South Florida Wellness, Inc. v. AllState Insurance Company
2014 U.S. App. LEXIS 2787
11th Cir.2014Background
- Sanchez injured in a Florida car accident; Wellness sought 80% of amounts billed under PIP, but Allstate paid 80% of the statutory fee schedule amounts.
- Wellness filed a putative class action in Florida state court seeking a declaration that policy language clearly indicated the use of the fee schedule, not damages.
- Allstate removed to federal court arguing CAFA jurisdiction with an alleged class over 100 members and significant potential benefits.
- Watson affidavit estimated 1,655,733 bills affected; actual paid benefits under the fee schedule totaled about $126,474,216.25; potential 80% of bills would be $194,651,033.94.
- District court remanded, concluding the amount in controversy was too speculative since relief is declaratory, not monetary.
- Eleventh Circuit reversed, holding the declaratory relief value can satisfy CAFA if it is measurable and would flow to the class.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether CAFA's $5 million AIC is satisfied by declaratory relief | Wellness argues AIC exceeds $5M via class-wide benefits at stake. | Allstate argues AIC is met by potential increased benefits to the class upon declaratory relief. | Yes; the AIC is satisfied by declaratory relief value. |
| How to value declaratory relief for CAFA purposes | Wellness contends relief is too speculative to value. | Allstate contends Watson affidavit provides measurable, concrete value. | Declaratory relief can be valued; actual bills and potential past benefits provide measurable value. |
Key Cases Cited
- Morrison v. Allstate Indem. Co., 228 F.3d 1255 (11th Cir. 2000) (value of declaratory relief is the monetary value flowing to plaintiff)
- Pretka v. Kolter City Plaza II, Inc., 608 F.3d 744 (11th Cir. 2010) (amount in controversy is an estimate of issues at stake, not ultimate recovery)
- McPhail v. Deere & Co., 529 F.3d 947 (10th Cir. 2008) (AIC is about what will be put at issue, not certainty of recovery)
- Leonard v. Enterprise Rent-A-Car, 279 F.3d 967 (11th Cir. 2002) (injunctive relief value can be too speculative when future transactions are uncertain)
- Cappuccitti v. DirecTV, Inc., 623 F.3d 1118 (11th Cir. 2010) (aggregate value considerations in CAFA analyses)