United States District Court,

E.D. Louisiana.

Tonja R. Wright

v.

National Interstate Insurance Company et al

CIVIL ACTION NO. 16-16214

|

Signed 01/24/2017

Attorneys and Law Firms

John Bartholomew Kelly, III, Amy Collins Fontenot, Jeanne K. Demarest, Kurt A. Offner, Roderick Alvendia, Alvendia, Kelly, & Demarest, LLC, New Orleans, LA, for Tonja R. Wright.

Guy D. Perrier, Mitchell D. Monsour, Jr., Nathan M. Gaudet, Perrier & Lacoste, LLC, New Orleans, LA, David Henry Kennedy, Law Offices of Harold G. Toscano, Metairie, LA, for National Interstate Insurance Company et al.

 

 

SECTION ‘L‘

ORDER & REASONS

ELDON E. FALLON, UNITED STATES DISTRICT JUDGE

*1 Before the Court is Plaintiff’s Motion to Remand. R. Doc. 8. Having reviewed the parties’ briefs and the applicable law, the Court now issues this Order & Reasons.

 

 

1. BACKGROUND

This case arises out of an automobile accident. On September 9, 2015, Plaintiff Tonja Wright (“Wright” or “Plaintiff”) was operating her 2011 Ford Escape in Tangipahoa Parish, Louisiana, when she was struck by a 2015 Kenilworth tractor and trailer owned by Defendant Mabe Trucking Company, Inc. (“Mabe”), and operated by Defendant Terry Tearle Poole (“Poole”). R. Doc. 1-1 at 2. Wright also brings this case on behalf of her minor son Noah Jackson (“Jackson”), who was travelling with her in the car at the time of the alleged accident. In her motion, Plaintiff provides a list of communications regarding her injuries between herself and Mabe’s and Poole’s insurer, Defendant National Insurance Company, from November 13, 2015, to August 8, 2016. R. Doc. 8-1 at 2-3.

 

Plaintiff filed suit in state court on August 23, 2016, seeking damages for past and future mental and physical pain and suffering, property damage, loss of use of vehicle, depreciation, rental expenses, medical expenses, loss of past earnings, loss of future earning capacity, disability, scarring and disfigurement, loss of consortium, and penalties and attorneys’ fees. R. Doc. 1-1 at 1, 4. While La. Code Civ. Proc. Art. 893(A)(1) prohibits plaintiffs from alleging a specific amount of monetary damages, Plaintiff could have stated in her initial complaint that the amount in controversy satisfied, or failed to satisfy, federal jurisdiction requirements. In her pleading, Plaintiff referred to her injuries as “severe and disabling,” without elaborating on the nature of the injuries. Id. at 3. On November 1, 2016, Defendants received medical records in response to a subpoena that indicated Plaintiff had undergone cervical fusion surgery. R. Doc. 1 at 4. Defendants filed their notice of removal from state court on November 9, 2016, maintaining that Plaintiff’s damages could reasonably exceed $75,000. Id. at 4, 6.

 

 

1. PRESENT MOTION

Plaintiff Wright filed the present Motion to Remand. R. Doc. 8. Wright maintains that Defendants’ removal was untimely, and asks this Court to remand the present action to state court. Id. at 1. Wright does not dispute that the parties are diverse and the amount in controversy exceeds $75,000, but contests the timeliness of the Notice of Removal. R. Doc. 8-1 at 4.

 

 

1. Plaintiff’s Motion to Remand

Wright provided correspondence between the parties prior to the commencement of the case detailing her injury and medical care. R. Doc. 8-1 at 2-3; R. Docs. 8-2; 8-3; 8-4; 8-5. Based on this correspondence, she claims that Defendants were aware of her cervical fusion surgery as of August 8, 2016, and should have been aware that damages in a cervical fusion case would exceed $75,000. Id. at 5. Plaintiff cites Fifth Circuit precedent holding that settlement letters are considered “other paper” for the purposes of the commencement of time for removal, thus rendering Defendants’ Notice of Removal untimely. Id. at 5.

 

 

1. Defendants’ Opposition

*2 Defendants oppose the motion to remand and contend that the provisions of 28 U.S.C. § 1332 and 1441 are satisfied. R. Doc. 9 at 2.

 

Relying on 28 U.S.C. 1446(b)(3), Defendants argue that because Plaintiff’s state court petition did not affirmatively reveal on its face that the damages sought were in excess of $75,000, it was not removable at that time. Id. at 3 (citing Chapman v. Powermatic, Inc., 969 F.2d 160, 163 (5th Cir. 1992)). Accordingly, Defendants maintain this Court must evaluate whether it became removable at a later time. Id. Relying on precedent from this Court, Defendants argue that none of Plaintiff’s communications regarding her injuries prior to filing the state court action were legally sufficient to start the clock. R. Doc. 9 at 3-4.

 

Defendants maintain that the Notice of Removal was filed within thirty days of their receipt of “other paper” and thus timely under 28 U.S.C. § 1446(b)(3). R. Doc. 9 at 5. Defendants agree with Plaintiffs that a settlement demand may be considered “other paper,” but note that they never received a settlement demand, and that settlement demands must be received after the initial demand to constitute “other paper.” R. Doc. 9 at 6. Defendants rely on Plaintiffs’ medical records obtained on November 1, 2016, as the first receipt of “other paper” indicating that damages would be greater than $75,000. R. Doc. 9 at 6. Using this date, Defendants contend that their November 9, 2016, Notice of Removal was within the thirty-day removal deadline. R. Doc. 9 at 6.

 

 

III. LAW AND ANALYSIS

1. Applicable Law

A defendant may remove a civil action filed in state court if a federal court would have had original jurisdiction over the issue. 28 U.S.C. § 1441(a). A federal court would have original jurisdiction over cases involving complete diversity of diversity of citizenship among the parties where the amount in controversy exceeds $75,000. 28 U.S.C. § 1332(a).

 

28 U.S.C. § 1446 creates two distinct thirty-day filing deadlines for a notice of removal. In Chapman v. Powermatic, Inc., the Fifth Circuit held that this provision creates a two-step test to analyze the timeliness of removal. 969 F.2d 160, 161 (5th Cir. 1992). First, a court must determine if the case was removable when initially filed:

[t]he notice of removal of a civil action or proceeding shall be filed within 30 days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based, or within 30 days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant, whichever period is shorter.

28 U.S.C. § 1446(b)(1)

 

The Fifth Circuit established in Chapman that, to be removable under § 1446(b)(1), a pleading must affirmatively reveal on its face that the plaintiff seeks damages in excess of $75,000. 969 F.2d at 163 (reaffirmed by Mumfrey v. CVS Pharmacy, 719 F.3d 392, 400 (5th Cir. 2013)). A defendant’s subjective knowledge of the amount of damages is not enough to convert a non-removable action into a removable one. S.W.S. Erectors, Inc. v. Infax, Inc., 72 F.3d 489, 494 (5th Cir. 1996).

 

*3 If the action is not removable when initially filed, the court then evaluates if the case became removable at a later time. Section 1446(b)(3) provides that:

[e]xcept as provided in subsection (c), if the case stated by the initial pleading is not removable, a notice of removal may be filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable.

Thus, a case is removable upon the defendant’s receipt of “other paper” from which the amount of damages sought may first be ascertained. To trigger the removal timer, the information contained in the “other paper” must be “unequivocally clear and certain.” Bosky v. Kroger Texas, LP, 288 F.3d 208 (5th Cir. 2002). “[O]ther paper” must also be “received by a defendant only after that defendant has received the initial pleading.” Chapman, 969 F.2d at 164. If a case is originally not removable for reasons concerning amount in controversy, responses to discovery are considered “other paper.” § 1446(c)(3).

 

 

1. Discussion

Defendant’s removal in this case is only timely if: (1) the timing provision of 28 U.S.C. § 1446(b)(1) was not triggered by Plaintiff’s initial pleading; and (2) if the timing provision of § 1446(b)(3) was triggered on or after October 10, 2016.

 

 

1. Section 1446(b)(1) and Plaintiff’s Complaint

Plaintiff’s initial complaint did not trigger the timing provisions of § 1446(b)(1) because the pleading did not affirmatively reveal on its face that Plaintiff sought damages in excess of $75,000. In the Fifth Circuit, the initial pleading can only trigger the thirty-day removal time period if the “pleading affirmatively reveals on its face that the plaintiff is seeking damages in excess of the minimum jurisdictional amount of the federal court.” Chapman v. Powermatic, Inc., 969 F.2d 160, 163 (5th Cir. 1992). Plaintiff sought damages for “past physical pain and suffering, future physical pain and suffering, past mental pain and suffering, future mental pain and suffering, property damage, loss of use of vehicle, depreciation, rental expenses, medical expenses, loss of past earnings, loss of future earning capacity, permanent disability of the body, scarring and disfigurement, loss of consortium and penalties and attorney’s fees” for her “severe and disabling injuries.” R. Doc. 1-1 at 3-4. Plaintiff did not include “a specific allegation that damages are in excess of the federal jurisdictional amount” in this initial pleading, and thus the initial pleading did not, on its face, trigger the removal timer. Chapman, 969 F.2d at 163.

 

Plaintiff’s cited cases involve amount disputes, not timeliness disputes. R. Doc. 8-1 at 4 (citingLucket v. Delta Airlines Inc., 171 F.3d 295, 298 (“the sole jurisdictional issue is whether the district court erred in deciding the amount in controversy exceeded $75,000”); White v. FCI USA, Inc., 319 F.3d 672, 673-74 (“Plaintiff … asserts the district court erred in finding the … amount-in-controversy requirement satisfied”); Allen v. R & H Oil & Gas Co., 63 F.3d 1326, 1330 (“plaintiffs … question the application of the amount-in-controversy standard”)). The Fifth Circuit has held that a “facially apparent” argument is relevant only to amount dispute cases, and specifically disavowed the applicability of Luckett v. Delta Airlines, Inc. in timeliness disputes. See Mumfrey v. CVS Pharmacy, Inc., 719 F.3d 392, 400 (5th Cir. 2013). Plaintiff admits that the amount in controversy exceeds $75,000, and relies on the argument that the Notice of Removal was untimely to justify remand to state court; thus, the cited cases do not support Plaintiff’s argument for remand.

 

*4 Plaintiff’s argument regarding damage awards for similarly-situated plaintiffs is also inapposite—Plaintiff did not detail her injuries in her initial complaint. R. Doc. 8-1 at 5. The Chapman inquiry focuses on the text of the pleading, not the defendant’s subjective knowledge. 969 F.2d at 163 (“We adopt this rule because we conclude that it promotes certainty and judicial efficiency by not requiring courts to inquire into what a particular defendant may or may not subjectively know.”)

 

 

1. Section 1446(b)(3) and Plaintiff’s Subpoena Response

Defendant’s removal was timely under § 1446(b)(3), because Defendant’s November 9, 2016, Notice of Removal was filed within thirty days of Defendant’s November 1, 2016, receipt of “other paper” which triggered the thirty-day removal period. “Other paper” can trigger the thirty-day timer under § 1446(b)(3) if it is received after the initial complaint and is “unequivocally clear and certain” regarding the information supporting removal. Bosky, 288 F.3d at 211. Defendant received “unequivocally clear and certain” notice that Plaintiff’s damages would exceed $75,000 on November 1, 2016 in medical records obtained through a subpoena response. R. Doc. 9 at 5. Defendants filed their Notice of Removal on November 9, 2016, within the thirty-day time period triggered by this “other paper,” and is therefore timely.

 

Plaintiff’s correspondence with Defendants prior to August 23, 2016, does not constitute “other paper” capable of triggering the removal provision. As discussed in this Court’s recent ruling in Oniate v. State Farm Mutual Automobile Insurance Company, Chapman holds that an “other paper” must be “received by a defendant only after that defendant has received the initial pleading.” Chapman, 969 F.2d at 164; Oniate, 2:15-CV-6431 (E.D. La. 1/20/16); 2016 WL 232437. None of the correspondence between Plaintiff and Defendants discussing medical treatment and expenses qualify as “other paper” because they were received prior to the August 23, 2016 initial pleading in state court. Therefore, Plaintiff’s argument is unpersuasive.

 

 

1. CONCLUSION

For the aforementioned reasons, IT IS ORDERED that Plaintiff’s Motion to Remand, R. Doc. 8, is hereby DENIED.

Superior Court of Pennsylvania.

Pittsburgh Logistics Systems, Inc., Appellant

v.

1. Keppel Trucking, LLC

No. 1943 WDA 2015

|

FILED JANUARY 06, 2017

Appeal from the Order December 1, 2015, In the Court of Common Pleas of Allegheny County Civil Division at No(s): G.D.13–18152

BEFORE: BENDER, P.J.E., RANSOM, J., and MUSMANNO, J.

Opinion

OPINION BY RANSOM, J.:

 

*1 Pittsburgh Logistics Systems, Inc. (Appellant) appeals from the order entered December 1, 2015, granting B. Keppel Trucking, LLC’s (Appellee) petition to confirm an arbitration award and granting judgement thereon. We affirm.

 

Appellant is a third-party logistics company that, among other services, brokers transportation of freight between shippers and trucking companies. See Pet. To Stay Arbitration 9/10/13. In September of 2009, Appellant began doing business with Appellee, a large trucking company. Keppel Dep., 12/3/15, 21:25. That month, an employee of Appellant called to offer Appellee a load for pick-up. Spears Dep., 1/31/14, 8:23–9:10. The parties orally agreed on the price of the shipment. Id. at 7:10. Appellee then received a “carrier set-up packet” containing various forms, as well as the Motor Carrier Service Contract (“MCSC”). Id. at 10:20–11:9. Appellee signed and returned the documents to Appellant. Id. at 12:1–4.

 

Other carriers used Appellant’s web-based system, which enables carriers to bid on loads posted by Appellant on behalf of its customers. Homan Dep., 12/6/13, 23:5–16. If a carrier is awarded a shipment, the carrier receives an email confirmation that contains a hyperlink to the Appellant’s Carrier Terms of Use (“Terms of Use”). The Terms of Use do not include an arbitration clause. See Carrier Terms of Use.

 

Regarding this first job, Appellee did not bid via the online system; Appellant contacted Appellee directly. Spears Dep. at 8:23–9:10. Nevertheless, twelve days after Appellee completed delivery, Appellant emailed an award confirmation containing a hyperlink to the Terms of Use. Id. at 9:11–20.

 

In May of 2012, Appellant contacted Appellee for assistance with another client, Streamlite. Id. at 14:25, 15:1–25, 16:1–6. Appellant called Appellee and other carriers for their pricing and ultimately awarded Appellee the job. Id. Thereafter, Appellant received weekly email confirmations arranging shipments for the following week. Keppel Dep. at 68:1–25, 69:1–6. This practice continued until June 2012, when Streamlite abruptly went out of business and Appellant stopped paying Appellee for shipments. Id. at 19:22–20:14. Appellant pursued legal action against Streamlite and was able to recover a portion of Streamlite’s unpaid balance. See Affidavit of Ryan Boushell 5/13/14 at ¶ 10. Appellant offered Appellee $9,812.87, 19% of the $50,513.15 owed to Appellee. Id. at ¶ 12.

 

Appellee refused payment and, on July 23, 2013, filed a demand for arbitration against Appellant seeking payment of the full $50,513.15. Appellant brought a Petition to Stay Arbitration pursuant to 42 Pa.C.S.A. § 7304(b), which the lower court denied. See Petition to Stay Arbitration, 10/21/13. The parties proceeded to arbitration, and ultimately Appellee was awarded $50,952.09, plus $637.50 in costs. See Arbitration Award 2/20/15. Appellant filed a Petition to Vacate the Arbitration Award. On April 10, 2015, the Petition to Vacate was denied. Appellant filed an appeal, which was quashed as premature. On December 1, 2015, the lower court granted Appellee’s Petition to Confirm the Arbitration Award and entered judgment in its favor. This appeal followed.

 

*2 Appellant timely filed a court-ordered PA.R.A.P. 1925(b) statement. The trial court issued a responsive opinion.

 

Appellant raises the following issue for review:

Did the Court of Common Pleas err in its denial of Appellant’s Petition to Stay arbitration and in its subsequent confirmation of the arbitration award were [sic] there was no enforceable arbitration agreement between the parties?

Appellant’s Brief at 5.

 

Appellant contends the trial court erred in compelling arbitration of Appellee’s claim for damages.1 Appellate courts employ a two-part test to determine whether a trial court should have compelled arbitration: the court must determine (1) whether a valid agreement to arbitrate exists, and (2) whether the dispute is within the scope of the agreement. Pisano v. Extendicare Homes, Inc., 77 A.3d 651, 654 (Pa. Super. 2013).

 

Appellant challenges the first part of this test. According to Appellant, an arbitration award should not be enforced where it contemplates execution by both parties, but not all parties sign. Appellant’s Brief at 16 (citing in support Bair v. Manor Care of Elizabethtown, PA, LLC, 108 A.3d 94 (Pa. Super. 2015)). Here, Appellant argues, it never signed the MCSC. Thus, according to Appellant, the MCSC was merely a draft agreement and not binding on the parties. Moreover, Appellant suggests that the parties never operated under the terms of the MCSC. Appellant’s Brief at 16. Rather, according to Appellant, the Carrier Terms of Use governed their relationship. Id.

 

An agreement to arbitrate is a contract. United Steelworkers of America, AFL–CIO v. Westinghouse Elec. Corp (Bettis Atomic Power Lab.), 413 Pa. 358, 196 A.2d 857, 859 (1964). Our standard of review is de novo, and our scope is plenary. Bair, 108 A.3d at 96 (quoting Bucks Orthopaedic Surgery Assoc., P.C. v. Ruth, 925 A.2d 868, 871 (Pa. Super. 2007)). The touchstone of any valid contract is mutual assent and consideration. Bair, 108 A.3d at 96; Weavertown Transp. Leasing Inc. v. Moran, 834 A.2d 1169, 1172 (Pa. Super. 2003).

 

Appellant’s reliance on Bair is misplaced. In Bair, following the death of her mother, plaintiff, as executrix of her mother’s estate, commenced a wrongful death action against the operator of her mother’s healthcare facility. Bair, 108 A.3d at 95. The healthcare facility sought to enforce an arbitration agreement signed by the plaintiff acting under power of attorney. Id. Despite a signature line for both parties, the healthcare facility never signed the agreement. Id. at 97. The trial court declined to enforce the agreement, and the healthcare facility appealed. Id. at 96. This Court affirmed, concluding that the failure of the defendant to sign the arbitration agreement precluded the defendant from enforcing the agreement against the plaintiff. Id. at 97. However, as noted by Appellee, this Court’s decision was not rooted solely in the healthcare facility’s mere failure to sign the arbitration agreement.

*3 “[t]he issue is not whether the arbitration agreement was signed by the party sought to be bound, but whether there was a meeting of the minds, that is, whether the parties agreed in a clear and unmistakable manner to arbitrate their disputes.”

Appellee’s Brief at 17 (quoting Bair, 108 A.3d at 97; emphasis omitted).

 

Here, the lack of Appellant’s signature does not render the MCSC invalid. The court in Bair noted, “[T]he absence of signatures is not fatal unless required by law or by the intent of the parties…” Bair, 108 A.3d at 98; Shovel Transfer Storage, Inc., v. Pa. Liquor Control Bd., 559 Pa. 56, 739 A.2d 133, 136 (1999) (“As a general rule, signatures are not required unless signing of contract is expressly required by law or the intent of the parties.”).

 

The contract language set forth in the MCSC does not explicitly require Appellant’s signature. In the MCSC, the line preceding the signature lines state, “In witness whereof, the parties, intending to be legally bound, have set their hands and seals the day and year first above written.” See MCSC Agreement at 12. This statement is not an express requirement for both parties’ signatures. The phrase “legally bound” constitutes consideration for the contract. Socko v. Mid–Atlantic Sys. of CPA, Inc., 126 A.3d 1266 (Pa. 2015) (holding that the term “legally bound” is interpreted by 33 P.S. § 6 to supply the necessary consideration for an agreement.)

 

Appellant also references Franklin Interiors v. Wall of Fame Mgmt. Co. Inc., 510 Pa. 597, 511 A.2d 761 (1986) and Commonwealth v. On–Point Tech. Sys., Inc., 821 A.2d 641 (Pa. Commw. Ct. 2003) in support of its argument that the MCSC is merely a draft, as Appellants did not sign the agreement. However, both cases are distinguishable, as the contracts at issue included explicit language requiring a signature. For example, in Franklin Interiors, the Supreme Court determined that an explicit requirement flowed from contractual language stating, “[t]his document does not become a final contract until approved by an officer of Franklin Interiors.” Franklin 511 A.2d at 763. Similarly, in On–Point Tech., the Commonwealth Court rejected a party’s contention that a binding contract was formed, where the contracted language expressly required signatures. On–Point Tech, 821 A.2d at 643.

 

Moreover, there is clear evidence of Appellant’s intent to be bound by the terms of the MCSC. At the beginning of their relationship, a representative from Appellant’s company contacted Appellee and provided them with the MCSC to sign and return. Furthermore, Appellant informed Appellee that until Appellee signed and returned the MCSC, they would not receive payment. Spears Dep. at 12:13–17. In contrast, Appellee did not receive the Carrier Terms of Use agreement until two weeks after they completed their delivery.

 

Appellant suggests that the Carrier Terms of Use controlled the parties. We disagree. There is no evidence that the parties operated under the Terms of Use agreement. During the course of their business, Appellee never placed a bid via Appellant’s online system. Appellee did not receive the Terms of Use in advance of their first job, and there is no evidence that the Terms of Use were negotiated or accepted. Rather, the terms were forwarded to Appellee as a hyperlink in an email received by Appellee after the job was accepted and completed. Based on the language in the MCSC and the business practices between the two parties, the Terms of Use agreement does not constitute a contract.

 

*4 The MCSC constitutes a valid agreement to arbitrate and is binding upon the parties. Thus, the trial court did not err in denying Appellant’s Petition to Stay and confirming the subsequent arbitration award.

 

Order affirmed.

 

All Citations

— A.3d —-, 2017 WL 65468, 2017 PA Super 5

 

 

Footnotes

1

Appellee asserts that Appellant has waived consideration of the claim it presents on appeal, suggesting that (1) its claim first arose in the context of interlocutory orders issued by the trial court, thus precluding appellate consideration now, (2) Appellant asserts arguments contrary to those raised before the trial court, and (3) Appellant has either omitted or stated issues vaguely. See Appellant’s Brief at 11–14. We disagree. First, Appellant could not pursue his appeal until entry of a final order or judgment, at which time, all previous, interlocutory issues may be raised. See McNeil v. Jordan, 586 Pa. 413, 894 A.2d 1260, 1266–67 (2006). (noting that an appeal from “the entry of judgment will be viewed as drawing into question any prior non-final orders that produced the judgment”). Second, Appellant has consistently maintained that the MCSC does not constitute a binding agreement to arbitrate. See Petition to Stay, 10/8/13, ¶ 38. Thus, we decline to dismiss Appellant’s claim as waived.