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The Northwest Railway Museum v. Indian Harbor Insurance Co.

United States District Court, W.D. Washington, Seattle

October 4, 2017



          JAMES L. ROBART, United States District Judge


         Before the court is Plaintiff The Northwest Railway Museum's ("the Museum") motion to remand. (Mot. (Dkt # 8).) The court has considered the parties' submissions in support of and in opposition to the motion, the relevant portions of the record, and the applicable law. Being fully advised, [1] the court denies the Museum's motion.


         On August 8, 2016, Robin Ann Roettger sued the City of Snoqualmie, Washington, for injuries she sustained after falling on a public sidewalk. (See generally Roettger Compl. (Dkt. #11-1).) In her complaint, Ms. Roettger alleges that she required multiple surgeries and "many invasive and expensive medical procedures." (Id. ¶ 5.1; see Murphy Decl. (Dkt. # 11) 14.) The City of Snoqualmie, in turn, sued the Museum for complete indemnification, alleging either that the Museum agreed to a hold harmless stipulation as part of its permit for using the sidewalk on which Ms. Roettger fell or that the Museum had actual control over the sidewalk and failed to warn Ms. Roettger. (Snoqualmie Compl. (Diet. # 11-2) ¶¶ 8.1-8.8.)

         The Museum then filed a liability insurance claim with Defendant Indian Harbor Insurance Company ("Indian Harbor"). (Compl. (Dkt. # 1-2) 16.) Indian Harbor refused to cover the Museum's potential liability from the City of Snoqualmie's lawsuit. (Id. ¶ 17.) In response, the Museum filed this lawsuit against Indian Harbor and its parent corporation Defendant XL Specialty Insurance Company (collectively, "Defendants") in King County Superior Court for (1) breach of contract, (2) bad faith conduct, (3) unreasonable denial of coverage under the Insurance Fair Conduct Act ("IFCA"), RCW 48.30.015, and (4) violations of the Consumer Protection Act ("CPA"), RCWch. 19.86. (See generally Compl.)

         Defendants removed the action based on diversity subject matter jurisdiction. (Not. of Removal (Dkt. # 1).) The Museum now moves to remand because (1) Defendants failed to prove complete diversity of citizenship among the parties, and (2) Defendants failed to prove an amount in controversy over $75, 000, 00. (Mot. at 3-4.) The court now considers the Museum's motion.

         III. ANALYSIS

         A. Legal Standards

         A court has subject matter jurisdiction over an action when there is complete diversity of citizenship among the parties and the amount in controversy exceeds $75, 000.00. Abrego Abrego v. The Dow Chem. Co., 443 F.3d 676, 679 (9th Cir. 2006) (citing 28 U.S.C. § 1332(a)). Removal from state court to federal court is proper where the federal court would have original jurisdiction over the state court action. Id. at 679-80 (citing 28 U.S.C. § 1441(a)). However, courts strictly construe the removal statute against removal jurisdiction and must reject jurisdiction if there is any doubt as to the right of removal in the first instance. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). "The 'strong presumption' against removal jurisdiction means that the defendant always has the burden of establishing that removal is proper." Id. (quoting St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 288-290 (1938)).

         B. Complete Diversity of the Parties

         The Museum disputes the court's jurisdiction by arguing that Defendants made an insufficient showing of complete diversity of citizenship in their notice of removal. (Mot. at 3.) Diversity subject matter jurisdiction requires complete diversity of citizenship among the parties. Caterpillar Inc. v, Lewis, 519 U.S. 61, 68 (1996); 28 U.S.C. § 1332(a)(1). Complete diversity exists when the state citizenship of each plaintiff is different from the state citizenship of each defendant. Id. (citing 28 U.S.C. § 1332(a)). A corporation can be a citizen in two states: (1) its state of incorporation and (2) the state where its principal place of business, typically its headquarters, is located, 28 U.S.C. § 1332(c)(1); Hertz Corp. v. Friend, 559 U.S. 77, 93 (2010) (concluding that a principal place of business is "normally" a corporation's headquarters).

         Although Defendants' notice of removal could be clearer, Defendants state that they are (1) incorporated in Delaware, and (2) citizens of states other than Washington. (See Not. of Removal ¶ 6.) Further, Defendants' counsel attests that Defendants are incorporated in Delaware with their principal places of business in Stamford, Connecticut. (Murphy Decl. ¶¶ 3-4.) Defendants allege the same in their counterclaims. (Answer at 8.) Because the Museum is a citizen of Washington (see Compl. 1; see also Not. of Removal ¶ 6), complete diversity of citizenship exists between Defendants and the Museum. Indeed, the Museum implicitly acknowledges as much by abandoning its diversity of citizenship argument in its reply memorandum. (See Reply (Dkt. #12).) Thus, the court concludes that Defendants have established complete diversity of citizenship among the parties.

         C. The ...

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