Isaac Hager v. Steele
- Lorna Schofield
- 1:20-cv-04482
- U.S. District Court · Southern District of New York
- 4
Rachel Isaac Hager v. Jay F. Steele: Judge Schofield denied remand, finding diversity jurisdiction and more than $75,000 in controversy.
Rachel Isaac Hager and defendants Jay F. Steele and Steele Consulting, LLC. The case remained in federal court rather than being returned to New York state court.
What happened
Rachel Isaac Hager sued Jay F. Steele and others in New York state court over her discharge from employment, alleging fraud, breach of contract, and violations of New York human-rights laws. The defendants moved the case to federal court, and Hager asked the federal court to send it back to state court.
The court found that the parties were citizens of different states because the defendants were domiciled in Georgia and Hager was domiciled in either New York or Connecticut. It also found a reasonable probability that the amount at issue exceeded $75,000, based on back pay, possible front pay or reinstatement, and Hager’s $250,000 salary.
Judge Lorna G. Schofield denied Hager’s motion to remand and directed the Clerk of Court to close the motion. The case therefore remained in federal court, and the order did not decide the underlying claims.
The detailed version
- Isaac Hager v. Steele · No. 1:20-cv-04482
- Lorna Schofield
- July 29, 2020
Background
Rachel Isaac Hager originally filed the action in New York state court. She alleged, among other claims, fraudulent inducement, breach of contract, and violations of the New York State Human Rights Law and New York City Human Rights Law based on events surrounding her discharge from employment with Steele Consulting, LLC. On June 11, 2020, the defendants removed the case to the U.S. District Court for the Southern District of New York. Hager then moved to remand, meaning she asked the federal court to return the case to state court.
Subject-Matter Jurisdiction
The defendants relied on diversity jurisdiction. A federal court has diversity jurisdiction when the parties are citizens of different states and more than $75,000 is in dispute. The court found complete diversity because Jay F. Steele was domiciled in Georgia, Steele Consulting, LLC was also a Georgia domiciliary because Steele was its sole member, and Hager was domiciled in either New York or Connecticut. The court noted that Hager was not domiciled in Georgia.
The court also found that the amount-in-controversy requirement was met. Hager did not state a specific damages amount, but she sought back pay, front pay, compensatory damages, punitive damages, or reinstatement. The court calculated potential back pay from the stated discharge date of May 15, 2020, through the June 11, 2020, removal date as $19,178.08. It further reasoned that, based on Hager’s undisputed $250,000 annual salary, slightly more than two and a half months of front pay would bring the amount above $75,000. The value of four months of employment if Hager were reinstated would also exceed $75,000.
Ruling
The court held that the defendants had shown by a preponderance of the evidence a reasonable probability that the amount in controversy exceeded $75,000 when the case was removed. It therefore DENIED Hager’s motion to remand and directed the Clerk of Court to close Dkt. No. 9. The order addressed only whether the federal court could retain the removed case; it did not decide the merits of Hager’s underlying claims.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.