Rodrigue v. Continental Insurance Company et al

Filing 31

ORDER & REASONS: granting 10 Motion to Remand to State Court; denying as moot 29 Motion for Leave to File Sur-reply. Signed by Judge Carl Barbier on 10/6/14. (sek)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
RODRIGUE

CIVIL ACTION

VERSUS

NO: 14-1797

CONTINENTAL INSURANCE COMPANY
ET AL.

SECTION: "J" (3)

ORDER AND REASONS
Before the Court is a Motion to Remand (Rec. Doc. 10) filed
by

Plaintiffs

Bonnie

Rodrigue,

Corey

Rodrigue,

and

Katie

Rodrigue; Defendants Puget Sound Commerce Center, Inc., Eagle,
Inc.,

and

Hanover

Insurance

Company

(collectively,

"Removal

Defendants")'s joint opposition (Rec. Doc. 22); and Plaintiffs'
reply. (Rec. Doc. 22) Having considered the motions and memoranda
of counsel, the record, and the applicable law, the Court finds
that Plaintiffs' motion should be GRANTED for the reasons set
forth more fully below.
FACTS AND PROCEDURAL HISTORY
This action derives from Jerry Rodrigue’s development of
mesothelioma,

which

Jerry

Rodrigue

alleged

was

caused

by

exposures to asbestos brought home on the person, clothes, and

other objects of his father, Morris Rodrigue, who worked at Todd
Shipyards from approximately 1943 until 1954. (Rec. Doc. 10-1, p.
1) On June 13, 2014, Jerry Rodrigue brought suit in the Civil
District Court for the Parish of Orleans against Continental
Insurance Company (successor to Fidelity & Casualty Company of
New York) (hereinafter “Continental”), The Travelers Insurance
Company (“Travelers”), Puget Sound Commerce Center (f/k/a Todd
Shipyards

Corporation,

(hereinafter

“Todd

f/k/a

Todd-Johnson

Shipyards”),

and

Eagle,

Dry

Docks

Inc.)

Inc.

(f/k/a

Eagle

Asbestos and Packaging Company, Inc.) ( hereinafter “Eagle”).
(Rec. Doc. 1-1, p. 1) Jerry Rodrigue later filed a Supplemental
and

Amending

Petition

adding

Hanover

Insurance

Company

(“Hanover”)1 as a Defendant. (Rec. Doc 10-1, p. 1)
When on July 23, 2014, Jerry Rodrigue passed away as a
result of his mesothelioma, his surviving spouse and children,
Bonnie Rodrigue, Corey Rodrigue, and Katie Rodrigue, were named
as Plaintiffs to recover survival and wrongful death damages
stemming from Jerry Rodrigue's development of and, ultimately,
death from mesothelioma. (Rec. Doc. 10-1, p. 1)
Thereafter, Defendants filed a Notice of Removal (Rec. Doc

1

Plaintiffs filed suit against Hanover, Continental, and Travelers as the
alleged insurers of Todd Shipyard’s Executive Officers, A. Herbert Smith, Roy M.
Barnett, John S. Smith, Jr., J. N. Pharr, and William McCaffrey, pursuant to
Louisiana Revised Statute 22:1269, which gives a plaintiff the right to bring a
direct action against an insurer.

1) on August 6, 2014, pursuant to 28 U.S.C. § 1332, 1441, and
1446 alleging that Plaintiffs fraudulently joined Eagle, Hanover,
Travelers, and Continental to destroy diversity, undermining this
Court’s jurisdiction over the matter. (Rec. Doc. 10-1, p. 2) On
August, 22, 2014, Plaintiffs filed the instant motion (Rec. Doc.
10), and on September 16, 2014, Defendants opposed the motion.
(Rec. Doc. 22) Plaintiffs replied on September 23, 2014. (Rec.
Doc. 27)
PARTIES' ARGUMENTS
Plaintiffs urge the Court to remand this action to the state
court from which it was removed. First, Plaintiffs assert that
Defendants’ Notice of Removal is procedurally defective, because
it was filed more than thirty days after Defendants’ receipt of
the initial complaint. Plaintiffs maintain that to the extent
that this action is or was ever removable based upon improper
joinder, Plaintiffs' original petition, filed on June 13, 2014,
made that basis for removal sufficiently clear. That is, the July
7, 2014, Jerry Rodrigue deposition, which Defendants argue was
the

first

time

they

could

ascertain

the

alleged

fraudulent

joinder, did not provide additional information regarding the
alleged

improper

joinder

already made clear.

that

the

original

petition

had

not

Thus, Defendants' Notice of Removal, filed

on August 6, 2014, more than thirty days after the original

petition, was untimely. Second, Plaintiffs assert that Hanover,
Travelers, and Continental, insurers of Todd Shipyard Executive
Officers,

were

properly

joined,

as

Louisiana

law

allows

a

plaintiff to directly sue an insurer. In regards to the Executive
Officers, Plaintiffs assert that these officers had an extended
duty to Jerry Rodrigue to maintain a safe workplace, so they are
therefore liable for breach of that duty. Moreover, Plaintiff
alleges that Eagle was properly joined as a defendant since they
sold, manufactured, and distributed asbestos to Todd Shipyards.
Further, they allege that the aforementioned Defendants are all
Louisiana citizens, which destroys diversity in this case. Thus,
this

Court

lacks

subject

matter

jurisdiction

to

consider

Plaintiffs' complaint.
Defendants

counter

argue

that

they

properly

removed

the

instant action to this Court. First, Defendants insist that the
Notice of Removal was timely because they removed within thirty
days from the deposition of Jerry Rodrigue. They argue that the
deposition constitutes "other paper" from which they could first
ascertain that the case was removable due to improper joinder.
Next, Defendants contend that Eagle was improperly joined as a
party because Plaintiffs are unable to meet their burden of proof
in connection to Eagle. Thus, there is no possibility of recovery
against Eagle in this suit. Finally, Defendants further argue

that the insurers of the alleged “Executive Officers” of Todd
Shipyards were improperly joined. They assert that Plaintiffs
have misapplied the standard for Executive Officer liability, and
Louisiana courts have not extended the duty of Executive Officers
to “household members of employees.” Defendants therefore urge
the Court to deny the Motion to Remand because the nondiverse
Defendants were improperly joined and complete diversity exists.
LEGAL STANDARD & DISCUSSION
A. Fraudulent Joinder
There are two ways to establish improper joinder:

(1)

actual fraud in the pleading of jurisdictional facts, or (2)
inability of the plaintiff to establish a cause of action against
the non-diverse party in state court. Smallwood v. Ill. Cent.
R.R. Co., 385 F.3d 568, 573 (5th Cir. 2004) (en banc). The test
for improper joinder where there is no allegation of actual fraud
is

whether

the

defendant

has

demonstrated

that

there

is

no

possibility of recovery by the plaintiff against an in-state
defendant.

Id.

A mere theoretical possibility of recovery is

not sufficient to preclude a finding of improper joinder.

Id.

A

court should ordinarily resolve the issue by conducting a Rule
12(b)(6)-type analysis, looking initially at the allegations of
the complaint to determine whether the complaint states a claim
under state law against the in-state defendant.

Id.

The party seeking removal bears a heavy burden of proving
improper joinder.

Id. at 574.

In determining the validity of an

allegation of improper joinder, the district court must construe
factual

allegations,

resolve

ambiguities

plaintiff’s favor.
216

(5th

Cir.

resolve
in

the

contested

factual

controlling

issues,
law

state

and
the

in

Burden v. Gen. Dynamics Corp., 60 F.3d 213,

1995).

The

Fifth

Circuit

has

articulated

two

avenues for determining whether a plaintiff has a reasonable
basis for recovery under state law. Smallwood, 385 F.3d at 573.
First, “The court may conduct a Rule 12(b)(6)-type analysis,
looking

initially

at

the

allegations

of

the

complaint

to

determine whether the complaint states a claim under state law
against

the

in-state

defendant.”

Id.

Typically,

there

is

no

improper joinder if a plaintiff is able to survive a 12(b)(6)
challenge. Id. Secondly, a court may pierce the pleadings and
conduct a summary inquiry of the evidence, but "only to identify
the presence of discrete and undisputed facts that would preclude
plaintiff's recovery against the in-state defendant." Id. "The
district

court

must

also

take

into

account

the

'status

of

discovery' and consider what opportunity the plaintiff has had to
develop its claims against the non-diverse defendant." Id.
Defendants argue that Plaintiffs improperly joined Eagle and
the insurers of Todd Shipyards. The Court will address the claims

against Eagle first. The Court must evaluate whether Plaintiffs
have

stated

a

claim

upon

which

relief

can

be

granted

under

Louisiana law against Eagle. A claim against a company that
allegedly sold, manufactured, distributed asbestos, as well as
contracted to perform activities at a plaintiff's workplace is
valid under Louisiana law. See Richoux v. CSR Limited, et. al.,
2008 WL 576242 (E.D. La. Feb. 29, 2008). "To prevail [on a claim
against an asbestos manufacturer, a plaintiff] must show, by a
preponderance of the evidence, that he was exposed to asbestos
from the defendants' products, and that he received an injury
that was substantially caused by that exposure." Abadie v. Metro.
Life Ins. Co., 00-344, at *63 (La. App. 5 Cir. 3/28/01); 784 So.
2d 46, 89-90. Here, Plaintiffs allege that Morris Rodrigue was
exposed to asbestos while working at Todd Shipyards, and that
Jerry

Rodrigue

was

exposed

to

asbestos

through

the

person,

clothes, and other things of his father, Morris, causing Jerry's
mesothelioma. Plaintiffs allege that Morris and Jerry Rodrigue
were exposed to Eagle asbestos specifically. Plaintiffs allege
that Eagle contractors working at Todd Shipyards handled their
asbestos products in such a manner that exposed Morris Rodrigue
to asbestos-containing dust. These allegations seem sufficient to
withstand the 12(b)(6)-type inquiry that is appropriate at this
stage.

Even conducting a summary inquiry of the evidence, the Court
does not find that there exist "discrete and undisputed facts"
precluding Plaintiffs' recovery. Plaintiffs base their claims
against Eagle on testimony from Jerry Rodrigue and employees of
Eagle and Todd's Shipyards. Jerry Rodrigue testified that his
father, Morris Rodrigue, worked at Todd Shipyards, including on
boats at Todd's Shipyards, from approximately 1944 to 1954. He
further testified that his father's clothing was dirty and dusty
when he returned from work, and that he was exposed to it. (Mot.
to Remand, Pl.'s Exh. 5, 6, 7, Rec. Docs. 10-8, 10-9, 10-10) An
Eagle

employee

testified

that

Eagle

was

the

only

insulation

contractor at Todd Shipyards during the war years and insulated
many ships during that time. Even when Todd employees conducted
the insulation work, they used Eagle materials. (Mot. to Remand,
Pl.'s Exh. 8, Rec. Doc. 10-11) Eagle "maintained its presence at
Todd

Shipyards

even

after

the

war

ended."

Todd

Shipyards'

purchasing agent testified that they subcontracted their asbestos
insulation work from 1945 to 1951. He further testified that he
was "sure" that Todd Shipyards subcontracted insulation work to
Eagle during that time. From 1951 to 1976, Eagle and another
company provided "a good 90 percent" of the asbestos used at Todd
Shipyards. (Mot. to Remand, Pl.'s Exh. 9, Rec. Doc. 10-12) The
presence of Eagle subcontractors and products at Todd Shipyards

is

confirmed

by

deposition

testimony

of

other

former

Todd

Shipyards employees. Finally, a Todd's Shipyards employee who
worked

there

during

the

relevant

time

period

testified

that

workers at Todd Shipyards were involved with the handling of
asbestos products, and that they were not segregated from other
workers who did not handle the asbestos.

(Mot. to Remand, Pl.'s

Exh. 12, Rec. Doc. 10-15)
Although Plaintiffs have not yet provided direct evidence to
show that Morris Rodrigue worked with Eagle products or was
exposed to dust from Eagle products as Eagle contractors worked
with them nearby, when this Court construes Plaintiffs' factual
allegations

in

Plaintiffs'

favor,

the

facts

alleged

are

sufficient to state a claim, and the evidence provided in support
Plaintiffs' claims does not reveal a discrete fact establishing
that Plaintiffs improperly joined Eagle. In fact, Plaintiffs'
evidence is comparable to evidence that other courts have found
sufficient to defeat a motion for summary judgment. See Francis
v. Union Carbide Corp., 2012-1397 (La. App. 4 Cir. 5/8/13); 116
So. 3d 858, 862-63 (reversing the district court's granting of
summary judgment where plaintiff in a take-home exposure case
presented evidence suggesting that plaintiff's father was exposed
to asbestos at work and plaintiff's father returned home with
dusty clothes).

Of particular import in this case is the limited time that
Plaintiffs have had to develop their claims and the evidence
necessary to support them. Defendants removed this action less
than two months after Plaintiffs filed suit in state court. This
fact

alone

distinguishes

much

of

the

authority

to

which

Defendants cite. For example, Defendants cite to Smith v. Union
Carbide Corp., arguing that the plaintiff's lack of evidence in
that case is analogous to the instant case. 2013 WL 6244199 *5
(E.D. La. Dec. 3, 2013). However, the parties in Smith were in
the

final

stages

of

discovery.

Id.

Therefore,

Smith

is

not

applicable here. Similarly, in Davidson v. Ga. Pac. LLC, No. 121463, 2014 WL 1768015, at *4 (W.D. La. Apr. 24, 2013), the
plaintiffs were given ample time to develop their claims and the
evidence
Defendants

necessary
have

to

failed

support
to

them.

establish

The
the

Court

improper

finds

that

joinder

of

Eagle.
Because

the

Court

finds

that

Eagle

was

not

improperly

joined, it is unnecessary to examine whether any other Defendants
were improperly joined. Eagle's presence destroys diversity and
undermines this Court's jurisdiction to adjudicate Plaintiffs'
claims. Additionally, having found that Defendants' basis for
removal is without merit, the Court will not address the question
of whether such removal was timely.

Accordingly,
IT IS HEREBY ORDERED that Plaintiffs' Motion to Remand (Rec.
Doc. 10) is GRANTED.
IT IS FURTHER ORDERED that Defendants' Motion to File SurReply (Rec. Doc. 29) is DENIED as moot.
New Orleans, Louisiana, this 6th day of October, 2014.

____________________________
CARL J. BARBIER
UNITED STATES DISTRICT JUDGE