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Haldiman v. Continental Casualty Co.

United States District Court, Ninth Circuit

August 2, 2013

Betty Lou Haldiman, an individual; John B. Haldiman, Jr., an individual, Plaintiffs,
v.
Continental Casualty Company, an Illinois corporation, Defendant.

ORDER

G. MURRAY SNOW, District Judge.

Pending before the Court is Plaintiffs' Motion to Remand, (Doc. 17), and Second Application for Order to Show Cause Regarding Request for Preliminary Injunction, (Doc. 8). For the reasons discussed below, the Motions are denied.

BACKGROUND

On March 15, 2013, Plaintiffs Betty Lou Haldiman and John B. Haldiman ("the Haldimans"), filed this action in the Superior Court of Arizona. (Doc. 1 ¶ 2.) The Haldimans allege breach of contract, breach of the duty of good faith and fair dealing (insurance bad faith), and unfair practices and frauds. (Doc. 1-1, Ex. A (Compl.) ¶¶ 17-37.) On April 11, 2013, Defendant Continental Casualty Company ("CCC"), removed this case to federal court, alleging subject matter jurisdiction based on diversity of citizenship and an amount in controversy greater than $75, 000. (Doc. 1 ¶ 3.) CCC is an Illinois corporation and has its principal place of business in Illinois. ( Id. ¶ 9.) The Haldimans are citizens of Arizona. (Doc. 1-1, Ex. A (Compl.) ¶ 1.)

Many years ago the Haldimans purchased a "Long-Term Care Insurance Policy" ("the policy") from CCC. ( Id. ¶ 3.) Under the policy, Ms. Haldiman is entitled to benefits of $151 per day for long-term care in a qualifying facility after an elimination period of 90 days. (Doc. 1 ¶ 14.) The benefits last as long as Ms. Haldiman is alive and receiving qualifying care. ( Id. ) According to a class action settlement, even if Ms. Haldiman does not reside in a facility that provides qualifying care, she is nevertheless entitled to 25% of the daily Long Term Care Facility Benefit contained in [the] policy or 25% of the actual daily cost of the facility, whichever is greater." (Doc. 12-1, Ex. B at 4.)[1] At some point, Ms. Haldiman moved to the Beatitudes Campus. (Doc. 1-1, Ex. A (Compl.) ¶¶ 5-7.) CCC determined that Ms. Haldiman's place of residence did not qualify as a long term care facility under its policy. ( Id. ¶¶ 10-15.) Although CCC has sent checks for 25% of Ms. Haldiman's benefits in accordance with the settlement agreement, (Doc. 20-1, Ex. A), the Haldimans' claims for full benefits have been denied by CCC thus far, (Doc. 1-1, Ex. A (Compl.) ¶¶ 10-16). Without specifying a dollar amount, the Haldimans seek an award of (1) actual damages, (2) general damages including those for emotional distress and consequential damages, (3) punitive damages, (4) a temporary restraining order, preliminary injunction and permanent injunction preventing CCC from denying full benefits, (5) reasonable attorneys' fees and costs, (6) and further relief as the Court deems proper. ( Id. ¶¶ 17-37.)

After filing their Complaint, the Haldimans submitted an Arizona Rule of Civil Procedure 68 Offer of Judgment, proposing judgment for $17, 747 and an additional $4, 222 per month as long as Ms. Haldiman is a resident at the Beatitudes. (Doc. 1-1 Ex. A at 16.) The Haldimans also submitted a certificate in Superior Court stating that their case was not subject to the Uniform Rules of Procedure for Arbitration because they are seeking injunctive relief. (Doc. 1-1 Ex. A at 15.)

DISCUSSION

I. MOTION TO REMAND

A. Legal Standard

"[A]ny 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 and division embracing the place where such action is pending." 28 U.S.C. § 1441(a). A party may remove an action from state court only if the action could have been brought in the district court originally. Ramirez v. Fox Television Station, Inc., 998 F.2d 743, 747 (9th Cir. 1993). The party asserting federal jurisdiction has the burden of proof on a motion to remand to state court, and the removal statute is strictly construed against removal jurisdiction. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (noting a "strong presumption" against removal jurisdiction, and stating that "[f]ederal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance.")

When removal is based on diversity jurisdiction, the removing party must show that (1) the opposing parties are not citizens of the same state and (2) "the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs." 28 U.S.C. § 1332(a). The burden of proving the amount in controversy depends on whether the plaintiff's complaint is ambiguous or whether it alleges a specific amount. Guglielmino v. McKee Foods Corp., 506 F.3d 696, 699 (9th Cir. 2007); Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 402, 404 (9th Cir. 1996). Where it is unclear from the complaint whether the plaintiff has pleaded the required amount in controversy, "the removing defendant bears the burden of establishing, by a preponderance of the evidence, that the amount in controversy exceeds [the jurisdictional amount]." Sanchez, 102 F.3d at 40; see also Gaus, 980 F.2d at 566-67. "[R]emoval cannot be based simply upon conclusory allegations' where the [complaint] is silent." Singer v. State Farm Mut. Auto. Ins. Co., 116 F.3d 373, 377 (9th Cir. 1997).

B. CCC Has Shown that the Amount in Controversy More Likely Than Not Exceeds $75, 000.

CCC removed this action based on diversity jurisdiction. (Doc. 1 ¶ 3.) The Haldimans contend that CCC has not met its burden to establish the requisite amount in controversy. The Haldimans did not specify the amount in controversy in their Complaint, which places the burden on CCC to establish, by a preponderance of the evidence, that the amount ...


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