How is a Personal Injury Case Removed from Nevada State District Court to Federal Court?

Most personal injury cases are filed in State Court. However, there are times when the at-fault party (aka ‘defendant”) may attempt to transfer (in legal terms “remove”) the case from State Court to Federal Court. 


State court generally assumes that one or both parties to the action, are residents of the state in which they are being sued. However, if the at-fault/defendant is not a resident or does not do business in Nevada (if it is an insurance company), the defendant can seek to have the case transferred to Federal Court. When the defendant is not a Nevada resident or business, then the Federal removal is based upon “Diversity Jurisdiction”.  However, the case has to have a value of more than $75,000.00. This is generally called the “amount in controversy”.

Relevant case law says that Diversity Jurisdiction exists only "where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs ... " (formerly $50,000). 28 USC§ 1332(a); See Arbaugh v. Y & H Corp. (2006) 546 US 500.514. 126 S.Ct. 1235. Courts note that this amount-in-controversy threshold is an ingredient of subject-matter jurisdiction. It is important to note that there is no generally no monetary limit in federal question cases. See 28 USC§ 1331. However, in your regular personal injury case, generally no federal question is presented.
 
The amount in controversy for jurisdictional purposes is determined by the amount of damages or the value of the property that is the subject of the action. See Hunt v. Washington State Apple Advertising Comm'n (1977) 432 US 333, 347-348. 97 S.Ct. 2434, 2443-2444; Meisel v. Allstate Indem. Co. (ED CA 2005) 357 F.Supp.2d 1222, 1225. The amount in controversy may include compensatory damage claims for "general" or "special" damages (pain and suffering, as well as out-of-pocket loss).

It is important to note that the amount in controversy may include punitive damages if (1) they are recoverable as a matter of state law and (2) it cannot be said to a legal certainty that plaintiff would not be entitled to recover the jurisdictional amount. [Anthony v. Security Pac. Fin 'I Services, Inc. (7th Cir. 1996) 7 5 F3d 311, 315; Watson v. Blankinship (10th Cir. 1994) 20 F.3d 383, 386-387; St. Paul Reinsurance Co., Ltd. v. Greenburg (5th Cir. 1998) 134 F3d 1250, 1253- 1254. When a punitive damages claim makes up the bulk of the amount in controversy, the court will "scrutinize that claim closely" to be certain jurisdiction exists. [Anthony v. Security Pac. Fin. Services, Inc., supra, 75 F3d at 315; Packard v. Provident Nat. Bank (3rd Cir. 1993) 994 F2d 1039.

The at-fault party/defendant has the burden of proof to show to the court that the case has a value over $75,000.00. Case law says that the removing defendant may make the requisite showing by either: demonstrating that it is ''facially apparent" from the complaint that the claims likely exceed $75,000 (e.g., claims of loss of life or limb, punitive damages, etc.); or setting forth facts in the notice of removal (or sometimes by affidavit) that support a finding of the requisite amount. [Luckett v. Delta Airlines, Inc. (5th Cir. 1999) 171 F3d 295, 298].

The next issue is the standard of proof. Courts vary on the standard of proof a defendant must satisfy in order to support its burden as to the amount in controversy when the state court complaint is uncertain or silent. Most courts, including the 9th Circuit (where Nevada is located), hold the defendant must prove existence of the jurisdictional amount by a preponderance of the evidence (i.e., "more likely than not"). [Sanchez v. Monumental Li(e Ins. Co. (9th Cir. 1996) 95 F3d 856, 860; Williams v. Best Buy Co., Inc. (11th Cir. 2001) 269 F.3d 1316, 1319; H & D Tire & Automotive-Hardware, Inc. v. Pitney Bowes Inc. (5th Cir. 2000) 227 F.3d 326,328, fn. 2.

Your personal injury attorney will make sure your case is in the proper court. If you case was improperly removed to Federal Court, your attorney will petition the Court to transfer the case back to State Court.

Next time, we will discuss the liability of parents when their teenage children are involved in a car accident.