United States District Court, W.D. Texas, Austin Division
SPARKS UNITED STATES DISTRICT JUDGE
REMEMBERED on this day the Court reviewed the file in the
above-styled cause, and specifically Plaintiff Melvin
Nelson's Motion to Remand [#10] and Defendants State Farm
Lloyds (State Farm) and Shane Fordham (collectively
Defendants)' Response [#11] in opposition. Having considered
the documents, the governing law, and the case file as a
whole, the Court now enters the following opinion and orders.
is a Texas citizen and the named insured on an insurance
policy issued by State Farm (the Policy). The Policy covers
Plaintiffs real property located at 902 Glass Drive, Leander,
Texas (the Property). State Farm is an unincorporated
association whose underwriters are all citizens of the State
of Illinois. Removal Noticef #1] ¶ 5. Mr. Fordham, a
citizen of Texas, is an insurance adjuster. Id.
April 20, 2016, a hail storm allegedly caused damage to the
Property. Id. [#1-1] Ex. A (State Court Records) at
8. Plaintiff submitted a claim to State Farm for the damage,
which included replacement of the Property's roof.
Id. State Farm assigned Mr. Fordham to adjust the
claim, and Mr. Fordham inspected the Property and adjusted
Plaintiffs claim on State Farm's behalf. Id.
August 31, 2017, Plaintiff filed suit in Texas state court.
Id. at 6. Plaintiff alleges Mr. Fordham violated
Texas Insurance Code § 541.060 when he improperly
evaluated the Property and failed to include the true cost of
repairing the Property in his adjustment. Id. at 8,
32-39. In addition, Plaintiff alleges State Farm failed to
review the adjustment and improperly denied coverage for the
full extent of the Property's damages. Id.
¶¶ 14-16. As a result, Plaintiff contends State
Farm wrongfully denied his claim, breached the insurance
contract, violated multiple sections of the Texas Insurance
Code, and breached its duty of good faith and fair dealing.
Id. ¶¶ 40-52.
Farm removed the case to this Court, arguing the Court
possesses diversity jurisdiction. According to State Farm,
Mr. Fordham was improperly joined because Plaintiff failed to
state a reasonable basis for recovering against Mr. Fordham.
Plaintiff filed a motion for remand, which is ripe for a
burden of establishing federal jurisdiction is placed upon
the party seeking removal." Willy v. Coastal
Corp., 855 F.2d 1160, 1164 (5th Cir. 1988). Moreover,
because removal jurisdiction raises significant federalism
concerns, courts must strictly construe removal jurisdiction.
Id. Any doubts or ambiguities regarding the
propriety of removal are construed against removal and in
favor of remand to the state court. Manguno v. Prudential
Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir*
2002). Here, State Farm invoked federal court diversity
jurisdiction under 28 U.S.C. § 1332(a).
courts have diversity jurisdiction over civil actions between
citizens of different states when the amount in controversy
exceeds $75, 000.00. 28 U.S.C. § 1332(a). Section 1332
requires "complete diversity"-that is, the
citizenship of every plaintiff must be different from that of
every defendant. Caterpillar Inc. v. Lewis, 519 U.S.
61, 68 (1996). Parties upon whose citizenship diversity
jurisdiction is grounded must be real and substantial parties
to the controversy. Navarro Sav. Ass 'n v. Lee,
AA6 U.S. 458, 460-61 (1980). Thus, the Court must
"disregard nominal or formal parties and rest
jurisdiction only upon the citizenship of the real parties to
the controversy." Id.; see also Americold
Realty Trust v. Conagra Foods, Inc., 136 S.Ct. 1012
parties dispute whether Mr. Fordham, who is a nondiverse
defendant, is properly joined. If Mr. Fordham is improperly
joined, then this Court has subject matter jurisdiction.
nondiverse defendant is improperly joined if "(1) the
plaintiff has stated a claim against a diverse
defendant that he fraudulently alleges is nondiverse, or (2)
the plaintiff has not stated a claim against a
defendant that he properly alleges is nondiverse."
Int'l Energy Ventures Mgmt., L.L.C v. United Energy
Grp., Ltd.,818 F.3d 193, 199 (5th Cir. 2016) (emphasis
in original). ...