Friday, November 30, 2018

Motion To Remand Case Back to State Court Denied

In the case of Pisanchyn v. Progressive Direct Ins. Co., No. 3:18-CV-01215 (M.D. Pa. Aug. 2, 2018), Judge A. Richard Caputo of the Federal Middle District Court of Pennsylvania addressed a Plaintiff’s Motion to Remand a case back to state court.

The Plaintiff asserted that a remand was required because the parties were not diverse and/or given that a forum selection clause in the insurance policy allegedly waived the Defendant’s right to remove the action to federal court in the first place.

The court held that, because diversity jurisdiction over the action existed and given that the Defendant did not waive its right to remove under the forum selection clause, the Plaintiff’s Motion to Remand would be denied.  

According to the Opinion, the UM/UIM policy in this matter included a provision with a forum selection clause requiring that any suit by the insured against the carrier be brought “in the county in which the person seeking benefits resides, or in the United States District Court serving that county.”  

The court initially rejected the lack of diversity argument.   The Plaintiff asserted that there was no diversity because his suit was a “direct action” against his carrier and, therefore, his carrier should be deemed to also be a citizen of Pennsylvania under §1332(c)(1).   

Judge Caputo noted that every Circuit that has considered  “direct action” argument, including the Third Circuit, has held that an action by an insured against his or her  own carrier is not a “direct action” within the meaning of §1332(c)(1).  

The Plaintiff also argued that the insurance company had waived the right to remove by virtue of the forum selection clause.  More specifically, the Plaintiff asserted that the carrier had agreed to “submit” to, and stay in, the forum chosen by the Plaintiff.  

With respect to the waiver argument, the court found that the policy language did not contain any agreement by the carrier to “submit” to any chosen court or to litigate there.

Anyone wishing to review this Opinion may click this LINK.  The companion Order can be viewed HERE.

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