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Denise Kalin, Co-Administrator of the Estate of Timothy Ross Langdon v. Qbe Insurance (Australia) ) Limited

January 25, 2013

DENISE KALIN, CO-ADMINISTRATOR OF THE ESTATE OF TIMOTHY ROSS LANGDON DOWN; AND ROBERT HOTCHIN, ADMINISTRATOR OF THE ESTATE OF BRETT HOTCHIN, PLAINTIFFS,
v.
QBE INSURANCE (AUSTRALIA) ) LIMITED, DEFENDANT.



The opinion of the court was delivered by: Judge Edmond E. Chang

MEMORANDUM OPINION AND ORDER

Plaintiffs Denise Kalin and Robert Hotchin, as administrators of the estates of Timothy Down and Brett Hotchin, respectively, filed suit in Cook County Circuit Court alleging that QBE Insurance breached an insurance policy when it failed to provide a defense and indemnification to the estates of Down and Brett Hotchin in a related lawsuit. R. 1-1.*fn1 Floyd A. Wisner moved to intervene [R. 1-4], and also filed an amended complaint asserting an additional claim against QBE for abuse of process [R. 1-8]. After Kalin, Robert Hotchin, and another intervening plaintiff, Shane Urquhart, voluntarily dismissed their claims without prejudice, QBE removed the case to this Court [R. 1], arguing that the case now meets the requirements for federal subject matter jurisdiction under diversity of citizenship. 28 U.S.C. § 1332. Intervening-Plaintiff Wisner moved to remand to state court [R. 13], arguing that the suit does not satisfy the amount-in-controversy requirement of 28 U.S.C. § 1332. For reasons explained more fully below, Wisner's motion is denied.

I.

This dispute originates from an airplane crash that occurred in Queensland, Australia in 2005. Much litigation has arisen in both the United States and Australia among and between the estates of the deceased passengers and crew members, the manufacturers and distributors of the aircraft and its various parts, and the insurance company that held policies for the two pilots operating the plane at the time of the crash. The original plaintiffs, Denise Kalin and Robert Hotchin, are no longer parties to this suit; they are Australian citizens and are the administrators of the estates of the pilots, Timothy Down and Brett Hotchin, respectively.*fn2 R. 1, Notice of Removal ¶ 3. Floyd A. Wisner, who filed the motion to remand [R. 13], in his personal capacity, is the United States-based attorney for Kalin and Robert Hotchin, and a citizen of Illinois. Id. ¶¶ 12, 36a. Defendant QBE Insurance (Australia) Limited is an Australian company and citizen. Id. ¶¶ 5, 36b.

Kalin and Hotchin*fn3 originally filed this suit in the Circuit Court of Cook County, alleging that QBE breached the pilots' insurance policies by failing to provide a defense and indemnification for counterclaims filed against the pilots' estates in litigation related to the 2005 plane crash. R. 1-1, Compl. The complaint alleged that Kalin and Hotchin had "suffered damages due to [QBE's] breach of its contract of insurance in that [Kalin and Hotchin] have been forced to incur fees and costs in defending these counterclaims and are exposed to potential liability to the counter-plaintiffs." Id. ¶ 14. Plaintiffs' damages were alleged to be "in excess of the jurisdictional minimum amount of [the Law Division of the Circuit Court of Cook County], together with costs and attorney's fees and such other damage as may be allowed by law." Id. at 3-4.

In October 2011, while the case was still pending in Cook County, Wisner sought to personally intervene as a plaintiff in the action. R. 1-4, Petitioner Floyd A. Wisner's Motion to Intervene as Plaintiff.*fn4 The judge in the state-court case did not rule on Wisner's motion to intervene before the case was removed, but Wisner was permitted to file an amended complaint in state court in December 2011. R. 1-7, Order of Dec. 29, 2011. In the amended complaint Wisner added an "abuse of process" claim asserted only on behalf of himself. R. 1-8, Am. Compl. at 4-5. As to his damages for this count, Wisner alleged:

As the direct and proximate result of [QBE's] tortious abuse of process . . ., plaintiff, Floyd A. Wisner, was forced to incur time and expense in pursuing motions . . . before this Illinois Court . . .

Id. at 5. Again, Wisner alleged that his damages were "in excess of the jurisdictional limits of [the Law Division of the Circuit Court of Cook County]." Id.. On the same date that Wisner was permitted to file an amended complaint, Kalin and Hotchin were permitted to voluntarily dismiss their claims without prejudice. Order of Dec. 29, 2011. After another intervening plaintiff, Shane Urquhart, was also permitted to voluntarily dismiss his claims without prejudice, R. 1-9, Order of Mar. 22, 2012, QBE removed the case to this Court, arguing that this Court now has jurisdiction under 28 U.S.C. § 1332. Notice of Removal. Intervening-Plaintiff Wisner moved to remand the case, alleging that the suit failed to satisfy the amount-in-controversy requirement of 28 U.S.C. § 1332. R. 13, Mot. to Remand and for Attys. Fees.

II.

Removal is governed by 28 U.S.C. § 1441, which provides, in pertinent part, that "any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district . . . embracing the place where such action is pending." 28 U.S.C. § 1441(a). "Only state-court actions that originally could have ben filed in federal court may be removed to federal court." Caterpillar v. Williams, 482 U.S. 386, 392 (1987). But even when a case is not removable at the outset based on its initial pleading, the defendant may file a notice of removal within 30 days after receipt of "an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable." 42 U.S.C. § 1446(b)(3) (emphasis added). "The party seeking removal has the burden of establishing federal jurisdiction, and federal courts should interpret the removal statute narrowly, resolving any doubt in favor of the plaintiff's choice of forum in state court." Schur v. L.A. Weight Loss Ctrs., 577 F.3d 752, 758 (7th Cir. 2009) (citing Doe v. Allied-Signal, Inc., 985 F.2d 908, 911 (7th Cir. 1993)). But "[t]here is no presumption against federal jurisdiction in general, or removal in particular." Back Doctors Ltd. v. Metropolitan Property and Cas. Ins. Co., 637 F.3d 827, 830 (7th Cir. 2011).

QBE's asserted basis for federal jurisdiction in this case is diversity jurisdiction under 28 U.S.C. § 1332. Section 1332 states in pertinent part that district courts have "original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between . . . citizens of a State and citizens or subjects of a foreign state . . . ." § 1332(a)(2). Here, diversity of citizenship is undisputed, but the parties contest whether the amount in controversy exceeds $75,000. In cases of removal, the amount in controversy is measured as "the amount required to satisfy the plaintiff's demands in full . . . on the day the suit was removed." Oshana v. Coca-Cola Co., 472 F.3d 506, 510-11 (7th Cir. 2006) (internal citations omitted). A defendant, when removing a suit, may "present its own estimate of the stakes; it is not bound by the plaintiff's estimate." Back Doctors Ltd. v. Metropolitan Property and Cas. Ins. Co., 637 F.3d 827, 830 (7th Cir. 2011). Whether the amount in controversy exceeds $75,000 is a prediction, not a fact. See Meridian Sec. Ins. Co. v. Sadowski, 441 F.3d 536, 541 (7th Cir. 2006). But the proponent of federal jurisdiction must allege and prove the "jurisdictional facts" that determine the amount in controversy by a preponderance of the evidence. Meridian, 441 F.3d at 541 (7th Cir. 2006); Back Doctors Ltd. v. Metropolitan Property and Cas. Ins. Co., 637 F.3d 827, 829 (7th Cir. 2011). "[O]nce these facts have been established[,] the proponent's estimate of the claim's value must be accepted unless there is a 'legal certainty' that the controversy's value is below the threshold." Meridian, 441 F.3d at 541 (citations omitted). This standard was reiterated recently by the Seventh Circuit when it clarified that in cases of removal "the estimate of the dispute's stakes advanced by the proponent of federal jurisdiction controls unless a recovery that large is legally impossible." Back Doctors, 637 F.3d at 830 (emphasis added).

III.

QBE has established by a preponderance of the evidence that the amount in controversy in this case exceeds $75,000, and Wisner has failed to counter that such a recovery by him would be "legally impossible."As noted above, Wisner's amended complaint added a claim for abuse of process. Am. Compl. at 4-5. Wisner's asserted damages for his abuse of process claim include compensation for the time and expense he incurred for various filings in this case related to injunctions that were obtained in the Australian proceeding. Am. Compl. at 5. Wisner did not specify the amount of damages he is seeking on his abuse of process claim in the amended complaint, except to note that the damages exceed the jurisdictional minimum for the Law Division of the Circuit Court of Cook County. Id. at 5. That minimum appears to be $30,000. See Gen. Order of the Cir. Ct. of Cook Cnty. 1.2, 2.1(a)(1)(i).

In its notice of removal, QBE argues that the amount in controversy exceeds $75,000 based on the fees that QBE itself has incurred in this action, the potential damages Wisner may seek on the underlying breach of contract action, and statements Wisner has made regarding fees he has incurred and is responsible for in the Australian proceeding. Notice of Removal ¶¶ 38-42.*fn5 Although QBE is mistaken in its argument that Wisner's post-removal affidavit is "irrelevant,"*fn6 R. 21, Def.'s Resp. Br. at 12, QBE has presented sufficient evidence to establish by a preponderance of the evidence that the "amount at stake" in this litigation may exceed the $75,000 jurisdictional minimum. See BEM I, L.L.C. v. Anthropologie, Inc., 301 ...


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