BAD FAITH DAMAGES CONSIDERED IN MEETING JURISDICTIONAL MINIMUM AMOUNT IN CONTROVERSY (Western District)

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The court dismissed this bad faith case for lack of diversity. Still, Judge Hornak opined on whether the plaintiff successfully alleged an amount in controversy above $75,000. The court found that, had there been complete diversity, it would have exercised jurisdiction.

“Courts ‘accept a party’s good faith allegation of the amount in controversy;’ however, when a defendant then challenges a plaintiff’s allegations of the amount in controversy, the plaintiff must provide ‘sufficient evidence’ to demonstrate the amount in controversy exceeds $75,000.” Courts “will only dismiss the case for failure to sufficiently allege the amount in controversy requirement if ‘it is apparent, to a legal certainty, that the plaintiff cannot recover the amount claimed.’”

In this case, the insured sought breach of contract damages and damages for statutory bad faith and violation of the UTPCPL. Judge Hornak believed the claims were asserted in good faith. Under these circumstances, the court could “not conclude ‘to a legal certainty’ that Plaintiffs cannot recover an amount that exceeds the seventy five thousand dollar ($75,000.00) requirement.”

Date of Decision: December 8, 2020

Amato v. AAA Interinsurance Exchange of the Automobile Club, U. S. District Court Western District of Pennsylvania No. 2:20-CV-00684, 2020 WL 7222769 (W.D. Pa. Dec. 8, 2020) (Hornak, J.)

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