Plaintiff and defendant were parties to a contract under which dispute arose and arbitration was demanded. Plaintiff filed an action in state court seeking to disqualify defendant’s counsel due to an alleged conflict of interest. Defendant removed to federal court. The federal court sua sponte raised the issue of whether the amount in controversy requirement for a diversity action was satisfied. After briefing on the issue, the court held that the requirement was not met, and that the exposure in the underlying arbitration was not the appropriate measure for amount in controversy, but rather only the financial impact of having counsel disqualified and retaining new counsel was implicated. The removing defendant failed to establish the requirement and remanded the case to state court. National Casualty Co. v. Utica Mutual Insurance Co., No. 12-cv-657-bbc (USDC W.D. Wis. Dec. 12, 2012).
This post written by John Pitblado.