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Smith v. Apple, Inc.

United States District Court, S.D. Indiana, Indianapolis Division

March 4, 2019

GREGORY W. SMITH, Plaintiff,
v.
APPLE, INC., Defendant.

          REPORT AND RECOMMENDATION

          Mark J. Dinsmore United States Magistrate Judge.

         The Court issued an Order to Show Cause why this matter should not be remanded to the court from which it was removed as the result of this Court's lack of subject matter jurisdiction over the case. [Dkt. 41.] Plaintiff responded, stating that he “does not allege and never has alleged that the amount in controversy, including out-of-pocket expenses, and all other damages, exceeds $75, 000.” [Dkt. 42 at 2.] For the reasons set forth below, the Magistrate Judge recommends the Court remand this case to the court from which it was removed.

         I. Background

         On November 7, 2017, Plaintiff Gregory Smith filed his Complaint against Defendant Apple Inc. in the Circuit Court of Hancock County, Indiana under Cause No. 30C01-1711-CT-001904. The Complaint alleges the following: on November 9, 2015, Plaintiff was carrying his iPhone in the front pocket of his pants, when suddenly and without warning, the device exploded. [Dkt. 1-1 at 6.] Consequently, Plaintiff was seriously injured, including burns on his thigh. [Id. at 7.] Plaintiff seeks damages for alleged severe and permanent injuries, medical and prescription expenses, physical and emotional pain, burns and scarring, and lost wages. [Dkt. 1-1.]

         On December 20, 2017, Defendant removed the case to federal court pursuant to 28 U.S.C. § 1332, alleging that this Court has diversity jurisdiction over the matter. [Dkt. 1.] The Notice states that Defendant is a California corporation with its principal place of business in California; Plaintiff is a citizen of Indiana; and based on the Complaint's allegations, the amount in controversy exceeds $75, 000, exclusive of interest and costs. [Dkt. 1 at 2.]

         Pursuant to Local Rule 81-1(b), Plaintiff was required to file a response to the Notice of Removal on or before January 19, 2018. S.D. Ind. L.R. 81-1(b). No such response was filed. Additionally, it came to the Court's attention that Plaintiff's total medical expenses relatable to this matter amount to $1, 674.90. [Dkt. 41 at 2.] Plaintiff claims a total of $2, 560.00 in lost wages, as well as the $649 cost of the iPhone at issue. [Id.] Consequently, the Court had serious reason to question its subject matter jurisdiction over this matter and ordered the parties to show cause why the issue should not be remanded. [Dkt. 41.]

         Plaintiff responded to the Order to Show Cause on October 1, 2018, requesting that the Court find it lacks subject matter jurisdiction, and that the matter be remanded to the Hancock County Circuit Court. [Dkt. 42 at 2.] On October 2, 2018, Defendant responded as well, stating that it removed this case to federal court based upon the parties' diversity of citizenship and a good-faith belief that Plaintiff's claims would exceed $75, 000. [Dkt. 43 at 1.] Furthermore, Defendant noted that Plaintiff has not yet outlined the amount of his claimed pain and suffering and permanent scarring damages, which, it argues, would likely cause the amount in controversy to exceed the statutory minimum. [Id. at 1-2.]

         II. Standard of Law

         Federal courts have original jurisdiction over “all civil actions where the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs, ” between citizens of different states. 28 U.S.C. § 1332(a)(1). “If at any time . . . it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c). Regardless of the “waste of effort” that results from a case partially or fully litigated in the wrong court, “both the Supreme Court and [the Seventh Circuit Court of Appeals] have noted time and again that subject matter jurisdiction is a fundamental limitation on the power of a federal court to act.” Del Vecchio v. Conseco, Inc., 230 F.3d 974, 980 (7th Cir. 2000). “[T]he propriety of removal is to be strictly construed against removal, with all doubts resolved in favor of remand.” People of the State of Ill. V. Kerr McGee Chem. Corp., 677 F.2d 571, 576 (7th Cir. 1982).

         The party seeking to invoke federal jurisdiction must establish both complete diversity of citizenship and that the “matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs.” 28 U.S.C. § 1332(a). The Court is satisfied that there is complete diversity among the parties; at issue here is only whether this case meets the amount in controversy requirement.

         “[T]he amount in controversy is the amount required to satisfy the plaintiff's demands in full on the day the suit begins, or in the event of removal, on the day the suit was removed.” Oshana v. Coca-Cola, Co., 472 F.3d 506, 510 (7th Cir. 2006). While the “notice of removal need include only a plausible allegation that the amount in controversy exceeds the jurisdictional threshold, ” the proponent of jurisdiction has the burden of showing by a preponderance of the evidence facts that suggest the speculated assertions when the plaintiff contests, or the court questions, the defendant's allegation. Dart Cherokee Basin Operating Co., LLC v. Owens, 135 S.Ct. 547, 554 (2014) (citing 28 U.S.C. §§ 1446(a), 1446(c)(2)(B)). That is easier said than done, however, when the plaintiff does not want to be in federal court and provides little information about the value of its claims. Oshana, 472 F.3d at 510. Or, similarly, in states that prohibit personal injury plaintiffs from listing a dollar figure in their claims for relief. See Ind. T.R. 8(A)(2). In such a case, “a [defendant's] good-faith estimate of the stakes is acceptable if it is plausible and supported by a preponderance of the evidence.” Oshana, 472 F.3d at 510.

         The amount in controversy is determined based on an evaluation of the controversy described in the plaintiff's complaint and the record as a whole, and it is determined as of the date of removal. Chase v. Shop ‘N Save Warehouse Foods, Inc., 110 F.3d 424, 428 (7th Cir. 1997). In making this determination, however, the Court is not limited to the evidence in the record at the time of removal, but may use whatever evidence “sheds light on the situation which existed when the case was removed.” Harmon v. OKI Sys., 115 F.3d 477, 479-80 (7th Cir. 1997).

         III. Discussion

         In claiming the jurisdictional amount is satisfied, Defendant relies on the Complaint's allegations of Plaintiff's damages, Plaintiff's response to Defendant's First Set of Interrogatories, Plaintiff's response to Defendant's Requests for Production of Documents, and Plaintiff's deposition testimony. Defendant argues that jurisdiction is proper in this Court because its “good faith basis for removal presently continues based on ...


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