Dooley v. Grancare, LLC

Filing 24

Order by Hon. Saundra Brown Armstrong denying 20 Motion to Remand and Striking First Amended Complaint.(tmiS, COURT STAFF) (Filed on 11/5/2015)

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UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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OAKLAND DIVISION

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10 PATRICK DOOLEY, individually and as the

Successor in Interest to the decedent Robert
11 Dooley,
Plaintiff,

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Case No: C 15-3038 SBA
ORDER DENYING PLAINTIFF’S
MOTION FOR REMAND, AND
STRIKING FIRST AMENDED
COMPLAINT

vs.

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Dkt. 20
14 GRANCARE, LLC dba CREEKSIDE

HEALTHCARE CENTER, and DOES 2
15 through 200, inclusive,

Defendants.

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The parties are presently before the Court on Plaintiff’s motion to remand and for

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the recovery of fees. Having read and considered the papers filed in connection with this

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matter and being fully informed, the Court hereby DENIES the motion. In addition, the

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Court STRIKES Plaintiff’s First Amended Complaint (“FAC”), which was filed

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improperly.1

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I.

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BACKGROUND
On May 5, 2015, Patrick Dooley, as the successor in interest to decedent Robert

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Dooley (“Decedent”), filed the instant action in the Alameda County Superior Court against

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Grancare, LLC dba Creekside Health Center (“Grancare”). Plaintiff alleges that Decedent

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The Court, in its discretion, finds this matter suitable for resolution without oral
argument. See Fed. R. Civ. P. 78(b); N.D. Cal. Civ. L.R. 7-1(b).

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was mistreated while at Grancare’s nursing facility in San Pablo, California, and ultimately

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died as a result. The Complaint alleges causes of action for: (1) elder abuse, pursuant to

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California Welfare and Institutions Code §§ 15600, et seq.; (2) negligence; (3) negligent

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hiring, supervision and retention; (4) violation of resident’s rights, pursuant to California

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Health and Safety Code § 1430(b), and (5) wrongful death.

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On June 30, 2015, Grancare removed the action on the basis of diversity jurisdiction,

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28 U.S.C. § 1332(a). The day after Grancare answered the Complaint, Plaintiff, without

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leave of court or the stipulation of Grancare, filed the FAC in this Court. The FAC alleges

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the same causes of action as the Complaint and joins Janet Rotich (“Rotich”), an

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administrator at Grancare and a California resident, as a party-defendant. Dkt. 11. In

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response, Defendants answered the FAC and filed a second notice of removal. Dkt. 15.

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Plaintiff now moves to remand the action on the ground that diversity jurisdiction is

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now absent, as both he and Rotich are California residents. Defendants counter that Rotich

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is a fraudulently-joined defendant whose citizenship should be disregarded for purposes of

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determining whether diversity jurisdiction is present.

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II.

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DISCUSSION
The doctrine of fraudulent joinder provides that the “[j]oinder of a non-diverse

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defendant is deemed fraudulent, and the defendant’s presence in the lawsuit is ignored for

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purposes of determining diversity, ‘[i]f the plaintiff fails to state a cause of action against a

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resident defendant, and the failure is obvious according to the settled rules of the state.’”

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Morris v. Princess Cruises, Inc., 236 F.3d 1061, 1067 (9th Cir. 2001) (quoting in part

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McCabe v. Gen. Foods Corp., 811 F.2d 1336, 1339 (9th Cir. 1987)). The fraudulent

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joinder doctrine presupposes that the allegedly fraudulently-joined party, is, in fact, a

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proper party to the action. As will be discussed below, the Court finds that the doctrine is

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inapt because Plaintiff’s putative joinder of Rotich as a party-defendant is procedurally

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improper.

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Plaintiff’s original complaint named only one defendant—Grancare—which, for

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purposes of the federal diversity jurisdiction statute, 28 U.S.C. § 1332(a), is a citizen of

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Delaware and Georgia. Plaintiff is a resident of California, and there is no dispute that the

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amount in controversy exceeds $75,000. As such, there can be no legitimate dispute that

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the removal was proper. See Sparta Surgical Corp. v. National Ass’n of Secs. Dealers, Inc.,

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159 F.3d 1209, 1213 (9th Cir. 1998) (“[J]urisdiction must be analyzed on the basis of the

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pleadings filed at the time of removal without reference to subsequent amendments[.]”).

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“Once removal has occurred, the district court has two options in dealing with an

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attempt to join a non-diverse party.” Morris v. Princess Cruises, Inc., 236 F.3d 1061, 1068

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(9th Cir. 2001). A court may either “[1] deny joinder, or [2] permit joinder and remand the

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action to the State court.” 28 U.S.C. § 1447(e); see Newcombe v. Adolf Coors Co., 157

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F.3d 686, 691 (9th Cir. 1998). In order to join a non-diverse party after removal, a plaintiff

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must seek leave of court, pursuant to 28 U.S.C. § 1447(e). See Newcombe, 157 F.3d at

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691. In deciding whether to grant leave, courts consider:

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(1) whether the party sought to be joined is needed for just
adjudication and would be joined under Federal Rule of Civil
Procedure 19(a); (2) whether the statute of limitations would
preclude an original action against the new defendants in state
court; (3) whether there has been unexplained delay in
requesting joinder; (4) whether joinder is intended solely to
defeat federal jurisdiction; (5) whether the claims against the
new defendant appear valid; and (6) whether denial of joinder
will prejudice the plaintiff.

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IBC Aviation Servs. v. Compania Mexicana De Aviacion, 125 F. Supp. 2d 1008, 1011

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(N.D. Cal. 2000). The decision of whether to grant leave to allow the joinder of a non-

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diverse defendant is a matter of the district court’s discretion. Newcombe, 157 F.3d at 691.

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In the instant case, Plaintiff did not seek leave to join Rotich pursuant to a motion

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brought under § 1447(e). Rather, the day after Grancare filed its answer, Plaintiff simply

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filed an amended complaint that added Rotich as a party-defendant. In doing so, Plaintiff

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apparently relied on Rule 15(a), which permits a party to amend its pleading “once as a

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matter of course,” inter alia, within “21 days after service of a responsive pleading . . . .”

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Fed. R. Civ. P. 15(a)(1). However, federal courts have concluded that when an amendment
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would deprive the court of subject matter jurisdiction, a party may not rely on Rule 15(a) to

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amend a pleading without leave of court; such an amendment must instead be analyzed

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pursuant to § 1447(e). See e.g., Mayes v. Rapoport, 198 F.3d 457, 462 n.11 (4th Cir. 1999)

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(“a district court has the authority to reject a post-removal joinder that implicates 28 U.S.C.

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§ 1447(e), even if the joinder was without leave of court.”); Ascension Enters. v. Allied

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Signal, 969 F. Supp. 359, 360 (M.D. La. 1997) (“[§] 1447(e) trumps Rule 15(a)”).

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In view of the foregoing, the Court finds that Plaintiff’s filing of a FAC and putative

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joinder of Rotich as a party-defendant under the auspices of Rule 15(a)(1) are legally

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ineffective. Because Plaintiff failed to seek leave in accordance with § 1447(e), the Court

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strikes the FAC from the record. See Wein v. Liberty Lloyds of Tex. Ins. Co., No. A-15-

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CA-19-SS, 2015 WL 1275915, *4-5, 7 (W.D. Tex. Mar. 19, 2015) (striking an amended

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complaint that added non-diverse defendants and denying the plaintiff’s motion to remand).

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Without Rotich, there is complete diversity between the parties. Accordingly, remand is

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not required.

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III.

CONCLUSION

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For the reasons set forth above,

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IT IS HEREBY ORDERED THAT Plaintiff’s motion to remand is DENIED.

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Plaintiff’s First Amended Complaint, Dkt. 11, shall be STRICKEN from the record. The

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denial of Plaintiff’s motion to remand is without prejudice to the filing of a motion to join

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Rotich in accordance with 28 U.S.C. § 1447(e). The parties are reminded of their

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obligation to meet and confer in good faith prior to the submission of any request to the

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Court.

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IT IS SO ORDERED.
Dated: 11/5/15

______________________________
SAUNDRA BROWN ARMSTRONG
United States District Judge

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