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Ljuljdjuraj v. State Farm Mut. Auto. Ins. Co.

United States Court of Appeals, Sixth Circuit

December 19, 2014

ELVIRA LJULJDJURAJ, Plaintiff-Appellant,
v.
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant-Appellee

Argued October 7, 2014.

Appeal from the United States District Court for the Eastern District of Michigan at Detroit. No. 2:13-cv-11655--Gerald E. Rosen, Chief District Judge.

ARGUED:

Mark Dundon, DAILEY LAW FIRM, P.C., Royal Oak, Michigan, for Appellant.

James G. Gross, JAMES G. GROSS, P.L.C., Detroit, Michigan, for Appellee.

ON BRIEF:

Mark Dundon, DAILEY LAW FIRM, P.C., Royal Oak, Michigan, for Appellant.

James G. Gross, JAMES G. GROSS, P.L.C., Detroit, Michigan, for Appellee.

Before: ROGERS and KETHLEDGE, Circuit Judges; and MALONEY, District Judge.[*]

OPINION

Page 909

ROGERS, Circuit Judge.

This case concerns the scope of the " direct action" proviso of the federal diversity jurisdiction statute, 28 U.S.C. § 1332(c)(1), and its application to suits brought under Michigan's no-fault automobile insurance laws. Elvira Ljuljdjuraj was driving a borrowed car when she drove over a patch of ice and collided with a negligently parked vehicle. The car she was driving was owned by a friend, Bardhyl Mullalli. Ljuljdjuraj filed a diversity suit in federal court, seeking recovery under Mullalli's no-fault automobile insurance policy, issued by State Farm, for injuries she suffered in the accident. Ljuljdjuraj and Mullalli are both citizens of Michigan, while State Farm is a citizen of Illinois. The district court dismissed the suit for lack of diversity jurisdiction because the court determined that the suit was a " direct action" under 28 U.S.C. § 1332(c)(1), requiring Mullalli's Michigan citizenship to be imputed to State Farm. On appeal, both Ljuljdjuraj and State Farm argue that the " direct action" proviso does not apply and accordingly that diversity jurisdiction exists. Because the direct action proviso does not apply to suits brought against the insurer by insured persons identifiable before the accident occurs, this suit was not a direct action and Mullalli's citizenship should not have been imputed to State Farm.

Just after midnight on December 29, 2012, Elvira Ljuljdjuraj struck an icy patch while making a left turn and collided with a negligently parked car.[1] As a result of the collision, Ljuljdjuraj suffered a traumatic brain injury, acute cervical and lumbar sprains, bulging discs, and other injuries. Ljuljdjuraj had been driving a car borrowed from the owner, Bardhyl Mullalli. Ljuljdjuraj filed a claim with State Farm under Mullalli's no-fault insurance policy, but State Farm refused to pay. Ljuljdjuraj filed suit in the Eastern District of Michigan, pleading that the amount-in-controversy exceeded $75,000, that she was a citizen of Michigan, and that State Farm was a citizen of Illinois. Elvira's aunt--Drana Lulgjuraj--was a passenger in the car and was also injured. Drana filed a separate suit against State Farm for recovery under Mullalli's policy.

Although both women were represented by the same law firm, their lawyers did not notify the district court that the cases were ...


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