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Williams v. Cargill

United States District Court, D. South Dakota, Southern Division

June 10, 2014

CASEY WILLIAMS, TIMOTHY UPTON, JOSHUA HANSEN, RONNIE OAKIE, STEVEN MITCHELL, and DAVID BUJARSKI, Plaintiffs,
v.
JOHN A. CARGILL, Defendant.

ORDER FOR FURTHER DEVELOPMENT OF THE RECORD

VERONICA L. DUFFY, Magistrate Judge.

INTRODUCTION

This diversity action is pending before this court on a complaint filed by plaintiffs Casey Williams, Timothy Upton, Joshua Hansen, Ronnie Oakie, Steven Mitchell, and David Bujarski. See Docket No. 1. Plaintiffs were injured in a one-vehicle accident that occurred on March 18, 2013, during which defendant, John Cargill, was driving. At that time and also presently, plaintiffs were all inmates with the South Dakota Department of Corrections (hereinafter "DOC"). In March 2013, Mr. Cargill was an employee of the same department, having charge of the plaintiffs on that day. Mr. Cargill now moves to dismiss this action, alleging that plaintiffs cannot meet the amount in controversy requirement of 28 U.S.C. § 1332. See Docket No. 8. The district court, the Honorable Jeffrey L. Viken, Chief Judge, referred Mr. Cargill's motion to this magistrate judge for a recommended disposition. See Docket No. 13.

DISCUSSION

A. Law Applicable to a Motion to Dismiss for Lack of Subject Matter Jurisdiction

It is axiomatic that this court must have subject matter jurisdiction before it may entertain this action. See Carton v. General Motor Acceptance Corp. , 611 F.3d 451, 455 (8th Cir. 2010) (determination of subject matter jurisdiction as to the amount in controversy under 28 U.S.C. § 1332 must be addressed at the outset); Lang v. Napolitano , 596 F.3d 426, 429 (8th Cir. 2010) (district court erred because it should have dismissed plaintiff's claim where the court lacked subject matter jurisdiction without reaching the merits of those claims).

Federal courts are courts of limited jurisdictionBthey may adjudicate only those cases within their articulated jurisdiction under Article III of the Constitution or a valid statute enacted pursuant to Article III. Marbury v. Madison , 1 Cranch (5 U.S.) 137, 173-80 (1803). A motion to dismiss for lack of subject matter jurisdiction pursuant to Fed. R. 12(b)(1) challenges the court's authority and competence to hear the case pending before it. 5B Charles A. Wright & Arthur R. Miller, Fed. Practice & Procedure, § 1350, at 64 (3d ed. 2004) (hereinafter "Wright & Miller"); Yankton Sioux Tribe v. United States Army Corps of Engineers , 194 F.Supp.2d 977, 983 (D.S.D. 2002). "[I]t is a cardinal rule upheld by countless federal cases that the parties may not create or destroy jurisdiction by agreement or by consent." 5B Wright & Miller, § 1350, at 128. The issue of a federal court's subject matter jurisdiction, or lack thereof, is central to the tenants of judicial federalism, the distribution of judicial power between state and federal courts. Id. at 120-33.

Plaintiffs rely on this court's diversity jurisdiction as the basis for bringing this action in federal court. See 28 U.S.C. § 1332. Under § 1332, a plaintiff must show diverse citizenship of the parties (a fact not in issue in the present motion), and an amount in controversy exceeding $75, 000, exclusive of interest and costs. Id . The Supreme Court has set forth what is termed the "legal certainty" test for determining whether the amount in controversy has been met.

The rule governing dismissal for want of jurisdiction in cases brought in the federal court is that, unless the law gives a different rule, the sum claimed by the plaintiff controls if the claim is apparently made in good faith.... [I]f, from the face of the pleadings, it is apparent, to a legal certainty, that the plaintiff cannot recover the amount claimed or if, from the proofs, the court is satisfied to a like certainty that the plaintiff never was entitled to recover that amount, and that his claim was therefore colorable for the purpose of conferring jurisdiction, the suit will be dismissed. Events occurring subsequent to the institution of suit which reduce the amount recoverable below the statutory limit do not oust jurisdiction.

St. Paul Mercury Indemnity Co. v. Red Cab Co. , 303 U.S. 283, 288-89 (1938). "According to the Court, it must appear to a legal certainty that the plaintiff's claim is really for less than the jurisdictional amount to justify dismissal for lack of subject matter jurisdiction." 14B Wright & Miller, § 3702, at 27 (1998).

A general statement from the plaintiff that the amount exceeds $75, 000 is sufficient, unless that assertion is challenged by the opposing party through a Rule 12(b)(1) motion. 14B Wright & Miller, § 3702, at 31; Gibbs v. Buck , 307 U.S. 66, 72 (1939). "Once the propriety of the amount in controversy is challenged, " the plaintiffs have the burden under St. Paul Mercury to show that their damages are not legally certain to be less than $75, 000. 14B Wright & Miller, § 3702, at 33-34. See also Trimble v. Asarco, Inc. , 232 F.3d 946, 959 (8th Cir. 2000), overruled on other grounds, Exxon Mobil Corp. v. Allapattah Servs., Inc. , 545 U.S. 546 (2005); Dupraz v. Aventis CropScience USA Holding, Inc. , 153 F.Supp.2d 1102, 1104 (D.S.D. 2001). Plaintiffs must prove the jurisdictional amount in controversy by a preponderance of the evidence. Scottsdale Ins. Co. v. Universal Crop Protection Alliance, LLC , 620 F.3d 926, 931 (8th Cir. 2010); Drobnak v. Andersen Corp. , 561 F.3d 778, 786 (8th Cir. 2009) (citing Missouri ex rel. Pemiscot County v. Western Surety Co. , 51 F.3d 170, 173 (8th Cir. 1995)); Dupraz , 153 F.Supp.2d at 1104.

In evaluating a Rule 12(b)(1) motion to dismiss based on failure to meet the jurisdictional amount in controversy, courts can decide the motion "in three ways: at the pleading stage, like a Rule 12(b)(6) motion; on undisputed facts, like a summary judgment motion; and on disputed facts." Jessie v. Potter , 516 F.3d 709, 712 (8th Cir. 2008) (citing Osborn v. United States , 918 F.2d 724, 728-30 (8th Cir. 1990)). If the motion is to be decided on disputed facts, the court may conduct an evidentiary hearing and make findings. Jessie , 516 F.3d at 712. See also Dupraz , 153 F.Supp.2d at 1104 (citing United Food Local 919 v. CenterMark Properties , 30 F.3d 298, 305 (2d Cir. 1994) (stating that where "the pleadings are inconclusive as to the amount in controversy, federal courts may look to other evidence in the record."). See also Deuser v. Vecera , 139 F.3d 1190, 1191 n.3 (8th Cir. 1998); Drevlow v. Lutheran Church, Missouri Synod , 991 F.2d 468, 470 (8th Cir. 1993). By contrast, if the argument is that the undisputed facts fail to establish the amount in controversy, the motion must be resolved on the pleadings alone and a motion akin to summary judgment may not resolve disputed factual issues. Jessie , 516 F.3d at 712.

"No presumptive truthfulness attaches to the plaintiff's allegations, and the existence of disputed material facts will not preclude the trial court from evaluating for itself the merits of the jurisdictional claims." Trimble , 232 F.3d at 959 (quoting Osborn , 918 F.2d at 730). When a court elects to look to evidence outside the pleadings, it does not convert the 12(b)(1) motion into a motion for summary judgment. Deuser , 139 F.3d at 1191 n.3 (citing Osborn , 918 F.2d at 729).

In this matter, plaintiffs have generally asserted in their complaint that their claims represents an amount in controversy in excess of $75, 000. See Docket No. 1. As noted above, this is insufficient to carry plaintiffs' burden once the amount in controversy is challenged. Gibbs , 307 U.S. at 72; Trimble , 232 F.3d at 959. Instead, in response to Mr. Cargill's motion, plaintiffs have the burden to demonstrate by a preponderance of the evidence that their claim exceeds $75, ...


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