Carroll v. Hilton

Filing 22

ORDER DENYING DEFENDANT GORDON R. HILTON'S MOTION TO DISMISS FOR LACK OF SUBJECT MATTER JURISDICTION, DOC. NO. 12 . Signed by JUDGE J. MICHAEL SEABRIGHT on 4/22/2015. (afc) CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). All participants are registered to receive electronic notifications.

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII

JASON CARROLL,

)
)
Plaintiff,
)
)
vs.
)
)
GORDON R. HILTON, and John
)
Does 1-99; Jane Does 1-99; Doe
)
Entities, 1-20; and Doe Governmental )
Units 1-10,
)
)
Defendants.
)
_____________________________ )

CIV. NO. 14-00456 JMS-BMK
ORDER DENYING DEFENDANT
GORDON R. HILTON’S MOTION TO
DISMISS FOR LACK OF SUBJECT
MATTER JURISDICTION, DOC. NO.
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ORDER DENYING DEFENDANT GORDON R. HILTON’S
MOTION TO DISMISS FOR LACK OF SUBJECT MATTER
JURISDICTION, DOC. NO. 12
I. INTRODUCTION
Defendant Gordon R. Hilton (“Defendant”) moves to dismiss Plaintiff
Jason Carroll’s (“Plaintiff”) Complaint for lack of subject matter jurisdiction,
contending that Plaintiff’s naming of Doe Defendants necessarily destroys
diversity of citizenship under 28 U.S.C. § 1332.1 Doc. No. 12-1, Mot. at 4-5. The

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Joinder of unidentified defendants is allowed under Hawaii Rule of Civil Procedure
17(d), but “[t]here is no analogous provision in the Federal Rules of Civil Procedure.” Macheras
v. Ctr. Art Galleries-Hawaii, 776 F. Supp. 1436, 1438 (D. Haw. 1991). “The purpose of this rule
is to allow a plaintiff to preserve an action against a party, whose name may not be known until
after the running of the statute of limitations.” Id. Federal law allows “Doe pleading” in suits
(continued...)

court determines this Motion without a hearing under Local Rule 7.2(d). Based on
the following, the Motion is DENIED.2
II. DISCUSSION
A.

The Presence of Doe Defendants Does Not Automatically Destroy
Diversity of Citizenship
In his Motion, Defendant largely relies on Seventh Circuit authority

which, subject to narrow exceptions, holds that “because the existence of diversity
jurisdiction cannot be determined without knowledge of every defendant’s place
of citizenship, ‘John Doe’ defendants are not permitted in federal diversity suits.”
Howell v. Tribune Entm’t Co., 106 F.3d 215, 218 (7th Cir. 1997) (citations
omitted); see also Liu v. 88 Harborview Realty, LLC, 5 F. Supp. 3d 443, 450
(S.D.N.Y. 2014) (“[T]his lawsuit cannot proceed with unknown Doe defendants,

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(...continued)
(unlike here) that are based on federal question jurisdiction, although such use “is not favored.”
Gillespie v. Civiletti, 629 F.2d 637, 642 (9th Cir. 1980).
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In his Reply, Defendant improperly raises two additional arguments that he did not
mention at all in his Motion -- he asserts that the Complaint is deficient on its face under § 1332
for failure to allege the actual citizenship of the named parties, and he argues that the Complaint
should be dismissed under Federal Rule of Civil Procedure 19 for failure to name an
indispensable party. The court disregards these arguments. See, e.g., Menashe v. Bank of N.Y.,
850 F. Supp. 2d 1120, 1137 n.8 (D. Haw. 2012) (“[T]he court does not address arguments raised
for the first time in Reply.”) (citing Hi-Tech Rockfall Constr., Inc. v. Cnty. of Maui, 2009 WL
529096, at *18 n.9 (D. Haw. Feb. 26, 2009) (“Local Rule 7.4 provides that ‘[a]ny arguments
raised for the first time in the reply shall be disregarded.’”)) (other citation omitted). And to the
extent the court sua sponte raises its subject matter jurisdiction at this pleading stage, the
Complaint adequately alleges diversity of citizenship of the actual named parties. See Doc. No.
1, Compl. ¶¶ 6, 11, 20, 44, 65.
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whose identity as LLC members is critical to determining this Court’s jurisdiction
under § 1332.”).
But federal courts are split on this question. See, e.g., Universal
Commc’n Sys., Inc. v. Lycos, Inc., 478 F.3d 413, 426 n.10 (1st Cir. 2007) (noting
that “Federal courts do not agree on whether John Does are permitted in diversity
cases originally filed in federal court,” but declining to reach the issue) (citing
cases); Doe v. Ciolli, 611 F. Supp. 2d 216, 219 (D. Conn. 2009) (“Federal courts
are divided on the question of whether the existence of unidentified or ‘Doe’
defendants defeats diversity jurisdiction.”) (comparing cases). And the Ninth
Circuit has issued “conflicting approaches” on this issue. See Fat T, Inc. v. Aloha
Tower Assocs. Piers 7, 8, & 9, 172 F.R.D. 411, 414 (D. Haw. 1996) (citing cases).
Nevertheless, a line of cases from the District of Hawaii -interpreting and relying on Ninth Circuit precedent holding that state-law “Doe
Defendant” provisions are “substantive” for purposes of the Erie doctrine because
of their potential effect on statutes of limitations -- has concluded that the presence
of Doe Defendants does not defeat diversity jurisdiction under § 1332. See Ctr.
Art Galleries, 776 F. Supp. at 1438-39 (applying Lindley v. Gen. Elec. Co., 780
F.2d 797, 800-01 (9th Cir. 1986)); Fat T, Inc., 172 F.R.D. at 414-15 (same); see
also Bailey v. United States, 289 F. Supp. 2d 1197, 1209 n.16 (D. Haw. 2003)
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(“‘Doe’ pleading in diversity cases is allowed.”) (citing Fat T, Inc.). Center Art
Galleries reasons that if Doe Defendants automatically destroy diversity
jurisdiction, Lindley’s holding that state “Doe statutes” are substantive law under
the Erie doctrine would be meaningless. 776 F. Supp. at 1439. “[W]ould-be
federal plaintiffs, who seek to exercise their rights under the state Doe statutes,
would, paradoxically, be confined to state court.” Id. at 1440.
Rather than automatically lacking diversity, a plaintiff who names
Doe Defendants “runs the risk of having the case dismissed entirely should an
indispensable party, who is not diverse, later surface[s].” Id.; see also Fat T, Inc.,
172 F.R.D. at 414 (“[A] more sensible approach [is] to allow Doe Defendants
while deferring the jurisdictional question until actual parties are substituted.”).
Many other jurisdictions follow the same approach. See, e.g., Ciolli, 611 F. Supp.
2d at 220 (citing Center Art Galleries and several decisions from district courts in
the Second Circuit); Johnson v. Rite Aid, 2011 WL 2580375, at *1 (D. N.J. June
28, 2011) (citing cases); But see Wong v. Rosenblatt, 2014 WL 1419080, at *4 (D.
Or. Apr. 11, 2014) (dismissing action without prejudice because of the presence of
Doe Defendants).
Some of these cases also note that, for purposes of removal, Congress
specifically allowed “Doe pleading” when it amended the removal statutes in 1988
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to provide that “[i]n determining whether a civil action is removable on the basis
of the jurisdiction under section 1332(a) of this title, the citizenship of defendants
sued under fictitious names shall be disregarded.” 28 U.S.C. § 1441(b)(1). See,
e.g., Ctr. Art Galleries, 776 F. Supp. at 1440 (extending the rule in the context of
§ 1441 to actions brought originally in federal court under § 1332); Ciolli, 611 F.
Supp. 2d at 219 n.3.
The court is persuaded by the logic of prior caselaw from this District
-- it will apply the reasoning of Center Art Galleries and Fat T, Inc. That is, the
court concludes that “‘the presence of fictitious defendants neither creates a
presumption that diversity is destroyed, nor requires Doe defendants to be named,
abandoned, or dismissed’ in order for a diversity-based claim to be brought in
federal court under § 1332.” Ctr. Art Galleries, 776 F. Supp. at 1440 (quoting
Cowan v. Cent. Reserve Life of N. Am. Ins. Co., 703 F. Supp. 64, 65 (D. Nev.
1989)). Accordingly, Defendant’s Motion is DENIED.
B.

Plaintiff Shall Dismiss the Doe Defendants if Their Presence Is
Unnecessary
In his Opposition, Plaintiff represents that he “knows of no non-

diverse real parties in interest,” Doc. No. 14, Opp’n at 6, and explains that he
named Doe Defendants simply “to ensure against the dismissal of the [tort] claims

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. . . which are subject to Hawaii’s 2-year statute of limitations if . . . Defendant
Hilton contended that he was merely a nominal party[.]” Id. at 6-7. Thus, if
discovery does not reveal any further need for the presence of Doe Defendants,
Plaintiff shall be required to dismiss the Doe Defendants from this action. That is,
if no actual Defendants are substituted for the Doe Defendants by the deadline for
the joinder of additional parties (October 16, 2015, or any extension thereof set by
a later scheduling order), then Plaintiff shall dismiss the Doe Defendants at that
time. This approach will assure that diversity of citizenship is preserved, while
still fulfilling the purposes of “Doe pleading” under Hawaii Rule of Civil
Procedure 17(d).
III. CONCLUSION
Defendant’s Motion to Dismiss for Lack of Subject Matter
Jurisdiction is DENIED. Plaintiff, however, is required to dismiss the Doe
Defendants from this action if their presence is not necessary. The deadline for
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such dismissal is October 16, 2015 -- the date for joinder of additional parties, or
any extension thereof set by a later scheduling order.
IT IS SO ORDERED.
DATED: Honolulu, Hawaii, April 22, 2015.

/s/ J. Michael Seabright
J. Michael Seabright
United States District Judge

Carroll v. Hilton, et al., Civ. No. 14-00456 JMS-BMK, Order Denying Defendant Gordon R.
Hilton’s Motion to Dismiss for Lack of Subject Matter Jurisdiction, Doc. No. 12

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