Shepherd v. Boston Old Colony Ins. Co.
| Citation | 811 F. Supp. 225 |
| Decision Date | 23 November 1992 |
| Docket Number | Civ. A. No. S91-0455(G). |
| Parties | Albert SHEPHERD v. The BOSTON OLD COLONY INSURANCE COMPANY, A Non-resident Corporation. |
| Court | U.S. District Court — Southern District of Mississippi |
John L. Hunter, Pascagoula, MS, for plaintiff.
Roger C. Riddick, Wes W. Peters, Jackson, MS, for defendant.
This cause comes before the Court on the motion of the defendant, Boston Old Colony Insurance Company Boston, for dismissal for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) and/or summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure or alternatively, to transfer venue pursuant to 28 U.S.C. § 1404(a). The Court, having duly considered the record in this action, in addition to the briefs of counsel, and being fully advised in the premises, concludes as follows:
STATEMENT OF FACTS
The plaintiff herein, Albert Shepherd, a resident of Mississippi, twice injured his back in 1986 while working for Dale Homes, Inc. Dale Homes, a Louisiana corporation.1 Both injuries occurred in Louisiana in the course and scope of his employment with Dale Homes.2 Following the plaintiff's injuries, Dale Homes' workers' compensation carrier, the defendant Boston, a non-resident of Mississippi, paid weekly compensation benefits to the plaintiff until a dispute concerning entitlement to such benefits arose in 1989.
On January 10, 1990, the plaintiff filed a petition for workers' compensation in the United States District Court for the Eastern District of Louisiana seeking the reinstatement of payment of benefits, in addition to the assessment of statutory penalties for the defendant's alleged arbitrary and capricious denial of such benefits. In Shepherd v. Dale Homes, Inc., No. 89-5500, 1990 WL 109282 (E.D.La. July, 25, 1990), the court, applying Louisiana Workers' Compensation Law, found that the plaintiff was temporarily totally disabled and entitled to the disputed workers' compensation benefits. Shepherd, No. 89-5500, slip op. at 10, 1990 WL 109282. The court ordered that benefits be made current and that weekly payments be made at the maximum rate until the plaintiff's "current status of temporary total disability altered." Id. at 10, 13. Additionally, the court found that the defendants' termination and denial of benefits was arbitrary and capricious and accordingly awarded the plaintiff the statutory damages available under Louisiana Workers' Compensation Law. Id. at 11-14.
On August 22, 1991, the plaintiff filed the instant action in the Circuit Court of George County, Mississippi, seeking to recover $1,000,000 in compensatory damages and $5,000,000 in punitive damages for the defendant's alleged bad faith termination of the workers' compensation benefits which were at issue in Shepherd v. Dale Homes, Inc., No. 89-5500, 1990 WL 109282 (E.D.La. July 25, 1990), and for the defendant's alleged continued bad faith for refusing to pay, since the conclusion of the litigation in Louisiana, certain "medical and/or chiropractic bills" related to the plaintiff's workers' compensation claim. (Complaint, para. X, XII, at 4-5.) The plaintiff further contends that the conduct of the defendant "constitutes bad faith refusal to honor its obligations under the compensation acts under the laws of the State of Mississippi and the State of Louisiana. ..." (Complaint, para. XI, at 4.) The action was subsequently removed to this Court based on diversity of citizenship, 28 U.S.C. § 1332. On January 8, 1992, the defendant filed its motion to dismiss for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) and/or summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure. Alternatively, the defendant requests that the Court transfer the case to the United States District Court for the Eastern District of Louisiana pursuant to 28 U.S.C. § 1404(a).
As previously mentioned, the defendant has moved this Court to dismiss the action for lack of subject matter jurisdiction and/or for summary judgment pursuant to Rules 12(b)(1) and 56 respectively, of the Federal Rules of Civil Procedure. The Court notes that regardless of the how the motion is denominated, the defendant's briefs indicate that the basis of either a motion to dismiss or for summary judgment is that the Court lacks the subject matter jurisdiction to hear this cause. As such, the Court will first address the motion as one to dismiss pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure.
To support its motion to dismiss, the defendant contends that this action lies within the exclusive jurisdiction of the Louisiana Department of Labor, Office of Workers' Compensation Administration, or the United States District Court for the Eastern District of Louisiana, the court of original jurisdiction where the plaintiff's petition for workers' compensation benefits was filed. The defendant asserts that the litigation in the Eastern District of Louisiana was not a final disposition based on the following language contained in the judgment:
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Defendants continue weekly payments to Plaintiff at the maximum rate until his current status of temporary total disability alters.
The defendant relies upon this language to support its contention that the Louisiana Office of Workers' Compensation retains continuing and primary jurisdiction of any dispute concerning the payment of medical bills and treatment. Finally, the defendant asserts that "the Plaintiff has selected his `jurisdiction' by filing his claim in Louisiana where the benefits were greater than the benefits otherwise payable in Mississippi," and basically that this Court should hold the plaintiff to his choice.
In his response, the plaintiff has not addressed the defendant's jurisdictional claims. The plaintiff instead, asserts that a conflict of laws analysis must be accomplished to determine whether Mississippi's "bad faith" law or Louisiana's workers' compensation law applies. Prior to reaching this argument, the Court will address the defendant's jurisdictional contentions.
Although the defendant contends that this bad faith action lies within the exclusive jurisdiction of the Louisiana Office of Workers' Compensation or the United States District Court for the Eastern District of Louisiana, the defendant has failed to direct the attention of the Court to any supporting authority. Also, the Court knows of no authority requiring that it reach the result sought by the defendant. As to the defendant's assertion that the Louisiana litigation was not a final disposition, the Court agrees that the Louisiana Office of Workers' Compensation retains continuing jurisdiction of any dispute concerning the payment of medical bills and treatment incurred by the plaintiff. Additionally, the Eastern District of Louisiana has continuing jurisdiction to enforce the aforementioned judgment which it has rendered. The flaw in the defendant's position is that the defendant fails to recognize that this action is not one seeking to resolve a dispute as to whether the defendant is liable to pay for certain medical treatment or bills incurred by the plaintiff. That determination has already been made by the Eastern District of Louisiana. Instead, this action has evolved from the Eastern District's determination that the plaintiff was entitled to certain benefits under Louisiana workers' compensation law, to the present action allegedly grounded in Mississippi's bad faith law. In this action, the plaintiff seeks to recover compensatory and punitive damages for the defendant's alleged bad faith termination and denial of the same benefits to which the plaintiff was previously adjudged entitled under Louisiana law. The plaintiff seeks to recover for a separate and independent tort which allegedly occurred in whole or part in Mississippi. In light of the absence of any authority to the contrary, this Court finds that it has subject matter jurisdiction to hear the bad faith claim which the plaintiff asserts is controlled by Mississippi law. Therefore, the Court must deny the defendant's motion to dismiss for lack of subject matter jurisdiction.
In a diversity case, a federal court must apply the choice of law rules of the forum state. Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496, 61 S.Ct. 1020, 1021, 85 L.Ed. 1477 (1941). Since Craig v. Columbus Compress & Warehouse Co., 210 So.2d 645, 649 (Miss.1968) and Mitchell v. Craft, 211 So.2d 509, 512-16 (Miss.1968), Mississippi has applied and refined the most significant relationship test as set forth in the Restatement (Second) of Conflicts of Law. McDaniel v. Ritter, 556 So.2d 303, 310 (Miss.1989); Boardman v. United Services Auto. Ass'n, 470 So.2d 1024, 1030 (Miss.1985), answer conformed to, 768 F.2d 718 (5th Cir.1985), cert. denied, 474 U.S. 980, 106 S.Ct. 384, 88 L.Ed.2d 337 (1985). Under Mississippi law, the Restatement Second's most significant relationship test is commonly referred to as the "center of gravity" test. Boardman, 470 So.2d at 1031.
At the outset of a conflict of laws analysis, the Court is immediately confronted with the Mississippi Supreme Court's decision in White v. Malone Properties, Inc., 494 So.2d 576 (Miss.1986), wherein the court stated the following:
White v. Malone Properties, Inc., 494 So.2d 576, 578 (Miss.1986). In White, a...
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