Ullman v. Safeway Insurance (995 F. Supp. 2d 1196, 2013)

MEMORANDUM OPINION AND ORDER

JAMES O. BROWNING, District Judge.

THIS MATTER comes before the Court on the Plaintiffs Motion for Remand, filed July 24, 2013 (Doc. 10)(“Motion to Remand”). The Court held a hearing on November 14, 2013. The primary issues are: (i) whether Defendant Safeway Insurance Company has established that Plaintiff Betty Ullman’s claims exceed the jurisdictional minimum for conventional diversity jurisdiction; (ii) whether Ullman fraudulently joined nondiverse Defendant Richard Bailey; (in) whether Ullman procedurally misjoined Bailey to defeat federal diversity jurisdiction; and (iv) whether Ullman is entitled to attorney’s fees. The Court concludes that, because Ullman’s claims exceed $75,000.00, the amount in controversy requirement is satisfied, and the Court may exercise supplemental jurisdiction over the remaining putative class members’ claims if they satisfy the other requirements of diversity jurisdiction, but, because it also concludes that the Ullman did not fraudulently join or procedurally misjoin Bailey and the claims against him, there is not complete diversity, and the Court does not have subject-matter jurisdiction over the case. The Court will, therefore, grant the Motion to Remand in part and remand the case to state court, but it will deny Ullman’s request for attorney’s fees.

FACTUAL BACKGROUND

The Court takes its facts from the Class Action Complaint for Breach of Statutory, Common Law, and Contractual Duties, and for Injunctive and Delaratory [sic] Relief and for Personal Injuries, filed in state court May 23, 2013, filed in federal court June 27, 2013 (Doe. 1 at ^(“Complaint”). The dispute arises from uninsured/underinsured motorist (“UM/UIM”) coverage provisions in Safeway Insurance policies issued to Ullman and others similarly situated.

On May 3, 2012, Bailey struck the passenger side of Ullman’s vehicle, injuring Ullman and totaling her vehicle; Bailey fled the scene, but a witness reported Bailey’s license plate number to the police, who then arrested him at his home. See Complaint ¶¶ 12-17, at 13-14. Bailey was uninsured, see Complaint ¶ 27, at 15; Ullman carried liability coverage from Safeway Insurance for the vehicle in the accident and a second vehicle in the amounts of $25,000 per person, $50,000 per occurrence for bodily injury damages, and $25,000 for property damage, see Complaint ¶ 21, at 14. Ullman complains that Safeway Insurance did not adequately inform her of her options to purchase uninsured/underinsured motorist (“UM/UIM”) coverage, nor did it obtain a waiver of UM/UIM coverage equal to the limits of liability coverage or a waiver of stacking the UM/UIM coverage; Ullman asserts that Safeway Insurance instead improperly advised that stacking coverage is not available. See Complaint ¶¶ 22-26, at 14-15. Ullman made a claim for UM/UIM benefits under her Safeway Insurance policy, “requesting equalization of UM/UIM coverage in an amount equal to the limits of her liability coverage, including the stacking of the UM/UIM coverage for the two vehicles covered under the policy,” Complaint ¶28, at 4, but Safeway Insurance denies coverage, see Complaint ¶ 29, at 16.

PROCEDURAL BACKGROUND

Ullman alleges that Safeway Insurance improperly denied benefits under the UM/ UIM insurance coverage to her and other similarly situated. See Complaint ¶ 1, at 12. She alleges, for herself and others similarly situated, eight insurance bad faith counts against Safeway Insurance, including: (i) violation of the New Mexico Unfair Trade Practices Act, N.M. Stat. Ann. §§ 57-12-1 to -22, see Complaint ¶¶ 48-52, at 21-22; (ii) violation of the New Mexico Trade Practices and Frauds Act, N.M. Stat. Ann. §§ 59A-16-1 to -30, see Complaint ¶¶ 53-57, at 23-24; (in) denial of uninsured motorist benefits, see Complaint ¶¶ 58-60 at 24; (iv) breach of the implied covenant of good faith and fair dealing, see Complaint ¶¶ 61-63, at 24; (v) breach of contract, see Complaint ¶¶ 64-67, at 25; (vi) injunctive relief, see Complaint ¶¶ 68-70, at 25; (vii) declaratory judgment, see Complaint ¶¶ 71-74, at 25-26; (viii) and punitive damages, see id. ¶¶ 75-77, at 26. See also Notice of Removal to the United States District Court for the District of New Mexico ¶ 7, at 2, filed June 27, 2013 (Doc. l)(“Notice of Removal”). Ullman also alleges three personal injury counts against Bailey and Safeway Insurance, including: (i) negligence, see Complaint ¶¶ 78-83, at 28-29; (ii) negligence per se, see Complaint ¶¶ 84-98, at 29-31; and (iii) punitive damages, see id. ¶¶ 99-103, at 31. See also Notice of Removal ¶ 8, at 2. Ullman asserts that Safeway Insurance “is liable for damages recovered by Plaintiff Ullman against Defendant Bailey, an uninsured driver, pursuant to Plaintiff Ullman’s UM/UIM coverage under her policy of insurance with Safeway.” Complaint ¶ 83, at 29. Accord id. at ¶¶ 98, 103, at 31 (same).

Safeway Insurance removed the case to federal court based on diversity jurisdiction: Ullman is a New Mexico citizen, and Safeway Insurance is incorporated in Illinois with its principal place of business in Illinois. See Notice of Removal ¶ 2, at 1; id. ¶ 4, at 2. Safeway Insurance does not admit that Ullman and the class may recover any specific amount, but contends that it has a good-faith basis to assert that the amount in controversy exceeds the jurisdictional minimum, because the Complaint prays for general, punitive, and treble damages, and stacked coverage of the reformed policies, and because “the cost of reforming policies to liability limits for the entire class would far exceed $75,000, as would the administrative costs that Defendant Safeway would have to bear.” Notice of Removal ¶ 25, at 8. Safeway Insurance asserts that it asked Ullman to “stipulate, on behalf of herself and others similarly situated,” that she would not claim more than $75,000.00 in damages, but she refused to stipulate to that fact. Notice of Removal ¶ 26, at 8.

Safeway Insurance argues that Ullman cannot state a claim against it for negligence; it says it is liable to Ullman for her personal injuries “through a contractual basis and only if the Court finds that Plaintiff did not properly reject UM/UIM coverage.” Notice of Removal ¶ 17, at 4. Safeway Insurance maintains that it does not have a duty to indemnify Bailey and was not responsible for Bailey’s actions while he drove the vehicle; instead, Safeway Insurance argues that it is in privity with Ullman to bring claims against Bailey pursuant to the insurance policy, and that Ullman must preserve and protect its “right to subrogate” against Bailey. Notice of Removal ¶ 17, at 4-5.

Bailey was a New Mexico citizen. See Notice of Removal ¶ 15, at 3. Safeway Insurance argues that Ullman fraudulently joined and procedurally misjoined Bailey to defeat diversity jurisdiction, and, thus, that the Court should ignore Bailey’s citizenship. See Notice of Removal ¶ 22, at 6-7. Safeway Insurance argues that a party is fraudulently joined when “the plaintiff has not or cannot state a claim for relief against that party or does not intend to secure a judgment against that particular defendant,” Notice of Removal ¶ 16, at 4 (citing 14B C. Wright, A. Miller, E. Cooper, & J. Steinman, Federal Practice and Procedure, § 3723, at 795-96 (4th ed., 2009)); in Safeway Insurance’s view, Ullman is seeking damages from it rather than from Bailey for Bailey’s negligence, and, thus, Ullman’s claims against Bailey are a sham, see Notice of Removal ¶ 18, at 5. Safeway Insurances contends that “there is no basis” for Ullman to recover from Bailey and that Ullman “seeks to recover fully from Defendant Safeway by reforming the Safeway policy to include UM/UIM coverage.” Notice of Removal ¶ 18, at 5. Safeway Insurance argues that Ullman will not likely recover from Bailey, because he passed away sometime after the accident: “While Plaintiff may have a negligence claim against Defendant Bailey and/or his estate, it is virtually impossible that Plaintiff would recover damages from the estate of Defendant Bailey.” Notice of Removal ¶ 19, at 5. Safeway Insurance argues that the other putative class members do not have personal injury claims against Bailey, and, thus, that the class does not share common questions of law or fact, further evincing that Ullman’s claims against Bailey are fraudulent and a sham. See Notice of Removal ¶ 20, at 5-6.

Safeway Insurance further asserts that Ullman misjoined Bailey under rule 20(a)(2) of the Federal Rules of Civil Procedure, because Ullman’s claims against Safeway Insurance “require different questions of law and fact[ ] than the questions of law and fact required for Plaintiffs negligence claims against Bailey,” and arise out of different transactions or occurrences. Notice of Removal ¶¶ 22-24, at 6-7. Safeway Insurance asserts that, although the Court may find that it has a duty to provide uninsured motorist coverage, it did not cause the car accident, and it has no relationship with Bailey that would require it “to indemnify, subrogate to, or be in privity with Defendant Bailey”; thus,' the insurance bad faith claims against it “require different questions of law and fact, than the questions of law and fact required for Plaintiffs negligence claims against Bailey.” Notice of Removal ¶ 23, at 7. In Safeway Insurance’s view, the claims against it arise out of different transactions or occurrences than the claims against Bailey, because, “[although the circumstances that initiated Plaintiffs claim against Safeway were Plaintiffs accident with Bailey, the alleged proximate cause of Plaintiff and the class’s bad faith claim against Safeway is their insurance agreement with Safeway, not a car accident.” Notice of Removal ¶ 24, at 7. Safeway Insurance reiterates that the other putative class members do not have claims against Bailey for negligence. See Notice of Removal ¶ 24, at 7-8.

Safeway Insurance notes that, “[a]s a possible alternative basis for removal,” the Court “may have subject matter jurisdiction under the Class Action Fairness Act, 28 U.S.C. § 1332(d)(4)(A).” Notice of Removal ¶ 28, at 9.

Ullman, for herself and all other similarly situated, brings the Motion to Remand under 28 U.S.C. § 1447 to request that the Court remand this matter to New Mexico state court. See Motion to Remand at 1. She states that “[tjhere are two bases for federal subject matter jurisdiction over class actions not arising under federal law: conventional diversity class actions and class actions removed under the Class Action Fairness Act (‘CAFA’).” Motion to Remand at 1. Ullman argues that Safeway Insurance bears the burden to show that the Court has jurisdiction under CAFA, but that it did not argue that the Court has jurisdiction under CAFA, did not state the elements, and did not “provide any evidence whatsoever of any of the elements necessary to remove on CAFA grounds, which is its burden.” Motion to Remand at 1 n. 2. “Because Defendant Safeway has presented no affidavits or other evidence whatsoever on the elements that must be proven under CAFA, Defendant’s Notice must be examined solely on conventional diversity grounds.” Motion to Remand at 9.

Ullman asserts that Safeway Insurance’s “sole argument” for federal jurisdiction is that she improperly joined Bailey. Motion to Remand at 1-2. See id. at 8. Ullman asserts that she did not improperly join Bailey, because “[njaming Bailey is the most judicially efficient and economical means of pursuing the claims and issues in this case.” Motion to Remand at 2. Ullman alleges that she has a direct claim against Bailey, or Bailey’s estate if he is deceased, and that she is protecting Safeway Insurance’s subrogation interest by naming Bailey in this action. See Motion to Remand at 2. Ullman contends that, to prove fraudulent joinder, Safeway Insurance “must demonstrate by clear and convincing evidence that there is no possibility” that she “would be able to establish a viable cause of action” against Bailey. Motion to Remand at 10 (citing Zufelt v. Isuzu Motors Am., L.C.C., 727 F.Supp.2d 1117, 1128 (D.N.M.2009); Couch v. Astec Indus., Inc., 71 F.Supp.2d 1145, 1147 (D.N.M.1999)). Ullman argues that Bailey is “directly liable” for negligence and negligence per se, and that Safeway Insurance is liable for any damages she recovers against Bailey pursuant to her insurance policy. Motion to Remand at 10. Regarding Safeway Insurance’s argument that Ullman cannot state a claim against it for negligence, Ullman argues that Safeway Insurance

ignores that it is responsible for damages found against Defendant Bailey up to the limits of Plaintiff Ullman’s UM/ UIM coverage under her policy of insurance with Safeway. New Mexico law unequivocally provides that UM/UIM coverage is for the purpose of and for the protection of insureds “who are legally entitled to recover damages from owners or operators of uninsured motor vehicles.”

Motion to Remand at 10 (quoting N.M. Stat. Ann. § 66-5-301). Safeway Insurance argues that Ullman is not likely to recover from Bailey; Ullman argues that she has viable direct claims against Bailey and that she, as the Plaintiff, is the “master of her complaint,” and that her motivation and Bailey’s suspected wealth or poverty does not affect the removal inquiry as long as the claims against him are color-able. Motion to Remand at 11. She asserts that Bailey “has claims and interests potentially affected by the outcome of this suit,” because she will have a right to collect damages from him or his estate “for any damages she incurred over and above the amount of UM/UIM coverage she purchased from Defendant Safeway.” Motion to Remand at 11. In Ullman’s view, she may join Bailey as a party under rule 20 of the Federal Rules of Civil Procedure, because relief is joint and several, and there are questions of law and fact common to Bailey and Safeway Insurance. See Motion to Remand at 11-12. “For example, as Defendant Safeway is liable for damages which may be found against Defendant Bailey, the legal claims and facts [for negligence and negligence per se] are common to both Defendants.” Motion to Remand at 12. Although the putative class members cannot seek relief from Bailey, Ullman asserts that fact is not an obstacle to joining Bailey and is not relevant in evaluating diversity jurisdiction. See Motion to Remand at 12. “The proper analysis for diversity purposes is not on the claims of the members of the putative plaintiff class[;] the focus is on the diversity of the defendant to the named plaintiff. ...” Motion to Remand at 12 (citing Triggs v. John Crump Toyota, Inc., 154 F.3d 1284, 1288 (11th Cir.1998)). Ullman explains that, although she believes the putative class will meet the requirements for class certification, she must also ensure “that all of her individual claims pertaining to this suit are properly brought, which include claims against Defendant Safeway and against Defendant Bailey, for which Defendant Safeway is liable up to the limits of its UM/UIM coverage with Plaintiff Ullman.” Motion to Remand at 13. Ullman says that even after the class is certified, she will still have the claims against Bailey for any damages above the UM/ UIM limits. See Motion to Remand at 13. Ullman points to a case from the United States Court of Appeals for the Eleventh Circuit, in which the Eleventh Circuit held that, if a “named plaintiff has any possibility of a claim against the non-diverse defendant, diversity cannot be defeated on a fraudulent joinder theory merely because most unnamed class members” do not have a claim against the non-diverse defendant. Motion to Remand at 13-14 (citing Triggs v. John Crump Toyota, Inc., 154 F.3d at 1287). Ullman asserts that Safeway Insurance improperly conflates the elements of class certification with the requirements for diversity jurisdiction under a conventional diversity theory, in which case the Court considers only the citizenship of the named parties: “Because Plaintiff Ullman has stated viable causes of action and claims against a non-diverse Defendant, and has properly joined the non-diverse Defendant, there is no fraudulent joinder of Defendant Bailey in this matter.” Motion to Remand at 14-15. Finally, Ullman says that Safeway Insurance “curiously argues that its subrogation interest in collecting from Defendant Bailey somehow supports its fraudulent joinder argument, when in fact naming Defendant Bailey is the strongest way to preserve Defendant Safeway’s subrogation rights.” Motion to Remand at 15 (footnote omitted). Ullman contends that Safeway'Insurance has not met its “heavy burden” to show that “there is no reasonable possibility that [Ullman] could prevail on her claims against Defendant Bailey,” and, thus, that Bailey is properly joined, and that the Court does not have jurisdiction. Motion to Remand at 15-16.

Ullman asserts that she is entitled to attorneys’ fees pursuant to 28 U.S.C. § 1447(c), because, in her view, Safeway Insurance did not have an objectively reasonable basis for seeking removal. See Motion to Remand at 16. Ullman explains that, before filing the Motion to Remand, her counsel called Safeway Insurance’s counsel regarding the problems with the fraudulent joinder argument and requested Safeway Insurance to withdraw its Notice of Removal; Safeway Insurance’s counsel did not. See Motion to Remand at 16. “Because New Mexico law explicitly allows for a private right of action against Defendant Bailey, and Defendant Safeway’s Notice provides no evidence or law to the contrary, Defendant Safeway lacked an objectively reasonable basis for seeking removal.” Motion to Remand at 16. Ullman contends that the Court has discretion to award attorneys’ fees and costs under 28 U.S.C. § 1447(c). See Motion to Remand at 17.

Safeway Insurance responds that it satisfied its burden to establish that the Court has diversity jurisdiction under 28 U.S.C. § 1332, and that Ullman fraudulently joined Bailey and “misjoined the personal injury causes of action to the insurance bad faith class action for the purpose of defeating diversity jurisdiction.” Defendant Safeway’s Response in Opposition to Plaintiffs Motion to Remand at 4, filed August 8, 2013 (Doc. ll)(“Response”). Safeway Insurance explains that federal courts have recognized three categories of fraudulent joinder:

(1) where a plaintiff cannot plead a cause of action against the non-diverse defendant, Rogers v. Hartford Accident & Indemnity Co., 133 F.3d 309, 315 (5th Cir.1998); (2) where a plaintiffs pleading of jurisdictional facts is outright fraudulent, Gottlieb v. Westin Hotel Co., 990 F.2d 323, 327 (7th Cir.1993); or (3) where a plaintiff joins a diverse defendant with a non-diverse defendant as to whom no joint, several, or alternative liability exists, and where plaintiffs claim against the non-diverse defendant has no real connection to the claim against the diverse defendant, Triggs v. John Crump Toyota, Inc., 154 F.3d 1284, 1287 (11th Cir.1998). Couch v. Astec Indus., Inc., 71 F.Supp.2d 1145, 1147 (D.N.M.1999).

Response at 6-7. Safeway Insurance argues that Ullman fraudulently joined Bailey under the third category of fraudulent joinder, because, in Safeway Insurance’s view, it does not have joint, several, or alternative liability with Bailey, and Ullman’s claims against it do not have a connection to Ullman’s claims against Bailey. See Response at 7. Safeway Insurance agrees with Ullman that she has “legitimate personal injury claims against Defendant Bailey,” but Safeway Insurance argues that Ullman’s personal injury action “will not result in a judgment that would apportion joint or several liability,” because “Bailey is the only negligent party that injured Plaintiff in the automobile collision.” Response at 7. “Safeway’s liability, if any, is based solely on the insurance contract.” Response at 7. Safeway Insurance further contends that Ullman is not seeking to collect damages from Bailey; in the Complaint, Ullman states that Safeway Insurance “ ‘is liable for damages recovered by Plaintiff Ullman against Defendant Bailey,’” pursuant to the UM/UIM coverage, but she does not plead any damages to collect against Bailey. Response at 8 (quoting Complaint ¶ 83, at 18; id. ¶¶ 98, 103, at 20). Safeway Insurance argues that Ullman “created no possibility of recovery” from Bailey. Response at 8.

Safeway Insurance argues that Ullman’s personal injury claims against Bailey do not have a “real connection” to the insurance bad faith claims; it admits that Bailey was negligent in the car accident and that he was an uninsured driver, but says the remaining controversy is whether Ullman is legally entitled to UM/UIM coverage, a question unconnected to the personal injury claims against Bailey. Response at 8-9.

The alleged improper waiver of UM/ UIM coverage occurred when the parties entered into the insurance contract on November 12, 2011, while the automobile collision between Plaintiff and Defendant Bailey occurred on May 3, 2012. Plaintiffs alleged improper waiver of UM/UIM did not stem from the automobile collision, and inversely, the collision did not stem from the alleged improper waiver. Regardless of the automobile collision facts, Plaintiffs automobile insurance policy with Defendant Safeway was in effect before the collision and before Plaintiff made an UM/ UIM coverage claim with Defendant Safeway.

Response at 9. Although Ullman argues that permissive joinder under rule 20 is appropriate in this case, Safeway Insurance argues that joinder is not appropriate. Safeway Insurance explains that a plaintiff may join multiple defendants if “ ‘any right to relief is asserted against them jointly, severally, or in the alternative with respect to or arising out the same transaction, occurrence, or series of transactions or occurrences,’ ” Response at 10 (quoting Fed.R.Civ.P. 20(2)(A)), but argues that “the bad faith insurance class action and the personal injury action” do not meet that requirement, Response at 10. “[MJisjoinder under Rule 21 ‘occurs when there is no common question of law or fact or when ... the event that gives rise to the plaintiffs claims against defendants do not stem from the same transaction.’ ” Response at 10 (quoting Nasious v. City & Cnty. of Denver-Denver Sheriffs Dept., 415 Fed.Appx. 877, 880 (10th Cir.2011)). Safeway Insurance contends that the Court can either sever the actions or drop a party. See Response at 10. Further, Safeway Insurance says that Ullman “claims that under Rule 18, she may bring as many claims as she has in one action,” but that Ullman’s reliance on rule 18 is misplaced, because the rule 20 analysis prevents joinder in this case. Response at ll.

Safeway Insurance reiterates that the putative class does not have claims against Bailey, which it argues violates the requirements for class actions. See Response at 11. It argues that Triggs v. John Crump Toyota, Inc. is inapposite, because the defendants in that case shared common issues of law and fact, unlike the personal injury claims against Bailey and the insurance bad faith claims against Safeway, which do not share common issues of law and fact. See Response at 12. In that case, Safeway Insurance explains, the two defendants were operating a fraudulent car sales scheme; one of the defendants defrauded most of the class members, and the other defendant defrauded the remaining class members. See Response at 12 (citing Triggs v. John Crump Toyota, Inc., 154 F.3d at 1286). Safeway Insurance asserts that, unlike Triggs v. John Crump Toyota, Inc., Ullman’s claims against Safeway involve entirely different questions of law and fact than the claims against Bailey: the “Plaintiff[’s] claims against Defendant Safeway require determination of the insurance contract where the court must apply contract and insurance law, whereas Plaintiffs claims against Defendant Bailey involve tort law and determining Bailey’s negligence that caused the May 3, 2012 collision.” Response at 12. It argues that Ullman’s claims against Bailey “will only serve to confuse the jury” and that the Court should sever the personal injury actions from the class action. Response at 12-13.

In the Plaintiffs Motion for Remand Reply, filed August 19, 2013 (Doc. 12)(“Re-ply”), Ullman argues that, although Safeway Insurance “continues to incorrectly state” that she is seeking to i'ecover damages from Safeway Insurance and not from Bailey, she has demonstrated direct claims against Bailey, and, thus, she did not fraudulently join Bailey to defeat diversity jurisdiction. Reply at 1-2. She asserts that her claims against Safeway Insurance and Bailey “arise out of the same car collision and share a common question of law and fact.” Reply at 2. Ullman argues that she named Bailey to preserve her direct claims against him and that, by including him in the same case, she is protecting Safeway Insurance’s subrogation interests. See Reply at 2. Although Safeway Insurance admits that Bailey was negligent in the car accident, Ullman points out that Bailey, or Bailey’s estate, will likely disagree, and his or his estate’s interests will be “directly affected by determination of his liability and the damages he owes.” Reply at 2. Ullman argues that Safeway Insurance has “failed to establish that there is no reasonable possibility of a colorable claim under New Mexico law against” Bailey, and thus, it cannot show that Ullman fraudulently joined Bailey. Reply at 3.

Ullman asserts that Safeway Insurance’s sole remaining basis for removal is procedural misjoinder, which she argues the Tenth Circuit has not adopted; even if the Tenth Circuit recognized the doctrine, she argues that she did not misjoin Bailey in this case. See Reply at 3. She explains that the Eleventh Circuit adopted procedural misjoinder in Tapscott v. MS Dealer Serv. Corp., 77 F.3d 1353, 1360 (11th Cir.1996), abrogated on other grounds by Cohen v. Office Depot, Inc., 204 F.3d 1069 (11th Cir.2000), as a third category of fraudulent joinder, but that the Tenth Circuit has not adopted the theory. See Reply at 4-5. Ullman argues that, even if the Court adopts procedural misjoinder, it would not help Safeway Insurance, because her decision to join Bailey was proper under rule 20. See Reply at 5. She contends that the same occurrence — the car accidenU — gave rise to the claims against Bailey and Safeway Insurance. See Reply at 5-6. Further, the legal claims for negligence and negligence per se are common to Bailey and Safeway Insurance, because Safeway Insurance “is responsible for damages found against Defendant Bailey up to the limits of Plaintiff Ullman’s UM/UIM coverage under her policy of insurance with Safeway” and she will have a right to collect any damages above the UM/UIM coverage amount directly from Bailey, implicating his interests. Reply at 6. Ullman notes that Safeway Insurance dropped its initial argument that its interest in preserving its subrogation rights supports its fraudulent joinder argument: “Because the naming of Defendant Bailey is the strongest way to preserve Defendant Safeway’s subrogation rights, it comes as no surprise that Safeway has abandoned this line of argument here.” Reply at 7. Although Ullman did not plead in the Complaint the amount of damages she is seeking from Bailey, she asserts that “the Rules of pleading in New Mexico (where this Complaint was properly filed) demand that ‘the complaint shall not contain an allegation for damages in any specific monetary amount,’ Rule 1-008(A)(3) NMRA, unless the amount is a necessary allegation of the complaint.” Reply at 7. Ullman maintains that she did not have to state a specific amount against Bailey. See Reply at 7. She further explains that “this Court has recognized that ‘the Supreme Court of New Mexico [has] expressed a preference that matters of insurance coverage be decided by the court considering the underlying action.’ ” Reply at 7 (alteration in original)(quoting Mach v. Triple D Supply, LLC, 773 F.Supp.2d 1018, 1047 (D.N.M.2011) (Browning, J.)). She argues that, although the other members of the putative class do not have claims against Bailey, this fact is “neither an obstacle to his joinder under Rule 20 nor the proper inquiry in evaluating diversity jurisdiction”; Ullman asserts that the focus for diversity jurisdiction is on the diversity of the defendants to the named plaintiff. Reply at 8. Ullman contends that Safeway Insurance misunderstands how the requirements for class certification relate to the requirements of fraudulent joinder and that the putative class does not need to assert claims against Bailey for him to be properly joined. See Reply at 8-9. For the diversity jurisdiction analysis, Ullman maintains that the Court should consider only the citizenship of the named parties and that, because there is not complete diversity, the Court does not have jurisdiction. See Reply at 9. She argues that Bailey is properly joined, because Safeway Insurance has a subrogation interest against him, and Bailey’s interests may be affected by the outcome of the suit if Ullman’s damages exceed the UM/UIM coverage limits. See Reply at 10. Finally, Ullman renews her request for an award of attorneys’ fees and costs for responding to the Notice of Removal. See Reply at 11.

The Court held a hearing on November 14, 2013, in which Safeway Insurance and Ullman attended; the Court noted that Bailey did not have counsel and was not present at the hearing. See Transcript of Hearing at 2:5-14 (Vargas, Johansen, Court, Romero)(taken November 14, 2013)(“Tr.”). The Court said that it had recently worked on an opinion in another case addressing procedural misjoinder and that it is inclined to adopt the doctrine. See Tr. at 2:22-3:19 (Court)(referring to Flores-Duenas v. Briones, No. CIV 13-0660 JB/CG, 2013 WL 6503537 (D.N.M. Dec. 1, 2013) (Browning, J.)). The Court explained that the Eleventh Circuit, in adopting the doctrine, seemed to require a heightened analysis of an “egregious misjoinder” under rules 20 and 21, but that it rejects that formulation; although the Court said it had not determined the appropriate standard, it believed that it would likely be a straightforward application of rules 20 and 21, and not some heightened standard. Tr. 3:20-4:15 (Court). The Court said that it could identify a but-for relationship between the accident with Bailey and the insurance claims against Safeway Insurance, and, because Safeway Insurance seemed to invoke traditional diversity jurisdiction rather than relying on CAFA, it was inclined to grant the Motion to Remand, but would hear the parties’ arguments. See Tr. at 4:21-5:13 (Court).

Ullman said that procedural misjoinder is currently “an anomaly limited to the Eleventh Circuit,” that “the Fifth, Eighth, and Ninth Circuits have expressly rejected it,” and that some courts within the Tenth Circuit have rejected it. Tr. at 6:21-7:2 (Vargas). Ullman agreed with the Court that the issue in this case boils down to the rule 20 and 21 analysis; she explained that, in New Mexico, “an uninsured motorist carrier stands in the shoes of the ... uninsured tortfeasor for purposes of defenses,” and that, to obtain uninsured motorist benefits, a plaintiff must prove the existence of the policy as well as the tortfeasor’s duty, breach, and damages. Tr. at 7:13-25 (Vargas). Ullman asserted that, like “hundreds” if not “thousands” of cases pending in New Mexico, she chose to “join the underlying tort case with the uninsured motorist carrier case because those same proofs will be required in both cases.” Tr. at 8:1-5 (Vargas). She explained that, if the Court were to bifurcate the cases, she would have to prove Bailey’s negligence as well as her damages, including whether the medical bills were reasonable and necessary; further, Safeway Insurance could argue that, because it would not be present in the bifurcated case against Bailey, it would not be bound by collateral estoppel or res judicata, and thus,. Ullman would have to relitigate the same issues. See Tr. at 8:12-18 (Vargas). The only additional proof, Ullman explained, is the existence of a policy in the uninsured motor carrier case. See Tr. at 8:19-21 (Vargas). “In short Your Honor, these are appropriately joined claims because they ... necessarily include the same proofs, the same witnesses, the same damage inquiry and bifurcating the two in fact risks inconsistent results.” Tr. at 9:1-4 (Vargas). Ullman argued that, although most of the putative class members do not have claims against Bailey, that does not destroy the joinder analysis; the related transactions arise under Safeway Insurance’s conduct. See Tr. at 9:9-19 (Vargas). Ullman argued that, although Safeway Insurance states that the amount in controversy requirement is met for Ullman by aggregating her uninsured motorist policy benefits plus the costs in administering the injunctive relief, Safeway Insurance has not met its burden to establish that each putative class member’s claim exceeds $75,000.00. See Tr. at 10:3-18 (Vargas)(citing Lovell v. State Farm Mut. Auto. Ins. Co., 466 F.3d 893 (10th Cir.2006)). The Court said that it is troubled by the fact that this case is a class action and that, if it remands the case to state court, Ullman could not maintain a class action against Bailey. See Tr. at 11:3-14 (Court). Ullman agreed that it is unlikely that another putative class member would have claims against Bailey, but said that, although she expects the class will be certified, she still has the ability to pursue her claims against Bailey and Safeway Insurance in the same action; otherwise, she risks duplicating efforts with inconsistent results. See Tr. at 11:16-12:1 (Vargas). Ullman emphasized that the Court is a court of limited jurisdiction and that Safeway Insurance could have attempted to establish jurisdiction using CAFA, but it did not. See Tr. at 12:3-25 (Vargas).

Safeway Insurance explained that it did not pursue federal jurisdiction based on CAFA, because it expects that the total amount in damages will be less than $5,000,000.00; instead, it is relying on traditional diversity jurisdiction. See Tr. at 13:5-19 (Court, Johansen). Safeway Insurance urged the Court to keep in mind the public policy behind diversity jurisdiction — that non-resident defendants should have an unprejudiced and impartial forum in which to litigate disputes when they have been unwillingly brought into state court. See Tr. at 13:21-14:12 (Johansen). Safeway Insurance argues that, although plaintiffs are permitted to name nondiverse defendants in some cases, it is not appropriate in this case, and that Ullman named Bailey solely to destroy diversity, as evidenced by the fact that she “only seeks damages against Safeway for the acts of Bailey.” Tr. at 14:13-15:6 (Johansen). Although the Tenth Circuit has not adopted procedural misjoinder, Safeway Insurance said in Couch v. Astec Industries, Inc., the Honorable Bobby Baldock, United States Circuit Judge for the Tenth Circuit, sat by designation as a District Court Judge and recognized three categories of what he called fraudulent joinder, which break down into procedural misjoinder and the two traditional bases for fraudulent joinder: (i) when the plaintiff cannot plead a cause of action against the nondiverse defendant; (ii) when the plaintiff pleads fraudulent jurisdictional facts; and (iii) when a plaintiff joins a non-diverse defendant to whom no joint, several, or alternative liability exists and where the plaintiffs claim against the non-diverse defendant has no connection to the claim against the diverse defendant. See Tr. at 15:11-16:17 (Court, Johansen). The Court noted that, in an unpublished Tenth Circuit opinion, the Tenth Circuit avoided having to decide if it would adopt procedural misjoinder. See Tr. at 17:2-15 (Court)(referring to Lafalier v. State Farm Fire & Casualty Co., 391 Fed.Appx. 732 (10th Cir.2010) (unpublished)). Safeway Insurance stressed again the public policy behind diversity jurisdiction and urged the Court to adopt procedural misjoinder. See Tr. at 17:22-18:4 (Johansen).

Turning to the rule 20 analysis, Safeway Insurance argued that there is no joint or alternative liability in this case, and that the putative class’ contractual case against Safeway Insurance for the rejection of uninsured motorist benefits is separate from the automobile accident between Bailey and Ullman. See Tr. at 18:5-19:18 (Johansen). For the rule 20 analysis, Safeway Insurance directed the Court to Sheets v. CTS Wireless Components, Inc., 213 F.Supp.2d 1279 (D.N.M.2002); in that case, the Honorable Bruce Black, United States District Judge for the District of New Mexico, stated that for plaintiffs to join their claims together in a single action, there must be a “logical relationship” between the plaintiffs. Tr. at 20:8-21:7 (Johansen). Safeway Insurance argued that there is no logical relationship between Ullman’s and the putative class’ contractual claims, and the personal injury claims which Ullman has against Bailey. See Tr. at 22:5-11 (Johansen). The Court asked whether it should focus on Ullman, Safeway Insurance, and Bailey for determining the rule 20 analysis; Safeway Insurance argued that the class action serves as a sign that the main focus of the case is on whether Ullman and the other class members waived UM/UIM coverage. See Tr. at 23:2-10 (Court, Johansen). The Court noted that, for most class action cases except those arising out of a large disaster such as an airplane crash, it would have to analyze a large number of transactions, and so rule 23 trumps rule 20 for joining multiple plaintiffs. See Tr. at 23:11-24:2 (Court, Johansen). Safeway Insurance argued that Triggs v. John Crump Toyota, Inc. demonstrates a situation where the putative class members’ claims arose from separate transactions, but involved the same cause of action, whereas Ullman’s claims involve two separate causes of action; in Safeway Insurance’s view, that distinction demonstrates that there is not a logical relationship between the class action and Ullman’s claims against Bailey. See Tr. at 24:3-25:4, 25:14-26:3 (Johansen). Safeway Insurance clarified that it is raising misjoinder under rule 20(a)(2) related to Bailey. See Tr. at 25:4-12 (Court, Johansen). Safeway Insurance argued that the case boils down to whether Ullman and the other putative class members signed a valid rejection of the UM/UIM coverage; if they did, then, Safeway Insurance argued, the ease would be over, but if not, then the Court would need to analyze other factors. See Tr. at 26:4-11 (Johansen). Safeway Insurance said that it was unsure if Bailey had passed away, but that it did not believe Bailey had been served; it argued that “[t]he claim clearly is against Safeway and it’s based upon the contractual analysis of the policy,” and, thus, the Court should drop Bailey or sever the claim according to rule 21. Tr. at 26:12-19 (Johansen). The Court noted that it was unsure what the remedy should be if it determines that the parties are misjoined, because it may be exercising jurisdiction it does not have by dropping parties or severing claims. See Tr. at 27:3-7 (Court). Safeway Insurance said that, although it also was unsure of the appropriate remedy, the Court should rule that Bailey was misjoined and deny the Motion to Remand. See Tr. at 28:16-22 (Johansen).

Regarding the amount in controversy, Safeway Insurance said that it asked Ullman to stipulate that her case was worth less than $75,000.00, which she would not do, and so it believed that it had a good-faith basis for removing; the Court questioned whether every putative plaintiff would also have to meet the $75,000.00 jurisdictional requirement. See Tr. at 29:16-30:7 (Johansen, Court). Safeway Insurance said it was unsure, but if that question concerned the Court, the Court could order additional briefing on the issue. See Tr. at 30:8-12 (Johansen).

Ullman explained that the claims against Safeway for herself and the putative class are not “just reformation claims,” as Safeway Insurance stated, but are also claims for damages for each putative class member. Tr. at 31:5-16 (Vargas). She also sought to clarify that she is seeking to establish the amount of damages that Bailey caused, and that, under the terms of the insurance contract, Safeway Insurance is liable for those damages up to the policy limit. See Tr. at 31:17-32:4 (Vargas). Ullman said that the Court was correct in stating that rule 23 trumps rule 20 and that the court in Triggs v. John Crump Toyota, Inc. discusses how rule 20 does not require all the plaintiffs to seek relief against all the defendants. See Tr. at 32:5-16 (Vargas). Ullman again urged the Court that, in a class action, it should look to the citizenship of the named parties for the complete diversity requirement. See Tr. at 32:17-20 (Vargas). The Court asked how to square that proposition with her previous argument that each plaintiff must satisfy the jurisdictional requirements; Ullman said that it is a separate analysis and that, for the citizenship of the parties, the Court should look at only the named parties, but for the jurisdictional amount, every putative class member must meet the amount. See Tr. at 33:4-35:14 (Court, Vargas). Ullman agreed with the Court that Safeway Insurance’s argument focuses on the defendants, and that there is not a strict standard on the plaintiffs side that each class member must be involved in the same exact transaction or occurrence. See Tr. at 34:15-35:15 (Court, Vargas). Ullman argued that, regarding the rule 20 analysis, Safeway Insurance is attempting to add a requirement that is not in the rule; Ullman argued that the Court should ignore the class for purposes of the rule 20 analysis and find that Bailey was not misjoined. See Tr. at 35:18-36:15 (Court, Vargas). Ullman said that, because the uninsured motorist carrier steps in the shoes of the tortfeasor, it is as though they are jointly and severally liable up to the policy limits. See Tr. at 36:21-37:1 (Vargas). Further, Ullman said that she must protect Safeway Insurance’s subrogation interest against Bailey and that she must sue Bailey within three years of the accident according, to the applicable statute of limitations. See Tr. at 37:6-22 (Vargas)(citing N.M. Stat. Ann § 66-5-301 A) She further contended that New Mexico case law holds the tortfeasor and uninsured motorist carrier jointly and severally liable for punitive damage aspects; however, if Bailey has passed away, Ullman said she would not have a punitive damage claim against Bailey. See Tr. at 37:23-38:2 (Vargas). The Court asked what it should do if Bailey has passed away; Ullman said she would attempt to follow rule 25, substitute his personal representative for him, and if there is no personal representative, then she would have to open probate and have a personal representative appointed, who would stand in Bailey’s shoes for this action. See Tr. at 38:3-17 (Court, Vargas). Ullman explained that a potential judgment creditor, like her, has standing to open probate, and that she must appoint a personal representative to accept service of process. See Tr. at 38:21-39:11 (Vargas).

The Court explained that it would further analyze rule 20, because these issues are becoming more common. See Tr. at 39:24-40:21 (Court). The Court said that rule 20 is very broad, and that it was still inclined to reject the Eleventh Circuit’s “egregious” standard; the Court said it was inclined to grant the Motion to Remand, because the underlying car accident connects the claims. Tr. at 40:22-41:20 (Court); id. at 42:7.

LAW REGARDING DIVERSITY JURISDICTION

“Subject-matter jurisdiction under 28 U.S.C. § 1332(a)(1) requires: (i) complete diversity among the parties; and (ii) that ‘the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs.’ ” Thompson v. Intel Corp., No. CIV 12-0620 JB/LFG, 2012 WL 3860748, at *12 (D.N.M. Aug. 27, 2012) (Browning, J.)(citing 28 U.S.C. § 1332(a)). As the Court has previously explained, “[t]he Supreme Court of the United States has described this statutory diversity requirement as ‘complete diversity,’ and it is present only when no party on one side of a dispute shares citizenship with any party on the other side of a dispute.” McEntire v. Kmart Corp., No. CIV 09-0567 JB/ LAM, 2010 WL 553443, at *3 (D.N.M. Feb. 9, 2010) (Browning, J.)(citing Strawbridge v. Curtiss, 7 U.S. 267, 267-68, 3 Cranch 267, 2 L.Ed. 435 (1806), overruled on other grounds, Louisville, Cincinnati, & Charleston R.R. Co. v. Letson, 43 U.S. 497, 2 How. 497, 11 L.Ed. 353 (1844); McPhail v. Deere & Co., 529 F.3d 947, 951 (10th Cir.2008)). The amount-in-controversy requirement is an “estimate of the amount that will be put at issue in the course of the litigation.” Valdez v. Metro. Prop. & Cas. Ins. Co., 867 F.Supp.2d 1143, 1163 (D.N.M.2012) (Browning, J.Xciting McPhail v. Deere & Co., 529 F.3d at 956).

1. Diversity of Citizenship.

For diversity jurisdiction purposes, citizenship is determined by a person’s domicile. See Crowley v. Glaze, 710 F.2d 676, 678 (10th Cir.1983). “A person’s domicile is defined as the place in which the party has a residence in fact and an intent to remain indefinitely, as of the time of the filing of the lawsuit.” McEntire v. Kmart Corp., 2010 WL 553443, at *3 (citing Crowley v. Glaze, 710 F.2d at 678). See Freeport-McMoRan, Inc. v. KN Energy, Inc., 498 U.S. 426, 428, 111 S.Ct. 858, 112 L.Ed.2d 951 (1991) (holding that diversity jurisdiction is assessed as of the time at which the suit is filed). If neither a person’s residence nor the location where the person has an intent to remain can be established, the person’s domicile is that of his or her parents at the time of the person’s birth. See Gates v. Comm’r of Internal Revenue, 199 F.2d 291, 294 (10th Cir.1952) (“[T]he law assigns to every child at its birth a domicile of origin. The domicile of origin which the law attributes to an individual is the domicile of his parents. It continues until another domicile is lawfully acquired.”). Additionally, “while residence and citizenship are not the same, a person’s place of residence is prima facie evidence of his or her citizenship.” McEntire v. Kmart Corp., 2010 WL 553443, at *3 (citing State Farm Mut. Auto. Ins. Co. v. Dyer, 19 F.3d 514, 520 (10th Cir.1994)).

2. Amount in Controversy.

The existence of diversity jurisdiction must be established by a preponderance of the evidence. See McPhail v. Deere & Co., 529 F.3d at 953. In the context of establishing an amount-in-eontroversy, the defendant seeking removal might appear to be bound by the plaintiffs chosen amount of damages in the complaint, which would seem to allow a plaintiff to avoid federal jurisdiction “merely by declining to allege the jurisdictional amount [in controversy].” McPhail v. Deere & Co., 529 F.3d at 955. The Tenth Circuit’s decision in McPhail v. Deere & Co. has foreclosed such an option for a plaintiff who wishes to remain in state court. McPhail v. Deere & Co. holds that a defendant’s burden in establishing jurisdictional facts is met if the defendant proves “jurisdictional facts that make it possible that $75,000 is in play.” McPhail v. Deere & Co., 529 F.3d at 955.

In McPhail v. Deere & Co., the Tenth Circuit relied on the Seventh Circuit’s decision in Meridian Secs. Ins. Co. v. Sadowski, in which the Honorable Frank H. Easterbrook, Circuit Judge, explained how a removing defendant asserting diversity jurisdiction in the face of a complaint silent about damages might proceed:

[T]he removing defendant, as proponent of federal jurisdiction, must establish what the plaintiff stands to recover. We have suggested several ways in which this may be done — by contentions, interrogatories or admissions in state court; by calculation from the complaint’s allegations^] by reference to the plaintiffs informal estimates or settlement demands!;] or by introducing evidence, in the form of affidavits from the defendant’s employees or experts, about how much it would cost to satisfy the plaintiffs demands. The list is not exclusive; any given proponent of federal jurisdiction may find a better way to establish what the controversy between the parties amounts to, and this demonstration may be made from either side’s viewpoint (what a judgment would be worth to the plaintiff, or what compliance with an injunction would cost the defendant). Once the estimate has been made — and contested factual allegations that support the estimate have been established in a hearing under Rule 12(b)(1) by admissible evidence ... then ... the case stays in federal court unless it is legally certain that the controversy is worth less than the jurisdictional minimum.

441 F.3d at 541-42 (citations omitted). The Tenth Circuit adopted the Seventh Circuit’s reasoning, stating:

Meridian eliminates the double standard that would come from misunderstanding what “preponderance of the evidence” requires. The proponent of federal jurisdiction must prove contested facts; and because a defendant has no control over the complaint, he cannot put a large sum of money in controversy simply by demanding it, as a plaintiff often can. But once those underlying facts are proven, a defendant (like a plaintiff) is entitled to stay in federal court unless it is “legally certain” that less than $75,000 is at stake.

McPhail v. Deere & Co., 529 F.3d at 954. Thus, a defendant removing a matter to federal court has met the burden to prove the amount-in-controversy requirement if the defendant has proved any contested facts regarding the amount-in-controversy and the amount-in-controversy is not legally certain to be less than $75,000.00.

As this Court has previously explained, “[i]n the absence of an explicit demand for more than $75,000.00, the defendant must show how much is in controversy through other means.” Salazar v. GEICO Ins. Co., No. CIV 10-0118 JB/RLP, 2010 WL 2292930, at *3 (D.N.M. April 27, 2010) (Browning, J.)(citing McPhail v. Deere & Co., 529 F.3d at 955). The Tenth Circuit has identified the means upon which a defendant may rely to show how much is in controversy: (i) the defendant may rely on an estimate of the potential damages from the allegations in the complaint; (ii) the defendant may rely on other documentation to provide a basis for determining the amount in controversy, such as interrogatories obtained in the state court before removal, affidavits, or other evidence submitted in federal court afterward; and (iii) the defendant may rely on the plaintiffs proposed settlement amount if it appears to reflect a reasonable estimate of the plaintiffs claim, because the plaintiffs estimate of its claim is a proper means of supporting the allegations in the notice of removal. See Salazar v. GEICO, 2010 WL 2292930, at *3 (citing McPhail v. Deere & Co., 529 F.3d at 956). In McPhail v. Deere & Co., the Tenth Circuit found that the defendant met its burden to support diversity jurisdiction where the plaintiffs complaint was silent on the amount in controversy. In its notice of removal, the defendant represented that the amount in controversy exceeded $75,000.00, and incorporated electronic mail messages and letters of conversations between the parties’ attorneys discussing the value of the claim. The defendant’s counsel interpreted the conversation as meaning that the plaintiff was seeking more than $75,000.00, but the plaintiffs counsel refused to concede an amount in controversy in excess of $75,000.00, stating “it may very well be” that the amount in controversy would exceed $75,000.00. 529 F.3d at 957. The Tenth Circuit found that the background information provided enough supplementary information for the district court to conclude that it was not legally certain that the plaintiff would recover an amount less than $75,000.00. See 529 F.3d at 957. In so ruling, the Tenth Circuit gave the example of a case in which a defendant has allegedly breached a contract and the plaintiff seeks damages in an indeterminate amount. The Tenth Circuit suggested that “a defendant might support jurisdiction by attaching a copy of the contract, valued at more than $75,000, to the notice of removal.” 529 F.3d at 956.

An example of an amount-in-controversy which is not legally certain to reach $75,000.00 is seen in Martin v. Franklin Capital Corp., 251 F.3d 1284 (10th Cir.2001). See 251 F.3d at 1291. In Martin v. Franklin Capital Corp., the defendant’s notice of removal totaled up all of the dollar figures in the plaintiffs complaint, but some of the dollar amounts were considered background information that were not linked to the plaintiffs attempts to recover damages. See 251 F.3d at 1291. Because the Tenth Circuit found that the defendant’s notice of removal depended on an erroneous “construction of the [plaintiffs] pleading,” the Tenth Circuit held that the amount-in-controversy requirement was not met. 251 F.3d at 1291.

LAW REGARDING CAFA

CAFA jurisdiction exists when the proposed class contains at least one-hundred persons, the amount in controversy exceeds $5,000,000.00, and there is minimal diversity. See Valdez v. Metro. Prop. & Cas. Ins. Co., 867 F.Supp.2d 1143, 1163 (D.N.M.2012) (Browning, J.)(citing 28 U.S.C. § 1332(d)(2) and (5)). “CAFA was enacted to respond to perceived abusive practices by plaintiffs and their attorneys in litigating major class actions with interstate features in state courts.” Coffey v. Freeport McMoran Copper & Gold, 581 F.3d 1240, 1243 (10th Cir.2009).

1. Amount in Controversy.

The amount-in-controversy requirement is “an estimate of the amount that will be put at issue in the course of the litigation.” McPhail v. Deere & Co., 529 F.3d 947, 956 (10th Cir.2008). “In actions seeking declaratory or injunctive relief, it is well established that the amount in controversy is measured by the value of the object of the litigation.” Hunt v. Wash. State Apple Adver. Comm’n, 432 U.S. 333, 347, 97 S.Ct. 2434, 53 L.Ed.2d 383 (1977). The Tenth Circuit follows the “either viewpoint rule,” which considers either the value to the plaintiff, or the cost to the defendant of injunctive and declaratory relief, as the measure of the amount in controversy. Lovell v. State Farm Mut. Auto. Ins. Co., 466 F.3d 893, 897 (10th Cir.2006). The Senate Report on CAFA also provides that the amount in controversy shall be determined from the viewpoint either of the plaintiff or of the defendant. See S.Rep. No. 109-14 at 42-43, 2005 WL 627977, at *37. The Senate Report states: “[T]he Committee intends that a matter be subject to federal jurisdiction under this provision if the value of the litigation exceeds $5,000,000.00 either from the viewpoint of the plaintiff or the viewpoint of the defendant, regardless of the type of relief sought.” S.Rep. No. 109-14 at 42-43, 2005 WL 627977, at *37.

The Senate Report also provides that, “in assessing the jurisdictional amount in declaratory relief cases, the federal court should include in its assessment the value of relief and benefits that would logically flow from the granting of the declaratory relief sought.” S.Rep. No. 109-14 at 42-43, 2005 WL 627977, at *37. In Keeling v. Esurance Ins. Co., 660 F.3d 273 (7th Cir.2011) (Easterbrook, J.), the United States Court of Appeals for the Seventh Circuit began its CAFA analysis of the amount in controversy with the “value of the injunctive relief that the class demands” and held that “the cost of prospective relief cannot be ignored in the calculation of the amount in controversy.” 660 F.3d at 274. The United States District Court for the Western District of Oklahoma has also held that the value of injunctive relief sought is determined “by ‘the pecuniary effect an adverse declaration will have on either party to the lawsuit.’ ” Cox v. Allstate Ins. Co., No. 07-1449, 2008 WL 2167027, at *3 (W.D.Okla. May 22, 2008) (Leonard, J.)(quoting City of Moore v. Atchison, Topeka, & Santa Fe Ry. Co., 699 F.2d 507, 509 (10th Cir.l983))(addressing CAFA’s amount-in-controversy requirement). See Toller v. Sagamore Ins. Co., 558 F.Supp.2d 924, 930-31 (E.D.Ark.2008) (addressing CAFA’s amount-in-controversy requirement).

In determining the value of litigation which increases insurance coverage, several courts have held that the proper measure of the amount in controversy is the increase in coverage limits of the policy. In Whitehead-Rojas v. American Family Mutual Ins. Co., No. 08-0103, 2008 WL 1924899 (D.Colo. Apr. 28, 2008), the United States District Court for the District of Colorado calculated the amount in controversy, in a case where the plaintiff sought reformation of an insurance policy, by looking at the enhanced benefits that the plaintiff would receive through the increase in coverage. See 2008 WL 1924899, at *3. Accordingly, where the plaintiff alleged that the policy limits should increase from $130,000.00 to $200,000.00, the District of Colorado determined that $70,000.00 was in controversy. See Whitehead-Rojas v. Am. Family Mut. Ins. Co., 2008 WL 1924899, at *3. See also Henderlong v. Allstate Ins. Co., No. 10-0698, 2010 WL 3843324, at *2 (D.Colo. Sept. 24, 2010) (finding that, where the plaintiff sought an increase in coverage in excess of the policy limits, the amount in controversy was the value of the additional coverage); Robinson v. Home Indem. Co., 316 F.Supp. 129, 131 (E.D.Ark.1970) (holding that amount in controversy, where plaintiffs sought to reform insurance policy, was the increased exposure to the insurance company that would result from increasing coverage to the insured). The United States Court of Appeals for the Sixth Circuit has held that, where the plaintiffs sought a declaratory judgment regarding their uninsured motorist coverage, the amount in controversy is the difference between the coverage they seek and the coverage that they currently have. See Freeland v. Liberty Mut. Fire Ins. Co., 632 F.3d 250, 254 (6th Cir.2011). The Seventh Circuit has held that, “when the validity of a policy is in dispute, the face-value of that policy is a proper measure of the amount-in-controversy.” Hawkins v. Aid Ass’n for Lutherans, 338 F.3d 801, 805 (7th Cir.2003). The Court used this approach in Valdez v. Metropolitan Property and Casualty Insurance Co.; although the plaintiffs were not seeking monetary damages, the Court explained that, if it granted the injunctive and declaratory relief that the plaintiffs requested, the plaintiffs would receive extended coverage without having to pay additional premiums, which would be a monetary benefit to the plaintiffs. 867 F.Supp.2d at 1180. “[T]he value of the litigation, viewed from the Plaintiffs’ perspective, is the total increase in additional uninsured motorist coverage.” 867 F.Supp.2d at 1180.

Federal courts have also held that a court can calculate the defendants’ costs associated with the relief sought to determine the amount in controversy. The Seventh Circuit has held that, where an insurer-defendant would either have to “stop charging a premium or change the terms so that policyholders receive indemnity more frequently, it will suffer a financial loss” and that the $1,500,000.00 in lost premiums was part of the amount in controversy. Keeling v. Esurance Ins. Co., 660 F.3d at 274. In Armour v. Transamerica Life Ins. Co., No. 10-2136, 2010 WL 4180459 (D.Kan. Oct. 20, 2010) (Melgren, J.), the Honorable Eric F. Melgren, United States District Judge for the District of Kansas, held that the amount-in-controversy requirement was satisfied where the insurer-defendant “identified the total number of in-force LTC policies owned by Kansas residents as 4,683, and the amount of premium increases, over the lifetime of those policies, as $6,441,652,” and where the plaintiffs challenged all premium increases. 2010 WL 4180459, at *4. Another district court within the Tenth Circuit has also applied the los