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USAA Casualty Insurance Co. v. Cit Bank, N.A.

United States District Court, D. New Jersey

May 15, 2018

USAA CASUALTY INSURANCE COMPANY, Plaintiff,
v.
CIT BANK, N.A., Defendant.

          REPORT & RECOMMENDATION

          HONORABLE JAMES B. CLARK, III UNITED STATES MAGISTRATE JUDGE.

         THIS MATTER comes before the Court on a motion by Plaintiff USAA Casualty Insurance Company (“USAA” or “Plaintiff') to remand this matter to New Jersey Superior Court, Bergen County, Chancery Division [ECF No. 4]. Defendant CIT Bank, N.A. (“CIT Bank” or “Defendant”) opposes Plaintiff's motion [ECF No. 9]. Pursuant to Local Civil Rule 72.1(a)(2), the Honorable John Michael Vazquez, U.S.D.J., referred the present Motion to the undersigned for Report and Recommendation. Having considered the parties' written submissions pursuant to Federal Rule of Civil Procedure 78, for good cause shown and for the reasons set forth herein, it is respectfully recommended that Plaintiff's motion to remand be DENIED.

         I. BACKGROUND

         Plaintiff filed the instant action in the Superior Court of New Jersey, Bergen County, Chancery Division, on August 22, 2017 seeking, inter alia, injunctive relief and monetary damages in connection with oil contamination located on Defendant's property. See generally Complaint, ECF No. 1-1 (“Compl.”).

         As set forth in the Complaint, Plaintiff is a Texas corporation authorized to conduct business in the state of New Jersey. Id. ¶ 1. Plaintiff's insured, Karen Schuitema, owns the property located at 21 Somerville Street, Rochelle Park, New Jersey 07662 (the “Schuitema Property”). Id. ¶ 7. Defendant owns the property immediately adjacent to the Schuitema Property located at 25 Somerville Street, Rochelle Park, New Jersey 07662 (the “CIT Property”). Id. ¶ 6. On February 22, 2007, a 275-gallon underground oil storage tank was removed from the Schuitema Property. After a thorough investigation it was determined that oil leaking from the storage tank caused soil and groundwater contamination. Id. ¶ 9. As a result, USAA expended more than $800, 000 remediating the Schuitema Property. Id. ¶ 10.

         Sometime after remediating the Schuitema Property, Plaintiff alleges that it learned of a similar fuel oil contamination located on the CIT Property, which resulted from a separate leaking underground oil storage tank located on the CIT Property. Id. ¶ 12. Although part of the CIT Property was remediated, Plaintiff alleges that the contamination located around the foundation of the CIT Property has not been addressed or otherwise remediated. Id. ¶ 14.

         Prior to the initiation of this action, Plaintiff alleges that two injection wells, located on the CIT Property and the property line between the CIT and Schuitema properties, showed evidence of petroleum oil contamination. Id. ¶¶ 16, 18. According to Plaintiff, the existence of this contamination on the borderline of the parties' properties suggests that the contamination has migrated from the CIT Property to the Schuitema Property, thereby causing damages to the Schuitema Property. Id. ¶ 19.

         On September 25, 2017, Defendant removed this action to this Court pursuant to 28 U.S.C §1441, citing this Court's federal diversity jurisdiction under 28 U.S.C § 1332(a). See Notice of Removal, ECF No. 1 (“NOR”). Although Plaintiff's Complaint does not contain a specified amount of damages, Defendant contends that removal is proper because the parties are diverse and because the amount in controversy exceeds $75, 000. See Id. On October 11, 2017, Plaintiff filed the instant motion to remand this matter to state court, asserting that the amount in controversy does not exceed the jurisdictional threshold of $75, 000. See Pl. Mot. to Remand, ECF No. 4.

         II. LEGAL STANDARD

         A civil action brought in state court may be removed by the defendant to a federal district court if the district court has original jurisdiction over the claim. 28 U.S.C. § 1441(a); see also Samuel-Bassett v. Kia Motors Am., 357 F.3d 392, 398 (3d Cir. 2004). Federal district courts have original jurisdiction on the basis of diversity of citizenship where: (1) the matter in controversy exceeds the sum or value of $75, 000; and (2) there is diversity of citizenship between each plaintiff and each defendant in the case. See, e.g., Kaufman v. Allstate N.J. Ins. Co., 561 F.3d 144, 148 (3d Cir. 2009) (citing 28 U.S.C. § 1332(a)(1)). Under § 1332(a)(1), “the party asserting federal jurisdiction in a removal case bears the burden of showing, at all stages of the litigation, that the case is properly before the federal court.” Frederico v. Home Depot, 507 F.3d 188, 193 (3d Cir. 2007) (citing Samuel-Bassett, 357 F.3d at 396); Morgan v. Gay, 471 F.3d 469, 473 (3d Cir. 2006). Any doubts must be resolved in favor of remand. Samuel-Basset, 357 F.3d at 403.

         The parties do not dispute that complete diversity exists. Plaintiff is a corporation organized under Texas law, licensed to conduct business in New Jersey, with its principal place of business in Texas. Compl. ¶ 1. Defendant is a national association, organized and existing under the National Bank Act, 12 U.S.C. 38, with its principal place of business in California. Id. ¶ 2. Accordingly, because the Court is satisfied that there is complete diversity between the parties, subject matter jurisdiction turns on whether the amount in controversy exceeds $75, 000.

         “The Third Circuit has provided a ‘roadmap' for evaluating whether a case removed from state court should be remanded because the amount in controversy does not exceed $75, 000.” Venuto v. Atlantis Motor Grp., LLC, No. CV173363RBKKMW, 2017 WL 4570283, at *2 (D.N.J. Oct. 13, 2017) (citing Frederico, 507 F.3d at 196). First, if the parties dispute jurisdictional facts, the party carrying the burden of proof must establish federal jurisdiction by a preponderance of the evidence. Frederico, 507 F.3d at 194 (citing McNutt v. Gen. Motors Acceptance Corp., 298 U.S. 178 (1936)). Even if jurisdictional facts are not expressly in dispute, a “court may still insist that the jurisdictional facts be established or the case be dismissed, and for that purpose the court may demand that the party alleging jurisdiction justify his allegations by a preponderance of the evidence.” McNutt, 298 U.S. at 189.

         Second, if jurisdictional facts are not in dispute, or the court is satisfied with the sufficiency of the jurisdictional proof, the analysis turns to whether the jurisdictional amount is met with “legal certainty.” Frederico, 507 F.3d at 196. The legal certainty test has two alternative strands. Id. If the complaint “specifically avers that the amount sought is less than the jurisdictional minimum, ” a defendant “seeking removal must prove to a legal certainty that [the] plaintiff can recover the jurisdictional amount.” Id. at 196-97 (relying on Morgan, 471 F.3d at 469). A plaintiff is entitled to this deferential standard only if the complaint “specifically (and not impliedly) and precisely (and not inferentially) states that the amount sought” shall not exceed the jurisdictional minimum. Id. at 196. Alternatively, if the “plaintiff has not specifically averred in the complaint that the amount in controversy is less than the jurisdictional minimum, ” then “the case must be remanded if it appears to a legal certainty that the plaintiff cannot recover the jurisdictional amount.” Id. at 197 (emphasis in original) (relying on Samuel-Bassett, 357 F.3d at 392).

         III. ...


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