong presumption’ against removal jurisdiction means that the 

defendant always has the burden of establishing that removal is proper.” Id. 

III. Discussion. 

 The complaint identifies two dollar amounts – $50,216.40 in replacement cost 

benefits and $38,133.40 in cash value benefits. The parties confirmed at the Case 

Management Conference that these amounts are mutually exclusive. An insured may 

obtain either replacement cost or cash value benefits under the policy, but not both. As a 

result, the largest amount of damages identified in the complaint is $50,216.40. 

 Defendant “bears the burden of establishing, by a preponderance of the evidence, 

that the amount in controversy exceeds [$75,000].” Sanchez v. Monumental Life Ins. Co., 

102 F.3d 398, 404 (9th Cir. 1996); see Matheson v. Progressive Specialty Ins. Co., 319 

F.3d 1089, 1090 (9th Cir. 2003). To meet its burden, Defendant “must provide evidence 

establishing that it is ‘more likely than not’ that the amount in controversy exceeds 

[$75,000].” Id.; see Gaus, 980 F.2d at 566-67 (“If it is unclear what amount of damages 

the plaintiff has sought, . . . then the defendant bears the burden of actually proving the 

facts to support jurisdiction, including the jurisdictional amount.”) (emphasis in original). 

 Defendant argues that compensatory damages and attorneys’ fees, when added to 

the $50,216.40 identified in the complaint, could exceed $75,000. Such a possibility 

“neither overcomes the ‘strong presumption’ against removal jurisdiction, nor satisfies 

[Defendant’s] burden of setting forth . . . the underlying facts supporting its assertion that 

the amount in controversy exceeds [$75,000].” Gaus, 980 F.2d at 567 (emphasis in 

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original); see also Singer v. State Farm Mut. Auto. Ins. Co., 116 F.3d 373, 375 (9th Cir. 

1997) (“removal ‘cannot be based simply upon conclusory allegations’ where the 

[complaint] is silent” as to the amount of damages) (citation omitted); Valdez v. Allstate 

Ins. Co., 372 F.3d 1115, 1116-17 (9th Cir. 2004) (removal cannot be based upon mere 

“information and belief” that the amount in controversy exceeds $75,000); see also 

Haisch v. Allstate Ins. Co., 942 F. Supp. 1245, 1249 (D. Ariz. 1996) (“It would be 

inherently speculative for this Court to conclude that the amount in controversy 

requirement can be met by simply asserting that large punitive damages have been 

awarded in the past against insurance companies.”). 

 Because the amount-in-controversy requirement has not been met in this case, 

federal subject matter jurisdiction is lacking. The Court accordingly will remand this 

matter to state court. See 28 U.S.C. § 1447(c); Valdez, 372 F.3d at 1118 (“If the district 

court determines that it is sufficiently doubtful that the amount-in-controversy 

requirement has been met and thus that federal subject matter jurisdiction is lacking, the 

district court should . . . remand to state court.”); Matheson, 319 F.3d at 1090 (“Where 

doubt regarding the right to removal exists, a case should be remanded to state court.”); 

Sanchez, 102 F.3d at 406 (district court should remand to state court where the defendant 

has failed to establish the jurisdictional amount by a preponderance of the evidence). 

 Both parties seek attorneys’ fees for this motion. The Court finds both parties’ 

positions to have been taken in good faith, and therefore will not award fees. 

IT IS ORDERED: 

 1. Plaintiff’s motion to remand (Doc. 8) is granted. 

 2. The Clerk shall remand this action to state court. 

 Dated this 5th day of March, 2015. 

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