United States District Court, D. Arizona
ORDER
Douglas L. Rayes United States District Judge
Plaintiffs
Stephen and Carol O'Bresley initiated this action by
filing a complaint in Maricopa County Superior Court on June
25, 2018. (Doc. 1-3 at 2.) Defendant Farm Bureau Property
& Casualty Insurance Company subsequently removed the
action to federal court, asserting subject matter
jurisdiction under 28 U.S.C. § 1332. (Doc. 1.) Before
the Court is Plaintiffs' motion to remand (Doc. 14),
which is fully briefed (Docs. 15, 18).[1] For the reasons
stated below, the motion is granted.[2]
I.
Background
Plaintiffs
are the insureds under a homeowners' insurance policy
issued by Defendant. (Doc. 1-3 at 2-3.) Plaintiffs allege
that their home suffered fire- and smoke- related damage in
June 2017. (Id. at 4.) They contend that the smoke
damage and related losses are covered under the
homeowners' insurance policy, but that Defendant
unreasonably handled their claim. (Id.) Plaintiffs
assert claims against Defendant for breach of contract and
breach of the covenant of good faith and fair dealing.
(Id. at 8-9.) They also seek to compel an appraisal.
(Id. at 9-10.) The amount in controversy is not
apparent from the face of the complaint, but Plaintiffs seek
general and special damages, including compensatory damages,
damages for funds still owing under the homeowners'
insurance policy, damages for mental and emotional distress,
punitive damages, as well as attorneys' fees and costs.
(Id. at 11.)
Along
with the complaint, Plaintiffs filed a Certificate Regarding
Compulsory Arbitration (Doc. 1-4) and an Offer of Judgment
letter (Doc. 1-7). The Certificate Regarding Compulsory
Arbitration certified that Plaintiffs' claims are not
subject to compulsory arbitration under Arizona law because
the amount in controversy exceeds $50, 000. (Doc. 1-4.) The
Offer of Judgment requested $74, 000 “inclusive of all
damages, all taxable court costs, all interest, and all
attorneys' fees.” (Doc. 1-7 at 2-3.)
Plaintiffs
served the summons, complaint, Certificate Regarding
Compulsory Arbitration, and Offer of Judgment letter via
service on Defendant's designated statutory agent, the
Arizona Department of Insurance (“ADOI”), on July
10, 2018. (Doc. 14 at 2.) On July 13, 2018, Defendant
received the documents. (Doc. 1 at 2.) On August 10, 2018,
Defendant removed the matter to this Court. (Doc. 1.)
II.
Legal Standard
Any
civil action brought in state court over which the federal
district courts have original jurisdiction may be removed by
the defendants to the federal district court for the district
where the action is pending. 28 U.S.C. § 1441(a). A
notice of removal must “be filed within 30 days after
the receipt by the defendant, through service or otherwise,
of a copy of the initial pleading . . . .” 28 U.S.C.
§ 1446(b). Although the statutory time limit for removal
petitions is procedural, not jurisdictional, the time limit
nonetheless is mandatory and a timely objection to a late
notice of removal will defeat removal. See Smith
v. Mylan Inc., 761 F.3d 1042, 1045 (9th Cir. 2014).
When
removal is based on diversity jurisdiction, complete
diversity among parties must exist and the matter in
controversy must exceed $75, 000. 28 U.S.C. § 1332(a).
If the complaint does not demand a specific dollar amount,
the defendant “must prove, by a preponderance of the
evidence, that the amount in controversy meets the
jurisdictional threshold.” Matheson v. Progressive
Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003).
Doing so requires more than “conclusory allegations,
” Singer v. State Farm Mut. Auto. Ins. Co.,
116 F.3d 373, 377 (9th Cir. 1997); a removing defendant must
offer evidence that it is “more likely than not”
that the amount in controversy exceeds $75, 000, Sanchez
v. Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir.
1996). A case will be remanded “if there is any doubt
as to the right of removal in the first instance.”
Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir.
1992).
III.
Discussion
It is
undisputed that Plaintiffs are citizens of Arizona and
Defendant is an Iowa corporation with its principal place of
business in West Des Moines, Iowa. (Doc. 1 at 3.) Plaintiffs
argue, however, that Defendant untimely noticed its removal
and, alternatively, that the amount in controversy does not
exceed $75, 000. (Doc. 14.)
A.
Timeliness of Removal
Pursuant
to A.R.S. § 20-221(B), Plaintiffs were required to serve
Defendant through the ADOI. The parties dispute whether the
30-day clock for removal began to run when Plaintiffs served
process on the ADOI, or when the ADOI forwarded the pleadings
to Defendant three days later. (Doc. 14 at 3; Doc. 15 at 2.)
Under
§ 1446(b), the 30-day removal period begins to run
“after the receipt by the defendant . . . of a copy of
the initial pleading.” 28 U.S.C. § 1446(b). In
enacting this provision, Congress intended to safeguard
defendants from not having “access to the complaint
before commencement of the removal period.” See
Befort v. Farm Bureau Prop. & Cas. Ins. Co., No.
CV-18-02564-PHX-RM, 2018 WL 5792339, at *2 (D. Ariz. Nov. 5,
2018) (quoting Murphy Bros., Inc. v. Michetti Pipe
Stringing, Inc., 526 U.S. 344, 351-52 (1999)).
Consistent with this purpose and with other district court
decisions within the Ninth Circuit, the Court concludes that
the removal period begins to run from the date a defendant
actually receives the complaint, not merely from the ...