Opinion
Civil Action No: 04-1460 Section: "J" (3).
January 20, 2005
ORDER AND REASONS
Before the Court are defendant's Motion for Reconsideration (Rec. Doc. 15) and Motion to Dismiss (Rec. Doc. 14) plaintiffs' first supplemental and amended petition for improper venue, failure to state a claim upon which relief can be granted, and failure to join an indispensable party. Plaintiffs oppose the motions. The motions, set for hearing on January 19, 2005, are before the Court on briefs without oral argument. For the reasons that follow, the Court finds that both motions should be DENIED.
BACKGROUND
The factual background of this case has been set forth in detail in the Court's prior order entered October 21, 2004 (Rec. Doc. 9) ("prior order") and thus, will not be restated here.In its prior order, the Court denied State Farm's motion to dismiss and granted plaintiffs leave to file an amended petition. The plaintiffs subsequently filed an amended petition, curing defects identified in the Court's prior order. In response to the denial of its motion to dismiss the original complaint, State Farm filed the instant motion for reconsideration. State Farm also filed the instant motion to dismiss plaintiffs' amended complaint, which is virtually identical to its original motion to dismiss. Since an amended petition has been filed, the Court will not reconsider State Farm's original motion to dismiss based on the plaintiffs' original petition. Rather, the Court will consider State Farm's motion to dismiss the plaintiffs' amended petition for improper venue, failure to state a claim, and failure to join an indispensable party.
DISCUSSION
A. Improper Venue
Citing 28 U.S.C. § 1391(a), State Farm argues that the Robertses have filed suit in an improper venue and that the proper venue for this suit is either where the accident occurred (Missouri) or where State Farm is incorporated or has its principal place of business (Illinois). State Farm further asserts that because this is not a direct action, the provision in 28 U.S.C. § 1332(c)(1) deeming insurers in a direct action suit to be citizens of the same state as the insured is inapplicable, and thus State Farm is not a citizen of Louisiana and venue is not proper here.
In contrast, the Robertses rely on section 1391(c), which states that for purposes of venue, corporate defendants are deemed to reside in any judicial district in which they are subject to personal jurisdiction. Claiming that State Farm is subject to personal jurisdiction in the Eastern District of Louisiana, the Robertses maintain that venue is proper in this Court.
When jurisdiction is based on diversity of citizenship, venue is determined in accordance with 28 U.S.C. § 1391. Under section 1391(a), venue is proper in 1) any judicial district where any defendant resides if all reside in the same state; 2) in the judicial district where a substantial part of the events giving rise to the claim occurred; or 3) in a judicial district in which any defendant is subject to personal jurisdiction at the time the action was commenced, if there is no other district in which the action can be commenced. 28 U.S.C. § 1391(a). As noted by plaintiffs, section 1391(c) further provides that if a defendant is a corporation, then it shall be deemed to reside in any judicial district in which it is subject to personal jurisdiction. 28 U.S.C. § 1391(c).
For reasons set forth in the prior order, the Court has already determined that State Farm is subject to personal jurisdiction in Louisiana. Thus, under section 1391(c), State Farm is deemed to reside in Louisiana for venue purposes. Under section 1391(a)(1) venue is proper where any defendant resides if all reside in the same state; because State Farm is the only defendant, then venue is proper where State Farm resides. Accordingly, venue is proper in the Eastern District of Louisiana.
The Court acknowledges that a typographical error in its previous order may have made it unclear which section of 1391 it was relying on in deciding that venue is proper in the Eastern District of Louisiana. Thus, the prior order (Rec. Doc. 9) is hereby amended so that the first full sentence on page 4 of the Court's previous order states: "Thus, as long as State Farm is subject to personal jurisdiction in the Eastern District of Louisiana, under section 1391(c), it is deemed to reside here and venue is proper in this court pursuant to 1391(a)(1)."
Defendant continues to maintain that State Farm is a citizen of Illinois, relying on 28 U.S.C. § 1332(c). However, by its terms, 28 U.S.C. § 1332(c)(1) addresses corporate citizenship for purposes of establishing diversity jurisdiction. Residence of a corporation for venue purposes is determined by application of 1391(c).
B. Failure to State a Claim upon which Relief Can be Granted
On this point, State Farm also reasserts the arguments made in its original motion to dismiss. Specifically, State Farm argues that the plaintiffs have failed to state a claim upon which relief can be granted because 1) Mr. Kent's liability has not been determined; 2) plaintiffs have not received a settlement from Mr. Kent; 3) plaintiffs have not sought relief from Ms. Cole's UM insurer; and 4) plaintiffs have not received a settlement from Ms. Cole's UM insurer. Thus, State Farm argues that since plaintiffs' UM claim on their own policy only applies if both Mr. Kent and Ms. Cole's insurance is insufficient, then the plaintiffs' claims are premature. Plaintiffs' agree with the Court's original order and submit that its amended petition states a claim upon which relief can be granted.
To state a claim for UM benefits, the plaintiffs must prove the following facts. First, the plaintiffs must prove that Mr. Kent caused the wreck and is thus liable for the Robertses' damages. Adams v. Allstate Ins. Co., 01-1244 (La.App. 5th Cir. 02/26/2002), 809 So. 2d 1169, 1172. Second, the Robertses must prove that Mr. Kent either did not have insurance or that his insurance coverage was insufficient to cover the plaintiffs' injuries. Id. Third, the Robertses must prove that Ms. Cole either did not have UM coverage or that her UM coverage was insufficient to cover the Robertses' injuries. Id. Fourth, the Robertses must prove that their damages were greater than the amount covered by Mr. Kent and Ms. Cole's insurance coverage combined. Id. Therefore, to state a claim to recover from their own UM insurer, the plaintiffs must have alleged all of these facts.
As explained in this Court's original order, the plaintiffs' original petition failed to state all of the necessary facts to state a claim. However, as recognized by State Farm, the Court may grant the plaintiff the "benefit of all inferences that can be derived from the alleged facts." Defendant's Motion to Dismiss, p. 8. Giving the plaintiffs the benefit of all inferences in their original complaint, this Court found that the plaintiffs could have stated a claim upon which relief could be granted and thus, granted the plaintiffs leave to amend. The plaintiffs have amended their complaint to add the following allegations to their original petition: 1) Mr. Kent caused the plaintiffs' injuries; 2) Mr. Kent had liability insurance in the amount of $50,000; 3) Ms. Cole had UM coverage in the amount of $100,000; and 4) plaintiffs' injuries exceed $150,000. Thus, including these allegations with plaintiffs' original allegations, plaintiffs have stated a claim upon which relief can be granted.
C. Indispensable Party
Last, State Farm argues, once again, that the Robertses' suit should be dismissed because Mr. Kent, his insurer, Ms. Cole, and her insurer are all indispensable parties which may not be joined. For the reasons previously set forth in its prior order, the Court has already determined that Mr. Kent, Ms. Cole, and their insurers are not indispensable parties and incorporates that reasoning by reference here. Accordingly, State Farm's argument that this matter must be dismissed for failure to join indispensable parties is also without merit. Therefore,
Since the court issued the prior opinion, Mr. Kent has settled with the Robertses and been dismissed with prejudice. This only bolsters the Court's prior determination that he is not an indispensable party to this suit.
IT IS ORDERED that defendant's Motion for Reconsideration (Rec. Doc. 15) should be and is hereby DENIED. IT IS ORDERED that defendant's Motion to Dismiss (Rec. Doc. 14) should be and is hereby DENIED.