[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT FILED
U.S. COURT OF APPEALS
________________________ ELEVENTH CIRCUIT
OCTOBER 18, 2001
No. 00-11829 THOMAS K. KAHN
________________________ CLERK
D. C. Docket No. 99-00128-CV-CC-1
MIRIAM W. WILLIAMS,
Plaintiff-Appellant,
versus
BEST BUY COMPANY, INC.,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Northern District of Georgia
_________________________
(October 18, 2001)
Before BIRCH, COX and ALARCON*, Circuit Judges.
COX, Circuit Judge:
*
Honorable Arthur L. Alarcon, U.S. Circuit Judge for the Ninth Circuit, sitting by
designation.
Miriam W. Williams sued Best Buy Company, Inc. (“Best Buy”) in state court
for personal injuries sustained as a result of a slip and fall. After the case was
removed to federal court, the district court granted summary judgment in favor of Best
Buy, and Williams appeals. We do not reach the merits of Williams’ arguments on
appeal, however, because it is not clear that the district court had subject matter
jurisdiction. We remand the case to the district court for factual findings on whether
the jurisdictional amount in controversy is satisfied.
I. Background
Williams filed a complaint in the State Court of Fulton County, Georgia,
alleging that she tripped over a curb while entering one of Best Buy’s retail stores and
sustained injuries as a result of Best Buy’s negligence. In addition to permanent
physical and mental injuries, the complaint alleges that Williams incurred substantial
medical expenses, suffered lost wages, and experienced a diminished earning capacity.
The complaint then alleges that Williams will continue to experience each of these
losses for an indefinite time into the future. For these injuries, the complaint seeks
general damages, special damages, and punitive damages in unspecified amounts.
Best Buy filed a notice of removal pursuant to 28 U.S.C. § 1441, alleging
diversity jurisdiction under 28 U.S.C. § 1332. The notice of removal states: “Counsel
for Plaintiff and Plaintiff have refused to stipulate that Plaintiff’s claims do not exceed
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and will not exceed the sum of $75,000.00. This suit is for a sum in excess of
$75,000.00.” (R.-1 at 2.) The notice of removal contains no other factual allegations
regarding the amount in controversy, and Best Buy did not submit any evidence
concerning the amount in controversy. Williams did not file a motion to remand the
case to state court or challenge in any other way the district court’s subject matter
jurisdiction. In fact, the joint preliminary planning report proposed by the parties
indicated that there was no question regarding the district court’s jurisdiction to hear
the case. Following removal, Best Buy moved the district court for summary
judgment, and the district court granted Best Buy’s motion. Williams appeals.
On appeal, we raised sua sponte the issue of whether the case involved a
sufficient amount in controversy to sustain diversity jurisdiction under § 1332. At our
request, the parties submitted supplemental briefs on this issue. In her brief, Williams
argues that Best Buy failed to demonstrate the requisite amount in controversy
because Best Buy has not submitted any evidence or made any factual showing on that
issue, relying instead on negative inferences and conclusory allegations. Williams
therefore urges us to remand the case to the district court with instructions to remand
the case to the State Court of Fulton County. Best Buy, on the other hand, maintains
that its burden is satisfied by Williams’ refusal to stipulate that she seeks less than the
jurisdictional amount.
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II. Standard of Review
Subject matter jurisdiction is a question of law subject to de novo review. See
Darden v. Ford Consumer Fin. Co., 200 F.3d 753, 755 (11th Cir. 2000).
III. Discussion
Appellate courts have a responsibility to examine the subject matter jurisdiction
of the district courts in actions that they review. Kirkland v. Midland Mortgage Co.,
243 F.3d 1277, 1280 (11th Cir. 2001); see also Morrison v. Allstate Indem. Co., 228
F.3d 1255, 1261 (11th Cir. 2000). In this case, the district court’s jurisdiction was
premised on diversity of citizenship pursuant to 28 U.S.C. § 1332. Diversity
jurisdiction exists where the suit is between citizens of different states and the amount
in controversy exceeds the statutorily prescribed amount, in this case $75,000. See 28
U.S.C. § 1332(a). There is no dispute in this case that the parties are of diverse
citizenship. Therefore, the only jurisdictional issue concerns whether the amount in
controversy requirement has been satisfied.
Because this case was originally filed in state court and removed to federal
court by Best Buy, Best Buy bears the burden of proving that federal jurisdiction
exists. See Kirkland, 243 F.3d at 1281 n.5. Where, as here, the plaintiff has not pled
a specific amount of damages, the removing defendant must prove by a preponderance
of the evidence that the amount in controversy exceeds the jurisdictional requirement.
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Id.; Tapscott v. MS Dealer Serv. Corp., 77 F.3d 1353, 1357 (11th Cir. 1996),
overruled on other grounds by Office Depot v. Cohen, 204 F.3d 1069 (11th Cir. 2000).
Although this court has not explicitly articulated the proper procedure for
determining the amount in controversy on removal, we have suggested the approach
that district courts should take in making such a determination. See Sierminski v.
Transouth Fin. Corp., 216 F.3d 945, 949 (11th Cir. 2000). In Sierminski, we held that
a district court may properly consider post-removal evidence in determining whether
the jurisdictional amount was satisfied at the time of removal. In reaching this
conclusion, we quoted language from the Ninth Circuit’s opinion in Singer v. State
Farm Mut. Auto. Ins. Co., 116 F.3d 373 (9th Cir. 1997):
The Fifth Circuit has described an appropriate procedure for determining
the amount in controversy on removal. The district court may consider
whether it is “facially apparent” from the complaint that the
jurisdictional amount is in controversy. If not, the court may consider
facts in the removal petition, and may “require parties to submit
summary-judgment-type evidence relevant to the amount in controversy
at the time of removal.” The Fifth circuit [sic] agrees with our
conclusion in Gaus that removal “cannot be based simply upon
conclusory allegations” where the ad damnum is silent.
Sierminski, 216 F.3d at 949 (quoting Singer, 116 F.3d at 377 (in turn quoting Allen
v. R & H Oil & Gas Co., 63 F.3d 1326, 1335-36 (5th Cir. 1995))). While we did not
explicitly adopt the approach described in Singer and Allen, we clearly relied upon
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that approach in concluding that the district court may consider evidence submitted
after the notice of removal is filed.
We now make explicit what we suggested in Sierminski and adopt the approach
of the Fifth and Ninth Circuits. When the complaint does not claim a specific amount
of damages, removal from state court is proper if it is facially apparent from the
complaint that the amount in controversy exceeds the jurisdictional requirement. If
the jurisdictional amount is not facially apparent from the complaint, the court should
look to the notice of removal and may require evidence relevant to the amount in
controversy at the time the case was removed. See also McNutt v. General Motors
Acceptance Corp., 298 U.S. 178, 189, 56 S. Ct. 780, 785 (1936) (stating that party
invoking federal jurisdiction must allege facts essential to show jurisdiction and court
may demand evidence supporting such facts). We reiterate that the burden of proving
jurisdiction lies with the removing defendant. A conclusory allegation in the notice
of removal that the jurisdictional amount is satisfied, without setting forth the
underlying facts supporting such an assertion, is insufficient to meet the defendant’s
burden. See Laughlin v. Kmart Corp., 50 F.3d 871, 873 (10th Cir. 1995); Allen, 63
F.3d at 1335; Gaus v. Miles, 980 F.2d 564, 567 (9th Cir. 1992); see also Burns v.
Windsor Ins. Co., 31 F.3d 1092, 1097 (11th Cir. 1994) (concluding that removing
defendant did not meet burden of proving amount in controversy where it offered
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“nothing more than conclusory allegations”); Gaitor v. Peninsular & Occidental S.S.
Co., 287 F.2d 252, 255 (5th Cir. 1961) (stating that removing defendant must make
“affirmative showing . . . of all the requisite factors of diversity jurisdiction”).1
In this case, it is not facially apparent from Williams’ complaint that the amount
in controversy exceeds $75,000. We therefore look to Best Buy’s notice of removal.
Although the notice of removal clearly asserts that the jurisdictional requirement is
satisfied, the only fact alleged in support of that assertion is that Williams refuses to
stipulate that her claims do not exceed $75,000. There are several reasons why a
plaintiff would not so stipulate, and a refusal to stipulate standing alone does not
satisfy Best Buy’s burden of proof on the jurisdictional issue. Thus, the pleadings are
inconclusive as to the amount in controversy.
Where the pleadings are inadequate, we may review the record to find evidence
that diversity jurisdiction exists. See Sun Printing & Publ’g Ass’n v. Edwards, 194
U.S. 377, 382, 24 S. Ct. 696, 697 (1904); Rice v. Office of Servicemembers’ Group
Life Ins., 260 F.3d 1240, 1245 (10th Cir. 2001); United Food & Commercial Workers
Union, Local 919 v. Centermark Props. Meriden Square, Inc., 30 F.3d 298, 305 (2d
Cir. 1994). Having done so in this case, we find the record to be inconclusive as well.
1
In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc),
this court adopted as binding precedent all decisions of the Former Fifth Circuit handed down
prior to October 1, 1981.
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The district court made no factual findings on the amount in controversy, and neither
Best Buy nor Williams submitted any evidence relevant to the issue. We cannot say,
on this record, that the amount in controversy more likely than not exceeds $75,000.
It is not clear, however, that the jurisdictional requirement is not satisfied.
Although the present record is inconclusive, the value of Williams’ claims could
conceivably amount to more than $75,000. As noted, her complaint demands general,
special, and punitive damages for permanent physical and mental injuries, as well as
substantial medical expenses, lost wages, and diminished earning capacity for an
indefinite period of time. Based on these allegations, the amount in controversy might
well exceed the jurisdictional amount.
Although Best Buy has the burden of proving federal jurisdiction, the lack of
a developed record cannot be attributed solely to Best Buy. Williams shares
responsibility for the lack of a developed record because of her failure to challenge the
district court’s jurisdiction. Facing a similar situation, the Second Circuit held that the
proper course of action under such circumstances is to remand the case to the district
court for factual findings on the amount in controversy. See United Food, 30 F.3d at
306. The United Food court reasoned that, had the plaintiff challenged the amount in
controversy by filing a motion to remand in the district court, “the parties, under the
direction of the district court, would have had an opportunity to supplement the record
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to allow for an informed decision on the issue.” Id. Therefore, the Second Circuit
found it “only fair . . . that the issue be remanded to the district court to allow the
parties to submit evidence on the amount in controversy and to give defendants an
opportunity to meet their burden as to this requirement of diversity jurisdiction . . . .”
Id.; accord Mehlenbacher v. Akzo Nobel Salt, Inc., 216 F.3d 291, 298-99 (2d Cir.
2000).
We find this reasoning persuasive and not inconsistent with our own precedent.
See Morrison, 228 F.3d at 1275 (remanding diversity case to district court so that
plaintiffs could prove amount in controversy); United States v. H.R. Morgan, Inc., 528
F.2d 986, 987 (5th Cir. 1976) (per curiam) (remanding to district court for factual
development and determination of jurisdictional issue); Airline Maint. Lodge 702 v.
Loudermilk, 426 F.2d 802 (5th Cir. 1970) (per curiam) (remanding to district court for
findings regarding jurisdiction and propriety of removal). Because Best Buy’s notice
of removal clearly asserted that the jurisdictional amount was satisfied, Best Buy
should be afforded an opportunity to submit evidence in support of its assertion. We
therefore hold that, where the notice of removal asserts the jurisdictional amount and
the plaintiff does not challenge that assertion in the district court, we will remand the
case to the district court for factual findings on the amount in controversy if the
amount in controversy cannot be clearly determined by a review of the record.
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IV. Conclusion
Accordingly, this case is remanded to the district court for the limited purposes
of developing the record and making findings of fact with regard to the amount in
controversy at the time of removal. If Best Buy carries its burden with respect to the
amount in controversy, we retain jurisdiction to consider whether the district court
properly granted summary judgment in this case. Conversely, if Best Buy does not
prove by a preponderance of the evidence that the amount in controversy exceeds
$75,000, there is no federal jurisdiction and the district court should remand the case
to the state court from whence it came. See 28 U.S.C. § 1447(c).2
LIMITED REMAND.
2
The district court is requested to advise the Clerk of this Court should it remand
the case, in which event we will dismiss this appeal.
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