Court: Court of Appeals for the Seventh Circuit; January 31, 2006; Federal Appellate Court
John R. Rising-Moore, the plaintiff-appellant, is involved in a slip-and-fall case against Red Roof Inns, Inc., the defendant-appellee. Rising-Moore initially preferred to litigate in state court, but the case was removed to federal court after he indicated a settlement demand of $160,000, with his claim valued between $180,000 and $200,000. The federal court granted summary judgment in favor of Red Roof Inns.
Rising-Moore's incident occurred outside the motel during a sleet storm after he stopped for the night while driving home. He claims that the ramp was initially ice-free but became slick by the time he left the lobby. He reported $10,000 in medical expenses, lost about 10 weeks of work, and suffers from permanent injuries, which he estimates cost him about $35,000 in lost income, bringing his total claim close to the federal jurisdictional minimum.
The district court denied Rising-Moore's motion to remand the case back to state court, agreeing with Red Roof Inns that the potential for pain, suffering, and future losses exceeded the jurisdictional threshold. Additionally, Indiana's trial rules do not require plaintiffs to specify damages in their complaints, complicating federal jurisdiction determinations under 28 U.S.C. § 1332, which relies on the amount in controversy. Without a specified amount, the claim must be assessed using alternative evaluations.
A defendant removing a suit with a complaint that lacks an ad damnum must demonstrate a "reasonable probability" that the amount in controversy exceeds $75,000. The burden of proof lies with the removing party, but once established, the St. Paul Mercury rule applies, which does not require proof of the plaintiff's likelihood of success or ultimate recovery above this threshold. The focus is on the plaintiff's claims for damages. Rising-Moore's attorney estimated potential damages between $180,000 and $200,000, which Rising-Moore later dismissed as preliminary and instead emphasized a settlement offer of $60,000. He argued that this amount reflects the true nature of the dispute, suggesting it never exceeded $75,000. However, the court determined that settlement offers can be considered to assess the stakes of the case, not liability. The court upheld the admissibility of Rising-Moore's initial estimates for damages, asserting their relevance despite being early in the litigation process. Rising-Moore did not challenge the possibility of a jury finding damages over $75,000 under Indiana law, nor did he request a hearing to dispute the claims regarding the amount in controversy. As a high-income plaintiff, the potential for damages exceeding the jurisdictional limit could not be dismissed, confirming that the case properly falls within federal jurisdiction.
Acceptance of a $60,000 settlement offer by Rising-Moore indicates that the amount in controversy exceeds $75,000. Rising-Moore sought a certain sum rather than contingent upon a jury's decision, suggesting that trial stakes are significantly higher. Statistics show plaintiffs win roughly half of tort cases, which supports the conclusion that a 50% chance of a $120,000 verdict would rationalize the offer of $60,000. If Rising-Moore is risk-averse, he might accept less than half of the expected award, implying a higher potential claim value. The district judge's skepticism about Rising-Moore's chances of winning further suggests the claim exceeds the threshold.
The merits of the case are briefly addressed, noting that Indiana law does not impose absolute liability on landowners for injuries from falls on their property. Specifically, Indiana does not mandate the immediate removal of snow or ice during winter storms. Previous cases indicate that reasonable diligence involves prompt action after a storm, but Red Roof Inns acted within a reasonable timeframe, as the conditions were acceptable upon Rising-Moore's entry to the motel. Liability would only arise from a continuous duty to monitor and clear during a storm, which Indiana law does not require. The decision was affirmed.
