Alabama Aggregate, Inc et al v. Powerscreen Crushing and Screening, LLC et al
OPINION AND ORDER: it is ORDERED as follows: (1) The #16 motion to remand is denied. (2) Dft Dustin White is dismissed and terminated as a party to this action. (3) The removing party has until 9/14/2021, to amend the notice of removal to allege jurisdiction sufficiently, 28 USC 1653; otherwise this lawsuit shall be remanded to state court. Signed by Honorable Judge Myron H. Thompson on 9/7/2021. (hfc, )
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 1 of 20
IN THE DISTRICT COURT OF THE UNITED STATES FOR THE
MIDDLE DISTRICT OF ALABAMA, NORTHERN DIVISION
ALABAMA AGGREGATE, INC., a
domestic corporation, and
DONALD R. RAUGHTON, SR.,
POWERSCREEN CRUSHING AND
SCREENING, LLC., a foreign
corporation, et al.,
CIVIL ACTION NO.
OPINION AND ORDER
Plaintiffs Alabama Aggregate, Inc., and Donald R.
Raughton, Sr. commenced this lawsuit in an Alabama state
Screening, LLC; Terex Corp.; Terex USA, LLC; Caterpillar
Inc. (otherwise known as CAT); and Dustin White.
Aggregate and Raughton bring various state-law claims
arising out of their purchase from Powerscreen of certain
equipment manufactured by Terex USA, Terex Corp., and
Terex USA removed the lawsuit to this court under
28 U.S.C. §§ 1332, 1441, and 1446 (diversity), contending
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 2 of 20
diversity-of-citizenship jurisdiction existed.
Aggregate and Raughton’s motion to remand, in which they
contend that White was not fraudulently joined.
reasons that follow, the court agrees with Terex USA and
concludes that White was fraudulently joined.
Aggregate and Raughton’s motion to remand.
However, the court is still concerned as to whether
it has removal jurisdiction:
As explained later, Terex
USA has failed to allege properly in its notice of removal
the “citizenship” of certain parties.
The court will,
nevertheless, provide Terex USA an opportunity to cure
that jurisdictional deficiency; if it fails to do so,
this case will be remanded, albeit for a reason unrelated
to White’s joinder.
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 3 of 20
I. Remand Standard
Federal courts are courts of limited jurisdiction.
See Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S.
A federal court may hear a case only if it
is authorized to do so by the United States Constitution
or by Congress.
See id. at 377.
A federal court may
exceeds $ 75,000, exclusive of costs and interests, and
the parties are citizens of different States.
U.S.C. § 1332(a).
When an action is filed in state court,
but the amount in controversy is sufficient and there is
complete diversity, federal law gives the defendant the
right to remove the action to federal court.
U.S.C. § 1446.
concerns, the removal statute, 28 U.S.C. § 1441, must be
See Shamrock Oil & Gas Corp. v.
federal-court jurisdiction must be resolved in favor of
a remand to state court.
See Burns v. Windsor Ins. Co.,
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 4 of 20
31 F.3d 1092, 1095 (11th Cir. 1994).
When a case is
removed from state court, the burden is on the party that
removed the action to prove federal-court jurisdiction.
In its notice of removal, Terex USA alleges the
Alabama Aggregate is an Alabama corporation.
Raughton is a “resident” of Alabama.
Powerscreen is a
limited liability company with one member, who is a
Terex USA is a Delaware limited liability
company with one member--Terex Corp.--and a principal
associate employed by Powerscreen, is a “resident” of
In their complaint, Alabama Aggregate and Raughton
allege the following:
Alabama Aggregate purchased from
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Powerscreen four pieces of equipment manufactured by CAT,
Terex Corp, and Terex USA. Raughton served as a guarantor
of the contracts of sale for Alabama Aggregate.
equipment is defective.
Alabama Aggregate and Raughton’s complaint states
seven causes of action under state law arising from the
sale and manufacture of the equipment.
III. Fraudulent Joinder
In order for diversity jurisdiction to be proper,
there must be complete diversity between the parties,
which means that no plaintiff may be a citizen of the
same State as any defendant.
7 U.S. 267 (1806).
See Strawbridge v. Curtiss,
Terex USA concedes that Alabama
Aggregate, Raughton, and White are not diverse.
contends, however, that White was fraudulently joined.
If a defendant was fraudulently joined, his citizenship
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A removing party who alleges fraudulent joinder “has
the burden of proving that either: (1) there is no
possibility the plaintiff can establish a cause of action
against the resident defendant; or (2) the plaintiff has
resident defendant into state court.”
Pacheco de Perez
That burden “is a heavy one”; if
the plaintiff states “even a colorable claim against the
resident defendant, joinder is proper and the case should
be remanded to state court.”
A district court must
stated a colorable claim upon the plaintiff’s pleadings
at the time of removal, supplemented by any affidavits
submitted by the parties.
It must “evaluate
factual allegations in the light most favorable to the
applicable law in the plaintiff’s favor.”
where the defendant has submitted affidavits contesting
facts alleged by the plaintiff, the court cannot resolve
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 7 of 20
those facts in the plaintiff’s favor based solely on
unsupported allegations in the complaint.
See Legg v.
Wyeth, 428 F.3d 1317, 1323 (11th Cir. 2005).
Shannon v. Albertelli Firm, P.C., 610 Fed.
Appx. 866, 871 (11th Cir. 2015) (citing Legg, 428 F.3d
Terex USA argues that White was fraudulently joined
because Alabama Aggregate and Raughton have not provided
establish, a cause of action against White.
Aggregate and Raughton argue that Terex USA has failed
to carry its burden of proof.1
1. Alabama Aggregate and Raughton also argue that
Terex USA’s notice of removal is deficient because the
other defendants did not consent to the removal, as
required by 28 U.S.C. § 1446(b)(2)(A).
See Motion to
Remand at ¶¶ 6–7, 17 (Doc. 16).
They are mistaken.
Powerscreen, Terex Corp., and CAT timely filed notices
See Def.’s Ex. C, Notices of Consent to
Removal at ¶¶ 4–5 (Doc. 1-14). Although White did not,
he was not required to, because he had not been served
at the time the removal petition was filed.
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 8 of 20
The court agrees with Terex USA.
and Raughton state the following claims against each of
‐ Breach of contract;
‐ Fraudulent misrepresentation, and/or suppression of
material facts, and/or deceit in violation of Alabama
Code §§ 6-5-101, 6-5-102, 6-5-103, 6-5-104;
‐ Private nuisance;
‐ Unjust enrichment;
‐ Violation of the Alabama Heavy Equipment Dealer Act,
Ala. Code § 8-21B-1 et seq.;
‐ Breach of warranty of merchantability; and
To prevail on their breach-of-contract claim against
White, Alabama Aggregate and Raughton must prove, among
other things, that they entered into a contract with
Retirement Systems of Alabama v. Merrill Lynch & Co., 209
F. Supp. 2d 1257, 1262 n.8 (M.D. Ala. 2002) (Albritton,
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 9 of 20
“An agent does not become a party to a contract
made on behalf of a disclosed principal unless the agent
and the third party so agree.”
Agency § 6.01.
Restatement (Third) of
“A principal is disclosed when the third
party has notice than an agent is acting for a principal
and has notice of the principal’s identity.”
undisputed that White acted as Powerscreen’s agent during
the entirety of the events giving rise to this lawsuit,
and that Alabama Aggregate and Raughton knew he was
acting as such.
And Alabama Aggregate and Raughton have
not alleged that White agreed to become a party to any
therefore failed to allege facts sufficient to support
their breach-of-contract claim against White.
deceit against White, Alabama Aggregate and Raughton must
§§ 6-5-101, 6-5-103, 6-5-104, or that he suppressed a
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material fact that he was obligated to communicate, see
Ala. Code § 6-5-102.
To that end, Alabama Aggregate and
operable and ‘new’ condition,” and that it would be
equipped with a CAT engine.2
¶¶ 32, 35, 42 (Doc. 1-7).
Second Amended Complaint at
White, however, asserts in an
negotiate the terms or conditions of their sale, or “make
any statements or representations about these machines
to Alabama Aggregate or Mr. Raughton,” and that his only
involvement in the sale of the machines consisted of
2. Alabama Aggregate and Raughton claim that White
“fraudulently and deceitfully ... suppressed and/or
concealed facts from the Plaintiff.”
Complaint at ¶ 31 (Doc. 1-7). But they have alleged no
facts to support that claim. And even had they alleged
that White concealed that the equipment was not in
operable condition and equipped with a CAT engine, they
could not prevail against White, because they have not
alleged any special circumstance that might give rise to
a duty to disclose. See Montgomery Rubber, 308 F. Supp.
2d at 1299.
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 11 of 20
Powerscreen’s president, and sending certain financing
agreements, which he did not prepare, to Terex.3
Ex. D, White Decl. at ¶¶ 4–5 (Doc. 1-15).
contradicting White’s assertions.4
Absent such evidence,
the court cannot resolve this factual dispute in their
See Legg, 428 F.3d at 1323.
and Raughton have therefore failed to provide evidence
sufficient to support their fraud and misrepresentation
claim against White.
3. White also asserts that, after Alabama Aggregate
bought the machines, he received telephone calls from the
company concerning problems with the machines, and that
he “directed them to the appropriate people who handle
service requests or warranty claims.”
Def.’s Ex. D,
White Decl. at ¶¶ 4–5 (Doc. 1-15).
4. Although Alabama Aggregate and Raughton contend
that “the only proper way for this matter to be
investigated so to [sic.] protect the rights of the
Plaintiffs would be through the process of discovery in
the state court,” Motion to Remand at ¶ 13 (Doc. 16),
they have not requested discovery from this court. The
court therefore declines to consider whether discovery
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 12 of 20
To prevail on their private-nuisance claim against
White, Alabama Aggregate and Raughton must prove, among
other things, that White owed them a legal duty of care
under a theory of nuisance, and that he breached that
duty, thereby proximately causing them an injury.
Tipler v. McKenzie Tank Lines, 547 So. 2d 438, 440–41
They must also prove that White’s breach
was continuous or recurring.
See Banks v. Harbin, 500
So. 2d 1027, 1029 (Ala. 1986).
Alabama Aggregate and
Raughton have alleged no facts to suggest that White owed
them any duty of care with regard to the sale of the
And Alabama Aggregate and Raughton have not
alleged that White, or any other defendant, committed a
breach of duty that was continuous or recurring.5
5. Alabama Aggregate and Raughton allege that White
committed acts that caused them injurious consequences
of lasting duration. See Motion to Remand at ¶ 48 (Doc.
16) (“[T]he Defendants’ actions created and continue to
Plaintiffs.”). But that does not a nuisance make. See
McCalla v. Louisville & N.R. Co., 50 So. 971, 972 (Ala.
1909) (“There is a wide difference between tort,
constituting an invasion of personal or contract right,
and nuisance. The former expends its force in one act,
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 13 of 20
support their private-nuisance claim against White.
To prevail on their unjust-enrichment claim against
White, Alabama Aggregate and Raughton must prove either
conscience, belongs to them, or that White holds money
that was improperly paid because of mistake or fraud.
See Avis Rent A Car Systems, Inc. v. Heilman, 876 So. 2d
maintain a fraudulent misrepresentation claim against a
defendant, that plaintiff will not be permitted a viable
claim of unjust enrichment which is based on an untenable
fraudulent misrepresentation claim.” Southern v. Pfizer,
Inc., 471 F. Supp. 2d 1207, 1219 (N.D. Ala.) (Hopkins,
As explained above, Alabama Aggregate and Raughton
although injurious consequences may be of lasting
duration. A nuisance involves the idea of continuity or
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 14 of 20
fraudulent-misrepresentation claim, however, that they
base their claim of unjust enrichment against White.
Alabama Aggregate and Raughton have therefore failed to
unjust-enrichment claim against White.6
To prevail on their claim that White violated the
Alabama Heavy Equipment Dealer Act, Ala. Code § 8-21B-1
et seq., Alabama Aggregate and Raughton must prove, among
other things, that at the time of the events giving rise
unjust-enrichment claim also fails because they have
provided no evidence that White holds money that
rightfully belongs to them, or that they paid as a result
of mistake or fraud. White asserts in an affidavit that
he “never owned or had title to the machines,” and that
he “did not sell these machines to Alabama Aggregate.”
Def.’s Ex. D, White Decl. at ¶ 4 (Doc. 1-15). Alabama
Aggregate and Raughton have offered nothing to contradict
The court therefore cannot resolve
this factual dispute in their favor. See Legg, 428 F.3d
Moreover, even if White received a bonus or
commission from the sale (which Alabama Aggregate and
Raughton do not allege), he would have received that
money from Powerscreen, not Alabama Aggregate and
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 15 of 20
“corporation ... engaged in the manufacture, assembly,
or wholesale distribution of heavy equipment,”7 and that
White’s principal entered into an agreement concerning
the purchase or sale of heavy equipment with a “person,
primarily engaged in the business of retail sales or
leasing of heavy equipment and heavy equipment parts.”
Ala. Code § 8-21B-3(8).
It is undisputed that White was
an agent of Powerscreen at the time of the events giving
rise to this lawsuit.
Alabama Aggregate and Raughton
corporation engaged in the wholesale distribution of
heavy equipment, or that Powerscreen entered into an
agreement with any person, corporation, partnership, or
other business entity primarily engaged in the business
of retail sales or leasing of heavy equipment and heavy
7. It appears that the Alabama Heavy Equipment Dealer
Act could be read to impose liability not only upon heavy
equipment suppliers and dealers, but upon their agents
See Ala. Code §§ 8-21B-2, 8-21B-3.
reaching the issue, the court assumes that White could
be held liable under the Act.
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 16 of 20
Alabama Aggregate and Raughton have
therefore failed to allege facts sufficient to support
Equipment Dealer Act.
against White, Alabama Aggregate and Raughton must prove,
among other things, that White was the seller of the
equipment, and not merely the seller’s agent.
Code §§ 7-2-313(1), 7-2-314(1), 7-2-315(1) (express and
implied warranty claims refer only to warranties created
by the seller of a product); Sealy, 257 So. 2d at 350;
see also Montgomery Rubber & Gasket Co., Inc. v. Belmont
Machinery Co., Inc., 308 F. Supp. 2d 1293, 1302–1303
(M.D. Ala. 2004) (Thompson, J.) (“While the proper remedy
for a breach of implied warranty resulting in purely
economic loss is against the seller ... only a principal,
and not a principal’s agent, is liable for an agent’s
actions that are within the agent’s authority.”).
equipment, and that White was merely Powerscreen’s agent.
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 17 of 20
Alabama Aggregate and Raughton have therefore failed to
breach-of-warranty claims against White.
possibly establish, a cause of action against White,
White was fraudulently joined and must be dismissed.
IV. Allegations of Citizenship
fraudulently joined, it finds that Terex USA’s notice of
removal is still jurisdictionally deficient in that it
To invoke removal jurisdiction based on diversity,
the notice of removal must distinctly and affirmatively
American Airlines, Inc., 511 F.2d 653, 654 (5th Cir.
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 18 of 20
1975) (per curiam).8
The allegations must show that the
citizenship of each plaintiff is different from that of
See 28 U.S.C. § 1332.
The notice of removal fails to meet this standard in
First, an allegation that a party is
a "resident" of a State is not sufficient to establish
that a party is a "citizen" of that State.
Am. Exp. Co., 735 F.3d 1266, 1269 (11th Cir. 2013).
“Citizenship is equivalent to ‘domicile’ for purposes of
diversity jurisdiction ... [a]nd domicile requires both
residence in a state and ‘an intention to remain there
indefinitely....’” Id. (quoting McCormick v. Aderholt,
293 F.3d 1254, 1257 (11th Cir. 2002)).
The notice gives
plaintiff Raughton, and is therefore insufficient to
establish his citizenship.
8. In Bonner v. City of Prichard, 661 F.2d 1206,
1209 (11th Cir. 1981) (en banc), the Eleventh Circuit
Court of Appeals adopted as binding precedent all of the
decisions of the former Fifth Circuit handed down prior
to the close of business on September 30, 1981.
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 19 of 20
Second, Terex USA’s removal notice is insufficient
because it does not properly indicate the citizenship of
corporation, the notice must allege the citizenship of
both the State of incorporation and where the corporation
has its principal place of business.
See 28 U.S.C.
§ 1332(c)(1); American Motorists Ins. Co. v. American
Employers' Ins. Co., 600 F.2d 15, 16 and n.1 (5th Cir.
1979) (per curiam).
The notice is insufficient because
it does not allege Alabama Aggregate’s principal place
Finally, the removal notice is insufficient because
it does not properly indicate the citizenship of a party
company is a citizen of any state of which a member of
the company is a citizen.”
Rolling Greens MHP, L.P. v.
Comcast SCH Holdings L.L.C., 374 F.3d 1020, 1022 (11th
citizenships of all the members of the limited liability
Case 2:21-cv-00357-MHT-SRW Document 26 Filed 09/07/21 Page 20 of 20
The notice alleges that the sole member
butprovides only his residence, not his citizenship.
Therefore, the allegation is inadequate.
v. Am. Exp. Co., 735 F.3d at 1269.
Accordingly, it is ORDERED as follows:
(1) The motion to remand (Doc. 16) is denied.
terminated as a party to this action.
(3) The removing party has until September 14, 2021,
to amend the notice of removal to allege jurisdiction
sufficiently, 28 U.S.C. § 1653; otherwise this lawsuit
shall be remanded to state court.
DONE, this the 7th day of September, 2021.
/s/ Myron H. Thompson
UNITED STATES DISTRICT JUDGE
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