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Porter v. Buck

United States District Court, W.D. Virginia, Roanoke, Division.

July 18, 2014

JACOB CECIL BUCK, et al., Defendants.


GLEN E. CONRAD, Chief District Judge.

This declaratory judgment action was removed from the Circuit Court of Franklin County by The Peninsula Insurance Company ("Peninsula"). The case is presently before the court on the plaintiffs motion to remand. For the reasons that follow, the plaintiff's motion will be denied.


The plaintiff, Abigail Lan Porter, a resident of Franklin County, Virginia, was seriously injured in an accident involving two all-terrain vehicles ("ATVs") on July 28, 2012. The ATV on which the plaintiff was riding as a passenger was driven by Jacob Cecil Buck. The second ATV was operated by Patrick Thomason. The plaintiff filed a tort action against Buck and Thomason in the Circuit Court of Franklin County, which remains pending.

In the instant action, filed on March 24, 2014, the plaintiff seeks a judgment declaring that she is entitled to $500, 000.00 of uninsured/underinsured motorist coverage (UM/UIM coverage) under a commercial automobile insurance policy issued by Peninsula. See Compl. unnumbered ¶ 20, Docket No. 1-1 ("[T]he Plaintiff moves this Court to declare The Peninsula Insurance Company's underinsured motorist coverage in the amount of $500, 000.00... is applicable to the injuries and damages sustained by the Plaintiff in the motor vehicle occurrence of July 28, 2012...."). In addition to Peninsula, the plaintiff named the following individuals and entities as defendants: the alleged tortfeasors, Buck and Thomason; the plaintiff's father, Steven L. Porter, who is listed as the named insured on the Peninsula policy; Buck's liability insurer, Foremost Insurance Company; and the Porter family's personal automobile insurer, Allstate Insurance Company.

On April 16, 2014, Peninsula, a Maryland corporation, removed the declaratory judgment action to this court on the basis of diversity jurisdiction. In the notice of removal, Peninsula acknowledged that Mr. Porter and the alleged tortfeasors, like the plaintiff, are citizens of Virginia.[1] Peninsula argues, however, that their presence does not defeat diversity jurisdiction because they are merely nominal parties.

On May 16, 2014, the plaintiff moved to remand the case to state court. She contends that the alleged tortfeasors are not merely nominal parties and, thus, that their presence precludes diversity jurisdiction. The plaintiff also argues that diversity jurisdiction is lacking because the plaintiff's citizenship must be imputed to Peninsula under 28 U.S.C. § 1332. In the event the court rejects these arguments and concludes that diversity jurisdiction does exist, the plaintiff requests that the court abstain from hearing the declaratory judgment action based on the factors set forth in Nautilus Ins. Co. v. Winchester Homes, Inc. , 15 F.3d 371, 377 (4th Cir. 1994).

The plaintiff's motion to remand has been fully briefed. Neither side requested a hearing on the motion, and the court has determined that oral argument would not aid in the decisional process. Accordingly, the matter is ripe for disposition.


I. Diversity Jurisdiction

The threshold question the court must resolve is whether it has subject matter jurisdiction over this declaratory judgment action. In order for an action to be removed from state court to federal court, the action must be one "of which the district courts of the United States have original jurisdiction." 28 U.S.C. § 1441(a). If at any time before final judgment it appears that the court lacks subject matter jurisdiction, the court must remand the case. 28 U.S.C. § 1447(c). The burden of demonstrating jurisdiction rests with Peninsula, "the party seeking removal." Mulcahey v. Columbia Organic Chems. Co. , 29 F.3d 148, 151 (4th Cir. 1994).

Peninsula premised its removal upon 28 U.S.C. § 1332, pursuant to which federal district courts have original jurisdiction over civil actions in which the amount in controversy exceeds $75, 000 and the dispute is between citizens of different states. See 28 U.S.C. § 1332(a)(1). "Section 1332 requires complete diversity among the parties, meaning the citizenship of each plaintiff must be different from the citizenship of each defendant." Hoschar v. Appalachian Power Co. , 739 F.3d 163, 170 (4th Cir. 2014).

A. The Nominal Party Exception

Although the plaintiff's father and the alleged tortfeasors share the plaintiffs Virginia citizenship, Peninsula contends that they are merely nominal parties. In determining whether complete diversity exists, "a federal court must disregard nominal or formal parties and rest jurisdiction only upon the citizenship of real parties to the controversy." Navarro Say. Ass'n v. Lee , 446 U.S. 458, 461 (1980). To rise above the status of a nominal party, a defendant must "possess a sufficient stake in [the] proceeding." Hartford Fire Ins. Co. v. Harleysville Mut. Ins. Co. , 736 F.3d ...

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