Roberson et al v. Newell Rubbermaid Incorporated et al

Filing 22

ORDER that Plaintiffs' Motion to Remand (Doc. 18 ) to Maricopa Superior Court pursuant to 28 U.S.C. § 1447(c) is GRANTED. IT IS FURTHER ORDERED that Plaintiffs' request for attorney fees, found in Doc. 17 , is not briefed adequately by either party for the Court to rule on at this time. Accordingly, Plaintiffs may file a motion for an award of attorneys' fees pursuant to Local Rule Civil 54.2 within 14 days. Signed by Senior Judge James A Teilborg on 11/12/2014. (Attachments: # 1 Remand Letter)(KMG)

1

WO

2
3
4
5
6

IN THE UNITED STATES DISTRICT COURT

7

FOR THE DISTRICT OF ARIZONA

8
9

Brittany Renae Roberson, et al.,
Plaintiffs,

10
11

ORDER

v.

12

No. CV-14-00573-PHX-JAT

Newell Rubbermaid Incorporated, et al.,

13

Defendants.

14
15

Pending before the Court is Plaintiffs’ 28 U.S.C. § 1447(c) Motion to Remand.

16

(Doc. 17). The Court now rules on the motion.

17

I.

BACKGROUND

18

Plaintiffs allege the following facts. In August 2011, Osbon Auto Repair, located

19

in Glendale, Arizona, repaired the rear axle on Plaintiff Roberson’s 1997 Mercury

20

Mountaineer. (Doc. 17, Ex. D). On November 24, 2011, Plaintiff Roberson’s 1997

21

Mercury Mountaineer experienced a rear axle failure causing the vehicle to swerve off

22

the road and rollover. (Doc. 16 at 4). Plaintiffs’ infant son was strapped in a Graco car

23

seat. (Id.). The car seat detached from its base and was ejected from the vehicle. (Id.)

24

Plaintiffs’ son was killed. (Doc. 17 at 2).

25

On November 22, 2013, Plaintiffs filed a complaint in Maricopa County Superior

26

Court against the manufacturers of the car seat, Defendant Newell Rubbermaid, Inc., and

27

its subsidiary, Graco Children’s Products, Inc. (collectively “Graco Defendants”). (Doc.

28

1, Ex. A at 3). Plaintiffs also named Osbon Auto Repair; the owner of Osbon Auto

1

Repair, Felipe De Jesus Sauceda and his wife, Jane Doe De Jesus Sauceda; and the

2

Osbon employee who worked on the vehicle, John Doe Arnenta and his wife, Jane Doe

3

Arnenta (collectively the “Osbon Defendants”) as defendants. (Id.) When Plaintiffs filed

4

their complaint, Osbon Auto Repair was no longer in business, and Plaintiffs could not

5

locate any of the other Osbon Defendants for personal service. (Doc. 21 at 4). However,

6

with the state court’s approval, Plaintiffs served the Osbon Defendants by publication of

7

the Complaint on April 5, 2014. (Doc. 17, Ex. B). On March 19, 2014, Graco Defendants

8

removed the matter to the United States District Court of Arizona, pursuant to 28 U.S.C.

9

§§ 1441 and 1446. (Doc. 1 at 1). Subsequently, Plaintiffs filed an amended complaint.

10

(Doc. 16). Plaintiffs now move to remand the matter to state court. (Doc. 17).

11

II.

MOTION TO REMAND

12

A.

Legal Standard

13

A federal district court has “original jurisdiction of all civil actions where the

14

matter in controversy exceeds the sum or value of $75,000, exclusive of interests and

15

costs, and is between . . . citizens of different States[.]” 28 U.S.C. § 1332(a)(1). The

16

removal statute, 28 U.S.C. § 1441, provides, in pertinent part: “[A]ny civil action brought

17

in a State court of which the district courts of the United States have original jurisdiction,

18

may be removed by the defendant” to the United States district court “for the district and

19

division embracing the place where such action is pending.” 28 U.S.C. § 1441(a); see

20

Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987) (“Only . . . actions that originally

21

could have been filed in federal court may be removed to federal court by the

22

defendant.”).

23

Courts strictly construe the removal statute and disfavor removal jurisdiction. See,

24

e.g., Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108–09 (1941); Gaus v. Miles,

25

Inc., 980 F.2d 564, 566 (9th Cir. 1992). There is a “strong presumption” against removal,

26

and “[f]ederal jurisdiction must be rejected if there is any doubt as to the right of removal

27

in the first instance.” Gaus, 980 F.2d at 566 (internal citations omitted). “The ‘strong

28

presumption’ against removal jurisdiction means that the defendant always has the

-2-

1

burden of establishing that removal is proper.” Id. If at any time it appears that the district

2

court lacks subject matter jurisdiction, the case must be remanded. 28 U.S.C. § 1447(c).

3

B.

4

Plaintiffs assert that remand is proper because the Court lacks subject matter

5

jurisdiction. (Doc. 17 at 2). Specifically, Plaintiffs argue that there are no claims arising

6

under federal law and because “Arizona residents are on both sides of this case . . .

7

removal based on diversity was improper.” (Id.) In response, Graco Defendants make two

8

arguments. First, they argue that removal is proper because it appears from the face of the

9

Complaint that diversity jurisdiction exists. (Doc. 20 at 2). Alternatively, Graco

10

Defendants contend that removal is proper because the Osbon Defendants were

11

fraudulently joined to destroy diversity. (Id. at 4).

12

Analysis

1.

Residency

13

Graco Defendants contend that because Plaintiffs have not been able to locate the

14

Osbon Defendants, Plaintiffs have not established that the Osbon Defendants were

15

Arizona residents when Plaintiffs filed their original complaint. (Doc. 20 at 2–3).

16

For the Court to have diversity jurisdiction, each plaintiff must be a citizen of a

17

different state than each of the defendants. Caterpillar Inc. v. Lewis, 519 U.S. 61, 68

18

(1996). A defendant who is a citizen of a plaintiff’s state destroys complete diversity,

19

regardless of whether that defendant was properly served prior to removal. Pullman Co.

20

v. Jenkins, 305 U.S. 534, 538 (1939); Preaseau v. Prudential Ins. Co., 591 F.2d 74, 78

21

(9th Cir. 1979); Clarence E. Morris, Inc. v. Vitek, 412 F.2d 1174, 1176 (9th Cir. 1969)

22

(“[T]he existence of diversity is determined from the fact of citizenship of the parties

23

named and not from the fact of service.”). It is immaterial whether the resident defendant

24

is named or whether that defendant’s true identity is known. See Preaseau, 591 F.2d at

25

78; Pecherski v. Gen. Motors Corp., 636 F.2d 1156, 1159 (8th Cir. 1981). On a motion to

26

remand, the removing party has the burden of proving complete diversity. Carson v.

27

Dunham, 121 U.S. 421, 425–46 (1887); Emrich v. Touche Ross & Co., 846 F.2d 1190,

28

1195 (9th Cir. 1988).

-3-

1

Here, Graco Defendants assert that the Osbon Defendants are not Arizona citizens

2

because Plaintiffs cannot locate them. (Doc. 20 at 2–3). However, Graco Defendants have

3

not provided any legal authority for their conclusion. Moreover, case law indicates that a

4

plaintiff’s inability to serve, or even identify, a defendant does not preclude a finding a

5

resident defendant is properly joined. Pullman Co., 305 U.S. at 538 (1939); Preaseau,

6

591 F.2d at 78. Additionally, Plaintiffs, despite not having the burden of proof, have

7

proven that they properly served the Osbon Defendants by publication, provided at least

8

the known last name of each Osbon Defendant, and established that the Osbon

9

Defendants’ last known residence was in Arizona. Accordingly, Graco Defendants have

10
11

not met their burden of proving that the Osbon Defendants are not Arizona residents.
2.

Fraudulent Joinder

12

Alternatively, Graco Defendants argue that the Court nonetheless has diversity

13

jurisdiction because Plaintiffs fraudulently joined the Osbon Defendants to defeat

14

diversity jurisdiction. Specifically, Graco Defendants assert that Plaintiffs’ original

15

complaint “fails to state a plausible claim against the [Osbon] Defendants” and that the

16

original, not the amended complaint, “is controlling for this Court’s analysis of

17

jurisdictional issues.” (Doc. 20 at 4). In support of their argument, Graco Defendants

18

state that Plaintiffs lack a cause of action against the Osbon Defendants because the

19

police report taken after the incident states that Plaintiff Roberson’s father, not the Osbon

20

Defendant’s worked on the vehicle’s rear axle prior to the incident.

21

Fraudulent joinder is a “term of art.” Morris v. Princess Cruises, Inc., 236 F.3d

22

1061, 1067 (9th Cir. 2001). Joinder of a resident defendant is considered fraudulent, and

23

courts ignore the defendant’s presence in the lawsuit for purposes of determining

24

diversity, “if the plaintiff fails to state a cause of action against a resident defendant, and

25

the failure is obvious according to the settled rules of the state.” Id. (quoting McCabe v.

26

Gen. Foods Corp., 811 F.2d 1336, 1339 (9th Cir. 1987)). Courts resolve any doubt as to

27

whether a plaintiff has stated a valid cause of action against the resident defendant in

28

favor of the case being retained by the state court. Albi v. St. & Smith Publ’ns, 140 F.2d

-4-

1

310, 312 (9th Cir. 1944). A joinder is fraudulent only when the plaintiff does not have “a

2

cause of action against the resident defendant, and has no reasonable ground for

3

supposing he has,” but joins him only to “evade the jurisdiction of the federal court.” Id.

4

As one court in this District acknowledged, a defendant asserting fraudulent joinder must

5

demonstrate that the plaintiff does not have a “glimmer of hope” to establish a claim

6

against the resident defendant. Ballesteros v. Am. Standard Ins. Co. of Wis., 436 F. Supp.

7

2d 1070, 1072 (D. Ariz. 2006) (quoting Mayes v. Rapoport, 198 F.3d 466 (4th Cir.

8

1999)).

9

While the court may only consider the original pleading to evaluate whether

10

removal is proper1, see Sparta Surgical Corp. v. Nat’l Ass’n of Sec. Dealers, Inc., 159

11

F.3d 1209, 1213 (9th Cir. 1998), for fraudulent joinder purposes, the court may look past

12

the original pleadings. See Ritchey v. Upjohn Drug Co., 139 F.3d 1313, 1318 (9th Cir.

13

1998) (The court “will ‘look only to a plaintiff’s pleadings to determine

14

removability’. . . . [However], where fraudulent joinder is an issue, we will go somewhat

15

further.”) (internal citations omitted).

16

complaint, a defendant asserting fraudulent joinder as a basis for removal must do more

17

than show that the original complaint fails to state a claim against the resident defendant.

18

See Didyoung v. Allstate Ins. Co., 2012 WL 1983779, at *2 (D. Ariz. June 4, 2012);

19

Burris v. AT&T Wireless, Inc., 2006 WL 2038040, at *2 (N.D. Cal. July 19, 2006).

Accordingly, when a plaintiff files an amended

20

Plaintiffs assert that they have properly pleaded negligence against the Osbon

21

Defendants and thus, remand is appropriate. Under Arizona law, to establish negligence,

22

a plaintiff must show (1) that the defendant had a duty to the plaintiff to conform to a

23

certain standard of conduct, (2) the defendant failed to conform to that standard, (3) there

24

is a reasonably close causal connection between the defendant’s failure and the resulting

25

injury, and (4) the plaintiff actually suffered damage or loss. Gipson v. Kasey, 150 P.3d

26

228, 231 ¶ 10 (Ariz. 2007); Ontiveros v. Borak, 667 P.2d 200, 204 (Ariz. 1983). In their

27
1

28

Graco Defendant cites several cases in support of their contention that the Court
must limit its analysis to the original complaint. (Doc. 20 at 4). However, none of the
cases that Graco Defendants rely on discuss fraudulent joinder.
-5-

1

amended complaint, Plaintiffs assert that the Osbon Defendants owed them a duty to

2

perform car repairs so as not to create an unreasonable risk of harm, the Osbon

3

Defendants breached that duty, and the Osbon Defendants’ breach caused Plaintiffs

4

substantial injury and loss. (Doc. 16 at ¶¶ 13–17). Plaintiffs also presented the auto repair

5

order showing that the Osbon Defendants preformed repairs on Plaintiff Roberson’s

6

vehicle shortly before the accident. (Doc. 17, Ex. D). The Graco Defendants, on the

7

other hand, assert that Plaintiff Roberson’s father was the last person to service the

8

vehicle’s rear axle, which makes it “clear that the [Osbon] Defendants are sham

9

defendants who should be disregarded for the purposes of determining the existence of

10

diversity jurisdiction.” (Doc. 20 at 5).

11

The Court finds that Plaintiffs’ pleading and evidence demonstrate that it is far

12

from “obvious” that Plaintiffs cannot prevail against the Osbon Defendants. Plaintiffs

13

have plead at least the basic elements of negligence, and simply offering conflicting

14

evidence falls well short of showing that Plaintiffs have no “glimmer of hope” to prevail.

15

Therefore, Graco Defendants have not established that the fraudulent joinder exception to

16

complete diversity applies. Accordingly, removal is not proper in this case.

17

IV.

CONCLUSION

18

For the foregoing reasons, the Court does not have federal question or diversity

19

jurisdiction over this case. Because the Court lacks subject matter jurisdiction, it must

20

remand pursuant to 28 U.S.C. § 1447(c). The Court will therefore grant Plaintiffs’

21

Motion to Remand.

22

Accordingly,

23

\

24

\

25

\

26

\

27

\

28

\

-6-

1
2

IT IS ORDERED that Plaintiffs’ Motion to Remand (Doc. 18) to Maricopa
Superior Court pursuant to 28 U.S.C. § 1447(c) is GRANTED.

3

IT IS FURTHER ORDERED that Plaintiffs’ request for attorney fees, found in

4

Doc. 17, is not briefed adequately by either party for the Court to rule on at this time.

5

Accordingly, Plaintiffs may file a motion for an award of attorneys’ fees pursuant to

6

Local Rule Civil 54.2 within 14 days.

7

Dated this 12th day of November, 2014.

8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

-7-