DEFENDANT PELEUS INSURANCE COMPANY’S NOTICE OF REMOVAL Page 1 

UNITED STATES DISTRICT COURT 

WESTERN DISTRICT OF TEXAS 

SAN ANTONIO DIVISION 

444 UTOPIA LANE, LLC AND 29360 N. 

HWY 281, LLC, 

Plaintiffs, 

v. 

PELEUS INSURANCE COMPANY AND 

CLEARVIEW RISK INSURANCE 

PROGRAMS, LLC d/b/a STRATA 

UNDERWRITING MANAGERS, 

Defendants. 

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§ 

CIVIL ACTION NO. 5:20-cv-00716 

DEFENDANT PELEUS INSURANCE COMPANY’S 

NOTICE OF REMOVAL 

Defendant Peleus Insurance Company files this Notice of Removal under 28 U.S.C. § 

1446(a) and respectfully states. 

I. 

INTRODUCTION 

1. Plaintiffs 444 Utopia Lane, LLC and 29360 N. Hwy 281, LLC (collectively, 

“Plaintiffs”), commenced this action on May 8, 2020 by filing Plaintiffs’ Original Petition and 

Requests for Disclosure (“Original Petition”) in the 216th Judicial District Court of Kerr County, 

Texas – Cause No. 20244A. 

2. This lawsuit arises out of Plaintiffs’ claim for coverage under a commercial 

property insurance policy issued by Peleus for physical loss or damage allegedly sustained by a 

commercial property owned and/or managed by Plaintiffs as the result of a hail event reportedly 

occurring on May 26, 2016 (“Claim”). 

 

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3. Plaintiffs’ Original Petition, which includes a jury demand, names Peleus and 

ClearView Risk Insurance Programs, LLC d/b/a Strata Underwriting Managers (“Strata 

Underwriting Managers”) as defendants. 

4. Strata Underwriting Managers acted as Peleus’ managing general agent with 

respect to the binding and issuance of the commercial property insurance policy under which 

Plaintiffs seeks coverage; however, Strata is not a party to said policy. 

5. Plaintiffs attempted to serve Peleus with process in this action by serving the 

Commissioner of Insurance for the Texas Department of Insurance. The Texas Department of 

Insurance received a copy of Plaintiffs’ Original Petition on May 20, 2020. However, due to 

deficiencies in the citation accompanying Plaintiffs’ Original Petition, the Texas Department of 

Insurance did not transmit Plaintiffs’ Original Petition to Peleus, but rather returned the pleading 

and accompanying citation to Plaintiffs’ counsel unserved. 

6. Without waiving and specifically reserving its right to assert that Plaintiffs have not 

properly served Peleus, Peleus files this Notice of Removal within the 30-day period required by 

28 U.S.C. § 1446(b)(2)(B). 

7. Venue is proper in this district under 28 U.S.C. § 1441(a) because the state court 

where the action is pending is located in this district. 

8. Peleus need not obtain Strata Underwriting Managers’ consent to removal because 

Strata Underwriting Managers was improperly joined as a defendant in this action.1

 However, to 

the extent Strata Underwriting Managers’ consent is required, Strata Underwriting Managers – 

which is represented by the undersigned counsel – consents to the removal of this action. 

 

1

 See Rico v. Flores, 481 F.3d 234, 239 (5th Cir. 2007). 

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Accordingly, the requirement that all defendants consent to removal is satisfied.

II. 

BASIS FOR REMOVAL 

9. Removal is proper under 28 U.S.C. § 1332(a) if there is complete diversity between 

the parties and the amount in controversy exceeds $75,000 excluding interest, costs, and attorneys’ 

fees. These two conditions are clearly satisfied in this matter. 

A. Removal is Proper Because Complete Diversity of Citizenship Exists Between 

Plaintiffs and Peleus. 

10. Plaintiff 444 Utopia Lane, LLC is a Texas limited liability company with its 

principal place of business in the State of Texas. The citizenship of a limited liability company is 

determined by the citizenship of its members.2 Plaintiff 444 Utopia Lane, LLC’s only reported 

members/managers are Michael Garcia and NAPA, LLC. Michael Garcia is an individual who is 

domiciled and resides in Texas. NAPA, LLC is a Texas limited liability company with its principal 

place of business in the State of Texas. only reported members/managers are Allen Kianipey and 

Parvin Mohazabnia – both of whom are domiciled and reside in Texas. Plaintiff 444 Utopia Lane, 

LLC is thus a citizen of Texas for diversity jurisdiction purposes. 

11. Plaintiff and 29360 N. Hwy 281, LLC is a Texas limited liability company with its 

principal place of business in the State of Texas. Plaintiff and 29360 N. Hwy 281, LLC’s only 

reported member/manager is Michael Garcia – an individual who is domiciled and resides in 

Texas. Plaintiff and 29360 N. Hwy 281, LLC is thus a citizen of Texas for diversity jurisdiction 

purposes. 

12. Defendant Peleus is an insurance company incorporated in the State of Virginia 

 

2

 See Carden v. Arkoma Assocs., 494 U.S. 185, 195-96 (1990). 

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with its principal place of business in Virginia. Peleus is thus a citizen of Virginia for diversity 

jurisdiction purposes. 

13. Defendant ClearView Risk Insurance Programs, LLC d/b/a Strata Underwriting 

Managers is a limited liability company organized under the laws of the State of Texas. ClearView 

Risk Insurance Programs, LLC’s sole member/manager is ClearView Risk Holdings, LLC – a 

limited liability company organized under the laws of the State of Delaware. The 

members/managers of ClearView Risk Holdings, LLC’s are citizens of Illinois, New York, and 

Texas. Defendant Strata is thus a citizen of Illinois, New York, and Texas for diversity jurisdiction 

purposes. However, this Court may disregard Strata Underwriting Managers’ citizenship in 

determining jurisdiction under 28 U.S.C. § 1332(a) because Strata Underwriting Managers’ was 

improperly joined as a defendant in this action. 

14. Because Plaintiffs are citizens of Texas and Peleus – the only properly-joined 

defendant in this action – is a citizen of Virginia, complete diversity of citizenship exists in this 

lawsuit. 

(1) Plaintiffs Improperly Joined Strata Underwriting Managers as a Defendant to 

Defeat This Court’s Jurisdiction.

15. For at least two independent reasons, Plaintiffs have no reasonable possibility of 

recovery against Strata Underwriting Managers, which was improperly joined as a defendant in 

this action to defeat this Court’s jurisdiction. 

(a) Plaintiffs have no viable right of recovery against Strata Underwriting 

Managers because Peleus’ elected to accept legal responsibility for the 

alleged acts and/or omissions forming the basis of Plaintiffs’ purported 

causes of against Strata Underwriting Managers. 

16. Defendant Strata Underwriting Managers has been improperly joined as a 

defendant in this action, and its citizenship should be disregarded for purposes of diversity 

jurisdiction. A court must disregard the citizenship of a non-diverse party if the removing 

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defendant shows improper joinder by either: (1) “actual fraud in the pleading of jurisdictional 

facts”; or (2) “inability of the plaintiff to establish a cause of action against the non-diverse party 

in state court.”3 Under the second method, the removing defendant must demonstrate “there is no 

possibility of recovery by the plaintiff against [the] in-state defendant, which, stated differently 

means that there is no reasonable basis for the district court to predict that that the plaintiff might 

be able to recover against [the] in-state defendant.”4 

17. Here, Plaintiffs’ Original Petition fails to establish a reasonable possibility of 

recovery against Strata Underwriting Managers because Plaintiffs lack a valid claim upon which 

relief may be granted as to Strata Underwriting Managers under Texas law. Plaintiffs’ lawsuit is 

governed by Chapter 542A of the Texas Insurance Code, which applies to actions on first-party 

insurance claims arising from alleged damage to covered property caused by “forces of nature,” 

such as “a flood, a tornado, lightning, a hurricane, hail, wind, a snowstorm, or a rainstorm.”5

 

18. Under Chapter 542A, an insurer “may elect to accept whatever liability an agent 

might have to the claimant for the agent's acts or omissions related to the claim by providing 

written notice to the claimant.”6 Whether the insurer makes such an election “before a claimant 

files an action” or “thereafter,” the result is the same: “the court shall dismiss” the action against 

the agent with prejudice.7 In either event, the insurer “may not revoke, and a court may not nullify, 

 

3

 Smallwood v. Ill. Cent. R.R. Co., 385 F. 3d 568, 573 (5th Cir. 2004) 

4

 Id.

5

 TEX. INS. CODE ANN. § 542A.001(2). 

6

 TEX. INS. CODE ANN. § 542A.006(A). 

7

 Compare TEX. INS. CODE § 542A.006(b) with § 542A.006(c). 

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[the] insurer's election.”8 The statute does not require the insurer's written notice of election to be 

made in any particular form, nor does it require the insurer to take any steps other than the election 

in order for the court to dismiss the action against the agent.9

19. For purposes of this Notice of Removal, it is beyond dispute that Strata 

Underwriting Managers is Peleus’ “agent” as defined by section 542A.001(1) of the Texas 

Insurance Code.10 Indeed, in the statutory demand letter Plaintiffs sent to Peleus before 

commencing this suit, Plaintiffs plainly allege that “Strata is Peleus' agent for the reporting, 

administering, and adjusting [of] claims under the insured's master policy.”11 Plaintiffs’ Original 

Petition includes similar allegations of agency.12

 

8

 TEX. INS. CODE § 542A.006(f). 

9

 See generally TEX. INS. CODE § 542A.006. 

10 See TEX. INS. CODE ANN. § 542A.001(1) ("Agent" means an employee, agent, representative, 

or adjuster who performs any act on behalf of an insurer.”) 

11 Exhibit G [Plaintiffs’ 542A Notice Letter] at 1 (alleging that “Strata is Peleus's agent for the 

reporting, administering, and adjusting claims under the insured's master policy”). 

12 See Exhibit B [Plaintiffs’ Original Petition] at 5 (stating that “Strata Underwriting Managers 

is the underwriting manager for the placement of the master policies and the administrator of 

the insurance programs” at issue); id. at 5 (stating that “Strata Underwriting Managers is also 

listed as the surplus lines agent, who issued the subject insurance policy”); id. at 6 (alleging 

that Strata Underwriting Managers is the agent of Peleus and, as such, Peleus is liable for the 

acts of the Strata Underwriting Managers”). Despite these clear allegations of agency, 

Plaintiffs’ Original Petition also states – without any factual support – that “Strata is the 

principal in the insurance program with Peleus for the selling and issuing of the subject policy 

and the reporting, administering, and adjusting of any claims under that policy.” See Exhibit B 

[Plaintiffs’ Original Petition] at 5. Given the allegations in Plaintiffs’ statutory demand letter, 

which state (in pertinent part) that “Strata is Peleus's agent for the reporting, administering, 

and adjusting claims” under Plaintiffs’ policy, coupled with the fact that Plaintiffs’ counsel has 

made substantially similar allegations of agency in several other lawsuits against Peleus, Peleus 

presumes the Original Petition’s isolated reference to Strata Underwriting Managers as the 

principal of Peleus is made in error. If that is not the case, Plaintiffs’ conclusory statement 

regarding Peleus Insurance Company’s relationship with Strata Underwriting Managers is 

simply false. As set forth in the attached Declaration of Tim Drake, all actions undertaken by 

Strata Underwriting Managers with respect to the insurance policy under which Plaintiffs seek 

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20. It is also undisputed that Peleus – via a letter dated March 23, 2020 – elected to 

accept whatever liability its agents might have to Plaintiffs in connection with the insurance Claim 

made the basis of this lawsuit, stating: 

[P]ursuant to Texas Insurance Code § 542A.006, [Peleus] has 

elected accept the liability of Strata Claims Management, LLC, 

Engle Martin & Associates, LLC, George Mares, Rodger Truitt, and 

any other agent or representative of [Peleus] with respect to (i) the 

alleged acts or omissions referenced in your notice letter dated 

December 19, 2019 and/or (ii) any other alleged acts or omissions 

relating to [Plaintiffs’] Claim.13 

21. Because Peleus provided Plaintiffs with written notice of its election of legal 

responsibility under section 542A.006, Texas statute mandates that all causes of action asserted 

against its agent – Strata Underwriting Managers – be dismissed with prejudice. As a result, there 

is no possibility that Plaintiffs might recover against Strata Underwriting Managers on any of the 

causes of action pleaded in Plaintiffs’ Original Petition, and this Court should disregard Strata 

Underwriting Managers’ citizenship for purposes of 28 U.S.C. § 1332(a). 

 

 

coverage and/or the insurance Claim made the basis of this lawsuit were undertaken by Strata 

Underwriting Managers on behalf of Peleus in its capacity as managing general agent for 

Peleus. See Exhibit I [T. Drake Decl.] at ¶7.

13 See Exhibit H [Peleus’ 542A.006 Notice of Election] at 3-4 (emphasis added). In the event 

Plaintiffs’ contend the election of liability included in Peleus’ letter dated March 23, 2020 was 

somehow deficient with respect to Strata Underwriting Managers, which Peleus expressly 

disputes and denies, pursuant to Texas Insurance Code § 542A.006, Peleus hereby reiterates 

and restates its election to accept the liability of its agent – ClearView Risk Insurance 

Programs, LLC d/b/a Strata Underwriting Managers – with respect to (i) the alleged acts or 

omissions referenced in Plaintiffs’ notice letter dated December 19, 2019 and/or (ii) any other 

alleged acts or omissions relating to Plaintiffs’ Claim, including (without limitation) all acts or 

omissions alleged in Plaintiffs’ Original Petition. This election is unconditional and cannot be 

revoked pursuant to statute. 

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(b) Plaintiffs’ allegations of “joint enterprise” liability provide no independent 

basis for recovery against Strata Underwriting Managers and fail to state 

a claim against Strata Underwriting Managers upon which relief can be 

granted. 

22. In short, Peleus’ election to accept legal responsibility for the alleged acts and 

omissions of its agent – Strata Underwriting Managers – has left Plaintiffs without any viable right 

of recovery against Strata Underwriting Managers, including any purported right of recovery under 

Plaintiffs’ allegations of “joint enterprise” liability. However, in the event Plaintiffs contend their 

allegations of a purported “joint enterprise” between Peleus and Strata Underwriting Managers 

constitutes an independent cause of action or provides an independent basis for recovery against 

Strata Underwriting Managers that circumvents Peleus’ statutory election of legal responsibility 

under section 542A.006 of the Texas Insurance Code, which Peleus expressly disputes and denies, 

any such argument is unavailing because Plaintiffs’ allegations of “joint enterprise” liability fail – 

as a matter of law – to state a claim against Strata Underwriting Managers upon which relief can 

be granted. 

 B. Removal is Proper Because Plaintiffs’ Claimed Damages Exceed This Court’s 

Jurisdictional Threshold of $75,000. 

23. Under 28 U.S.C. § 1332(a), diversity subject matter jurisdiction requires that the 

matter in controversy “exceed[] the sum or value of $75,000, exclusive of interest and costs.” “To 

determine whether the amount in controversy is satisfied, the Court must look to the complaint at 

the time it was filed. . . . An allegation in the complaint of the requisite amount will normally 

suffice to confer jurisdiction upon the court if the claim is made in good faith . . . .”14 

 

14 Gutierrez v. Nissan N. Am., Inc., No.: A–15–CA–01250–SS, 2016 WL 8258790, *2 (W.D. 

Tex. Apr. 12, 2016) (citations and internal quotation marks omitted); see also KVOS, Inc. v. 

Associated Press, 299 U.S. 269, 277, 57 S. Ct. 197, 200, 81 L. Ed. 183 (1936) (same). 

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24. Here, Plaintiffs’ Original Petition states that Plaintiffs seek to recover damages in 

excess of $200,000, but no more than $1,000,000 in this lawsuit.15 Peleus denies the validity and 

merits of Plaintiffs’ claims, the legal theories upon which those claims are based, and the 

allegations for monetary and other relief requested. However, for purposes of removal only, and 

without conceding that Plaintiffs are entitled to any damages or other relief in this action, it is 

facially apparent that the amount in controversy exceeds $75,000, exclusive of interest and costs. 

25. Because there is complete diversity between the parties and the amount in 

controversy exceeds $75,000 excluding interest, costs, and attorneys’ fees, this Court has 

jurisdiction under 28 U.S.C. § 1332(a), and this action is removable under 28 U.S.C. § 1441(b). 

III. 

COMPLIANCE WITH 28 U.S.C. § 1446 

26. As required by 28 U.S.C. § 1446(a), a copy of each of the following are attached to 

(or filed with) this Notice of Removal: 

a. the docket sheet in the state court action, attached as Exhibit A to Notice of 

Removal; and 

b. each pleading, writ, or order filed, issued, or entered in the state court action 

(as separate attachments arranged in chronological order according to state court filing 

date), attached as Exhibits B - F to Notice of Removal. 

27. In addition to the documents required by 28 U.S.C. § 1446(a), a copy of each of the 

following are attached to (or filed with) this Notice of Removal: 

a. Notice Letter from Plaintiffs’ counsel – Robert W. Loree – dated December 19, 

2019 [Plaintiffs’ 542A Notice Letter], attached as Exhibit G to Notice of 

Removal; 

 

15 See, e.g., Exhibit B [Plaintiffs’ Original Petition] at 1 and 10. 

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b. Letter from Peleus’ counsel – James W. Holbrook, III – to Robert W. Loree 

dated March 23, 2020 [Peleus’ 542A.006 Notice of Election], attached as 

Exhibit H to Notice of Removal; and 

c. Declaration of Tim Drake dated June 17, 2020, attached as Exhibit I to Notice 

of Removal.16

28. Pursuant to 28 U.S.C. § 1446(d), written notice of filing of this Notice will be given 

to all adverse parties promptly after the filing of this Notice, and Peleus will promptly file a copy 

of this Notice with the clerk of the state court where the action is pending. 

WHEREFORE, Defendant Peleus Insurance Company hereby provides notice that this 

action is duly removed from the 216th Judicial District Court of Kerr County, Texas, to the United 

States District Court for the Western District of Texas, San Antonio Division, and respectfully 

requests that this Court enter such further orders as may be necessary and appropriate. 

 

 

16 In conducting an improper joinder analysis, a district court may “pierce the pleadings” and 

conduct a summary judgment inquiry. Smallwood v. Illinois Cent. R. Co., 385 F.3d 568, 573 

(5th Cir. 2004). Piercing the pleadings is appropriate when “a plaintiff has stated a claim but 

has ‘misstated or omitted discrete facts that would determine the propriety of joinder.’” Craig 

Penfold Props., Inc. v. Travelers Cas. Ins. Co., No. 3:14-CV-326-L, 2014 WL 4055356, at *3 

(N.D. Tex. Aug. 14, 2014). That is the case here – as Plaintiffs’ Original Petition misstates or 

omits discrete facts critical to this Court’s improper joinder analysis, including (without 

limitation): (a) known facts regarding Peleus’ relationship with Strata Underwriting Managers; 

(b) known facts regarding Strata Underwriting Manager’s role in the issuance of the insurance 

policy under which Plaintiffs’ seek coverage and the investigation/evaluation of the insurance 

Claim made the basis of this lawsuit; and (c) the fact indisputable fact that Peleus elected to 

accept legal liability for any alleged acts or omissions of its agent – Strata Underwriting 

Managers – relating to the Claim. 

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DEFENDANT PELEUS INSURANCE COMPANY’S NOTICE OF REMOVAL Page 11 

Respectfully submitted, 

ZELLE LLP 

By: /s/ James W. Holbrook, III 

James W. Holbrook, III 

Texas Bar No. 24032426 

jholbrook@zelle.com 

Bennett A. Moss 

Texas Bar No. 24099137 

bmoss@zelle.com 

901 Main Street, Suite 4000 

Dallas, TX 75202-3975 

Telephone: 214-742-3000 

Facsimile: 214-760-8994 

ATTORNEYS FOR DEFENDANTS 

CERTIFICATE OF SERVICE 

This is to certify that on June 18, 2020, a true and correct copy of the foregoing document 

was delivered to all known counsel of record in accordance with the Federal Rules of Civil 

Procedure as follows: 

Robert Loree 

rob@lhllawfirm.com 

Stephen M. Fields 

stephen@lhllawfirm.com 

LOREE & LIPSCOMB

The Terrance at Concord Park 

777 East Sonterra Boulevard, Suite 320 

San Antonio, TX 78258 

Telephone: 210-404-1320 

Facsimile: 210-404-1310 

Counsel for Plaintiffs

 /s/ James W. Holbrook, III 

James W. Holbrook, III 

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