Siding & Insulation Co. v. Acuity Mut. Ins. Co.

A purported class action alleged that Beachwood Hair Clinic violated the Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227, by disseminating more than 37,000 unsolicited fax advertisements in 2005 and 2006. Facing more than $18 million in statutory damages, Beachwood and its insurer, Acuity, agreed to a $4-million class settlement with the Ohio-based class representative, Siding. The settlement stipulated that separate litigation between Acuity and Siding would resolve a $2-million coverage dispute under Beachwood’s policy. Siding sought a declaratory judgment under Beachwood’s policy. The district court granted summary judgment to Acuity denying coverage. The Sixth Circuit vacated, finding that Siding did not establish diversity jurisdiction, which requires an amount in controversy greater than $75,000, 28 U.S.C. 1332(a). Unable to identify a singular interest exceeding $75,000 in the remaining $2-million coverage dispute, Siding sought to aggregate its interest with putative class members to satisfy that requirement, or to have the court consider the value of the policy dispute from Acuity’s perspective: $2 million. Acuity suggested ancillary jurisdiction via the settlement judgment in the underlying class action. The court rejected all arguments. View "Siding & Insulation Co. v. Acuity Mut. Ins. Co." on Justia Law