William R. Harr and Finster Courier, Inc. d/b/a Elite Express, Appellants-Defendants/Cross-Appellees,
Julian Hayes and Tracey Hayes, Appellees-Plaintiffs/Cross-Appellants.
from the Marion Superior Court The Honorable John F. Hanley,
Judge Trial Court Cause No. 49D11-1510-CT-35449
ATTORNEYS FOR APPELLANTS Larry L. Barnard Grant A. Liston
Carson Boxberger LLP Fort Wayne, Indiana
ATTORNEYS FOR APPELLEES Nathaniel Lee Jennifer Lee Lee
Cossell & Crowley, LLP Indianapolis, Indiana
Summary and Issues
Following an accident between two semi-tractor trailers, a
lawsuit commenced between the two drivers, Julian Hayes
("Hayes") and William R. Harr, and Harr's
employer, Finster Courier, Inc., d/b/a/ Elite Express
(collectively, "Defendants"). The Defendants
attempted to remove the case to federal court contending the
parties were citizens of different states and that the amount
in controversy exceeded $75, 000. Hayes objected to removal,
arguing such action was premature and that the amount in
controversy did not exceed $75, 000. The district court
determined it lacked subject matter jurisdiction and remanded
the case to state court. Following a jury verdict in state
court of $187, 500 in favor of Hayes, the Defendants filed a
motion to correct error and asked the trial court to modify
the judgment to $75, 000 based on the doctrines of judicial
estoppel, waiver, and judicial admission. The trial court
denied the Defendants' motion and the Defendants now
appeal, raising the sole issue of whether the trial court
erred in denying their motion to correct error. Hayes
cross-appeals, arguing the appeal is frivolous and requesting
attorneys' fees. Concluding the trial court did not err
in denying the Defendants' motion to correct error and
that Hayes is not entitled to attorneys' fees, we affirm.
and Procedural History
On July 23, 2015, two semi-tractor trailers collided on
Interstate 465 causing injury to one of the drivers, Julian
Hayes. On October 26, 2015, Hayes filed suit in the Marion
Superior Court against the other driver, William Harr, and
Harr's employer, Finster Courier, Inc., d/b/a/ Elite
Express. Almost immediately, Defendants filed a
notice of removal alleging diversity of citizenship under 28
U.S.C. § 1332. 28 U.S.C. § 1332 provides, in
(a) The district courts shall 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--
(1) citizens of different States . . . .
The Defendants alleged that the district court possessed
diversity jurisdiction because "the amount in
controversy exceeds the sum or value of Seventy-Five Thousand
Dollars ($75, 000), exclusive of interest and costs,"
and that Harr is a citizen of Pennsylvania, Finster is
incorporated in New Jersey, and Hayes is a citizen of
Indiana. Appellees' Appendix, Volume II at 5-6. Upon the
Defendants' motion, the case was removed to the United
States District Court for the Southern District of Indiana,
Indianapolis Division. On December 16, 2015, Hayes filed a
motion to remand, arguing removal was "pre-mature in not
having conducted discovery to investigate the amount of this
claim or even inquire as to Plaintiff's demand."
Appellants' Corrected Appendix, Volume II at 52. Hayes
alleged that the district court lacked subject matter
3. Plaintiff further provides that diversity jurisdiction is
not met in this matter because the amount in controversy does
not exceed Seventy-Five Thousand Dollars ($75, 000.00).
* * *
6. On December 16, 2015, Plaintiff submitted his first demand
to Defendants in the amount of Seventy-Two Thousand, Five
Hundred Dollars ($72, 500.00). [Exhibit "I"].
7. Therefore, even if the citizenship of the parties is
diverse, the requirements of diversity jurisdiction under 28
U.S.C. §1441 are not met because the amount in
controversy does not exceed Seventy-Five Thousand Dollars
Id. at 52-53.
At the time of removal, Hayes had been released to return to
work full time but was receiving ongoing medical treatment
and had accumulated around $3, 500 in medical bills. His
workers compensation claim was still being processed. The
same day Hayes filed the motion to remand, he also submitted
a settlement demand for $72, 500. In response, the Defendants
sent a letter stating that they would agree to remand the
case if Hayes would "provide assurance that he would
not execute on any potential judgment over $75, 000,"
and included a proposed covenant not to execute. Id.
at 77. Hayes responded that "WE [sic] cannot agree to
any agreement without payment. Are you offering the $75, 000?
If so, send a check." Id.
On December 29, Defendants objected to remanding the case,
arguing the amount in controversy was clearly over $75, 000
because Hayes refused to sign the proposed covenant.
Id. at 78. On January 20, 2016, the district court
granted Hayes' motion to remand, determining that it
lacked subject matter jurisdiction because it is the removing
party's burden to establish by a preponderance of the
evidence that each requirement of 28 U.S.C. § 1332 has
been met and "Defendants have made no effort whatsoever
to explain why they had a good faith belief, at the time of
removal, that the amount in controversy exceeded $75,
000." Id. at 78-79.
With the case back in Marion Superior Court, Defendants filed
a motion to limit entry of judgment. The basis of the
Defendants' motion was the district court's grant of
Hayes' motion to remand in which Hayes asserted the
district court lacked subject matter jurisdiction
"because the amount in controversy does not exceed $75,
000." Id. at 46. Defendants therefore argued
that, "Under the doctrine of judicial estoppel, any
judgment entered in favor of the Plaintiffs in this case must
be limited to $75, 000.00." Id. at 47.
Defendants included in their motion to limit entry of
judgment what they purported to be a "true and exact
copy of the [district] Court's Order . . . marked as
Exhibit 'C.'" Id. However,
Defendants' Exhibit C omitted page 5 of the district
court's order in which the district court discussed the
Defendants' failure to meet their burden of proof
regarding each requirement of 28 U.S.C. § 1332.
On July 31, 2017, Hayes moved to strike the Defendants'
motion to limit damages. Hayes cited the omitted page of the
district court's order and argued "the [district]
Court order clearly demonstrates that the Defendants failed
to meet their burden to demonstrate all of the elements
necessary for federal court jurisdiction." Id.
at 64. In a supplemental response to the Defendants'
motion to limit entry of judgment, Hayes stated that since
the removal action, a physician had determined that Hayes had
an 8% permanent impairment and that his medical expenses
totaled over $21, 000. These facts, coupled with Hayes'
"ongoing and incomplete" treatment, Hayes argued,
caused the current value of the case to be
"substantially higher today than at the time this
lawsuit was filed." Id. at 87. Therefore, while
Hayes "would have gladly accepted $72, 500.00" at
the time of removal, "the value has increased and the
Defendant[s] owe more than the original amount in
controversy." Id. at 88.
A jury trial was conducted on August 8 and 9, 2017. The jury
returned a verdict for Hayes in the amount of $187, 500 and
the trial court subsequently denied Defendants' motion to
limit entry of judgment to $75, 000 and Defendants'
motion to correct error regarding the same. In so doing, the
trial court explained:
This Court remains troubled by the notion that a party may
represent to the U.S. District Court that the amount in
controversy in a case is less than the jurisdictional
requirement, and then, once remanded, that it exceeds that
amount. However, neither party has pointed to any precedent
which expressly prohibits such a practice. The parties
submitted this matter to a jury in this Court for
determination. The jury, as the trier of fact, determined
that the Plaintiffs' damages totaled One Hundred
Eight-Seven [sic] Thousand Five Hundred and 00/100 Dollars
($187, 500.00). The Court finds that the jury's verdict
should not be disturbed.
Order at 4.
Defendants now appeal and Hayes cross-appeals for an award of
attorneys' fees, costs, and post-judgment interest,
alleging that Defendants filed the underlying "frivolous
appeal, which is meritless and . . . filed in bad faith, for
purposes of harassment, and delay." Response Brief of
Appellee at 25.