Lumbermans Mutual Casualty Company v. Fishman, CIVIL ACTION NO. 99-0929 (E.D. Pa. 9/22/1999), CIVIL ACTION NO. 99-0929.
| Decision Date | 22 September 1999 |
| Docket Number | CIVIL ACTION NO. 99-0929. |
| Parties | LUMBERMANS MUTUAL CASUALTY COMPANY, v. ALAN B. FISHMAN and FAYE FISHMAN. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
Presently before this Court are the consolidated actions of Alan Fishman ("Mr. Fishman") and Kaye Fishman (collectively hereinafter, the "Fishmans" or the "Defendants") and Lumbermans Mutual Casualty Company (hereinafter, "Lumbermans" or the "Plaintiff"). The Court first considers the Fishmans' Motion to Remand (Docket No. 3), the Fishmans' Praecipe to Attach Supplemental Exhibit (Docket No. 8), and Lumbermans' Answer to Remand (Docket No. 10). For the reasons stated below, the Fishmans' Motion to Remand is DENIED.
The Court next considers the Fishmans' Motion to Dismiss Lumbermans' Complaint Pursuant to F.R.C.P. 12(b)(1) (Docket No. 5) and Lumbermans' Response to the Fishmans' Motion to Dismiss (Docket No. 7). For the reasons stated below, the Fishmans' Motion to Dismiss is DENIED.
This action arises out of a February 14, 1999 auto accident in which Mr. Fishman allegedly suffered injuries. At the time of the accident, Mr. Fishman was an employee of Cintas Corporation ("Cintas") and allegedly suffered injuries while driving a Cintas vehicle. The Cintas vehicle was insured by Lumbermans.
The Fishmans made a claim against the operator and owners of the other vehicle and their insurance carrier, Allstate Insurance Company ("Allstate"). Allstate tendered the $50,000.00 liability limit of coverage to the Fishmans. The Fishmans then made a claim upon Lumbermans for recovery of underinsured motorists ("UIM") benefits under Cintas' insurance policy. Lumbermans denied the Fishmans' claim. Lumbermans thereafter filed suit against the Fishmans, seeking declaratory and injunctive relief. The Fishmans then filed a Petition to Compel Arbitration in the Court of Common Pleas of Philadelphia County to recover underinsured motorist benefits under the Cintas policy. Lumbermans filed a Motion for Removal. Upon grant of Lumbermans' Motion, the Fishmans filed the instant Motion to Remand. The Fishmans then filed the instant Motion to Dismiss under federal Rule of Civil Procedure 12(b)(1) on the basis that this Court lacks subject matter jurisdiction over this matter.
Additionally, this Court granted Lumbermans' unopposed Motion to Consolidate on May 4, 1999. Accordingly, this Court considers in this Memorandum Fishmans' motions for remand and dismissal and all relevant responsive pleadings to said motions.
The Court first decides the Fishmans' Motion to Remand for this decision affects this Court's jurisdiction over other pending matters in this action, including the Fishmans' Motion to Dismiss.
In general, a party may remove a civil action filed in state court if the federal court would have had original jurisdiction to hear the matter. See 28 U.S.C. § 1441(b) (1999); see also Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990), cert. denied, 498 U.S. 1085 (1991). Once the case has been removed, however, the federal court may remand if there has been a procedural defect in removal, or if the court determines that it lacks federal subject matter jurisdiction to hear the case. See 28 U.S.C. § 1447(c) (1999); see also Township of Whitehall v. Allentown Auto Auction, 966 F. Supp. 385, 386 (E.D.Pa. 1997). Upon a motion to remand, it is always the moving party's burden to establish the propriety of removal, and all doubts as to the existence of federal jurisdiction must be resolved in favor of remand. See Batoff v. State Farm Ins. Co., 977 F.2d 848, 851 (3d Cir. 1992); Independent Mach. Co. v. International Tray Pads & Packaging, Inc., No. CIV.A.97-2987, 1998 WL 35002, at *2 (D.N.J. Jan. 5, 1998).
The Fishmans argue that remand in proper because this Court lacks subject matter jurisdiction over this controversy. The Fishmans reason that federal jurisdiction is improper because Lumbermans' Motion for Removal was filed in response to their Petition to Compel Arbitration, that their Petition to Compel does not seek monetary damages, and, therefore, that the $75,000.00 amount in controversy requirement of 28 U.S.C. § 1332 cannot be satisfied. (Fishmans' Mem. of Law in Supp. of [Lumbermans'] Mot. to Remand at 4). The Fishmans further reason that jurisdiction cannot be exercised because their Petition to Compel does not seek monetary damages but only seeks to change the forum in which this controversy will be resolved. (Fishmans' Mem. of Law in Supp. of [Lumbermans'] Mot. to Remand at 4-5).
Lumberman, relying on Third Circuit case law, argues that a Petition to Compel Arbitration which was properly removed to federal court may not be remanded unless the award resulting from the desired arbitration cannot possibly exceed the $75,000.00 amount in controversy requirement of 28 U.S.C. § 1332. (Lumberman's Ans. Mot. to Remand at 3-5). Lumberman cites Manze v. State Farm Ins. Co., 817 F.2d 1062 (3d Cir. 1987), for the proposition that where a court considers the jurisdictional amount requirement when deciding whether to remand a Petition to Compel Arbitration (or other similar petition), "the court should look through to the possible award resulting from the desired arbitration, since the petition to compel arbitration is only the initial step in a litigation which seeks as its goal a judgment affirming the award." Id. at 1068.
In Manze, the petitioner ("Manze") argued that her Petition to Appoint an Arbitrator was not removable pursuant to 28 U.S.C. § 1441 and that the district court lacked jurisdiction because the amount in controversy requirement was unsatisfied. Id. The Third Circuit disagreed, holding that Manze's Petition to Appoint an Arbitrator was removable because she never stated that her claim would total less than the amount in controversy requirement. Id.
The instant matter and Manze are similar factually. The Fishmans seek to reform their UIM policy to add $1,000,000.00 in additional insurance coverage. This Court adopts the Manze court's reasoning and holds that Lumbermans' removal was proper because an arbitrator's award in this matter may exceed the $75,000.00 jurisdictional amount in controversy requirement of 28 U.S.C. § 1332. After all, the Fishmans wish to reform their insurance policy to include $1,000,000.00 of UIM insurance coverage. Accordingly, in recognition that an arbitrator's award may exceed $75,000.00, the Fishmans' Motion to Remand is DENIED, thereby vesting this Court with continued jurisdiction over this matter. The Court now considers the Fishman's Motion to Dismiss.
Pursuant to Federal Rule of Civil Procedure 12(b)(1), a district court may grant a dismissal based on the legal insufficiency of a claim. Dismissal is proper only when the claim clearly appears to be either immaterial and solely for the purpose of obtaining jurisdiction, or is wholly insubstantial and frivolous. Kehr Packages, Inc. v. Fudelcor, Inc., 926 F.2d 1406, 1408-09 (3d Cir.), cert. denied, 501 U.S. 1222, 111 S.Ct. 2839 (1991). When the subject matter jurisdiction of the court is challenged, the party that invokes the court's jurisdiction bears the burden of persuasion. Kehr Packages, Inc., 926 F.2d at 1409 (citation omitted). Moreover, the district court is not restricted to the face of the pleadings but may review evidence to resolve factual disputes concerning the existence of jurisdiction. McCarthy v. United States, 850 F.2d 558, 560 (9th Cir. 1988) (citation omitted), cert. denied, 489 U.S. 1052, 109 S.Ct. 1312 (1989).
Lumbermans filed a Complaint Seeking Declaratory and Injunctive Relief pursuant to the Federal Declaratory Relief Act (the "Act"). . The Fishmans argue that the Act empowers this Court to refuse to exercise its discretionary jurisdiction over this matter and that this Court, for the reasons discussed below, should refuse to exercise jurisdiction over Lumbermans' Complaint Seeking Declaratory and Injunctive Relief.
At the center of this controversy is the parties' conflicting interpretation and proposed application of 75 Pa. Cons. Stat. Ann. § 1731(c.1), which sets forth the availability, scope, and amount of uninsured and underinsured motorist coverage under Pennsylvania law. Section 1731(c.1) states in pertinent part:
Insurers shall print the rejection forms required by subsections (b) [uninsured motorist coverage] and (c) [underinsured motorist coverage] on separate sheets in prominent type and location. . . . Any rejection form that does not specifically comply with this section is void. If the insurer fails to produce a valid rejection form, uninsured or underinsured coverage, or both, as the case may be, under that policy shall be equal to the bodily injury liability limits.
75 Pa. Cons. Stat. Ann. § 1731 (West 1999) (emphases added).
Recent federal court decisions, as relied on by Lumbermans, interpret section 1731(c.1) to mean that while uninsured and underinsured coverage waivers must appear on separate pages, each waiver may be printed on a page that also contains other provisions of the insurance policy. See Nationwide Mutual Ins. Co. v. Monteith, CIV.A. No. 96-7907, 1997 WL 87280, at *3 (E.D.Pa. February 26, 1997) (); Estate of Franks v. Allstate Ins. Co., 895 F. Supp. 77, 91 (E.D.Pa. 1995) ().
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