Florida Record

Thursday, August 22, 2019

Court settles jurisdiction dispute, for now, in breach of contract case between roofing, insurance companies

Lawsuits

By Charmaine Little | Aug 15, 2019


On July 1, the U.S. District Court for the Middle District of Florida’s Orlando Division denied Rising Star Roofing’s motion to remand a case back to state court in its lawsuit against an insurance company – but left open the possibility the case might be remanded anyway.

Rising Star sued for breach of contract in state court. But Wilshire Insurance Company removed it to the current court, claiming that diversity jurisdiction applied. U.S. Magistrate Judge Thomas B. Smith denied Rising Star’s motion to remand but instructed Wilshire to prove why the case shouldn’t be remanded, saying he wasn't sure the removal was appropriate.

Smith said Rising Star is a Florida limited liability company, as it does business in Brevard County. But Wilshire said it does business in North Carolina, which it said presents diversity jurisdiction. 

Wilshire said Rising Star’s sole member, Christopher D. Soverns, lives in Connecticut. Rising Star said this doesn’t matter since the lawsuit is involving Rising Star, not Soverns. 

"This contention is without merit," Smith wrote. "As defendant correctly notes, the document filed on October 30, 2017, with Florida’s Secretary of State identifies Christopher Soverns as a member of Rising Star Restoration LLC, but Mr. Soverns amended the Articles of Organization on November 14, 2017, for the sole purpose of changing the name of the entity from Rising Star Restoration LLC to Rising Star Roofing LLC.”

Smith said the correct company, Rising Star Roofing LLC, includes Soverns and a manager and owner, Marcus Keilch. But, he said, the late change meant the entire motion is founded on a false pretense, so he denied it.

However, even though Wilshire gave the proper information concerning the entity, it hasn’t given enough information of where the members of that entity live, Smith said, so he determined the diversity of the parties is still an issue.

Smith warned Wilshire that if it doesn’t respond, the case could result in “remand without further notice,” according to the court.

The amount of the lawsuit also applied to the decisdion. Wilshire had to prove that Rising Star’s lawsuit is for more than $75,000. Rising Star, however, didn’t ask the court for a specific amount. 

Wilshire argued the repairs in the dispute were estimated at $100,954.72, but the lawsuit isn’t for that amount. 

"The complaint alleges that plaintiff provided defendant ‘with an itemized description of the services required to return the property to a ‘pre-loss’ condition, as required by the policy, but defendant failed to pay the total amount owed for these services,” Smith wrote.

Rising Star did not allege that Wilshire didn’t make any payment at all, only that Wilshire didn’t make the total payment, so it’s possible Wilshire paid a portion of it, meaning the total at stake may be less than the $75,000 threshold, Smith said.

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U.S. District Court for the Middle District of Florida, Orlando Division

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