In Studer v. State Farm Lloyds, 4:13CV413, 2014 WL 234352 (E.D. Tex. Jan. 21, 2014), the Federal District Court adopted a magistrate’s recommendation holding the Plaintiff had improperly joined an insurance adjuster in an effort to defeat diversity jurisdiction.  The case arose out of a June 21, 2011 hail storm that hit Denton County, Texas.  Plaintiff alleged his home suffered damage as a result of the storm and he submitted a claim to State Farm.  State Farm assigned adjuster Tommie Taylor to adjust the insured’s claim and, in his subsequent bad faith suit, Plaintiff claimed both Taylor and State Farm conducted an inadequate and unreasonable investigation of his claim. Plaintiff vaguely alleged that his solarium was damaged during the hail event and claimed Taylor was “predisposed” to reject his claim due to the cost of the repairs without regard to the fact that Plaintiff’s policy allegedly covered such damages.

State Farm removed the lawsuit from state court in Denton County to Federal Court on the basis that Taylor was improperly joined in the lawsuit.  The Plaintiff filed a motion to remand with a supporting affidavit regarding adjuster Taylor’s conduct.

The Court correctly noted State Farm must prove that there is no possibility that the Plaintiff will be able to establish a cause of action against the in-state defendant in state court, or that there has been outright fraud in the Plaintiff’s pleading of jurisdictional facts. The Court stated State Farm did show that Plaintiff had no possibility of establishing a valid cause of action against adjuster Taylor and Plaintiff had only attempted to allege causes of action against Taylor for his alleged policy benefits, although his policy with State Farm and not Taylor individually. The Court held Plaintiff’s breach of contract claims are against the insurer, not the adjuster.  The Court noted Plaintiff failed to allege an independent ground for recovery against Taylor.

Importantly, the Court noted its decision applied the more stringent federal pleading standard. Unlike the Southern District of Texas that applies the less stringent Texas “notice” standard when reviewing these remand issues, the Eastern District of Texas applies the federal pleading-sufficiency standard when analyzing improper joinder.  The Court noted the issue has not been decided by the 5th Circuit yet.

Additionally, the Court refused to consider Plaintiff’s post-removal affidavits in support of Plaintiff’s Motion to Remand.  The Court held the affidavit did not clarify the claims actually alleged in the controlling petition, and it refused to consider the post-removal affidavit. As such, the Court noted that Plaintiff’s petition offered nothing more than “conclusory allegations” against Taylor, denied Plaintiff’s Amended Motion to Remand, and dismissed Taylor from the lawsuit.

Editor’s Note: MDJW represents State Farm in this bad faith case.  Counsel Chris Martin, George Lankford and Leslie Pitts wish to thank the carrier for the opportunity to protect its interests in this case in north Texas.

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