United States District Court, W.D. Washington
ORDER TO SHOW REGARDING AMOUNT IN
L. ROBART United states District Judge
court has reviewed Plaintiff Lil' Man in the Boat,
Inc.'s ("Lil Man") complaint (Compl. (Dkt. #1))
and is concerned that the jurisdictional amount in
controversy is not met. The court thus orders Lil' Man to
show cause within 10 days of the date of this order why the
court should not dismiss this case for lack of subject matter
a contract dispute about a vessel called the Queen of
Seattle, (Id. at 20.) Lil' Man alleges that
Defendant Auk Ta Shaa, LLC ("Auk Ta Shaa") breached
a contract to sell the boat and brings an action to enforce
that alleged contract. (Id. at 29.) Lil' Man makes
three allegations regarding the amount in controversy. First,
Lil' Man alleges that the "amount in controversy
exceeds $75, 000.00." (Id. at 2.) Additionally,
Lil' Man seeks a declaratory judgment regarding the duty
to transfer title to the boat. (Id. at 29.) In the
alternative, Lil' Man seeks $1, 000, 000.00 in
compensatory damages. (Id.)
Man alleges that the parties concluded a contract for the
sale of the Queen of Seattle and seeks to enforce that
contract. (Id. at 21.) Although the original asking
price for the vessel was $250, 000.00 (id. at 4),
Lil' Man expresses concern that the vessel may not be
able to receive a Certificate of Inspection
("COI"), which Lil' Man alleges is necessary
for commercial use of the vessel (id. at 14
(alleging that the expiration of the COI "may well make
it difficult if not impossible to financially return the boat
into [sic] operating conditions"), 15 (alleging
that if Lil Man "was to purchase the vessel and could
not get a COI for it, it would become a liability to have it
scrapped"), 18 (describing the allegedly unsatisfactory
inspection of the vessel that took place on December 8th,
2015)). In light of these concerns, the parties allegedly
agreed upon a purchase price of $12, 500.00 for the vessel.
(Id., Ex. 3.)
Legal Standards for the Amount in Controversy
Man invokes the court's subject matter jurisdiction
pursuant to 28 U.S.C. § 1332. (Compl. at 2.) Section
1332 provides that the district courts "shall have
original jurisdiction of all civil actions where the matter
in controversy exceeds the sum or value of $75, 000 ... and
is between citizens of different states." 28 U.S.C.
courts typically accept a plaintiffs alleged damages as
prima facie evidence of the amount in controversy, this
court has an obligation to confirm that it has subject matter
jurisdiction over the case and to address the issue of
jurisdiction sua sponte if necessary. See Snell
v. Cleveland, Inc., 316 F.3d 822, 826 (9th Cir. 2002).
In general, a plaintiff need only include a plausible
allegation that the amount in controversy exceeds the
jurisdictional threshold, see Pachinger v. MGM Grand
Hotel-Las Vegas, Inc., 802 F.2d 362, 363-64 (9th Cir.
1986), unless it appears to a legal certainty that the
plaintiff cannot recover that amount, see First Nat
7 Bank v. La. Highway Comm 'n, 264 U.S. 308, 310
(1924). The legal certainty test applies "when a rule of
law or limitation of damages would make it virtually
impossible for a plaintiff to meet the amount-in-controversy
requirement." Pachinger, 802 F.2d at 364. If
the plaintiff alleges a sum that will, as a legal certainty,
fall below the jurisdictional threshold, then the court must
dismiss the case. Naffe v. Frey, 789 F.3d 1030, 1040
(9th Cir. 2015) (adopting the "legal certainty"
jurisdictional amount is challenged, then the party invoking
the jurisdiction of the federal court has the burden to
support its allegations through the submission of
"summary-judgment type evidence relevant to the amount
in controversy" as it existed at the time of filing.
See Singer v. State Farm Mut. Auto. Ins. Co.,
116F.3d373, 377 (9th Cir. 1997); see also Sanchez v.
Monumental Life Ins. Co., 102 F.3d 398, 403 (9th Cir.
1996 (quoting Hale v. Billups of Gonzales, Inc., 610
F.Supp. 162 (M.D. La. 1985)). The court questions whether the
amount in controversy is met as measured by the value of the
Queen of Seattle and the availability of compensatory damages
for lost profits.
The Measure of Damages in Actions for Replevin
actions for declaratory or injunctive relief, the amount in
controversy is the value of the object of the litigation.
Hunt v. Wash. State Apple Advert. Comm 'n, 432
U.S. 333, 347 (1977). In actions for replevin, the amount in
controversy typically equals the replacement value of the
disputed goods. Stengel v. Black, No. 03 Civil No.
0495 (GEL), 2004 WL 1933612, at *2 (S.D.N.Y. Aug. 30, 2004)
(citing Satterwhite v. Harriman Natl. Bank & Trust
Co., 13 F.Supp. 493, 499 (S.D.N.Y.1935). Lil' Man
effectively seeks a declaratory judgment compelling Auk Ta
Shaa to transfer title to the Queen of Seattle upon full
payment. (Compl. at 29.) Thus, the value of the Queen of
Seattle appears to best reflect the amount in controversy.
Stengel, 2004 WL 1933612, at *5.
Stengel, the court places significant weight on the
arms-length negotiations between the parties in determining
the value of the goods in question. Id. The parties
allegedly negotiated a purchase price of $12, 500.00 for the
Queen of Seattle. (Compl. at 21.) This amount is well below
this court's jurisdictional threshold. 28 U.S.C. §
1332(a). Thus, the court orders Lil Man ...