United States District Court, N.D. Texas, Dallas Division
RONALD E. COHEN, et al., Plaintiffs,
SENECA INSURANCE CO., INC., J.S. HELD, INC., HAAG ENGINEERING CO., and R. KEAN JENNER, Defendants.
MEMORANDUM OPINION AND ORDER
Lindsay United States District Judge.
the court is Plaintiffs' Motion to Remand and for
Attorney's Fees, filed June 25, 2015 (Doc. 4). After
considering the motion, briefing, record, and applicable law,
the court grants Plaintiffs' Motion to Remand and denies
Plaintiffs' request for attorney's fees.
lawsuit arises out of an insurer's alleged failure to
properly adjust and pay all appropriate amounts for storm
damage to Plaintiffs' commercial structures under an
insurance policy. Plaintiffs are the owners of two commercial
properties (collectively, the "Properties"), one
located at 2021 North Town East Boulevard in Mesquite, Texas
(the "Town East Property"), and the other located
at 4901 Ross Avenue, Dallas, Texas (the "Ross Avenue
Property"). Pis.' Sec. Am. Orig. Pet. 113, attached
as Ex. 5 to Defs.' Not. of Removal (Doc.
purchased insurance policies from Defendant Seneca Insurance
Company, Inc. ("Seneca"), effective December 1,
2011 to December 1, 2013 (the "Policies"), to
insure the Properties. Id. ]f 14. Severe wind and
hail damaged the Town East Property on April 3, 2012, and
damaged the Ross Avenue Property on March 9, 2013
(collectively, the "Losses"). Id.
Plaintiffs notified Seneca of the Losses in compliance with
the terms of the Policies and fully complied with all
conditions precedent for recovery under the Policies as a
result of the Losses. Id. Seneca hired Defendants
J.S. Held, Inc. ("J.S. Held") and Haag Engineering
Company ("Haag") as "insurance adjusters and
consultants" to "measure, document, estimate, and
adjust the damage to the roofs of the Properties."
Id. ]f 15. Haag, in turn, had its employee,
Defendant R. Kean Jenner ("Jenner"), visit the
Properties to "measure, document, and adjust the
claim." Id. Jenner traveled to the Properties
but failed and refused to conduct a thorough investigation.
Id. ]f 16. At the Ross Avenue Property, Jenner found
a "large number of small bare spots" on the roof,
and attributed them to the "caustic effects of pigeon
droppings." Id. At the Town East Property,
Jenner found "a large number of circular chips" and
attributed them to hail events that occurred "a long
time ago." Id. In making this determination,
Jenner noted a "modest number of bruises" in the
roof membrane. Id. Defendant Haag had inspected the
same roof in 2011 and found "no evidence of any
hailfall, old or new, with hailstones sufficient to
bruise" the roofing material. Id.
allege that, following Jenner's findings, J.S. Held,
Haag, and Jenner, jointly and severally, "made a
coverage determination that the hail damage was not covered
and failed and refused to provide coverage for the
Plaintiffs' Loss." Id. If 17. Plaintiffs
further allege that "Defendants' failure to provide
coverage under the terms of the policies in question is a
breach of the policies, and violates the Texas Insurance Code
and the Unfair Claims Settlement Practices Act."
February 19, 2015, Plaintiffs filed their Original Petition
in County Court at Law No. 1, Dallas County, Texas. On April
21, 2015, Plaintiffs filed their First Amended Original
Petition, which was mistakenly labeled as their Second
Amended Original Petition. See Pis.' Sec. Am.
Orig. Pet., attached as Ex. 5 to Defs.' Not. of Removal
(Doc. 1-5). For purposes of consistency, the court will
continue to refer to the pleading at the time of removal as
Plaintiffs' Second Amended Original Petition.
Ronald Cohen ("Cohen") is a Texas
citizen. Plaintiffs Morben Realty Company, Inc. and
Ronco Realty are both incorporated under the laws of Texas
with principal places of business in Dallas County, Texas,
and are, therefore, Texas citizens for purposes of diversity
jurisdiction. 28 U.S.C. § 1332(c)(1). Plaintiff Mateo is
alleged, on information and belief, to be a citizen of Texas.
Seneca is incorporated under the laws of New York with its
principal place of business in New York, New York, and is,
therefore, a citizen of New York. Defendant J.S. Held is
incorporated under the laws of Texas with its principal place
of business in Dallas, Texas, and is, therefore, a citizen of
Texas. Defendant Haag is incorporated under the laws of Texas
with its principal place of business in Dallas, Texas, and
is, therefore, a citizen of Texas. Defendant Jenner is a
citizen of Texas.
assert that Seneca has not performed its contractual duties
under the Policies and failed to settle their claims in a
fair manner. Plaintiffs also contend that Defendants'
failure to properly adjust and inspect, and later fully
compensate them, constitute violations of the Texas Insurance
Code. Plaintiffs allege causes of action for breach of
contract, violations of Chapters 541 and 542 of the Texas
Insurance Code, violations of Section 17.50(a)(4) of the
Texas Business and Commerce Code ("DTPA"), common
law bad faith, tortious interference, conspiracy, fraudulent
misrepresentation, fraudulent inducement, and breach of
27, 2015, Defendants removed the case to this court,
contending that complete diversity of citizenship exists
between the parties and that the amount in controversy
exceeds $75, 000, exclusive of costs and interest. Defendants
contend that Haag, J.S. Held, and Jenner, all nondiverse
parties, were improperly joined to defeat diversity
jurisdiction, and, therefore, urge the court to disregard
their citizenship. On June 25, 2015, Plaintiffs moved to
remand the case to County Court at Law No. 1, Dallas County,
Texas, arguing that the nondiverse Defendants were properly
joined in this lawsuit, thereby requiring remand. The motion
has been fully briefed and is ripe for adjudication.
Applicable Legal Standards
courts are courts of limited jurisdiction and possess only
that power authorized by the United States Constitution or by
statute. Kokkonen v. Guardian Life Ins. Co. of Am.,511 U.S. 375, 377 (1994) (citations omitted). Unless Congress
expressly provides otherwise, a defendant may remove a state
court civil action to a federal district court if the
district court has original jurisdiction over the action. 28
U.S.C. § 1441(a). A federal court has original
jurisdiction over civil actions in which there is diversity
of citizenship between the parties and the amount in
controversy exceeds $75, 000, exclusive of interest and
costs. 28 U.S.C. § 1332(a). The statute requires
complete diversity of citizenship; that is, a district court
cannot exercise subject matter jurisdiction if any plaintiff
shares the same citizenship as any defendant. See
Corfield v. Dallas Glen Hills LP,355 F.3d 853, 857 (5th
Cir. 2003) (citing Strawbridge v. Curtiss, 7 U.S. (3
Cranch) 267 (1806)). In considering citizenship, however, the
court considers only the citizenship of real and substantial
parties to the litigation; it does not take into account
nominal or formal ...