United States District Court, N.D. Texas, Dallas Division
MEMORANDUM OPINION AND ORDER
BARBARA M. G. LYNN CHIEF JUDGE
the Court is Plaintiff's Motion to Remand (ECF No. 11).
For the following reasons, the Court GRANTS
the Motion and REMANDS the case to the 134th
Judicial District Court of Dallas County, Texas.
action concerns a dispute over Defendants' denial of
Plaintiff's insurance claim for property damage.
Plaintiff, a Texas citizen, filed an Original Petition in the
134th Judicial District Court of Dallas County, Texas against
Defendant State Farm Lloyds (“State Farm”), an
Illinois and Arizona corporation, and Defendant Teresa
Williams (“Williams”), a Texas citizen and
individual adjuster employed with State Farm. Pl.'s Orig.
Pet. [Docket Entry #1-1], Defs.' Notice of Removal at
¶ 9 [Docket Entry #1].
alleges that his property, allegedly covered by an insurance
policy issued by State Farm (“Policy”), sustained
hail and/or wind storm damage on June 9, 2015. Pl.'s
Orig. Pet. [Docket Entry #1-1] at ¶ 12. Plaintiff claims
that he asked State Farm to cover the cost of repairs
pursuant to the Policy. State Farm assigned Williams to
adjust and investigate the claim. Id. at ¶ 15.
Plaintiff alleges that State Farm wrongfully denied
Plaintiff's claims for repairs and did not provide full
coverage under his Policy. Id. at ¶ 21.
filed suit in state court for common law fraud, conspiracy to
commit fraud, and waiver against both State Farm and
Williams. Id. at pp. 13-15. Plaintiff asserts the
following causes of action against State Farm: (1) breach of
contract based on failure to pay adequate compensation under
the terms of the Policy; (2) violations of Sections 541 and
542 of the Texas Insurance Code; (3) breach of the common law
duty of good faith and fair dealing; and (4) fraud.
Id. at pp. 15-19. Plaintiff further asserts
violations of Section 541 of the Texas Insurance Code against
Williams. Id. at 9-12.
Farm and Williams removed the case to this Court, arguing
that Williams was improperly joined because Plaintiff failed
to state a claim against her and Williams' Texas
citizenship should therefore be disregarded for purposes of
diversity jurisdiction. Defs.' Notice of Removal [Docket
Entry #1] at ¶ 9. Plaintiff moved to remand, arguing
Williams was properly joined as a Defendant, and thus, there
is not complete diversity. [Docket Entry #11 at ¶ 2].
of any civil action filed in state court over which district
courts have original jurisdiction is proper under 28 U.S.C.
§ 1441(a). Federal courts have subject matter
jurisdiction under 28 U.S.C. § 1332 only where there is
diversity of citizenship between the parties and the amount
in controversy exceeds $75, 000, exclusive of interest and
costs. See 28 U.S.C. § 1332. Here, the parties
do not appear to dispute that the amount in controversy
exceeds $75, 000; therefore, subject matter jurisdiction
exists if the matter in controversy is between citizens of
different states. Id.; Halmekangas v. State Farm
Fire and Cas. Co., 603 F.3d 290, 294 (5th Cir. 2010).
Fifth Circuit applies the federal court pleading standard to
a plaintiff's state court petition for purposes of a
removal and improper joinder analysis. Int'l Energy
Ventures Mgmt., L.L.C. v. United Energy Grp.,
Ltd., 818 F.3d 193, 208 (5th Cir. 2016).
“[T]he petition as filed in state court controls the
inquiry.” See Cavallini v. State Farm Mut. Auto
Ins. Co., 44 F.3d 256, 264 (5th Cir. 1995).
defendant can establish improper joinder by (1) showing
either actual fraud in the pleading of jurisdictional facts
or (2) an inability to establish a cause of action against
the non-diverse defendant in state court. Waste Mgmt.,
Inc. v. AIG Specialty Ins. Co., No. CV H-16-3676, 2017
WL 3431816, at *3 (S.D. Tex. Aug. 9, 2017). The latter is
applicable here. To prevail, the removing defendant must show
that there is no possibility of recovery by the plaintiff
against the in-state defendant in state court. Travis v.
Irby, 326 F.3d 644, 649 (5th Cir. 2003). “If a
nondiverse defendant has been properly joined, then the
federal court has no jurisdiction and must remand the removed
case.” Arrow Bolt & Elec., Inc. v. Landmark Am.
Ins. Co., No. 3:17-CV-1894-M, 2017 WL 4548319, at *2
(N.D. Tex. Oct. 12, 2017) (Lynn, C.J.). If, on the other
hand, the nondiverse defendant has been improperly joined,
then remand must be denied, and the claims against the
nondiverse defendant should be dismissed without prejudice.
determine whether a plaintiff has a “reasonable basis
for recovery under state law . . . [t]he court may conduct a
Rule 12(b)(6)-type analysis.” Smallwood v. Ill.
Cent. R.R. Co., 385 F.3d 568, 573 (5th Cir. 2004) (en
banc); Anderson v. Georgia Gulf Lake Charles, 342
Fed.Appx. 911, 915 (5th Cir. 2009). To survive a 12(b)(6)
challenge, the petition must contain sufficient facts to
state a claim for relief that is plausible on its face.
Arrow Bolt, 2017 WL 4548319 at *1. Disputed
questions of fact are resolved in favor of the plaintiff, and
the court must then decide whether the plaintiff has any
possibility of recovery against the defendant whose joinder
is questioned. Carriere v. Sears, Roebuck and Co.,
893 F.2d 98, 100 (5th Cir 1990). If the court finds
a reasonable basis to predict that plaintiff can potentially
recover on any of the alleged causes of action, the court
must remand the entire case. Roach v. Vehicle, No.
3:15-CV-3228-G, 2016 WL 795967, at *4 (N.D. Tex. Feb. 29,
2016) (Fish, J.).
is a split of authority regarding whether an adjuster can be
held liable under Tex. Ins. Code § 541.060(a)(2)(A).
This Court has concluded that an insurance adjuster may be
held personally liable for engaging in unfair settlement
practices under § 541.060(a)(2). Martinez v. State
Farm Lloyds, No. 3:16-CV-00040-M, 2016 WL 4427489, at *2
(N.D. Tex. Aug. 22, 2016) (Lynn, C. J.); Progressive
Island, LLC v. Scottsdale Insurance Company, No.
3:13-CV-0741-M, 2013 WL 6065414, at *2-3 (N.D. Tex. Nov. 18,
2013) (Lynn, J.); See Denley Group, LLC v. Safeco
Insurance Company of Indiana, No. 3:15-CV-1183-B, 2015
WL 5836226, at *3-4 (N.D. Tex. Sept. 30, 2015) (Boyle, J.)
(finding that an insufficient investigation may well lead to
a less than fair settlement of a claim); (Lopez-Welch v.
State Farm Lloyds, No. 3:14-CV-2416-L, 2014 WL 5502277,
at *8 (N.D. Tex. Oct. 31, 2014) (Lindsay, J.); Shade Tree
Apartments, LLC v. Great Lakes Reinsurance (UK) PLC, No.
A-15-CA-843-SS, 2015 WL 8516595, at *6 (W.D. Tex. Dec. 11,
2015). Contra Messersmith v. Nationwide Mut. ...