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Removal – Subject Matter Jurisdiction

By: Derek Hawkins//July 28, 2015//

Removal – Subject Matter Jurisdiction

By: Derek Hawkins//July 28, 2015//

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Civil

7th Circuit Court of Appeals

Officials: POSNER, EASTERBROOK, and SYKES, Circuit Judges.

Removal – Subject Matter Jurisdiction

No. 14-2959 Joseph McCormick v. Independence Life and Annuity

Appellant suit wrongfully removed to federal court.

“Suppose, despite this, that the policy’s value exceeds $75,000. The policy serves as security for the loan. Forget insurance for a moment and consider the situation in which the owner of a parcel of land worth $1 million uses it as security for a $50,000 loan. The borrower does not repay, and the lender seeks to foreclose and sell the parcel to satisfy the debt. What is the amount in controversy: $50,000 or $1 million? The amount is $50,000, because that is what would satisfy the lender’s entire demand on the date the suit was filed. See Gardynski-Leschuck v. Ford Motor Co., 142 F.3d 955 (7th Cir. 1998). Similarly, the McCormicks could have satisfied Independence’s demand by paying the $44,000 it claims as interest—and they could have avoided a risk of the policy’s cancellation by paying even less (just enough to keep its cash value positive). The request for an injunction against cancellation therefore does not turn this dispute about $44,000 into a controversy worth more than $75,000.”

Judgment Vacated – Lack of Subject Matter Jurisdiction


Attorney Derek A. Hawkins is the managing attorney at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.

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