United States District Court, S.D. Mississippi, Southern Division
MEMORANDUM OPINION AND ORDER DENYING JEREMY
CHERRY'S  MOTION FOR SUMMARY JUDGMENT; GRANTING IN
PART AND DENYING IN PART ALLSTATE INSURANCE COMPANY'S
 MOTION FOR SUMMARY JUDGMENT; AND DISMISSING JEREMY
CHERRY'S BAD FAITH CLAIM WITH PREJUDICE
SULEYMAN OZERDEN UNITED STATES DISTRICT JUDGE
THE COURT in these consolidated cases are the Motion  for
Summary Judgment filed by Jeremy Cherry and the Motion 
for Summary Judgment filed by Allstate Insurance Company.
After consideration of the Motions, related pleadings, the
record, and relevant legal authority, the Court finds that
Cherry's Motion  should be denied and that
Allstate's Motion  should be granted in part and
denied in part. Plaintiff's bad faith claim will be
dismissed with prejudice.
purposes of resolving both Motions ,  for Summary
Judgment, the parties do not dispute the basic facts of this
case. Michelle Simpson (“Simpson”) carried an
automobile insurance policy (the “Policy”) with
Allstate Insurance Company (“Allstate”),
effective February 20, 2017. See Policy [1-3] at
6-45. The Policy included uninsured motorist insurance
coverage for bodily injury and property damage. Id.
at 7. The only vehicle listed in the Policy declarations was
Simpson's 2006 Ford Taurus. Id. at 6.
Policy afforded coverage for an “insured person”
for “bodily injury” and “property
damage” when caused by accident, and when such injury
or damage arose out of the ownership, maintenance, or use of
an uninsured automobile. Policy [1-3] at 21, 35. The Policy
defined “insured person” as, among others, the
named insured or any resident relative. Id. at 36.
“Bodily injury” included physical harm to the
body, id. at 25, and “property damage”
was defined as “damage to or destruction of the
insured auto, including loss of use, and the personal
property owned by an insured person which is contained in the
insured auto at the time of the accident, ”
id. at 36 (emphasis added). In turn, “insured
auto” was defined as “any auto or utility auto
you own which is described in the Policy Declarations,
” and includes for purposes of uninsured motorist
coverage a “replacement auto, ”an
“additional auto, ” a “substitute auto,
” and a “non-owned
auto.” Id. at 25.
Cherry (“Cherry”) is Simpson's adult
grandson. Cherry owned a GMC truck that was registered in his
own name during the time period covered by the Policy.
See Cherry's Mot.  at 2. Cherry lived with
Simpson, but neither he nor his truck was identified as an
additional driver or insured vehicle on the Allstate Policy.
Id. Cherry did not carry separate insurance on his
April 5, 2017, Cherry was driving his GMC truck when he was
involved in an automobile collision with another motorist,
Tony A. Stallworth (“Stallworth”), whom Cherry
claims was uninsured at the time. Cherry made a claim upon
Simpson's Allstate Policy demanding payment under the
uninsured motorist provision for bodily injury to himself and
property damage to his truck. According to a preliminary
estimate [21-1] supplied by Cherry, his truck sustained $14,
495.61 in damage.
purposes of Allstate's present Motion ,
“Allstate assumes that, as Cherry alleges, Stallworth
was uninsured.” Allstate's Mem.  at 2 n.1.
Allstate does not contest that Cherry is afforded bodily
injury coverage under the Policy as a resident relative of
Simpson's, and the parties have resolved that claim.
See Stipulation  at 1. What remains of the
coverage dispute is the issue of whether the property damage
to Cherry's truck is covered.
parties agree that the unambiguous language of the Policy
excludes from coverage the property damage to Cherry's
truck. See, e.g., Allstate's Compl.  at 4;
Cherry's Resp.  at 2. Cherry argues, however, that the
Mississippi Uninsured Motorist Act, Mississippi Code
§§ 83-11-101, et seq. (the “UM
Act”), mandates coverage for such damage as a matter of
law, regardless of the language contained in the Policy.
23, 2017, Allstate filed a Complaint  for Declaratory
Judgment against Simpson and Cherry in this Court (the
“Lead Case”), Compl.  at 1-6, seeking a
declaratory judgment that uninsured motorist property damage
benefits are not recoverable under the Policy for
Cherry's property damage claim, and that any bad faith,
punitive damages, and/or extra-contractual damages are not
legally viable in this coverage dispute. Id. at 6.
28, 2017, Cherry initiated a separate lawsuit in the Circuit
Court of Jackson County, Mississippi, against both Stallworth
and Allstate. See Cherry v. Stallworth, No.
1:17cv219 (the “Member Case”). The Complaint in
the Member Case advanced a negligence claim against
Stallworth and uninsured motorist and bad faith claims
against Allstate. See Member Case Compl. [1-1] 4-13.
Allstate removed that case to this Court, invoking diversity
jurisdiction pursuant to 28 U.S.C. § 1332, see
Member Case Notice of Removal  at 1, and then filed a
Motion to Sever Cherry's claims against the non-diverse
party Stallworth and remand the severed claims to state
court, see Member Case Mot.  at 1. The Court
granted Allstate's Motion to Sever and retained
jurisdiction over Cherry's claims against Allstate in the
Member Case. See Member Case Order  at 10.
Allstate's Motion, the Court next consolidated the Lead
Case and the Member Case, which both remain pending.
See Order  at 3. Cherry and Allstate have now
filed cross Motions ,  for Summary Judgment, asking
the Court to resolve the question of whether there is
uninsured motorist property damage coverage for Cherry's
truck under the Policy and under Mississippi law. In
addition, or in the alternative, Allstate seeks summary
judgment on Cherry's bad faith claim.
filed the Lead Case in this Court on the basis of diversity
jurisdiction. See Allstate's Compl.  at 2
(citing 28 U.S.C. § 1332). 28 U.S.C. § 1332(a)(1)
provides that “district courts shall have original
jurisdiction of all civil actions where the matter in
controversy exceeds the sum or value of $75, 000, exclusive
of interest and costs, and is between . . . citizens of
different States . . . .” 28 U.S.C. § 1332(a)(1).
The record supports the conclusion that Allstate is a citizen
of Delaware and Illinois for diversity purposes, and that
Simpson and Cherry are citizens of Mississippi. The parties
are therefore completely diverse.
Complaint  asserts that the amount-in-controversy exceeds
$75, 000.00. Allstate's Compl.  at 2. While Simpson
and Cherry did not file a motion to dismiss for lack of
subject-matter jurisdiction, in support of its Motion 
for Summary Judgment Allstate has supplied an e-mail from
Cherry's counsel in which counsel questions whether the
amount in controversy is satisfied. See EMail [23-3]
at 2 (“the amount in controversy, even by the language
in your pleading, is far less than $75, 000”).
Court has a continuing duty to examine its subject-matter
jurisdiction. Insurance Corp. of Ireland, Ltd. v.
Compagnie des Bauxites de Guinee, 456 U.S. 694, 702
(1982); Warren v. United States, 874 F.2d 280,
281-82 (5th Cir. 1989). Federal courts are courts of limited
jurisdiction, having subject-matter jurisdiction only over
those matters specifically designated by the Constitution or
Congress. Halmekangas v. State Farm Fire and Cas.
Co., 603 F.3d 290, 292 (5th Cir. 2010). Courts
“must presume that a suit lies outside this limited
jurisdiction, and the burden of establishing federal
jurisdiction rests on the party seeking the federal
forum.” Howery v. Allstate Ins. Co., 243 F.3d
912, 916 (5th Cir. 2001). The party invoking the Court's
jurisdiction bears the burden of establishing diversity
jurisdiction. Bynane v. Bank of New York Mellon for
CWMBS, Inc. Asset-Backed Certificates Series 2006-24,
866 F.3d 351, 355 (5th Cir. 2017).
plaintiff insurer seeks a declaratory judgment regarding the
scope of coverage afforded by an insurance policy, the amount
in controversy is assessed according to the value of the
right to be protected, which is the plaintiff insurer's
potential liability under the policy, plus potential
attorneys' fees, penalties, statutory damages, and
punitive damages. Hartford Ins. Grp. v. Lou-Con
Inc., 293 F.3d 908, 911-12 (5th Cir. 2002) (citing
St. Paul Reinsurance Co., Ltd. v. Greenberg, 134
F.3d 1250, 1253 (5th Cir. 1998)). The potential liability
under the policy is not necessarily equal to the policy
limit, but is based upon what the insured actually seeks to
Complaint  in the Lead Case relies upon the $50, 000.00
policy limit and Cherry's bad faith and punitive damages
claims to establish that the amount in controversy is
satisfied. It is clear that, although Cherry's truck may
have only sustained $14, 495.61 in damage, see
Estimate [21-1] at 1-3,  Cherry's pleadings seek full policy
limits from Allstate. In the Member Case, Cherry raises a
“continuing demand for payment of his bodily injury and
property damage claims up to the sum of the Uninsured
Motorist Coverage limits set for [sic] on the Simpson
declaration page.” Cherry's Compl. [1-1] at 8. In
addition, Cherry seeks an award of punitive damages.
Considering Cherry's Complaint [1-1] in the Member Case
as the object of the Lead Case, Allstate's potential
liability under the Policy, coupled with potential
attorneys' fees and punitive damages, exceeds the $75,
Allstate's potential liability for actual property
damages is limited to $14, 495.61, the Court finds that the
amount in controversy nevertheless exceeds $75, 000.00. An
award of punitive damages in a “single digit
ratio” to the $14, 495.61 in compensatory damages could
easily exceed $75, 000.00. See generally, e.g., Gentiva
Certified Healthcare Corp. v. Rayborn, No.
5:14-CV-97-DCB-MTP, 2016 WL 164322, at *3 (S.D.Miss. Jan. 13,
2016) (holding that the requisite $75, 000.00 jurisdictional
amount compared to a potential $13, 000.00 compensatory award
is less than a 6 to 1 ratio, well within the “single
digit ratio” which the Supreme Court suggests complies
with due process) (citing State Farm Mut. Auto. Ins. Co.
v. Campbell, 538 U.S. 408, 425 (2003)).
upon the foregoing, Allstate has carried its burden of
demonstrating that the amount in controversy in this
particular case exceeds the sum or value of $75, 000.00,
exclusive of interest and costs. See 28 U.S.C.
§ 1332(a). The Court finds that it has subject-matter
jurisdiction pursuant to 28 U.S.C. § 1332.
Summary judgment standard
Rule of Civil Procedure 56(a) provides that summary judgment
is appropriate “if the movant shows that there is no
genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed.R.Civ.P.
56(a). A genuine dispute of material fact exists if the
evidence is such that a reasonable jury could return a
verdict for the nonmoving party. Bennett v. Hartford Ins.
Co. of Midwest, 890 F.3d 597, 604 (5th Cir. 2018)
Interpretation of insurance policies under Mississippi
parties do not dispute that Mississippi law governs the
claims in this case. Mississippi courts treat the language
and provisions of insurance policies as contracts, subject to
the same rules of interpretation as other contracts.
Pulliam v. Alfa Ins. Co., 238 So.3d 620, 627 (Miss.
Ct. App. 2018) (citing Hayne v. The Doctors Co., 145
So.3d 1175, 1180 (Miss. 2014)). When a policy's language
is clear and unambiguous, it must be enforced as written.
Id. “Any ambiguity in the policy is construed
against the insurer, and exclusions in uninsured motorist
policies are strictly construed.” Boatner v.
Atlanta Speciality Ins. Co., 115 F.3d 1248, 1251 (5th
Cir. 1997). However, if the provisions of an uninsured
motorist insurance policy conflict with Mississippi's
Uninsured Motorist Act, the statutory provisions prevail and
are incorporated into the policy. Dunnam v. State Farm
Mut. Auto. Ins. Co., 366 So.2d 668, 670 (Miss. 1979).
Mississippi's Uninsured Motorist Act
the insured rejects it in writing, an automobile liability
insurance policy in Mississippi must contain
an endorsement or provisions undertaking to pay the
insured all sums which he shall be legally entitled to
recover as damages for bodily injury or death from
the owner or operator of an uninsured motor vehicle . . . .
Miss. Code § 83-11-101(1) (emphasis
added). Such a policy must also contain
an endorsement or provisions undertaking to pay the
insured all sums which he shall be legally entitled to
recover as damages for property damage from the
owner or operator of an uninsured motor vehicle . . . .
Miss. Code Ann. § 83-11-101(2) (emphasis added).
“Obviously the purpose of uninsured motorist insurance
is to benefit the insured by making available compensation
for his property damage, bodily injuries or death.”
State Farm Mut. ...