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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

PENNSYLVANIA GEAR CORP., : CIVIL ACTION

Plaintiff :

 :

v. :

 :

ACSA STEEL FORGINGS, S.P.A. :

Defendant : NO. 02-4359

MEMORANDUM AND ORDER

McLaughlin, J. November ____, 2002

The question raised by the plaintiff's motion to remand

is whether the Court has removal jurisdiction under 28 U.S.C. §

1441. The question turns on whether the plaintiff's claims of

$53,425 in damages for converted equipment and $50,000 in damages

for unjust enrichment from using the same equipment to sell goods

can be aggregated. The claims cannot be aggregated in this

situation so the amount in controversy is less than the $75,000

required for removal jurisdiction based on diversity of

citizenship leaving the Court with no basis for removal

jurisdiction. The plaintiff's motion to remand is granted.

The plaintiff, Pennsylvania Gear Corporation

("Pennsylvania Gear"), is a Pennsylvania corporation. The

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defendant, ACSA Steel Forgings ("ACSA"), is an Italian

corporation. See Compl. at ¶¶ 1-2.

In 1997, ACSA and Pennsylvania Gear entered into an

agreement under which ACSA was to supply steel forgings to

Pennsylvania Gear. To execute this arrangement, Pennsylvania

Gear directed ACSA to create specialized cutting and forming

equipment. See Compl. at ¶¶ 6-7.

At some point, ACSA ceased supplying Pennsylvania Gear

with steel forgings, but it retained the specialized equipment. 

Pennsylvania Gear alleges that ACSA continues to make forgings

and sell the forgings to other businesses with the specialized

equipment it retained. See Compl. at ¶¶ 10-12.

The plaintiff filed a complaint in the Court of Common

Pleas, Bucks County on June 5, 2002 seeking to recover on two

counts. First, the plaintiff seeks damages in the amount of

$53,425 for the value of the specialized equipment it alleges

ACSA converted. Second, the plaintiff seeks damages in an amount

in excess of $50,000 for unjust enrichment it alleges ACSA

received by using the specialized equipment to sell steel

forgings to other businesses. See Compl. at ¶¶ 19, 24.

On July 1, 2002, ACSA filed a notice of removal

claiming that the Court has jurisdiction because there is

diversity of citizenship and there is in excess of $100,000 in

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controversy. See Def.'s Notice of Removal at ¶¶ 4-5. On October

1, 2002, the plaintiff filed a motion to remand this case back to

the Court of Common Pleas because the $75,000 amount in

controversy requirement is not met as the plaintiff seeks damages

of $53,425 for conversion and in excess of $50,000 for unjust

enrichment. See Mot. to Remand at ¶ 7.

For a federal court to exercise jurisdiction over a

removed case, the district court must have original jurisdiction

over the case based either on diversity of citizenship or federal

question jurisdiction. 28 U.S.C. § 1441(a). 

The diversity statute confers subject matter

jurisdiction on a federal court to hear cases where suit is

between citizens of a state and citizens of a foreign state. 28

U.S.C. § 1332(a). In the present case, Pennsylvania Gear is a

Pennsylvania corporation and ACSA is an Italian corporation

satisfying the diversity of citizenship requirement. 

Additionally, to exercise diversity jurisdiction, the

amount in controversy must exceed $75,000. Id. In the present

case, this requirement can be met only if the conversion and

unjust enrichment claims can be aggregated. 

Claims brought by a single plaintiff can be aggregated

unless it appears to a "legal certainty" that there could not be

recovery for an amount in excess of the amount in controversy

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requirement. An example of when separate claims cannot be

aggregated is when a plaintiff claims alternative bases for

recovery for the same harm under state law. Suber v. Chrysler

Corp., 104 F.3d 578, 588 (3d Cir. 1990). 

Conversion and unjust enrichment are alternative bases

for recovery in the present case. A plaintiff may recover

ordinary tort damages for conversion or restitution damages for

unjust enrichment but not both. See Lindsley v. First Nat'l Bank

of Philadelphia, 190 A. 876, 878 (Pa. 1937) (a plaintiff whose

check was converted could recover for restitution damages instead

of tort damages); Rogers v. Studebaker Sales Co., 157 A. 6, 6

(Pa. Super. Ct. 1931) (allowing the plaintiff to recover for

restitution damages instead of tort damages when the defendant

converted and sold the plaintiff’s automobile); see also Buford

v. Wilimington Trust Co., 841 F.2d 51, 56 (3d Cir. 1988) (citing

with approval Wessel v. Montgomery, Scott & Co., 163 A. 347, 351

(Pa. Super. Ct. 1932)); 1A C.J.S. Actions §§ 110, 123; Dan R.

Dobbs, Law of Remedies § 5.18(1)-(2), at 923-24, 928-29 (2d ed.

1993).

There is a legal certainty that the plaintiff cannot

recover for both conversion and unjust enrichment because these

are alternative bases for recovery. The claims, therefore,

cannot be aggregated for amount in controversy purposes. Because

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the amount in controversy is below $75,000, removal of this case

from state to federal court is improper.

An appropriate order follows.

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