Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-3_13-cv-08105/USCOURTS-azd-3_13-cv-08105-0/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
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 

Barbara L. Richie, 

Plaintiff, 

v. 

State Farm Mutual Automobile Insurance 

Company, a foreign corporation licensed to 

do business in the State of Arizona, et al., 

Defendants.

No. CV-13-08105-PCT-GMS

ORDER 

 Pending before the Court is Plaintiff Barbara Richie’s Motion to Remand Back to 

Navajo County Superior Court of Arizona. (Doc. 12.) For the reasons discussed below, 

the Motion is granted. 

BACKGROUND 

 This case arises out of an insurance claim dispute. On January 12, 2011, Richie 

was injured in a vehicular accident. Sometime after the accident, Richie filed an 

insurance claim with her insurer, Defendant State Farm Mutual Automobile Insurance 

Company (“State Farm”). On June 27, 2012, Richie’s counsel sent a letter to State Farm 

to settle the claim. (Doc. 16, “Tab 1”.) In that letter, Richie demanded full policy limits to 

settle the claim and stated that the opposing driver’s insurer had determined liability of its 

insured and paid its policy limits of $100,000 to Richie. (Id.) On July 13, 2012, State 

Farm acknowledged receipt of the letter and on July 16, it requested from Richie an 

“indefinite extension on the time limit” for her demand pending “all films obtained of 

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Ms. Richie along with utilization review” because it had questions regarding causation of 

some of her injuries and treatment. (Doc. 18-1, Ex. 2; Doc. 18-2, Ex. 2.) Following a 

phone conversation with State Farm’s claim representative, on July 19, 2012, Richie’s 

counsel sent another letter to State Farm stating that the evidence provided to State Farm 

was sufficient to settle the claim and reminding it of its duty to deal with Richie, as her 

insurer, in good faith. (Doc. 16, “Tab 2”.) 

 State Farm completed its evaluation of Richie’s claim on December 03, 2012, and 

in a letter to Richie it concluded, based on the opinion of its consulting physician, that she 

had been adequately compensated for her injuries by the settlement with the opposing 

driver’s insurer. (Doc. 18-3, “Ex. 3.”) In response, Richie’s counsel sent a letter to State 

Farm disagreeing with its evaluation and providing a final settlement offer of $35,000 as 

full and final compensation for her claim. (Doc. 18-4, Ex. 4.) 

 Because the Parties could not settle the claim, Richie filed a suit in the Navajo 

Superior Court on March 25, 2013 alleging claims for breach of contract, and breach of 

duty of the good faith and fair dealing. (Doc. 1, “Tab 1”.) On May 1, 2013, State Farm 

removed the case to this Court. (Doc. 1.) Richie now moves to remand the case back to 

state court for lack of subject matter jurisdiction. 

DISCUSSION 

 “[A]ny civil action brought in a State court of which the district courts of the 

United States have original jurisdiction, may be removed by the defendant or the 

defendants, to the district court of the United States for the district and division 

embracing the place where such action is pending.” 28 U.S.C. § 1441(a). A party may 

remove an action from state court only if the action could have been brought in the 

district court originally. Ramirez v. Fox Television Station, Inc., 998 F.2d 743, 747 (9th 

Cir. 1993). The party asserting federal jurisdiction has the burden of proof on a motion to 

remand to state court. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). The 

removal statute is strictly construed against removal jurisdiction. Id. (citing Emrich v. 

Touche Ross & Co., 846 F.2d 1190, 1195 (9th Cir. 1988)). There is a “strong 

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presumption” against removal jurisdiction, and “[f]ederal jurisdiction must be rejected if 

there is any doubt as to the right of removal in the first instance.” Id. 

 The Court has diversity jurisdiction over an action in which the parties are not 

citizens of the same state and “the matter in controversy exceeds the sum or value of 

$75,000, exclusive of interest and costs.” 28 U.S.C. § 1332(a). Richie contends that the 

Court lacks diversity jurisdiction in this case because the amount in controversy does not 

exceed $75,000. State Farm argues that based on Richie’s settlement offer preceding the 

filing of this suit, the amount in controversy exceeds $75,000. The Ninth Circuit has held 

that “[a] settlement letter is relevant evidence of the amount in controversy if it appears to 

reflect a reasonable estimate of the plaintiff's claim.” Cohn v. Petsmart, Inc., 281 F.3d 

837, 840 (9th Cir. 2002) (citing Wilson v. Belin, 20 F.3d 644, 651 n.8 (5th Cir.1994) 

(“Because the record contains a letter, which plaintiff's counsel sent to defendants stating 

that the amount in controversy exceeded $50,000, it is ‘apparent’ that removal was 

proper.”)); see Babasa v. LensCrafters, Inc., 498 F.3d 972, 975 (9th Cir. 2007) (“Like the 

letter in Cohn, the Bruinsma letter put LensCrafters on notice as to the amount in 

controversy.”). 

 Richie has not stated in her complaint a specific amount of damages that she is 

seeking in this case. (See Doc. 1, “Tab 1”.) Where a plaintiff’s state court complaint does 

not specify a particular amount of damages, the removing defendant must prove the 

existence of the amount in controversy by a preponderance of evidence. Sanchez v. 

Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir. 1996). In support of the assertion 

that Richie requested $100,000 to settle her claim, State Farm refers to a letter from 

Richie’s counsel dated June 27, 2012. In that letter, Richie’s counsel requested, on behalf 

of his client, State Farm’s policy limits to settle the personal injury claim. There is no 

evidence in the record that those policy limits amount to $100,000. In the letter, Richie’s 

counsel referred to the fact that the opposing driver’s insurer had paid its policy limits of 

$100,000 to Richie. Even assuming that State Farm’s policy limits amount to $100,000, 

however, that does not “reflect a reasonable estimate” of Richie’s claim. In the most 

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recent settlement letter on the record prior to filing suit, Richie offered to “accept the 

amount of $35,000.00 as full and final compensation of her bodily injury claim.” (Doc. 

18-4, Ex. 4. at 1.) That offer along with Richie’s assertion in her Motion that her claim 

does not exceed $75,000 is sufficient to conclude that the amount in controversy in this 

case does not exceed $75,000. Therefore, the Court lacks subject matter jurisdiction to 

hear the case. 

IT IS THEREFORE ORDERED that Defendant’s Motion to Remand Back to 

Navajo County Superior Court of Arizona, (Doc. 12), is granted. The Clerk of Court is 

directed to remand this action back to the Navajo County Superior Court. 

 Dated this 21st day of August, 2013. 

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