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Betts v. Progressive Specialty Insurance Co.

United States District Court, S.D. Alabama, Southern Division

October 16, 2017




         This matter is before the Court on a sua sponte Show Cause Order (Doc. 81), Betts' Response (Doc. 82), and Safeco Insurance Company of Illinois's Reply (Doc. 85). For the reasons explained below, Betts' claim against Safeco is DISMISSED for want of subject matter jurisdiction. Betts' claim against Progressive Specialty Insurance Company is also DISMISSED for the same unless Progressive files an objection showing cause by October 27, 2017.

         I. Background

         a. Factual Background

         Betts' state law claims arise from an accident in Texas. While driving a tanker for his employer, an uninsured motorist rear-ended Betts. Because the accident involved an uninsured motorist, Betts filed suit against three insurance companies under their respective uninsured motorist policies.

         b. Procedural Background

         Betts originally sued three entities in state court, which was later removed to federal court. (1:16-cv-00254-KD-N). For reasons unrelated to the current issue, Betts dismissed the removed case and re-filed anew in federal court. (Doc. 1). In Betts' second action, his complaint cited 28 U.S.C. § 1332 as the statute providing the Court subject matter jurisdiction over his claims.

         Upon review of Safeco's Motion for Summary Judgment (Doc. 71-1), the Court questioned whether the Court had subject matter jurisdiction over Betts' claims. As a result, the Court issued a Show Cause Order to Betts inquiring as to the Court's subject matter jurisdiction. (Doc. 81). The Court noted its concern centered upon whether Betts' claims satisfied § 1332's amount in controversy requirement. (Doc. 81). Betts filed a response to the Show Cause Order in which he conceded his claims against both Safeco and Progressive do not satisfy the amount in controversy requirement. (Doc. 81 at 3). Safeco then moved for leave to submit a reply to Betts' response. (Doc. 83). The Court granted Safeco leave and ordered Safeco to specifically 28 U.S.C. § 1367(b)'s applicability to Betts' claims. (Doc. 84).

         II. Discussion of Law

         a. Subject Matter Jurisdiction

         Federal courts are courts of limited jurisdiction. As a result of this limitation, federal district courts have the power and “obligation at any time to inquire into jurisdiction[.]”Am. Civil Liberties Union of Florida, Inc. v. City of Sarasota, 859 F.3d 1337, 1340 (11th Cir. 2017) (quoting Fitzgerald v. Seaboard Sys. R.R., 760 F.2d 1249, 1251 (11th Cir. 1985)). And once a court concludes it lacks subject matter jurisdiction, “the court is powerless to continue.” Univ. of S. Alabama v. Am. Tobacco Co., 168 F.3d 405, 410 (11th Cir. 1999).

         Federal courts “are ‘empowered to hear only those cases within the judicial power of the United States as defined by Article III of the Constitution' and that have been entrusted to them by a jurisdictional grant authorized by Congress.” PTA-FLA, Inc. v. ZTE USA, Inc., 844 F.3d 1299, 1304 (11th Cir. 2016) (quoting Taylor v. Appleton, 30 F.3d 1365, 1367 (11th Cir. 1994)). “Congress has the constitutional authority to define the jurisdiction of the lower federal courts and, once the lines are drawn, limits upon federal jurisdiction must be neither disregarded nor evaded.” PTA-FLA, Inc., 844 F.3d at 1304 (quoting Keene Corp. v. United States, 508 U.S. 200, 207 (1993)) (internal ellipsis omitted).

         Two main statutes confer original jurisdiction: 28 U.S.C. §§ 1331 and 1332. The former statute provides a "federal forum for plaintiffs who seek to vindicate federal rights . . . under the Constitution, laws, or treaties of the United States.” Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 552 (2005). The latter “provide[s] a neutral forum for what have come to be known as diversity cases, [that is] civil actions between citizens of different States, between U.S. citizens and foreign citizens, or by foreign states against U.S. citizens.” Exxon, 545 U.S. at 552.

         Congress restricted diversity cases to those “where the matter in controversy exceeds the sum or value of $75, 000 . . . .” 28 U.S.C. § 1332(a). In order to satisfy the requirements of § 1332, the parties must be completely diverse, Univ. of S. Alabama, 168 F.3d at 412 (citing Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 2 L.Ed. 435 (1806)), and the matter in controversy must exceed $75, 000. To justify dismissal, “it must appear to a legal certainty that the claim” does not exceed $75, 000. Federated Mut. Ins. Co. v. McKinnon Motors, LLC, 329 F.3d 805, 807 (11th Cir. 2003) (quoting St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 289 (1938)). However, if a party asserts jurisdiction “based on a claim for indeterminate damages, the Red Cab Co. ‘legal certainty' test gives way, and the party ...

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