The opinion of the court was delivered by: WILLIAM STIEHL, Senior District Judge
Before the Court is defendants' motion to dismiss plaintiff's
complaint, to which plaintiff has filed a response, and
defendants a reply.
In this declaratory judgment action, the plaintiff insurance
company seeks a declaration that it is entitled to a setoff in
the amount of $50,000 per award granted to each defendant at
arbitration. Plaintiff brought the action in this Court based on
diversity jurisdiction. The underlying facts are as follows.
Defendant Janet Payton and her minor son were involved in an
automobile accident caused by Samuel Risby. Risby was insured by
The Hartford; after the accident The Hartford paid $50,000 to
Janet Payton, individually, and $50,000 to Janet Payton, as her
son's guardian. Payton then submitted a claim to plaintiff under
her underinsured motorist policy, and the matter was thereafter
submitted to arbitration. At arbitration, awards were entered in
the amount of $107,473 to Payton, individually, and $110,000 to
Payton, as her son's guardian. Plaintiff thereafter tendered
checks to defendants in the amounts of $57,473 and 60,000, which
represented payment of the awards after deducting the payments
totaling $100,000 made by The Hartford. Defendants assert that
plaintiff is not entitled to a setoff of $50,000 per award, and
have filed the instant motion to dismiss the complaint for
To sustain a dismissal of a complaint under Fed.R.Civ.P.
12(b)(6), the Court must take all well pleaded allegations as
true and construe the complaint in the light most favorable to
the plaintiffs. See, Conley v. Gibson, 355 U.S. 41, 45-46
(1957); Hernandez v. City of Goshen, Indiana, 324 F.3d 535, 537
(7th Cir. 2003). Dismissal is appropriate only if it appears
beyond a doubt that no relief may be granted under any set of
facts that could be proved consistent with the allegations in the
complaint. See, Conley, 355 U.S. at 45-46; Weizeorick v. ABN
Amro Mortg. Group, Inc., 337 F.3d 827, 830 (7th Cir. 2003).
Defendants argue that plaintiff has not satisfied the amount in
controversy requirement because plaintiff cannot aggregate the
two $50,000 awards to meet the amount in controversy requirement.
In a declaratory judgment action, "the value of the object of the
litigation is the `pecuniary result' that would flow to the
plaintiff (or defendant) from the court's granting the injunction
or declaratory judgment." America's MoneyLine, Inc. v. Coleman,
360 F.3d 782, 786 (7th Cir. 2004) (citing McCarty v. Amoco
Pipeline Co., 595 F.2d 389, 393 (7th Cir. 1979)).
Here, plaintiff argues, an adverse judgment would result in a
total pecuniary loss to plaintiff of $100,000.
While it is true that the Seventh Circuit has adopted the
"either viewpoint" approach, namely, that the amount in
controversy can be determined from either party's viewpoint, see,
McCarty, 595 F.2d at 395, the Seventh Circuit has also held
that the amount of controversy from the defendants' point of view
in a class action lawsuit is the amount the defendants risk
paying each plaintiff, not all plaintiffs. See, Del Vecchio v.
Conseco, Inc., 230 F.3d 974, 978 (7th Cir. 2000). As applied
here, the amount in controversy from the plaintiff's viewpoint is
the amount it risks paying each defendant, namely, $50,000, not
the $100,000 aggregate sum that it risks paying to both defendants.*fn1 See, e.g., Middle Tenn. News
Co. v. Charnel of Cincinnati, Inc., 250 F.3d 1077, 1081 (7th
Cir. 2001) ("In diversity cases, when there are two or more
defendants, plaintiff may aggregate the amount against the
defendants to satisfy the amount in controversy requirement only
if the defendants are jointly liable; however, if the defendants
are severally liable, plaintiff must satisfy the amount in
controversy requirement against each individual defendant.")
(citing Motorists Mut. Ins. Co. v. Simpson, 404 F.2d 511, 513
(7th Cir. 1969)); Am. Standard Ins. Co. of Wis. v. Rogers,
123 F. Supp.2d 461, 464 (S.D. Ind. 2000) ("claims by a single
plaintiff against multiple defendants cannot be aggregated in
order to reach the amount in controversy unless the two
defendants could be held jointly liable on claims that satisfied
the jurisdictional amount") (cite omitted). Accordingly, the
plaintiff has not shown that the amount in controversy exceeds
the jurisdictional amount.*fn2
It is unnecessary to consider defendants' remaining claim, as
the Court concludes that plaintiff has not satisfied the amount
in controversy requirement for diversity jurisdiction. Based on
the foregoing, the Court GRANTS defendants' motion to dismiss.
This action is DISMISSED for lack of subject matter
jurisdiction. IT IS SO ORDERED.
© 1992-2005 VersusLaw ...