United States Court of Appeals
For the First Circuit
No. 09-1943
DELIA ESQUILÍN-MENDOZA; DAYMAR VEGA-ROSA;
MICHAEL TORRES-ROSARIO; ROBERTO PACHECO-ROSARIO,
Plaintiffs, Appellants,
v.
DON KING PRODUCTIONS, INC.,
Defendant, Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
[Hon. Raymond L. Acosta, U.S. District Judge]
Before
Torruella, Leval,* and Lipez, Circuit Judges.
Louis A. De Mier Le-Blanc for appellants.
Ricardo L. Díaz Soto for appellee.
February 18, 2011
*
Of the Second Circuit, sitting by designation.
LEVAL, Circuit Judge. Plaintiff Delia Esquilín-Mendoza
("Esquilín") appeals from the judgment of the United States
District Court for the District of Puerto Rico, dismissing her tort
claim against Don King Productions, Inc. ("DKP"). The suit,
brought in federal court by virtue of diversity of citizenship, 28
U.S.C. § 1332, alleged that DKP acted negligently in seizing
Plaintiff’s automobile in execution of a court judgment
notwithstanding a defect in the execution warrant, and in failing
to return the vehicle promptly when the court vacated the warrant.
Plaintiff claimed damages of approximately $1 million for emotional
distress and deprivation of the use of the automobile. The
district court dismissed the action and entered judgment for the
Defendant, based on its finding that Plaintiff had failed to
establish a causal connection between the Defendant’s actions and
her injury. We hereby direct that the judgment be vacated and the
suit dismissed for lack of federal jurisdiction under § 1332
because it is a legal certainty that the "matter in controversy
[does not] exceed[] the sum or value of $75,000." 28 U.S.C. § 1332.
BACKGROUND
The pertinent facts of this case consist primarily of the
facts of the prior lawsuit brought by DKP. DKP was the producer of
a closed-circuit telecast transmission of a championship boxing
match on March 1, 2003, between Roy Jones, Jr. and John Ruiz. DKP
distributed this televised transmission to subscribing
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establishments in Puerto Rico. On or about August 13, 2004, DKP
brought suit in the United States District Court for the District
of Puerto Rico against numerous restaurants, bars, and other like
establishments in Puerto Rico, and their owners, alleging that they
had violated Section 705 of the Communications Act of 1934, 47
U.S.C. § 605, by intercepting its closed-circuit transmission and
exhibiting it to their patrons. DKP sought damages against each
defendant under the statute’s provision for a private cause of
action by "any person with proprietary rights in the intercepted
communication." 47 U.S.C. § 605(d)(6); § 605(e)(3)(A). Among the
numerous defendants named in DKP’s suit were:
30. Defendants Alberto López, his wife Delia López,
and the conjugal partnership which they constitute
. . . doing business as DELIA’S TACOS.
Upon the failure of those defendants to answer the complaint,
the court noted the default and granted summary judgment to DKP,
awarding damages of $12,000. The order of judgment named the
defendants as "Alberto López, individually and in representation of
the conjugal partnership between him and his wife Delia López,
a.k.a. Delía Esquilín d/b/a Delia’s Tacos." Upon the defendants’
failure to pay the judgment, the court issued a writ of execution,
pursuant to which the United States Marshal seized the Plaintiff’s
1995 Toyota 4 Runner sport utility vehicle. The writ, consistent
with DKP’s complaint, named "Alberto López, his wife Delia López,
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and the conjugal partnership which they constitute . . . doing
business as DELIA’S TACOS" as the defendants against whom judgment
had been entered.
Esquilín then moved to set aside the judgment and the writ of
execution. The basis of the motions was essentially that Delia,
the owner of Delia’s Tacos, is not married to Alberto López, so
that her surname is not López, as specified in DKP’s complaint, but
Esquilín, and that Alberto López is not an owner but an employee of
Delia’s Tacos. DKP did not contest these motions. The judgment
and writ of execution were therefore vacated, and on September 11,
2006, the court directed DKP to return the vehicle by September 25,
2006. For reasons which are disputed by the parties (each side
accusing the other of failure to cooperate), the vehicle was not
restored to Delia Esquilín’s possession until October 2007.
Esquilín then brought this action against DKP asserting gross
negligence and illegal embargo. She claimed damages of
approximately one million dollars for deprivation of the vehicle,
extreme mental anguish and depression resulting from public
humiliation, injury to her public dignity, and stress, which
exacerbated her heart problems.
The District Court granted DKP’s motion to dismiss Esquilín’s
suit, ruling that she failed to establish a causal connection
between DKP’s actions and her alleged injuries, and that her own
acts and omissions contributed to her loss.
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DISCUSSION
For cases brought in the federal courts on the basis of
diversity of jurisdiction, § 1332 of the Judicial Code of the
United States provides that jurisdiction lies only "where the
matter in controversy exceeds the sum or value of $75,000,
exclusive of interests and costs." 28 U.S.C. § 1332. Although no
party has questioned whether the district court had jurisdiction to
rule in this case, it is well established that the courts have a
duty to ensure that they are not called upon to adjudicate cases
which in fact fall outside the jurisdiction conferred by Congress.
Arbaugh v. Y & H Corp., 546 U.S. 500, 514 (2006).
In St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S.
283, 288-89 (1938), the Supreme Court reviewed a case in which the
Court of Appeals had directed the remand to the state court of a
suit, which had been brought by the plaintiff in state court and
had been then removed by the defendant to federal court on the
basis of diversity of citizenship. The complaint asserted damages
of $4,000, which exceeded the then-current threshold requirement of
$3,000. The district court had found in the plaintiff’s favor on
the merits and awarded damages in the amount of $1,162.98. The
Court of Appeals directed that the judgment be vacated and the case
remanded to the state court on the ground that the plaintiff’s
claim did not equal the amount necessary to give the District Court
jurisdiction. Id. at 285. The Supreme Court reversed the remand
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to state court and reinstated the judgment. The Supreme Court
explained that the court’s eventual determination that the damages
were less than the jurisdictional amount did not negate the
propriety of the plaintiff’s original claim for an amount that
exceeded the jurisdictional minimum. The Supreme Court described
the test for determining satisfaction of the jurisdictional amount
as follows:
The intent of Congress drastically to restrict
federal jurisdiction in controversies between
citizens of different states has always been
rigorously enforced by the courts. The rule
governing dismissal for want of jurisdiction in
cases brought in the federal court is that, unless
the law gives a different rule, the sum claimed by
the plaintiff controls if the claim is apparently
made in good faith. It must appear to a legal
certainty that the claim is really for less than
the jurisdictional amount to justify dismissal.
The inability of plaintiff to recover an amount
adequate to give the court jurisdiction does not
show his bad faith or oust the jurisdiction. Nor
does the fact that the complaint discloses the
existence of a valid defense to the claim. But if,
from the face of the pleadings, it is apparent, to
a legal certainty, that the plaintiff cannot
recover the amount claimed or if, from the proofs,
the court is satisfied to a like certainty that the
plaintiff never was entitled to recover that
amount, and that his claim was therefore colorable
for the purpose of conferring jurisdiction, the
suit will be dismissed.
Id. at 288-89.
This discussion in St. Paul is confusing. On the one hand, it
states, "[T]he sum claimed by the plaintiff controls if the claim
is apparently made in good faith. . . . The inability of plaintiff
to recover an amount adequate to give the court jurisdiction does
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not show his bad faith or oust the jurisdiction." Id. at 289. On
the other hand, another part of the Court’s explanation states
that, where it appears "to a legal certainty that the claim is
really for less than the jurisdictional amount," dismissal is
required. Id. (emphasis added). "[I]f . . . from the proofs, the
court is satisfied to a [legal] certainty that the plaintiff never
was entitled to recover that amount, and that his claim was
therefore colorable1 for the purpose of conferring jurisdiction,
the suit will be dismissed." Id. The latter passage appears to
render irrelevant whether the plaintiff exercised good faith in
pleading entitlement to recover the jurisdictional amount when it
is clear "to a legal certainty" that he cannot recover a sufficient
amount. Id.
Our decisions have construed the Supreme Court’s summary to
mean that "legal certainty that the claim is really for less than
the jurisdictional amount," id., trumps the plaintiff’s good faith
1
Some further confusion arises from the Supreme Court’s use
of the term "colorable" where the term "not colorable" seems more
appropriate. In the legal context, the word is most commonly used
to mean having apparent validity, see Bryan A. Garner, A Dictionary
of Modern Legal Usage 124 (1st ed. 1987) ("used in the law in the
sense ‘having at least a prima facie aspect of justice or
validity’"), which does not seem compatible with the Court’s
explanation. It appears, however, that "colorable" also has a
secondary meaning which is very nearly the contrary of the first.
The Merriam-Webster Third New International Dictionary, for
example, gives as the first and second meanings, "1. Seemingly
valid and genuine, having an appearance of truth, right, or
justice, plausible" and "2. FEIGNED, FICTITIOUS, COUNTERFEIT."
Merriam-Webster Third New International Dictionary 449. The
Supreme Court apparently had in mind the latter sense.
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in claiming for a larger amount. See Barrett v. Lombardi, 239 F.3d
23, 30 (1st Cir. 2001) ("[T]he amount specified by the plaintiff
controls, as long as that amount is asserted in good faith. Hence,
a court can dismiss an action for insufficiency of the amount in
controversy only when, ‘from the face of the pleadings, it is
apparent, to a legal certainty, . . . that the plaintiff never was
entitled to recover’ a sum equal to, or in excess of, the
jurisdictional minimum." (citations omitted) (quoting St. Paul, 303
U.S. at 289)); see also Spielman v. Genzyme Corp., 251 F.3d 1, 5
(1st Cir. 2001); Dep't of Recreation & Sports v. World Boxing
Ass'n, 942 F.2d 84, 88 (1st Cir. 1991).
Saying approximately the same thing in slightly different
terms in other cases, we construed the Supreme Court’s language in
St. Paul to mean that the plaintiff’s "good faith" in pleading the
jurisdictional amount includes an element of "objective good
faith": jurisdiction is defeated notwithstanding the plaintiff’s
good faith in claiming for the jurisdictional amount if one
familiar with the applicable law could not reasonably have
concluded that the claim was worth the jurisdictional amount.
Coventry Sewage Assoc. v. Dworkin Realty Co., 71 F.3d 1, 4-8 (1st
Cir. 1995); Jimenez Puig v. Avis Rent-A-Car System, 574 F.2d 37, 40
(1st Cir. 1978).
The present case seems to us to fall squarely within the
contested territory between the divergent prongs of the Supreme
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Court’s explanation. Esquilín pleaded that, as the result of DKP’s
improper seizure of her car and its failure to return it promptly
when the judgment against her and the execution warrant were
vacated, she suffered not only deprivation of use of the vehicle
but also serious emotional injury resulting from her humiliation
and anxiety. We have no reason to believe that Esquilín possesses
any sophisticated understanding of legal entitlements and thus have
no reason to question her good faith in asserting entitlement to
damages for these injuries. If her good faith in making the claim
were controlling, federal jurisdiction would lie because her
complaint pleaded injury far beyond the requisite jurisdictional
amount.
On the other hand, examination of her claims and concessions
makes clear that she has no legal entitlement to recover damages
for any emotional or other injury caused by DKP’s execution of its
judgment against the vehicle. The only defect identified by
Esquilín in the proceedings that led to the seizure of the vehicle
was that, because of DKP’s mistaken belief that she was married to
her employee, López, her surname was written incorrectly in the
operative documents. DKP’s complaint was directed against "Alberto
López, his wife Delia López, and the conjugal partnership which
they constitute . . . doing business as DELIA’S TACOS." The
subject of the complaint was the unauthorized interception and
exhibition of DKP’s transmission at Delia’s Tacos. The plaintiff
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Delia Esquilín acknowledges that she is the owner of Delia’s Tacos,
and has never denied that DKP’s closed-circuit transmission was
exhibited at Delia’s Tacos without DKP’s authorization. Her
allegations therefore show no impropriety in DKP’s having brought
suit and obtained judgment against her, or its subsequent seizure
of her car pursuant to a warrant of execution when she failed to
pay the judgment. The fact that DKP erroneously believed that the
Delia who owned Delia’s Tacos was married to López and shared his
surname, and that DKP made out the court documents naming her in
that manner, in no way shows any impropriety in the seizure of her
car, given her admissions that she was the owner of Delia’s Tacos,
which illegally intercepted DKP’s transmission. DKP’s suit was
thus properly brought against her; judgment and execution therefore
were properly entered notwithstanding the mistake as to her
surname.
While Esquilín claims she was not served with process in DKP’s
suit, which resulted in the seizure of the car, it is clear on
careful reading of her allegations that she is not denying that the
summons and complaint were served on her. She is rather contending
that the service of the complaint should be deemed ineffective and
void because it named her by the wrong name. Whatever merit there
may be to such a contention where a defendant reasonably believes
that the complaint served on her was not properly directed against
her because it named a different person, that is not the
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circumstance here. It was unmistakably clear from the face of
DKP’s complaint that it was directed against Delia, the owner of
Delia’s Tacos, and that it related to the unauthorized interception
and exhibition of the fight telecast at Delia’s Tacos. As Delia
Esquilín admits that she is Delia, the owner of Delia’s Tacos, and
did not deny that DKP’s telecast was exhibited at Delia’s Tacos,
she could not have had any reasonable doubt that the complaint
served on her was intended for her and sufficiently identified her.
Therefore, notwithstanding her presumable good faith in making
the claim, we find it clear to a legal certainty that the plaintiff
Delia Esquilín has no legal entitlement to damages for emotional
injury resulting from the judgment against her and the consequent
seizure of her car. These damage claims are all predicated on the
theory that DKP had no cause for the judgment that resulted in the
seizure of her car. But, notwithstanding its insignificant mistake
as to her marital status, DKP was entitled to judgment against
Delia, the owner of Delia’s Restaurant, and to seize her car in its
execution.
Esquilín’s only plausible claim for damages relates to the
delay in returning the vehicle, which DKP and Esquilín each claim
was due to the fault of the other. Assuming the validity of
Esquilín’s claim that DKP was at fault in failing to return the car
to her promptly following the court’s order, the only harm she
suffered from that wrong was the deprivation of the use of a
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vehicle for approximately thirteen months. The rental value of an
equivalent car for the period of allegedly wrongful deprivation
constitutes the only damages to which she might have a plausible
entitlement.
The cost of renting a vehicle equivalent to hers for this 13-
month period could not have approached $75,000. By Esquilín’s own
admission, the rental of an equivalent vehicle would not have
exceeded $22,500. One "familiar with the applicable law . . .
could [not] objectively have . . . viewed [the claim] as worth [the
jurisdictional minimum]." Coventry, 71 F.3d at 6. Because it is
clear to a legal certainty that Esquilín has no claim for damages
remotely approaching $75,000, we dismiss the case for want of
jurisdiction.
CONCLUSION
The District Court’s judgment is hereby vacated and the suit
is dismissed for lack of federal jurisdiction.
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