Federal Procedure – Jurisdiction – Suit Under Direct Action Statute Where There is Diversity of Citizenship Between Claimant and Insurer but Not Between Claimant and Wrongdoer
Plaintiff, a citizen of Louisiana, was injured in an automobile accident allegedly caused by the negligence of another citizen of Louisiana. Defendant insurance company, an Illinois corporation, had issued a public liability policy insuring the latter against claims arising from the negligent operation of his car. Pursuant to a Louisiana statutory provision that “the injured person or his or her heirs, at their option, shall have a right of direct action . . . against the insurer alone or against both the insured and the insurer, jointly and in solido,” respondent brought an action against the petitioner alone in the United States District Court in Louisiana alleging diversity of citizenship and damages in excess of $3,000. Petitioner’s motion to dismiss the complaint for lack of federal jurisdiction was granted. The Court of Appeals for the Fifth Circuit reversed and remanded the case for trial. On certiorari to the Supreme Court of the United States, held, affirmed. Federal jurisdiction exists in a suit for damages brought by the injured party under the Louisiana direct action statute against the wrongdoer’s insurer alone, where diversity of citizenship exists between the complainant and the defendant insurer but not between the complainant and the wrongdoer. Lumbermen’s Mutual Casualty Co. v. Elbert, 348 U.S. 48, 75 S.Ct. 151 (1954).