United States District Court, S.D. Texas, Corpus Christi Division
ORDER ON MOTION TO REMAND
GONZALES RAMOS UNITED STATES DISTRICT JUDGE.
Avalanche Food Group, LLC and AFG SPID, Inc. filed this
action against their insurance carriers,  along with their
independent adjuster, Jay Adame, Sr. (Adame), alleging
violations of the Texas Insurance Code. At issue is a
claim for business interruption losses caused by a city-wide
water contamination event on or about December 15, 2016.
Plaintiffs originally filed the action in the 94th Judicial
District Court of Nueces County, Texas on August 31, 2017.
Carriers removed the action to this Court on October 27,
2017, within thirty days of being served with the summons and
complaint. D.E. 1, ¶ 4. The basis for removal is
diversity jurisdiction pursuant to 28 U.S.C. § 1332. It
is undisputed that the amount in controversy requirement is
met. However, Defendant Adame is a Texas citizen, destroying
the diversity of citizenship requirement. In support of
federal jurisdiction, the Carriers argue that Defendant Adame
is improperly joined such that the Court may disregard his
the Court is Plaintiffs' motion to remand (D.E. 10), in
which Plaintiffs defend against the improper joinder
argument. The Carriers have filed their response (D.E. 17).
For the reasons set out below, the Court GRANTS the motion to
remand (D.E. 10).
Standard of Review
motion to remand, “[t]he removing party bears the
burden of showing that federal jurisdiction exists and that
removal was proper.” Manguno v. Prudential Prop.
& Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002).
“Any ambiguities are construed against removal because
the removal statute should be strictly construed in favor of
remand.” Id. The strict construction rule
arises because of “significant federalism
concerns.” See generally, Shamrock Oil & Gas
Corp. v. Sheets, 313 U.S. 100, 108-09 (1941).
party seeking removal bears a heavy burden of proving that
the joinder of the in-state party was improper.”
Smallwood v. Illinois Cent. R.R. Co., 385 F.3d 568,
574 (5th Cir. 2004) (en banc). The removing party proves
improper joinder by demonstrating: (1) actual fraud in the
pleading of jurisdictional facts; or (2) the inability of the
plaintiff to establish a cause of action against the
non-diverse defendant in state court. See Crockett v.
R.J. Reynolds Tobacco Co., 436 F.3d 529, 532 (5th Cir.
2006) (citing Travis v. Irby, 326 F.3d 644, 646-47
(5th Cir. 2003)); see also Boone v. Citigroup,
Inc., 416 F.3d 382, 388 (5th Cir. 2005). Only the
second method is at issue here.
motion to remand must be granted unless “there is
absolutely no possibility that the plaintiff will be able to
establish a cause of action against the non-diverse defendant
in state court.” Griggs v. State Farm Lloyds,
181 F.3d 694, 699 (5th Cir. 1999). The existence of a viable
claim is determined according to federal pleading standards.
Int'l Energy Ventures Mgmt, L.L.C. v. United Energy
Grp., Ltd., 818 F.3d 193, 208 (5th Cir. 2016). Under
federal standards, the pleadings must allege sufficient facts
to demonstrate that the claim alleged is plausible rather
than speculative. Ashcroft v. Iqbal, 556 U.S. 662
(2009); Bell Atlantic Corp. v. Twombly, 550 U.S. 544
Sufficiency of the Allegations Against Adame
The Facts and their Fit Plaintiffs have alleged the
following facts against Adame:
• In adjusting the claim, Adame retained an accounting
expert that was biased in favor of the Carriers;
• Adame was aware of policy provisions prohibiting the
reduction of a claim for certain stock, supplies,
merchandise, and services, had no evidence of such items, yet
adjusted the loss so as to reduce it for such items;
• Adame persisted in this error despite having it
pointed out to him; and
• Adame prepared a sworn statement and proof of loss
containing these errors and tried to get ...