Opinion
Civil Action No. 05-253, Section: "R" (4).
April 22, 2005
ORDER AND REASONS
The plaintiff moves the Court to remand the action to state court. For the following reasons, the Court GRANTS the plaintiff's motion.
I. BACKGROUND
A Best Sewer Drain Service, Inc. alleges that it has operated a plumbing, sewer and drain cleaning business in Louisiana since 1977 under the service mark of "Rooter Man" and the accompanying logo. On December 9, 1999, A Corp, a Massachusetts corporation, filed for and obtained the service mark "Rooter-Man Logo" in Louisiana for sewer and drain cleaning services. In February and March of 2002, A Corp demanded that A Best cease and desist using the name and service mark of "Rooter Man."
On December 23, 2004, A Best sued A Corp in state court. A Best contends that use of the "Rooter Man" name and service mark by A Corp will likely cause confusion or deceive A Best's customers. A Best also asserts that A Corp's use of the "Rooter Man" service mark constitutes unfair competition or an unfair trade practice. A Best asks the Court to declare that A Corp cannot sue A Best for alleged infringement or dilution of the "Rooter Man" service mark, to enjoin A Corp from threatening A Best with infringement, dilution, and unfair competition, to enjoin A Corp from using the "Rooter Man" service mark, to cancel A Corp's registration of the service mark "Rooter Man Logo," and to award A Best damages and attorney's fees. A Best alleges that damages are less than $100,000.00.
On January 28, 2005, A Corp removed the action to this Court on the basis of diversity jurisdiction. As noted supra, A Corp is a Massachusetts corporation and A Best is a Louisiana corporation. A Corp alleges that the amount in controversy exceeds $75,000.00. After A corp removed the action, A Best submitted the affidavit of its president stating that the amount in controversy is less than $75,000.00. (Pl.'s Mot. Remand, Aff. of Lavenia at ¶¶ 3-5.)
II. DISCUSSION
A. Legal Standard
A defendant may typically remove a civil action filed in state court if the federal court would have had original jurisdiction. See 28 U.S.C. § 1441(a). The removing party bears the burden of establishing the existence of federal jurisdiction. See Allen v. R H Oil Gas Co., 63 F.3d 1326, 1335 (5th Cir. 1995). The jurisdictional facts supporting removal are examined as of the time of removal. See Gebbia v. Walmart Stores, Inc., 223 F.3d 880, 883 (5th Cir. 2000); Asociacion Nacional de Pescadores a Pequena Escala O Artesanales de Colombia ("ANPAC") v. Dow Quimica de Colombia S.A., 988 F.2d 559, 565 (5th Cir. 1993), abrogated on other grounds by Marathon Oil Co. v. Ruhrgas, 145 F.3d 211 (5th Cir. 1998), rev'd on other grounds, 526 U.S. 574 (1999); Bonck v. Marriott Hotels, Inc., 2002 WL 31890932, at *1 (E.D.La.). The Court must remand the case to state court "[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction[.]" 28 U.S.C. § 1447(c).
Louisiana law prohibits a plaintiff from pleading a specific amount of monetary damages. See LA. CODE CIV. PROC. art. 893. When the plaintiff has alleged an indeterminate amount of damages, the removing defendant must prove by a preponderance of the evidence that the amount in controversy exceeds $75,000. Simon v. Wal-Mart Stores, 193 F.3d 848, 850 (5th Cir. 1999); see also De Aguilar v. Boeing Co., 47 F.3d 1404, 1412 (5th Cir. 1995). A defendant makes this showing when it is facially apparent that the claims are likely to exceed $75,000. See Allen, 63 F.3d at 1335. In the alternative, the defendant can set forth the facts in controversy, preferably in the removal petition, but sometimes by affidavit or stipulation, that support a finding of the requisite amount. See id. The defendant must do more than point to a state law that might allow plaintiff to recover more than what is pleaded; the defendant must submit evidence that establishes that the actual amount in controversy exceeds $75,000. See De Aguilar, 47 F.3d at 1412. If the defendant meets its burden in either of these ways, the plaintiff must then show with legal certainty that his claims are really for less than $75,000. See id. at 1411-12. The Court may consider a plaintiff's post-removal affidavit that clarifies the amount in controversy only when the petition is ambiguous. See ANPAC, 988 F.2d at 565 (considering plaintiffs' lawyer's post-removal affidavit that damages were less than the jurisdictional amount).
In most cases, "the particular relief sought by the plaintiff — typically compensatory damages — will be exactly the same as the liability imposed on the defendant." Wright, Miller Cooper, Federal Practice and Procedure: Jurisdiction 3d § 3703. Sometimes, however, the potential benefit to the plaintiff differs from the potential loss to the defendant. Id. This often occurs in suits seeking declaratory or injunctive relief. Id. "`The amount in controversy, in an action for declaratory or injunctive relief, is the value of the right to be protected or the extent of the injury to be prevented.'" St. Paul Reinsurance Co. v. Greenberg, 134 F.3d 1250, 1252-53 (5th Cir. 1998) (quoting Leininger v. Leininger, 705 F.2d 727, 729 (5th Cir. 1983)). See also Hartford Ins. Group v. Lou-Con, Inc., 293 F.3d 908, 911 (5th Cir. 2002); Alfonso v. Hillsborough County Aviation Auth., 308 F.2d 724, 727 (5th Cir. 1962) (noting that "[t]he value to the plaintiff of the right to be enforced or protected determines the amount in controversy"). This is commonly known as the plaintiff-viewpoint rule. The Fifth Circuit has consistently followed the plaintiff-viewpoint rule to determine the amount in controversy. See Garcia v. Koch Oil Co., 351 F.3d 636, 640 n. 4 (5th Cir. 2003) (noting that the Fifth Circuit has not abandoned the plaintiff-viewpoint rule); Puckett Mach. Co., Inc. v. United Rentals, Inc., 342 F.Supp.2d 610, 614 (S.D. Miss. 2004) (noting that "the Fifth Circuit has continuously applied the `plaintiff viewpoint' rule"). Therefore, in an action seeking declaratory and injunctive relief for trademark infringement, the value of the right to be protected is the value of the use of the trademark to the plaintiff. See Cohn v. Petsmart, Inc., 281 F.2d 837, 840 (9th Cir. 2002) (calculating the amount in controversy on the basis of the value of the use of the trademark to the plaintiff in an action seeking declaratory and injunctive relief for trademark infringement); Wells' Dairy, Inc. v. Estate of Richardson, 89 F.Supp.2d 1042, 1047 (N.D. Iowa 2000) (same); Murphey v. G.C. Murphy Co., 216 F.Supp. 124, 126 (W.D. La. 1963) (determining that the value of the use of the trademark to the plaintiff determines the amount in controversy in a suit for injunctive relief for trademark infringement, and noting that "[t]he possible pecuniary effect upon the defendant is inapposite to the issue involved").
B. Discussion
A Corp does not argue that the amount in controversy is apparent on the fact of the complaint. Indeed, it is not. Instead, A Corp offers evidence that it contends demonstrates that the amount in controversy exceeds the jurisdictional minimum. Specifically, A Corp submits evidence that the value of the "Rooter Man" service mark is worth more than $75,000.00 to A Corp. This is because A Corp charges an initial franchise fee of $50.00 per one thousand residents in the area exclusive to the franchisee. (Def.'s Ex. A, Aff. of MacDonald at ¶ 7.) A Corp contends that based on its initial franchise fee and the population of the state of Louisiana, the right to use the "Rooter Man" service mark in Louisiana is worth $223,448.00 to A Corp. (Def.'s Mem. at 6.) A Corp also submits evidence that one of its competitors, Mr. Rooter, charges an initial franchise fee of $200.00 per one thousand residents, which amounts to more than $800,000.00 in franchise fees for the entire state. (Def.'s Ex. A, Aff. of MacDonald at ¶ 8.) The Court notes that A Corp submits no evidence of what A Best's attorney's fees in the matter will likely be.
The Court finds that A Corp's evidence is inapposite. A Corp submits no evidence to the Court to prove the value of A Best's right to use the "Rooter Man" service mark. Significantly, A Corp operates a nation-wide franchise system with franchises in 30 states. (Def.'s Ex. A, Aff. of MacDonald at ¶¶ 2, 6.) A Best, on the other hand, is a Louisiana business. Therefore, the value of the "Rooter Man" service mark to A Corp does not necessarily prove its value to A Best. See Murphey, 216 F.Supp. at 126 (finding that evidence of the value of the use of the trademark to the defendant, a nation-wide chain, was inapposite to a determination of the value of the use of the trademark to the plaintiff, a local business operating in Shreveport, Louisiana). Accordingly, A Corp fails to carry its burden to prove to the Court that it is more likely than not that the value of A Best's right to use the "Rooter Man" service mark meets the jurisdictional minimum. Therefore, the Court remands the action to state court.
III. CONCLUSION
For the foregoing reasons, the Court GRANTS the plaintiff's motion to remand.