Bonilla v. State Farm Mutual Automobile Insurance Company

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

ALFREDO BONILLA, CIVIL ACTION

Plaintiff

VERSUS NO. 24-341

STATE FARM MUTUAL SECTION: “E” (5)

AUTOMOBILE INSURANCE

COMPANY, ET AL.,

Defendants

ORDER AND REASONS

Before the Court is a Motion to Remand to State Court (“Motion to Remand”) filed

by Plaintiff Alfredo Bonilla.1 For the reasons that follow, Plaintiff’s motion is DENIED.

FACTUAL AND PROCEDURAL BACKGROUND

This case arises from an automobile accident occurring in St. John the Baptist

Parish, Louisiana.2 According to Plaintiff, on October 27, 2021, an underinsured motorist

crashed into the rear of the vehicle Plaintiff was driving, causing Plaintiff to suffer

“personal and bodily injuries, mental anguish, inconvenience, and sustained medical

bills.”3 Plaintiff alleges that, on October 13, 2022, he resolved his claims against the

motorist and the motorist’s insurer for the full limit of the motorist’s liability insurance

policy, which totaled $30,000.4

On August 2, 2023, Plaintiff filed suit in the 40th Judicial District Court for the

Parish of St. John the Baptist against Defendants State Farm Mutual Automobile

Insurance Company (“State Farm”) and Allstate Property and Casualty Insurance

1 R. Doc. 12.

2 R. Doc. 2-2 at ¶1.

3 Id. at ¶¶3-4.

4 Id. at ¶5.

Company (“Allstate”). 5 Plaintiff alleges State Farm and Allstate (collectively, the

“Defendants”) had in full force and effect policies of uninsured/underinsured automobile

insurance in favor of Plaintiff.6 Plaintiff’s state court petition seeks damages for his

“[m]ental pain and suffering,” “[p]hysical pain and suffering,” “[m]edical expenses,”

“[i]nconvenience,” “[l]oss of enjoyment of life,” “[p]ast lost wages and/or loss of future

earning capacity,” “[b]ad faith damages under [Louisiana Revised Statutes] 22:1973 and

[] 22:1892,” and “[a]ll damages allowed under Louisiana law which may be proven at the

trial of this matter.”7 Plaintiff’s state court petition does not assign specific amounts to the

claims asserted against the Defendants, his insurers.8

Defendants were served with the state court petition on August 15, 2023.9 On

October 24, 2023, Defendants served on Plaintiff a request that he admit his total

damages exceed $75,000.10 On January 10, 2024, Plaintiff responded to the Defendants’

request with an admittance.11 Further, Plaintiff responded to Defendants’ Interrogatories

and Requests for Production on the same date, informing them that Plaintiff was still

seeking medical treatment and providing his medical records.12

On February 7, 2024, Defendant State Farm removed the action to federal court

on the jurisdictional basis of diversity of citizenship.13 Plaintiff then filed the Motion to

Remand on March 7, 2024, arguing that the Notice of Removal was untimely because it

5 Id. at ¶7.

6 Id. at ¶¶1, 6.

7 Id. at ¶10.

8 See R. Doc. 2-2. Louisiana law forbids the pleading of a “specific monetary amount of damages” but

permits “a general allegation that the claim exceeds or is less than the requisite amount” required for federal

jurisdiction or other purposes. LA. CODE CIV. PROC. art. 893(A)(1).

9 R. Doc. 2 at ¶2.

10 Plaintiff’s Responses to Request for Admissions, R. Doc. 2-3.

11 Id. at Response to Admission No. 2.

12 Plaintiff’s Responses to Interrogatories and Requests for Production, R. Doc. 2-4.

13 R. Doc. 2. Allstate consented to the removal. R. Doc. 2-5.

was filed more than 30 days after he filed the state court petition, which he claims was

“removable on its face.”14 State Farm filed an opposition to the Motion to Remand,

arguing the Notice of Removal was timely because Defendants were first put on notice

that the amount-in-controversy exceeded $75,000 when Plaintiff responded to

Defendants’ discovery requests on January 10, 2024, less than 30 days before the Notice

of Removal was filed.15

LAW AND ANALYSIS

State Farm removed this action pursuant to 28 U.S.C. § 1441, invoking this Court’s

diversity jurisdiction under 28 U.S.C. § 1332. 16 Neither requirement of diversity

jurisdiction—that the parties be citizens of different states, and that the amount in

controversy exceed $75,00017—is in dispute. Rather, at issue is when it became clear that

the amount-in-controversy requirement was satisfied, and in turn, whether Defendants’

February 7, 2024 Notice of Removal was timely under 28 U.S.C. § 1446.

Plaintiff argues that State Farm’s removal was untimely. Plaintiff contends

Defendants’ time to remove expired on September 14, 2023, 30 days after Defendant was

served with Plaintiff’s state court petition on August 15, 2023. 18 Plaintiff claims his state

court petition was “removable on its face due to the allegations made against [Defendants]

under [Louisiana Revised Statutes] 22:1973 and [] 22:1892 regarding the insufficient sum

of monies previously paid and plaintiff’s allegations of bad faith.”19 State Farm responds

that its 30-day timeline to remove the case from state court did not begin until it received

14 R. Doc. 12-1 at p. 2.

15 R. Doc. 13.

16 R. Doc. 2 at p. 1.

17 28 U.S.C. § 1332(a).

18 See R. Doc. 12-1 at pp. 2, 4.

19 Id. at p. 2.

Plaintiff’s responses to Defendants’ discovery requests on January 10, 2024, and, as a

result, the Notice of Removal was timely. 20 State Farm’s argument prevails.

A. 28 USC § 1446 offers two tests for timely removal.

Federal courts are courts of limited jurisdiction and possess only the authority

conferred upon them by the United States Constitution or by Congress.21 Federal law

allows for state civil suits to be removed to federal courts in certain instances. Generally,

removal jurisdiction is governed by 28 U.S.C. § 1441(a), which provides:

Except as otherwise expressly provided by [an] Act of Congress, 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 and

division embracing the place where such action is pending.22

“The removing party bears the burden of showing that federal jurisdiction exists and that

removal was proper.”23

Two provisions of 28 U.S.C. § 1446 are relevant here.24 The first, 28 U.S.C. §

1446(b)(1), requires that when a case satisfies the requirements for federal jurisdiction

and is thus removable from state court, any notice of removal “shall be filed within 30

days” of a defendant’s receipt of “the initial pleading setting forth the claim for relief.”25

In the diversity-jurisdiction context, the Fifth Circuit has ruled that to trigger this 30-day

timeline under § 1446(b)(1), a plaintiff’s initial state court pleading must contain “a

specific allegation that damages are in excess of the federal jurisdictional amount.”26

20 See R. Doc. 13 at p. 2.

21 Howery v. Allstate Ins. Co., 243 F.3d 912, 916 (5th Cir. 2001).

22 28 U.S.C. § 1441(a).

23 See Manguno v. Prudential Property and Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002).

24 See Chapman v. Powermatic Inc., 969 F.2d 160, 161 (5th Cir. 1992) (“When read as a whole, § 1446(b)

provides a two-step test for determining whether a defendant timely removed a case.”); see also, e.g.,

Wright v. Nat’l Interstate Ins. Co., 2017 WL 344283 (E.D. La. Jan 24, 2017).

25 28 U.S.C. § 1446(b)(1).

26 Chapman, 969 F.2d at 163.

The second relevant provision, 28 U.S.C. § 1446(b)(3), provides a timeline for

removal when the initial pleading does not make clear the case is removable, but some

later filing does. In that instance, “a notice of removal may be filed within 30 days after

receipt by the defendant” of “an amended pleading, motion, order or other paper from

which it may be first ascertained that the case is one which is or has become removable.”27

The definition of “other paper” includes “information relating to the amount in

controversy” in those instances when “the case stated by the initial pleading is not

removable solely because the amount in controversy does not exceed” the $75,000

requirement for federal diversity jurisdiction.28 Further, “other paper” means that paper

“received by a defendant only after that defendant has received the initial pleading”29 and

produced by some “voluntary act by the plaintiff.” That is, “‘the defendant’s subjective

knowledge’ cannot begin the clock for removal.”30

B. Section 1446(b)(3) applies to this case and State Farm’s removal was

timely upon receipt of the “other paper” in the form of Plaintiff’s

responses to Defendants’ discovery requests.

The parties’ core disagreement is which provision of § 1446 applies, and thus, when

the 30-day period for Defendants to file their Notice of Removal began.

Plaintiff claims that the 30 days began no later than August 15, 2023, the date

Defendants were served with Plaintiff’s August 2, 2023 state court petition.31 Plaintiff first

argues that, even though his state court petition did not clearly allege damages in excess

of $75,000,32 “State Farm was well aware of the value or amount of controversy of

27 28 U.S.C. § 1446(b)(3) (emphasis added).

28 28 U.S.C. § 1446(c)(3)(A).

29 Chapman, 969 F.2d at 164 (emphasis added).

30 Daverede v. State Farm Fire & Cas. Co., 22-463, 2022 WL 1963713, at *2 (E.D. La. June 6, 2022) (quoting

S.W.S. Erectors, Inc., v. Infax, Inc., 72 F.3d 489, 494 (5th Cir. 1996)).

31 R. Doc. 12-1 at p. 4.

32 See R. Doc. 2-2.

Plaintiff’s claims as early as June 17, 2022, and certainly became aware through the

allegations contained in the Petition for Damages, which was served on August 15,

2023.”33 Specifically, Plaintiff contends he “provided a settlement demand, updated

medical reports, and confirmation of a policy limits settlement with the [motorist’s]

underlying [insurance] carrier” on June 17, 2022 (the “June 2022 Settlement Demand”),

which provided sufficient notice to Defendants that the amount in controversy exceeded

$75,000 before Plaintiff filed his state court petition. 34 Second, Plaintiff argues

Defendants were apprised that his claims exceeded the jurisdictional amount-in-

controversy threshold requirement based on the bad faith allegations in the petition,

alone.35

State Farm responds that Plaintiff’s petition “does not affirmatively reveal on its

face that Plaintiff seeks damages in excess of $75,000 exclusive of interests and costs,”

but “merely alleges a settlement occurred between plaintiff, the alleged defendant-driver

in the subject accident, and the tortfeasor’s insurer for $30,000 and further prays for

penalties and attorney’s fees pursuant to Louisiana’s bad faith statutes.”36 In opposition

to Plaintiff’s first argument, State Farm contends that, under Fifth Circuit law,

Defendants “w[ere] under no duty of ‘due diligence’ to ascertain based on approximations

or other materials provided before the suit was filed that the case was removable” when

they were served with the petition on August 15, 2023.37 In response to Plaintiff’s second

argument, State Farm notes that Plaintiff’s petition “only alleges general categories of

damages and a settlement between plaintiff, the defendant-driver, and the liability

33 R. Doc. 12-1 at p. 5.

34 Id.

35 Id. (citing Block L. Firm, APLC v. Bankers Ins. Co., 22-949, 2022 WL 2353378 (E.D. La. June 30, 2022)).

36 R. Doc. 13 at p. 5.

37 Id. (citing Chapman, 969 F.2d 160).

insurer for $30,000.”38 State Farm argues it “could not have ascertained from the petition

alone that the amount in controversy exceeded the diversity jurisdiction threshold”

because the value of Plaintiff’s “collateral settlement” with the underinsured motorist “has

no bearing on the calculation of damages for a bad faith claim.”39

For a purported diversity-jurisdiction case to be removable upon the initial

pleading, that pleading must “affirmatively reveal on its face that the plaintiff is seeking

damages in excess of the minimum jurisdictional amount of the federal court.”40 While

Louisiana law does not allow a plaintiff to plead a specific amount of money damages, it

does permit a plaintiff to allege that the damages sought affirmatively meet or fail to meet

a specific jurisdictional threshold.41 Plaintiff did not do so here, and in the initial-pleading

removal context, courts may not speculate about the jurisdictional sufficiency of generally

stated damages 42 nor hold defendants responsible for whether their “subjective

knowledge”43 suggests removal is proper upon the initial pleadings.

Indeed, certain “practical ramifications” underlie the requirement that plaintiffs

be specific and deliberate as to the jurisdictional consequences of the damages they

claim.44 Under this rule, courts operate more efficiently, avoiding “copious time” spent in

search of what a defendant knew or “should have known” upon receipt of the initial

pleading.45 Even more, defendants need not “remove cases prematurely” for “fear of

accidentally” missing the 30-day window of § 1446(b)(1) when the initial pleading does

38 Id. at p. 7.

39 Id.

40 Chapman, 969 F.2d at 163; Mumfrey v. CVS Pharmacy, Inc., 719 F.3d 392, 399 (5th Cir.2013).

41 See supra note 8.

42 See, e.g., Welp v. Hanover Ins. Co., 07-8859, 2008 WL 235348 (E.D. La. Jan. 28, 2008); Shaw, et al. v.

Wal-Mart Louisiana, LLC, et al., 2022 WL 123248, (E.D. La. Jan. 13, 2022).

43 Daverede, 2022 WL 1963713, at *2.

44 Mumfrey, F.3d at 399 (citing Chapman, 969 F.2d at 163).

45 Id.

not obviously satisfy removal criteria.46 Rather, failing any “specific allegation that

damages are in excess of the federal jurisdictional amount,”47 a defendant may remove a

case within 30 days of receiving the “other paper” from which it may ascertain that the

case is removable.48

Plaintiff’s state court petition did not satisfy the “bright line rule” that requires a

plaintiff to make a specific allegation of damages in excess of “the federal jurisdictional

amount” to start the 30-day clock for removal.49 The only specified amount of damages

in the petition is the $30,000 Plaintiff claims he received from the underinsured motorist

in the subject accident and the motorist’s liability insurer.50 That is not a specific

allegation that Plaintiff’s claims in this action exceed the jurisdictional amount.51

Moreover, Plaintiff did not avail himself of the option provided by Louisiana law to

affirmatively state the $75,000 threshold would be exceeded.52 As a result, this case was

not removable upon service of that initial pleading.53

Further, under Fifth Circuit law, the June 2022 Settlement Demand that Plaintiff

provided to the Defendants before he filed suit on August 2, 2023 was insufficient to

46 Id.

47 Chapman, 969 F.2d at 163.

48 28 U.S.C. § 1446(b)(3).

49 See Chapman, 969 F.2d at 163.

50 See R. Doc. 2-2.

51 Chapman, 969 F.2d at 163.

52 See LA. CODE CIV. PRO. art. 893(A)(1).

53 In his Motion to Remand, Plaintiff urges the Court to follow Block Law Firm, APLC v. Bankers Ins. Co.,

22-949, 2022 WL 2353378 (E.D. La. June 30, 2022) as an example of how to avoid Chapman’s “specific

allegation rule.” Plaintiff argues that, pursuant to Block Law Firm, Defendants were on notice that the

damages exceeded $75,000 because the petition asserted claims for penalties and attorneys’ fees under

Louisiana’s bad faith statutes. See R. Doc. 12-1. That misreads the case. In Block Law Firm, Chief Judge

Brown ruled that Plaintiffs had made a specific allegation that the amount in controversy exceeded $75,000

because the initial Louisiana state court petition sought $58,203.12 in damages for outstanding insurance

payments and “penalties against the insurer in an amount not to exceed . . . two times the damages

sustained.” Block Law Firm, 2022 WL 2353378, at *4 (omission and emphasis in original). Two times the

damages of $58,203.12 was $116,406.24, a specific and unambiguous allegation that the amount in

controversy exceeded the $75,000 threshold of § 1332. In this case, no such clarity can be found in Plaintiff’s

state court petition.

trigger the time period for Defendants to remove the case.54 Indeed, “[b]y its plain terms

[28 U.S.C. § 1446(b)(3)] requires that if an ‘other paper’ is to trigger the thirty-day time

period[,] . . . the defendant must receive the ‘other paper’ only after it receives the initial

pleading.”55 As a result, the Court does not consider Defendants’ receipt of Plaintiff’s June

2022 Settlement Demand or any other knowledge Defendants may have had prior to the

filing of the instant suit on August 2, 2023.

Instead, Plaintiff’s January 10, 2024 responses to Defendants’ discovery requests

constituted the “other paper” in this case that allowed State Farm to ascertain the case

was removable to federal court. Unlike the state court petition, in response to Defendants’

discovery requests, Plaintiff admitted the total amount of his damages exceed $75,00056

and, in support, informed Defendants that he was still seeking medical treatment and

provided his medical records.57 These discovery responses clearly supported an amount

in controversy in excess of the $75,000 threshold for diversity jurisdiction. Moreover, the

responses were received after the initial pleadings and obviated any need for Defendants

to rely on subjective knowledge in their efforts to determine the amount in controversy.

Defendants’ 30-day period to remove under 28 U.S.C. § 1446(b)(3) began on that day,

January 10, 2024, and expired on February 10, 2024, three days after Defendant State

Farm timely filed the Notice of Removal.

Accordingly, because State Farm removed this case less than 30 days after

Defendants received the “other paper,” the removal was timely.

54 See Chapman, 969 F.2d at 164.

55 See id. (emphasis added).

56 Plaintiff’s Responses to Request for Admissions, R. Doc. 2-3 at Response to Admission No. 2.

57 Plaintiff’s Responses to Interrogatories and Requests for Production, R. Doc. 2-4.

C. The Court will deny State Farm’s request for attorneys’ fees and costs.

State Farm requests attorneys’ fees and costs incurred by the filing of its opposition

be assessed against Plaintiff because “[P]laintiffs arguments ignore the Fifth Circuit’s

thirty [] year-old ‘bright-line’ rule on the issue.”58 The Court disagrees that the award of

attorneys’ fees and costs is warranted in this case.

Accordingly, the Court will deny Plaintiffs request for attorneys’ fees and costs.

CONCLUSION

For the foregoing reasons, IT IS ORDERED that Plaintiffs Motion to Remand is

DENIED.59

IT IS FURTHER ORDERED that State Farm’s request for attorneys’ fees and

costs incurred by the filing of its opposition to Plaintiffs Motion to Remand is

DENIED.°°

New Orleans, Louisiana, this 3rd day of April, 2024.

Sse fone □

SUSIE MORGAN

UNITED STATES DISTRICT JUDGE

58 R, Doc. 13 at p. 1.

59 R. Doc. 12.

60 R, Doc. 13.

10