State of Louisiana v. American National
Property And Casualty Company
, 2013 WL 5201146 (E.D. La. Sept. 11, 2013).
In this case, the District Court for the Eastern District of
Louisiana held that, while subject matter jurisdiction is generally
determined at the onset of litigation, when an action is severed
under Federal Rule of Civil Procedure 21, the severed action must
have an independent jurisdictional basis to remain in federal
court.
Procedural History
In Louisiana v. AAA Insurance, Case No. 07-5528 (the
"Road Home Litigation"), the State of Louisiana
(the "State"), brought an action in state court to
recover funds from over 200 insurers. Recipients of Road Home
grants had assigned the disputed funds to the State pursuant to
subrogation agreements with the recipients' insurers. In
the aftermath of Hurricanes Katrina and Rita, the State, with
funding from the United States Department of Housing and Urban
Development, created The Road Home program to
