February 3, 2019

Recovery Not Limited to $75,000 after Remand from Federal Court; Harr v. Hayes

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Lawsuits can only be removed to federal court because of diversity if the amount in controversy exceeds $75,000. If a plaintiff fights removal by arguing that the amount in controversy does not meet this amount, can the plaintiff later be awarded more by a jury? In this case, the Court found that it could.

Harr and Hayes were involved in an accident on I-465 in July 2015. Hayes sued Harr and his employer in October 2015, and the defendants “almost immediately” filed a notice of removal based on diversity of citizenship. Hayes moved to remand. At the time, he had returned to work, his medical bills were only $3,500 (but his treatment was ongoing), and he was seeking workers compensation benefits. Hayes argued that he had only demanded $72,500, which was less than the jurisdictional minimum. The district court granted the motion to remand.

The matter proceeded to a jury trial, and the jury returned a verdict for Hayes in the amount of $187,500. The defendants moved to limit the judgment to $75,000, but the trial court denied that motion. The defendants appealed.

On appeal, the defendants argued that judicial estoppel required that the judgment be limited. Judicial estoppel prevents a litigant from asserting a position that is inconsistent with one asserted in the same or a previous proceeding. Hayes argued that this did not apply to him because his statement was made in a motion, not a pleading; the Court found that this made no difference. Hayes next argued that he did not repudiate the statements made in the motion; the Court found that he did partially repudiate those claims. Hayes argued that the motion to remand was in the district court, so the state trial court could not apply judicial estoppel; the Court found “no logical reason” for limiting judicial estoppel in this way.

After dispensing with these three arguments against applying judicial estoppel, the Court did agree with Hayes on one important point—that the statements regarding the amount in controversy in the motion to remand were not a material misrepresentation at the time of the removal. For at the time he filed the motion, the medical bills were limited, and Hayes’s demand was for less than $75,000. The Court recognized that this may create an incentive for plaintiffs to play fast and loose with the facts but accepted this risk.

Ongoing medical treatment and growing medical expenses, however, are not uncommon in personal injury actions. For this reason alone, plaintiffs should be cautious of proclaiming that the amount in controversy does not exceed $75,000—lest they be held to their word. In this regard, we share the trial court’s concern “that a party may represent to the U.S. District Court that the amount in controversy in a case is less than the jurisdictional requirement, and then, once remanded, that it exceeds that amount.” Under certain circumstances, judicial estoppel would serve to prevent a plaintiff from making representations to defeat diversity jurisdiction and then claiming otherwise in subsequent litigation. Such facts, however, are not presently before us.

The Court then placed blame on the defendants for not taking steps to prove the amount in controversy in federal court, noting that they did not serve “interrogatories as to the specific monetary damages claimed, or otherwise investigating the specific monetary amount” before seeking removal. And it found that this failure of proof, rather than Hayes’ assertions, were the reason for the remand.

Judicial estoppel is limited to instances where “the allegations or admissions must have been acted on by the court.” We addressed this element in Allstate Ins. Co. v. Dana Corp., emphasizing that “[a]n essential part of the doctrine [of judicial estoppel] is that it prohibits a party from presenting a position contrary to one upon which it previously prevailed.” Here, although Hayes’ position was technically successful, that success was due to the Defendants’ failure—not Hayes’ post-removal representations. After conducting further discovery or issuing interrogatories as to Hayes’ specific monetary damages, Defendants could have removed the case again. They chose, however, not to do so.

Therefore, the Court refused to apply judicial estoppel to limit the judgment. After dealing with other issues, the trial court’s judgment was affirmed.


  1. The doctrine of judicial estoppel prevents a litigant from asserting a position that is inconsistent with one asserted in the same or a previous proceeding.
  2. The fact that a statement is in a motion, rather than a pleading, makes no difference for the purposes of judicial estoppel.
  3. The fact that a statement was made in a different court makes no difference for the purpose of judicial estoppel.
  4. Judicial estoppel will not apply if the facts have materially changed for an unforeseen reason.
  5. Defendants who unsuccessfully seek removal should conduct discovery on the amount in controversy with an eye on seeking removal in the future.