Cook v. Rewards Network ( 2021 )

IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NORTH CAROLINA WESTERN DIVISION Case No. 5:20-CV-00532-M ) DARRYL COOK, ) ) Plaintiff, ) ) ORDER v. ) ) REWARDS NETWORK, ) ) Defendant. ) This matter comes before the court on Plaintiff's Motion to Remand [DE 11], Defendant’s Motion to Compel Arbitration and Dismiss or Stay [DE 14], and Plaintiff's Motion for Leave to File Surreply [DE 24]. The motions are briefed to the extent required by federal and local rules and the court is fully apprised. For the reasons that follow, Plaintiff's motion to remand is denied, Plaintiff's motion to file surreply is granted, and Defendant’s motion to compel is granted. I. Background Plaintiff initiated this action on September 8, 2020 in the District Court of Wake County, North Carolina, alleging that Defendant violated the North Carolina Debt Collection Act. See Compl. DE 1-1. On October 7, 2020, Defendant removed the action to this court alleging the court’s diversity jurisdiction; specifically, in reliance on the Complaint’s allegations, Defendant asserts that the parties are citizens of different states and the amount in controversy exzeeds $75,000.00. Notice of Removal, 45, DE 1. Plaintiff filed the present motion to remand on October 21, 2020, arguing that the court lacks subject-matter jurisdiction because the amount in controversy does not necessarily exceed $75,000.00. Defendant counters that prevailing law holds that the jurisdictional amount is that which is alleged in the Complaint at the time of removal, and the Complaint specifically seeks $300,000.00 in monetary damages. Defendant also filed the present motion to compel arbitration, contending that Plaintiff's company, Cook Hospitality LLC d/b/a Der Biergarten (“Cook Hospitality”), executed a Receivables Purchase and Marketing Agreement with Defendant on June 19, 2019, and the Agreement contains a provision permitting either party to require that any claim or dispute relating to the Agreement or the parties’ dealings with each other be resolved through binding arbitration. Plaintiff counters that he “disput[es] the agreement in full (including the arbitration clause) — thereby not binding the Plaintiff to arbitration.” Resp. at 1, DE 21. Following Defendant’s reply brief, Plaintiff filed the present motion seeking leave to file a surreply on December 15, 2020, saying he “contests the legal standards and facts with regards to the compelling of arbitration,” purportedly set forth in the reply brief. Defendant did not file a response to this motion. Because the Plaintiff's motion to remand challenges the court’s subject-matter jurisdiction, the court will address the motion first, then proceed, if necessary, to address the remaining motions. II. Motion to Remand Defendants are permitted to remove to federal court “any civil action brought in a State court of which the district courts of the United States have original jurisdiction.” 28 U.S.C. § 1441. “Ifa plaintiff files suit in state court and the defendant seeks to adjudicate the matter in federal court through removal, it is the defendant who carries the burden of alleging in his notice of removal and, if challenged, demonstrating the court’s jurisdiction over the matter.” Strawn v. AT&T Mobility LLC, 530 F.3d 293, 296 (4th Cir. 2008). Here, Defendant alleges this court’s diversity jurisdiction to support its removal of the action. Notice, § 5. Removal based on diversity is proper when the parties are diverse and the amount in controversy exceeds $75,000 exclusive of interest and costs. See 28 U.S.C. § 1332(a). As stated, Plaintiff's challenge to Defendant’s removal and this court’s jurisdiction is based on the amount in controversy. “If the plaintiff's complaint, filed in state court, demands monetary relief of a stated sum, that sum, if asserted in good faith, is ‘deemed to be the amount in controversy.”” Dart Cherokee Basin Operating Co., LLC v. Owens, 574 U.S. 81, 84 (2014) (citing 28 U.S.C. § 1446(c)(2)); see also Francis v. Allstate Ins. Co., 709 F.3d 362, 367 (4th Cir. 2013) (“If diversity of citizenship, under 28 U.S.C. § 1332(a), provides the grounds for removal, then ‘the sum demanded in good faith in the initial pleading shall be deemed to be the amount in controversy . . ..” (quoting 28 U.S.C. § 1446(c)(2))). In this case, the operative Complaint reflects the Plaintiffs “Prayer for Relief,” in pertinent part, as follows: WHEREFORE, Plaintiff prays: 1. For general damages according to proof; } /59 aur 2. For special damages according