K.R. v. Backpage.com et al (JOINT ASSIGN)(MAG2)

Filing 50

MEMORANDUM OPINION AND ORDER directing as follows: (1) Backpage's 48 Objections are OVERRULED; (2) the Magistrate Judge's 44 Report and Recommendation is ADOPTED; (3) plf's 33 Motion to Remand to State Court is GRANTED; and (4) this action is REMANDED to the Circuit Court of Houston County, AL; directing the clerk to take all necessary steps to effectuate the remand. Signed by Chief Judge William Keith Watkins on 8/18/17. (Attachments: # 1 civil appeals checklist). Certified copy mailed to Clerk, Circuit Court of Houston County, AL(djy, )

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF ALABAMA
SOUTHERN DIVISION
K.R.,
Plaintiff,
v.
BACKPAGE.COM, et al.,
Defendants.

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CASE NO. 1:17-CV-299-WKW

MEMORANDUM OPINION AND ORDER
I. INTRODUCTION
Plaintiff, a formerly underage victim of Alabama’s illicit sex trafficking
industry, brought this lawsuit in Alabama state court pursuant to Alabama Code
§ 13A-6-157, which creates a civil cause of action for victims of sex trafficking. She
named a long list of defendants. Three of them were added because of their
affiliation with the hotels where Plaintiff was victimized (Choice Hotels
International, Inc., Veda LLC, Nirav Joshi; collectively, “Hotel Defendants”). One
was her former pimp (Santiago Alonso, i.e., “Alonso”). The rest were individuals
and companies responsible for operating the website Backpage.com (“Backpage
Defendants”), which was the site Alonso used to advertise Plaintiff’s sexual services
to potential clients. Backpage Defendants removed the case to federal court on the
ground that Plaintiff had fraudulently misjoined Alonso and the Hotel Defendants,

both of whom are citizens of Alabama (“Alabama Defendants”), in an effort to defeat
federal jurisdiction. (Doc. # 1.) Plaintiff then filed a Motion to Remand to state
court, arguing that the Alabama Defendants were properly joined. (Doc. # 33.) On
June 26, 2017, the Magistrate Judge filed a Recommendation (Doc. # 44), to which
Backpage timely objected (Doc. # 48). For the reasons set forth below, and upon an
independent and de novo review of the record and consideration of the
Recommendation, Backpage’s objections are due to be overruled, the
Recommendation is due to be adopted, and the motion to remand is due to be
granted.
II. DISCUSSION
The Backpage Defendants make two arguments in their objections. First, they
argue that the Magistrate Judge applied the wrong standard in determining whether
the Alabama Defendants were fraudulently misjoined. And second, they argue that,
even under the correct standard, the allegations in the complaint do not support the
conclusion that Plaintiff’s claims against Backpage are sufficiently connected to her
claims against the Alabama Defendants, such that joinder is appropriate.
A.

The Magistrate Judge applied the correct standard
The joining of a resident defendant to defeat diversity jurisdiction is

fraudulent joinder: “(1) if there is no [reasonable] possibility the plaintiff can prove
a cause of action against the resident defendant; or (2) if there has been outright fraud
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by the plaintiff in pleading jurisdictional facts.” Tapscott v. MS Dealer Serv. Corp.,
77 F.3d 1353, 1360 n.17 (11th Cir. 1996), abrogated on other grounds in Cohen v.
Office Depot, Inc., 204 F.3d 1069 (11th Cir. 2000); see also Legg v. Wyeth, 428 F.3d
1317, 1324 n.5 (11th Cir. 2005) (clarifying that “no possibility” means “[t]he
potential for legal liability must be reasonable, not merely theoretical” (citations
omitted)). Tapscott also identified a third category of fraudulent joinder: Even
where the plaintiff can prove a cause of action against him, the resident defendant is
fraudulently “misjoined” if the claims against him “have no real connection with the
controversy.” Tapscott, 77 F.3d at 1360.
Focusing on a single sentence from the Recommendation, the Backpage
Defendants argue that the Magistrate Judge applies the standard for fraudulent
joinder (the first Tapscott category), rather than misjoinder (the third Tapscott
category), when he writes: “There is nothing trivial or far-fetched in the claims
against [the Alabama] defendants.” (Doc. # 44, at 10.) But Backpage’s myopic
analysis ignores the rest of the opinion. Just before that sentence, the Magistrate
Judge analyzes the extent to which the claims against the Backpage Defendants have
“a real connection” with the claims against the Alabama Defendants, concluding
that:
the alleged actions of the Backpage Defendants in engaging with
Alonso, an Alabama resident defendant, to advertise the sexual services
of a minor child, which services were carried out in a Dothan Alabama
Quality Inn owned and operated by Veda and Joshi, and resulted in
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injury to K.R., arise from the same operative facts or series of
occurrences.
(Doc. # 44, at 9.) The Magistrate Judge’s analysis applies the correct standard—that
is, whether the claims against the allegedly misjoined defendants “have no real
connection with the controversy.” For this reason, Backpage’s first argument is
without merit.
B.

The Complaint supports the Magistrate Judge’s conclusion
The Backpage Defendants next argue that Plaintiff fails to plead facts

sufficient to establish that her claims against them have a “real connection” with her
claims against the Alabama defendants. They argue that the Magistrate Judge relies
on “conclusory allegations,” rather than “specific factual allegations,” to conclude
otherwise. (Doc. # 48, at 6.)
Again, buying Backpage’s argument would require the court to ignore entire
paragraphs from the Recommendation. To quote the Magistrate Judge:
K.R. alleges the liability of Backpage and the other Defendants under
Alabama’s anti human-trafficking statute. Her allegations reference
Backpage’s creation of a multimillion-dollar advertising platform that
caters to pimps and sex traffickers in order to benefit financially from
illegal prostitution and sex trafficking, including the sexual
exploitation, trafficking, and victimization of children, including K.R.
She cites to the findings of the Senate Report entitled “Backpage.com’s
Knowing Facilitation of Online Sex Trafficking” that summarizes the
role www.backpage.com and its founders and officers (James Larkin,
Michael Lacey, and Carl Ferrer) have played in the criminal industry of
sex trafficking. She describes Backpage’s practices and procedures of
altering its “adult” advertisements before publication by deleting
words, phrases, and images indicative of criminality, including child
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sex trafficking, in order to conceal evidence of criminality, and which
knowingly facilitated illegal prostitution and child sex trafficking.
She alleges the combined actions of all the named Defendants caused
her injuries and that she would be prejudiced significantly if she could
not present all of her claims in a single action. K.R. has alleged that all
the Defendants conspired to cause her injuries and that her right to relief
for her injuries arises out of the same series of occurrences which
involve common questions of law and fact to all Defendants.
These allegations are more than enough to establish that the claims against the
Backpage Defendants have a “real connection” with the claims against the Alabama
Defendants. Thus, Backpage’s second argument is also meritless.
III. CONCLUSION
Accordingly, it is ORDERED as follows:
1.

Backpage’s objections (Doc. # 48) are OVERRULED;

2.

The Magistrate Judge’s Recommendation (Doc. # 44) is ADOPTED;

3.

Plaintiff’s Motion to Remand (Doc. # 33) is GRANTED; and

4.

This action is REMANDED to the Circuit Court of Houston County,

Alabama.
The Clerk of the Court is DIRECTED to take all necessary steps to effectuate
the remand.
DONE this 18th day of August, 2017.
/s/ W. Keith Watkins
CHIEF UNITED STATES DISTRICT JUDGE

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