UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
HUSSEIN AHMAD SLEIMAN,
Plaintiff, Case Number 11-10694
Honorable David M. Lawson
v.
NATIONAL CASUALTY INSURANCE
and ZURICH AMERICAN INSURANCE
COMPANY,
Defendants.
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ORDER REMANDING CASE
On February 21, 2011, defendant Zurich American Insurance Company (Zurich) removed
this first-party no-fault-insurance case to this Court from the Wayne County, Michigan circuit court.
Under Michigan’s no fault insurance law, a covered person injured in a motor vehicle accident is
entitled to recover from his insurance company (or an insurance carrier assigned priority by statute)
“[a]llowable expenses consisting of all reasonable charges incurred for reasonably necessary
products, services and accommodations for an injured person’s care, recovery, or rehabilitation”;
“[w]ork loss consisting of loss of income from work an injured person would have performed during
the first 3 years after the date of the accident”; and “[e]xpenses not exceeding $20.00 per day,
reasonably incurred in obtaining” replacement services. Mich. Comp. Laws § 500.3107(1)(a)-(c).
Based on the allegations in the complaint, the statements in the notice of removal, and discussions
at the initial case management conference, it appears that at the time the notice of removal was filed,
the plaintiff had not incurred expenses in the categories noted above that exceeded the $75,000-
jurisdictional threshold prescribed by 28 U.S.C. § 1332(a). Therefore, on April 20, 2011, the Court
ordered the defendants to show cause why the case should not be remanded for want of subject
matter jurisdiction for failure to meet the amount-in-controversy requirement.
Zurich responded, arguing that the amount in controversy is determined by the plaintiff’s
damages incurred prior to and including the date of the filing of his complaint, plus all damages to
which the plaintiff is entitled as of the date of eventual judgment, plus those future damages that
either defendant will become obligated to pay under their respective insurance contracts. However,
Zurich acknowledged that at the time of removal, the plaintiff only had “approximately $30,000 in
outstanding invoices . . . relating to the incident.” Zurich’s Resp. to Court’s Mar. 17, 2011 Order
Requiring Submission of Information Regarding Removal at 4.
Zurich is not entirely correct in arguing that the present cause of action encompasses all
future damages that the defendants may be liable to pay under their insurance contracts. Under
Michigan’s No-Fault Act, an insurer is liable only for expenses that are reasonable, necessary, and
incurred. Nasser v. Auto Club Ins. Ass’n, 435 Mich. 33, 50, 457 N.W.2d 637, 645 (1990). A
plaintiff may continue to incur damages while his first-party lawsuit is pending and may recover
those damages at trial; but the jury is not permitted to award future damages for first-party expenses
because those damages would not have been “incurred.” See Manley v. Detroit Auto. Inter-
Insurance Exchange, 425 Mich. 140, 157, 388 N.W.2d 216, 223 (1986) (holding that a “no-fault
insurer is required to pay only necessary allowable expenses actually incurred,” and that a no-fault
insurer is not obliged to pay for a future expense that the trial court declares to be both necessary
and allowable until it is actually incurred). If the plaintiff incurs additional expenses thereafter and
his insurance company refuses to pay, he must commence a new lawsuit for the newly-incurred
expenses. See Elser v. Auto-Owners Ins. Co., 253 Mich. App. 64, 68, 654 N.W.2d 99, 101 (2002).
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The assessment of jurisdiction, on the other hand, must occur as of the time the case is
removed. Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868, 871 (6th Cir. 2000) (stating that “[t]his
circuit has recognized a rule that the determination of federal jurisdiction in a diversity case is made
as of the time of removal” (citing Ahearn v. Charter Twp. of Bloomfield, 100 F.3d 451, 453 (6th Cir.
1996)). The defendants bear the burden of showing “by a preponderance of the evidence that the
amount in controversy requirement has been met.” Hayes v. Equitable Energy Res. Co., 266 F.3d
560, 572 (6th Cir. 2001) (citing Gafford v. Gen. Elec. Co., 997 F.2d 150, 158 (6th Cir. 1993),
abrogated on other grounds by Hertz Corp. v. Friend, --- U.S. ----, 130 S. Ct. 1181 (2010)). The
defendant must show that it is “more likely than not” that the plaintiff is seeking damages in excess
of the $75,000 limit. Gafford, 997 F.2d at at 158. “‘[A]ll doubts as to the propriety of removal are
resolved in favor of remand.’” Jacada (Europe), Ltd. v. Int’l Mktg. Strategies, Inc., 401 F.3d 701,
704 (6th Cir. 2005) (quoting Coyne v. Am. Tobacco Co., 183 F.3d 488, 493 (6th Cir. 1999)),
abrogated on other grounds by Hall St. Assocs., L.L. C. v. Mattel, Inc., 552 U.S. 576 (2008).
Courts have permitted prospective damages to be considered in calculating the amount in
controversy for jurisdictional purposes. See White v. Loomis Armored US, Inc., 729 F. Supp. 2d
897, 902 (E.D. Mich. 2010) (citing cases). But such future damages generally are limited to those
that “the plaintiff stands to recover by the time the case concludes.” Ibid.
According to the complaint, the motor vehicle accident in this case occurred on July 20,
2010, yet by the time the case was removed the contested expenses amounted to little more than
$30,000. The defendants have not pointed to any information that suggests that the plaintiff will
incur an additional $45,000 in first-party benefits by the time of trial, which presently is scheduled
for February 14, 2012. The expenses incurred thus far appear to involve diagnostic studies and
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physical therapy. The claim submitted asks for “$1 for wage loss.” Notice of Removal, Ex. D. The
Court may not base its assessment of jurisdiction on speculation concerning future developments.
See Lowdermilk v. United States Bank Nat’l Ass’n, 479 F.3d 994, 1002 (9th Cir. 2007). In his
complaint in this case, the plaintiff has not sought a declaration concerning liability of the
defendants for potential future liability for first-party damages yet to be incurred. The defendants
have not convinced the Court that it is more likely than not that the amount in controversy exceeds
$75,000, casting doubt on the Court’s subject matter jurisdiction. Therefore, the Court must remand
the case to state court. See Eastman v. Marine Mech. Corp., 438 F.3d 544, 549-50 (6th Cir. 2006)
(“[B]ecause lack of jurisdiction would make any decree in the case void and the continuation of the
litigation in federal court futile, the removal statute should be strictly construed and all doubts
resolved in favor of remand.” (quoting Brown v. Francis, 75 F.3d 860, 864-65 (3d Cir. 1996))).
Accordingly, it is ORDERED that the case is REMANDED to the Wayne County,
Michigan circuit court.
s/David M. Lawson
DAVID M. LAWSON
United States District Judge
Dated: June 1, 2011
PROOF OF SERVICE
The undersigned certifies that a copy of the foregoing order was served
upon each attorney or party of record herein by electronic means or first
class U.S. mail on June 1, 2011.
s/Deborah R. Tofil
DEBORAH R. TOFIL
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