ORDER GRANTING PLAINTIFF’S MOTION TO REMAND
I. INTRODUCTION
Plaintiff Conrad Associates moves to remand on the grounds that the amount in controversy in this diversity case does not exceed $75,000. ■ Plaintiff also seeks sanctions against Defendant Hartford Accident and Indemnity Company for improperly removing this case. For the reasons set forth below, plaintiffs motion to remand is GRANTED and plaintiffs motion for sanctions is DENIED.
II. BACKGROUND
-On February 1, 1983, Conrad Associates (“Conrad”) entered into a contract to design a two-story parking structure located at the
On December 28, 1988, four anchor plates broke through the concrete deck of the shopping center’s parking lot, and the owner’s insurer filed suit against Conrad Associates, alleging defective construction. Plaintiff tendered its defense to Hartford, which Hartford refused. Plaintiff contributed $16,500 towards the settlement of that case, and spent approximately $40,000 defending the action.
On August 19, 1997, plaintiff filed the instant action for breach of contract and breach of the implied covenant of good faith and fair dealing in the Superior Court for the County of Monterey. The complaint alleges that Conrad incurred $56,500.00 in expenses from Hartford’s alleged breach of contract, seeks damages in the form of attorneys’ fees and costs incurred in seeking policy benefits from Hartford, and punitive damages. Defendant received notice of the, complaint on September 15, 1997, and filed a Notice of Removal based on diversity jurisdiction on October 14,1997.
III. LEGAL STANDARDS
The removal statute, 28 U.S.C. § 1441, provides in part, “[A]ny civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant ... to the district court of the United States for the district and division embracing the place where such action is pending.” 28 U.S.C. § 1441(a). District courts have diversity jurisdiction over all civil actions between citizens of different states where the amount in controversy exceeds $75,000, exclusive of interest and costs. 28 U.S.C. § 1332. 1 If at any time before final judgment it appears that the district court lacks subject matter jurisdiction over a case that has been removed to federal court, the case must be remanded. 28 U.S.C. § 1447(c).
In a motion to remand to state court, the party asserting federal jurisdiction has the burden of proof. “The burden of establishing federal jurisdiction is upon the party seeking removal, and the removal statute- is strictly construed against removal jurisdiction.”
Emrich v. Touche Ross & Co.,
In cases in which the existence of diversity jurisdiction depends on the amount in controversy, “[t]he district court may consider whether it is ‘facially apparent’ from the complaint that the jurisdictional amount is in controversy.”
Singer v. State Farm Mutual Auto. Ins. Co.,
IV. DISCUSSION
Plaintiff asserts that Hartford cannot meet its burden of proving, by a preponderance of the evidence, that the amount in controversy exceeds the jurisdictional minimum of $75,-000. Defendant contends that the amount in controversy, which includes contract damages in the amount of $56,500, plus attorneys fees, plus punitive damages, exceeds $75,000.
Defendant advances three arguments in support of its contention that plaintiffs claim is worth more than $75,000. First, defendant contends that Conrad’s refusal to stipulate to damages less than $75,000 “conclusively” establishes that plaintiff deems the amount in controversy to be in excess of $75,000. Second, defendant asserts that plaintiffs request for attorneys’ fees incurred in seeking to enforce insurance benefits is likely to reach at least $20,000 by the conclusion of this litigation since the parties have agreed to have the issue of Hartford’s duty to defend addressed in a motion for summary judgment. Third, defendant asserts that a punitive damage award would likely exceed the jurisdictional amount since the average punitive damage award in a bad faith claim for the past year in the State of California was $6,720,222.23.
A. Plaintiffs Refusal to Stipulate to Lessor Damages
Defendant’s assertion that it is “conclusively established” that the amount in controversy in this case exceeds $75,000 by plaintiffs refusal to stipulate that the case is not worth $75,000 is not convincing. First, defendant cites no cases permitting such a conclusion from a failure to so stipulate. Two eases in this district have expressly declined to find that a refusal to stipulate to damages below the jurisdictional amount is even persuasive in evaluating the worth of the claims in a complaint. See
Valle v. State Farm Mutual Automobile Ins.,
B. Attorneys’ Fees
California law permits recovery of attorneys fees incurred by the insured in obtaining the benefits due under the policy when the insurer’s conduct in withholding benefits was tortious.
Brandt v. Superior Court,
Defendant states that it sought documentation from plaintiff of its attorney fees expended in this litigation thus far, but plaintiff has failed to provide documentation to date despite its promises to do so. Defendant
Plaintiff confirms in its unsworn reply that total attorney fees to date have totaled. $6000. Plaintiff asserts, however, that defendant has not attempted to demonstrate which percentage of these fees were incurred to recover contract damages (recoverable under Brandt) and which percentage of these fees were expended to seek extra-contractual damages (not recoverable under Brandt).
Defendant’s contention that attorney fees are likely to total at least $20,000 is too speculative to support its burden of establishing jurisdiction by a preponderance of the evidence. First, defendant simply asserts that it will take eighty hours to bring this ease to the summary judgment stage without providing any factual information of how it arrived at this figure. Although defendant sets forth the tasks plaintiffs counsel will have to take in opposing a motion for summary judgment, it does not estimate the amount of time each major task will take in arriving at its eighty hour figure. Second, it is speculative to say that every hour expended in this litigation will be billed by Mr. Green at $200 per hour. Third, since only those attorney fees incurred in seeking policy benefits are recoverable under
Brandt,
it is unclear what amount of this estimated sum would likely be recovered as
Brandt
fees. Finally, the amount in controversy must be determined as of the date of removal.
Miranti v. Lee,
Therefore, the evidence introduced by defendant does not establish that it is more likely than not that Brandt attorney fees are likely to add $18,500 to the $56,500 contractual damages identified in the complaint as of the date the complaint was removed to federal court.
C. Punitive Damages
Defendant corfSctly points out that California law permits recovery of punitive damages for insurance bad faith claims and that such damages may be included in calculating the jurisdictional amount.
Richmond v. Allstate Ins. Co.,
Assuming that defendant’s submission of bad faith jury verdicts is probative on the potential recovery of punitive damages in this case, defendant has made no effort to compare the facts of those cases with the alleged facts of this case. In fact, as set forth in the jury verdict summaries, the eases cited by defendant bear little or no resemblance to this litigation. Many of the jury verdict summaries submitted by defendant involve disability insurance claims, private homeowner insurance policies, or commercial policies with emotional distress claims and/or loss of homes and businesses. The few commercial insurance policy cases involve economic and compensatory damages in the sum of hundreds of thousands of dollars. See, e.g., Fillippo Industries, Inc. v. WM. H. McGee & Co. (plaintiff claimed $624,000 due under insurance policy, plus loss of business and punitive damages); Vann v. The Travelers Co. (plaintiff claimed $1,460,000 in compensatory damages and damages for loss of business and emotional distress compounded by the fact that plaintiffs wife suffered from Alzheimer’s Syndrome); Lifetime Memory Products, Inc. v. Century Indemnity Ins. Co. of North America (parties stipulated to $150,000 in compensatory damages); Partnership Placements, Inc., et al. v. Landmark Ins. Co. ($460,000 breach of contract damages). Only two of the cases submitted by defendant even involve an insurer’s duty to defend.
The instant case does not appear to contain the egregious circumstances involved in the eases submitted by defendant. Moreover, the compensatory damages sought by plaintiff are well below the damages sought in any of the cases submitted by defendant. Defendant’s citation of these cases, by itself, is not sufficient to meet its burden under
Sanchez.
As stated by the district court in
Haisch v. Allstate Insurance Co.,
[i]t would be inherently speculative for this Court to conclude that the amount in controversy requirement can be met by simply asserting that large punitive damage awards have been awarded in the past against insurance companies faced with allegations of fraud. As Plaintiff points out, Defendant has failed to articulate why the particular facts that are alleged in the instant case might warrant extraordinary damages, (emphasis added.)
The court has not been presented with any
facts
that would support an award of punitive damages in this case. Defendant’s burden cannot be met simply by pointing out that the complaint seeks punitive damages and that any damages awarded under such a claim
could
total a large sum of money, particularly in light of the high burden that must be met in order for a plaintiff even to be eligible for receipt of discretionary punitive damages. See also,
Terry v. Service America Corp.,
Therefore, the evidence submitted in this action provides no rehable basis for the court to determine that it is more likely than not that a potential punitive damage award could sufficiently increase the amount in controversy to meet the jurisdictional requirement.
Given “[t]he strong presumption against removal jurisdiction” and in favor of remand, 5 the court holds that defendant has not shown, by a preponderance of the evidence, that the amount in controversy exceeds the jurisdictional minimum of more than $75,000. The court therefore lacks diversity jurisdiction to hear this case.
For the foregoing reasons, plaintiffs motion to remand is GRANTED. IT IS FURTHER ORDERED that plaintiffs request for costs and attorney fees as sanctions is DENIED.
IT IS SO ORDERED.
Notes
. The parties do not dispute diversity.
. Some cases have remanded an action to state court after the plaintiff voluntarily stipulated that he would not seek damages above the jurisdictional amount, or have refused to remand after the plaintiff freely conceded that damages would exceed $75,000. However, as noted in Valle, supra., it would be unfair to give defendants a strategic advantage by being able to force plaintiffs to make a choice between stipulating against their future remedies and remaining in federal' court. Moreover, plaintiffs offer to settle the action for $74,000 equally suggests that plaintiff values its claim as below the jurisdictional minimum.
. While plaintiff's failure to provide promised documentation of attorney’s fees after it promised to do so appears to be unreasonable, defendant cites no case permitting a court to invoke jurisdiction as an evidentiary sanction.
. Defendant’s reliance upon
Davenport v. Mutual Benefit Health & Accident Ass'n,
.
Gaus v. Miles, Inc.,