United States District Court, D. Utah
MEMORANDUM DECISION AND ORDER
A. Kimball, United States District Judge.
matter is before the court on Plaintiff American Family's
Motion to Dismiss for lack of subject matter jurisdiction
pursuant to Rule 12(b)(1) of the Federal Rules of Civil
Procedure. A hearing on the motion was held on February 8,
2018. At the hearing, Plaintiff was represented by Bryan J.
Stoddard, and Defendants were represented by Darren A. Davis.
The court took the matter under advisement. The court has
carefully considered the memoranda and other materials
submitted by the parties, as well as the law and facts
relating to the motion. Now being fully advised, the court
renders the following Memorandum Decision and Order.
Defendants Nicolas Orozco and Eva Gonzalez were in an
accident and sought uninsured motorist benefits from
Plaintiff American Family. American Family filed the instant
action in this court, seeking declaratory judgment that
Defendants' claims are barred by the relevant statute of
limitations. Defendants responded by filing the present
motion to dismiss for lack of subject matter jurisdiction.
seek to dismiss American Family's claim pursuant to
Federal Rule of Civil Procedure 12(b)(1). Defendants concede
complete diversity but deny that the amount in controversy
exceeds $75, 000. The court presumes that a plaintiff's
amount in controversy controls subject matter jurisdiction.
Adams v. Reliance Standard Life Ins. Co, 225 F.3d
1179, 1183 (10th Cir. 2000). And the party asserting
jurisdiction bears the burden of proving subject matter
jurisdiction. See Kokkonen v. Guardian Life Ins. Co. of
Am., 511 U.S. 375, 377 (1994). The party meets this
burden by alleging sufficient facts to convince the court
that each party's recoverable damages bear a reasonable
relation to the minimum jurisdictional floor. Gibson v.
Jeffers, 478 F.2d 216, 221 (10th Cir. 1973).
Family asserts that the amount in controversy exceeds the
$75, 000 jurisdictional threshold because in cases seeking
declaratory relief, the amount in controversy is the value of
litigation to the parties. Lovell v. State Farm Mut.
Auto. Ins. Co., 466 F.3d 893, 897 (10th Cir. 2006). In
this case, the value of litigation for American Family is the
$100, 000 policy limit on each of Defendants' respective
policies. Under Tenth Circuit law, the amount in controversy
is measured by “the maximum limit of the insurer's
liability under the policy.” State Farm Mut. Auto.
Ins. Co. v. Narvaez, 149 F.3d 1269, 1271 (10th Cir.
1998) (finding maximum policy limits to be amount in
controversy where bona fide claim exceeds policy limits);
see also Terra Nova Ins., Ltd. v. Fort Bridger Historical
Rendezvous Site, Corp., 2005 WL 2671947, **2 (10th Cir.
2005) (finding amount in controversy to be equal to maximum
contend that the amount in controversy should be tied to the
amount Defendants may recover. Under Tenth Circuit law, this
court's jurisdictional determination turns on which
damages are legally certain. See Lovell, 466 F.3d at
897. Generally, dismissal for lack of legal
certainty only occurs if (1) a contract limits any possible
recovery, (2) the law limits the amount recoverable, or (3)
there is an obvious abuse of federal court jurisdiction.
Woodmen of the World Life Ins. Soc'y v.
Manganaro, 242 F.3d 1213, 1216-17 (10th Cir. 2003).
case, it is a legal certainty that the insurance contract
limits any possible recovery to $100, 000 for each Defendant.
Although Defendants' claims alleged specific damages in
the amount of $20, 344.62 and $13, 847.86 respectively, well
below the $75, 000 threshold, Defendants do not specifically
state the amount they seek in general damages. In order to
meet the amount in controversy, therefore, a 4:1 or 5:1
general to specific damages ratio would be required.
Defendants claim that, absent aggravated liability or
catastrophic injury, this would be a rare occurrence. But
even if the necessary ratios are improbable, they are
nonetheless possible. Damages are like a box of chocolates;
you never know what you are going to get. In the realm of
legal certainty, mere possibilities are fatal:
“[i]ndeterminacy of the amount to be recovered is
therefore not sufficient to defeat diversity
jurisdiction.” See Jumara v. State Farm Ins.
Co., 55 F.3d 873, 877 (3rd Cir. 1995).
anticipating this problem, Defendants offered an affidavit
containing their and their counsel's opinion that full
compensation for their injuries would require less than $75,
000. But were this case to proceed to trial, there is only
one opinion that would matter-the fact-finder's. If the
fact-finder determined that Defendants' damages merited
more than $75, 000, Defendants would not object. Defendants
did not stipulate to damages in an amount less than $75, 000,
and this court's jurisdictional analysis requires
something more firm than a mere opinion. The standard is
“legal certainty” not “legal
probability.” The court concludes that Defendants'
insurance policy limit is the only legal certainty regarding
the amount in controversy. The court, therefore, has subject
matter jurisdiction over this case pursuant to 28 U.S.C.
on the above reasoning, Defendants' Motion to ...