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Estate of Beard v. G4S Secure Solutions USA, Inc.

United States District Court, W.D. Kentucky, Louisville Division

March 27, 2019

ESTATE OF PERRY KEVIN BEARD Plaintiff
v.
G4S SECURE SOLUTIONS USA, INC. Defendant

          MEMORANDUM OPINION AND ORDER

          Rebecca Grady Jennings, District Judge

         Plaintiff Estate of Perry Kevin Beard (“Beard”) sued Defendant G4S Secure Solutions USA, Inc. (“G4S”) in Jefferson County Circuit Court alleging discrimination and unlawful discharge under KRS 344 and retaliation under KRS 433.280. [DE 1-3, Compl. at ¶¶ 10-14]. G4S removed the case to this Court on diversity-of-citizenship jurisdiction. [DE 1 at ¶ 3]. Beard now moves to remand the case back to Jefferson County Circuit Court [DE 5], G4S moves to dismiss the Complaint [DE 6], and Beard moves to stay G4S's Motion to Dismiss until resolution of the Motion to Remand [DE 8]. These matters are ripe for judgment. [See DE 7; DE 9; DE 10]. For the reasons below, the Court GRANTS Beard's Motion to Remand, DENIES AS MOOT G4S's Motion to Dismiss, and DENIES AS MOOT Beard's Motion to Stay.

         BACKGROUND

         Beard was employed by G4S when he suffered severe medical complications and related anxiety. [DE 1-3 at ¶ 6]. Beard claims that he disclosed his medical condition to G4S and sought accommodations. Id. at ¶ ¶ 8-9. G4S denied Beard's accommodations request, and after he voiced opposition, the company terminated him. Id. Beard sued in Jefferson County Circuit Court alleging discrimination and unlawful discharge. Id. at ¶¶ 10-14. The Complaint states that the “amount in controversy in this matter exceeds the jurisdictional minimum [of Jefferson County Circuit Court] but is less than $75, 000 inclusive of fees, punitive damages and the fair value of any injunctive relief.” Id. at ¶ 4.

         Without completing any discovery, G4S removed the case to this Court on diversity-of-citizenship jurisdiction. [DE 1 at ¶ 3]. Beard then moved to remand, claiming that this Court lacks jurisdiction because the amount in controversy is less than $75, 000. [DE 5 at 63]. Beard attached a stipulation to his Motion affirming that he will neither seek nor accept any relief equal to or greater than $75, 000. [DE 5-1 at 65]. G4S responds that Beard's post-removal stipulation does not destroy diversity jurisdiction and that the Court should deny the Motion. [DE 7 at 95].

         DISCUSSION

         A. Standard of Review

         Removal to federal court is proper for “any civil action brought in a State court of which the district courts of the United States have original jurisdiction.” 28 U.S.C. § 1441(a). Diversity jurisdiction gives “[t]he district courts . . . original jurisdiction [over] all civil actions where the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs, and is between . . . citizens of different states.” 28 U.S.C. § 1332(a), (a)(1). A defendant removing a case has the burden of proving jurisdiction. See Wilson v. Republic Iron & Steel Co., 257 U.S. 92, 97 (1921). The determination of federal jurisdiction in a diversity case should be made at the time of removal. Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868, 872 (6th Cir. 2000).

         Beard does not dispute that complete diversity of citizenship exists between the parties. [DE 5]. Rather, he disputes only whether the amount-in-controversy requirement is satisfied. Id. Thus, the question for the Court is whether G4S properly removed the action in the first instance based on the amount in controversy at the time of removal and, if so, whether Beard's post-removal stipulation destroys diversity jurisdiction.

         B. Amount in Controversy

         Generally, courts “conduct a fair reading” of the complaint to determine whether the amount in controversy satisfies the requirements of 28 U.S.C. § 1332(a). Hayes v. Equitable Energy Res. Co., 266 F.3d 560, 573 (6th Cir. 2001). Because the plaintiff is “master of the claim, ” a claim explicitly less than the federal requirement will typically preclude removal. Rogers, 230 F.3d at 872 (quoting Gafford v. General Elec. Co., 997 F.2d 150, 157 (6th Cir. 1993)). Two rules of Kentucky procedure complicate the question of proper removal to federal court in regard to the amount-in-controversy threshold. First, Kentucky's Rules of Civil Procedure prohibit a plaintiff from making a specific demand for damages in his or her complaint. Ky. R. Civ. P. 8.01(2). In such cases, “the defendant may assert the amount in controversy in the notice of removal.” Jenkins v. Delta Air Lines, Inc., No. 3:18-CV-244-CRS, 2018 WL 6728571, at *2 (W.D. Ky. Dec. 21, 2018). And the defendant must establish by a preponderance of the evidence that the amount in controversy exceeds $75, 000 at the time of removal. Id. (citing Rogers, 230 F.3d at 872).

         Second, Ky. R. Civ. P. 54.03 states that “[e]xcept as to a party against whom a judgment is entered by default for want of appearance, every final judgment shall grant the relief to which the party in whose favor it is rendered is entitled, even if the party has not demanded such relief in his pleadings.” This enables a plaintiff to claim in his or her complaint an amount lower than the federal amount-in-controversy threshold but still seek and recover damages exceeding the amount prayed for. Rogers, 230 F.3d at 871. In such situations, the removing defendant must show that it is “more likely than not” that the plaintiff's claims meet the amount-in-controversy requirement at the time of removal. Gafford, 997 F.2d at 158.

         To establish the jurisdictional threshold, “[a] defendant drawn into a Kentucky court would be wise to engage in pre-removal discovery to clarify the amount in controversy.” Shannon v. PNC Bank, N.A., No. 3:14-CV-00421-CRS, 2015 WL 3541850, at *3 (W.D. Ky. June 2, 2015). Evidence of the amount of damages can be obtained through pre-removal interrogatories or requests for admissions. Id.; see also Sanders v. Print Fulfillment Servs., LLC, No. 3:17CV-245-CRS, 2017 WL 2624550, at *3 (W.D. Ky. June 16, 2017). That said, the defendant's failure to conduct pre-removal discovery does not necessarily foreclose the ability to establish the requisite amount in controversy at the time of removal. See Shannon, 2015 WL 3541850, at *3.

         In workplace-discrimination and retaliation cases, defendants routinely establish the amount in controversy by calculating the value of the plaintiff's compensatory and punitive damages. See Jenkins, 2018 WL 6728571, at *2; Proctor v. Swifty Oil Co., No. 3:12-CV-00490-TBR, 2012 WL 4593409, at *2 (W.D. Ky. Oct. 1, 2012); Blocker v. PPG Indus., Inc., No. 3:17-CV-29-DJH, 2017 WL 3431136, at *3 (W.D. Ky. Aug. 9, 2017). Courts have noted that “[b]ack pay accrued through the projected trial date is properly included in the amount-in-controversy calculation where . . . the plaintiff seeks past and future wages.” Blocker, 2017 WL 3431136, at *3 (internal ...


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