Pleading to Stay in State Court: Forum Control, Federal Removal Jurisdiction, and the Amount in Controversy Requirement

I. Introduction It is hornbook law that the plaintiff is master of his complaint.1 Traditionally, a plaintiff's control of the complaint implied control to choose a state or federal forum for a diversity case.2 According to the long-standing rule of St. Paul Mercury Indemnity Co. v. Red Cab Co.,3 if a plaintiff prefers a state court forum and is willing to seek damages below the federal jurisdictional amount, then.the plaintiff may prevent a geographically diverse defendant from removing to federal court.4 More recently, however, many states have adopted procedural rules that do not limit recovery to the plaintiff's demand.5 In these states, civil plaintiffs may now receive awards greater than the specific amounts prayed for in their complaints.6 A plaintiff may force a defendant to litigate in a state forum, yet the defendant may stand to lose more than the jurisdictional amount. Thus, federal courts are beginning to allow defendants to challenge the validity of a specifically pleaded damage amount.7 A court allowing a removing defendant to challenge a plaintiff's specific damages then confronts the question of what burden the defendant should bear to show that the requisite amount truly is in controversy.8 Federal judges have proposed three different standards.9 First, the "reverse legal certainty" standard10 requires a defendant to show that it is not a legal certainty that the plaintiff would recover less than the jurisdictional amount.11 Stated simply, a defendant bears the burden of showing only that the plaintiff possibly could recover more than the jurisdictional amount.12 Second, the "preponderance of the evidence" standard13 attempts to strike a balance between a plaintiff's right to choose a state forum and a defendant's right to remove by requiring a defendant to prove the jurisdictional amount by a preponderance of the evidence.14 Third, the stringent "legal certainty" standard15 forces a defendant to prove to a legal certainty that a prevailing plaintiff cannot recover less than the jurisdictional amount.16 This Note explores the three removal standards by examining two federal court of appeals opinions regarding removed cases with specified damages below the jurisdictional amount: one opinion in which the United States Court of Appeals for the Eleventh Circuit adopted the "legal certainty" standard and one in which the United States Court of Appeals for the Fifth Circuit adopted the "preponderance of the evidence" standard. Part II.A provides an overview of the statutory basis for removal to federal court.17 Part II.B identifies changing judicial attitudes toward specifically pleading jurisdictionally insufficient damages to secure a state court forum.18 Part II concludes with an examination of case law preceding the current willingness of some courts to allow defendants to attempt to remove facially unremovable cases.19 Part III.A analyzes Kliebert v. Upjohn Co.,20 a vacated Fifth Circuit opinion from whose reasoning both the Fifth and Eleventh Circuits drew heavily in later opinions.21 Part III.B examines the Eleventh Circuit's adoption of Kliebert's "legal certainty" standard.22 Part III.C examines the Fifth Circuit's decision to adopt the more permissive "preponderance of the evidence" standard and to reject Kliebert.23 Part IV analyzes removal standards in light of the historical and practical reasons for Congress's statutory requirement that a minimum amount be in controversy in order to restrict access to federal courts in diversity cases.24 Part V concludes that the difficult "legal certainty" burden is preferable because it comports more closely with the rationale of the jurisdictional amount than does the less onerous "preponderance of the evidence" standard or the permissive "reverse legal certainty" standard.25 II. Removal to Federal Court and the Amount in Controversy Requirement Removal is a peculiar procedure in that it permits defendants to remove an action properly brought in one system of courts, our state courts, into another set of courts, our federal district courts. …