Case Study

Saeyoung Chang lives in California. Over the holidays, he drives to Arizona to visit his grandmother. While there, a cold and wet weather system moves in and drenches the area. Saeyoung decides to cut his visit short and return to California before the highways become impassable. He knows of a shortcut he can take to get to the freeway quickly, but he needs to cross what is normally a dry wash to get there. Saeyoung sees that the water is rising but believes he can get across before it is flooded. Saeyoung is wrong. The wash fills with rain water, and Saeyoung narrowly escapes before his car is swept down the wash.

Less than a block away, Saeyoung's car careens into a house bordering the wash. Saeyoung's car is totaled, and the side of the house is severely damaged. The homeowner, Stan Janek, is furious that Saeyoung tried to cross the wash. He gets an estimate on home repair. The house will cost $70,000 to repair. Stan consults an attorney and sues Saeyoung in federal district court in Arizona for $70,000 compensatory damages and $100,000 punitive damages.

Saeyoung does not believe Stan's lawsuit has any merit because the accident was an act of nature. Saeyoung also does not believe the federal court has jurisdiction because the actual damage to Stan's house is $70,000, which falls short of the $75,000 requirement for federal subject matter jurisdiction based on diversity of ownership.

If Saeyoung wishes to file a motion to dismiss, he must do so before filing an answer and within the time permitted to answer.

a. True
b. False