Opinion
No. A3-01-20.
April 12, 2001.
MEMORANDUM AND ORDER
Before the Court is plaintiffs' motion for remand of this case, which defendant removed to this Court from the state courts of North Dakota (doc. # 6). Defendant has resisted the motion. The motion came on for hearing at 9:30 a.m. on Wednesday, April 11, 2001, in Fargo, North Dakota. As the Court ruled at the hearing, the motion to remand is DENIED.
Plaintiffs' claims revolve around recovery of property damages allegedly covered by insurance policies between the parties and as to which defendant has denied coverage. In the complaint, Red River Zoological Society and TCW jointly claim damages of $8,246.42; Dakota Developments LLP claims $10,600; and Adams Development Corporation claims $22,134. Further, however, plaintiffs each seek treble damages, costs and attorney's fees under North Dakota Century Code chapter 51-15, which allows such damages if a plaintiff establishes fraud, false promises, or misrepresentation in connection with the sale or advertisement of any merchandise. See N.D. Cent. Code § 51-15-02, -09. The notice of removal further sets forth that Red River Zoological Society is a resident business in the state of North Dakota while defendant Generali is a corporation incorporated under the law of New York and having its principal place of business in New York. These facts are not disputed by either party.
The Court also notes that there is another case involving these same parties — as well as several others — pending in the district. Generali U.S. Branch v. Dakota Park Ltd., et. al., No. A3-00-99. The parties agreed at the hearing that this case involves essentially the same issues as the case at bar, though they are postured somewhat differently. As will be explained below, the fact that this case exists plays a role in the Court's decision here.
Generally, the party resisting remand and seeking removal bears the burden of establishing federal subject matter jurisdiction. In re Business Men's Assur. Co. of America, 992 F.2d 181, 183 (8th Cir. 1993). Therefore, the Court is required "to resolve all doubts about federal jurisdiction in favor of remand." Id. Defendant seeks removal on the basis of diversity jurisdiction under 28 U.S.C. § 1332, which allows federal jurisdiction so long as the parties are citizens of different states and the amount in controversy exceeds $75,000. Plaintiffs seem not to contest that diversity of citizenship exists between the parties. Thus, the sole issue contested by the parties is the amount in controversy.
Plaintiffs argue none of the individual claims, even trebled, reaches $75,000, and since claims of individual defendants may not be aggregated to reach the jurisdictional amount, remand is required. Crenshaw v. Great Central Ins. Co., 482 F.2d 1255 (8th Cir. 1973) (explaining that claims of separate and distinct plaintiffs may not be aggregated for purpose of jurisdiction). The Court of course agrees that each of the claims must meet the jurisdictional minimum in its won right, and that there can be no aggregation. Id. However, the Court finds this rule met here, since each claim exceeds $75,000 when fees, costs, and punitive damages are considered.
First, it is well settled that attorney's fees and costs and punitive damages may count in the total amount. Capitol Indem. Corp. v. Miles, 978 F.2d 437, 438 (8th Cir. 1992) (counting attorney fees). Counting fees and costs is especially appropriate in this case, since N.D. Cent. Code section 51-15 allows for recovery of both attorney's fees and costs and is the kind of statute that opens the door to punitive damages. See N.D. Cent. Code § 51-15-02, -09. Therefore, the amount in controversy here must include consideration of both fees and costs.
Further, it is clear that the Court may consider punitive damages when calculating the amount in controversy, though the Court is to "scrutinize a claim for punitive damages more closely than a claim for actual damages to ensure that Congress' limits on diversity jurisdiction are properly observed." State of Mo. ex rel Pemiscot Cty. v. Western Sur. Co., 51 F.3d 170, 173 (8th Cir. 1995). Plaintiffs here have not yet requested punitive damages. However, a plaintiff in North Dakota cannot plead punitive damages in an initial complaint; rather, he or she must move to amend the complaint to include such damages. N.D. Cent. Code § 32-03.2-11. Though it is somewhat attenuated, the Court believes it appropriate to consider punitive damages in this case.
Initially, defendant's brief in opposition to remand suggested plaintiffs would likely seek punitives and offered to agree to remand if plaintiffs would limit recovery to $74,999.99. Plaintiffs' reply stated they are not willing to waive the right to seek such damages. Further, the Court notes that plaintiffs have sought to pursue a punitive damage claim in the related case discussed above. Since this case involves the same basic facts as the earlier case, the Court views it as likely that plaintiffs will seek punitive damages here as well. Therefore, the Court proceeds with the assumption that punitive damages must be considered as part of the amount in controversy.
When all of these elements are considered, the Court finds the jurisdictional amount satisfied. Though the inquiry is by its nature somewhat imprecise, if the base claims are trebled and augmented with statutory fees and costs, as well as punitive damages, each will likely exceed $75,000. Therefore the motion to remand this action to North Dakota state court is DENIED. This conclusion is especially appropriate considering that the earlier, substantially similar action is pending in this Court, and it is likely they should be resolved together.