Practical Healthcare Supply Inc v. AssuredPartners Gulf Coast Insurance Agency L L C et al

Filing 30

MEMORANDUM RULING: Considering the evidence, the law, and the arguments of the parties, and for the reasons fully explained herein, the 8 Motion to Remand is DENIED. Signed by Magistrate Judge Patrick J Hanna on 6/17/2015. (crt,Alexander, E)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF LOUISIANA
LAFAYETTE DIVISION
PRACTICAL HEALTHCARE
SUPPLY, INC.

CIVIL ACTION NO. 6:15-cv-00235

VERSUS

JUDGE DOHERTY

ASSUREDPARTNERS GULF COAST
MAGISTRATE JUDGE HANNA
INSURANCE AGENCY, LLC d/b/a
LANDRY HARRIS & CO., FRANKIE
S. HARRIS, III, and LIBERTY MUTUAL
INSURANCE CO.

MEMORANDUM RULING
Pending before the Court is the plaintiff’s motion to remand (Rec. Doc. 8). The
motion is opposed. Oral argument was heard on April 28, 2015. Following the
hearing, the undersigned ordered the removing defendants to amend their removal
notice with summary-judgment-style evidence proving the citizenship of the parties
to this lawsuit and ordered all of the parties to supplement their arguments regarding
the alleged improper joinder of defendants AssuredPartners Gulf Coast Insurance
Agency, LLC and Frankie S. Harris, III. (Rec. Doc. 24). The parties complied with
the order (Rec. Docs. 25, 26, 28, 29), and the undersigned has reviewed the additional
submissions. Considering the evidence, the law, and the arguments of the parties, and
for the reasons fully explained below, the motion to remand is DENIED.

FACTUAL BACKGROUND
The factual background set forth in the order of May 15, 2015 (Rec. Doc. 24)
is incorporated herein by reference.
ANALYSIS
Defendants Liberty Mutual Insurance Company and Peerless Insurance
Indemnity Company contend that this Court has subject-matter jurisdiction over this
action under 28 U.S.C. §1332 because the amount in controversy exceeds the
jurisdictional minimum and the parties are diverse in citizenship when the citizenship
of the allegedly improperly joined defendants is ignored.
The undersigned previously found that it is facially apparent from the
plaintiff’s First Amended, Supplemental and Restated Petition for Damages and
Declaratory Judgment (hereinafter “the restated petition”) that the amount in
controversy exceeds the $75,000 statutory threshold for jurisdiction under 28 U.S.C.
§ 1332.

(Rec. Doc. 24).

The analysis used in reaching that conclusion is

incorporated herein by reference.
However, in the prior order (Rec. Doc. 24), the undersigned explained that the
removing defendants had failed to prove the citizenship of each of the parties,
precluding the undersigned from determining whether the plaintiff was diverse in
citizenship from all of the defendants. The removing defendants were ordered to
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amend their removal notice to provide additional information to be used in evaluating
the parties’ citizenship (Rec. Doc. 24), and the removing defendants complied with
that order (Rec. Doc. 28). Based on the additional information provided, the
undersigned now finds that the plaintiff is a citizen of Louisiana, defendant
AssuredPartners is a citizen of Delaware and Florida, defendant Mr. Harris is a citizen
of Louisiana, defendant Liberty Mutual is a citizen of Massachusetts, and defendant
Peerless is a citizen of Illinois and Massachusetts. Because the plaintiff and Mr.
Harris are both citizens of Louisiana, the parties are not completely diverse.
The removing defendants argue, however, that Mr. Harris’s citizenship should
be disregarded because he was improperly joined as a defendant in this lawsuit.1 To
establish the improper joinder of a non-diverse defendant, the removing defendants
must demonstrate either: (1) actual fraud in the pleading of jurisdictional facts, or (2)
the inability of the plaintiff to establish a cause of action against the non-diverse party

1

The removing defendants contend that both AssuredPartners and Mr. Harris were
improperly joined. The improper joinder doctrine permits a court to ignore the citizenship of a
nondiverse party when evaluating whether the parties are diverse in citizenship. “The improper
joinder doctrine constitutes a narrow exception to the rule of complete diversity.” McDonal v. Abbot
Laboratories, 408 F.3d 177, 183 (5th Cir. 2006). Therefore, the improper joinder doctrine is not
applicable to a diverse defendant. Since AssuredPartners is diverse from the plaintiff, the improper
joinder analysis does not apply to it. Only Mr. Harris’s citizenship can destroy diversity; therefore,
he is the only defendant that might be improperly joined.

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in state court.2 The removing defendants have not alleged any actual fraud in this
case; instead, they contend that the plaintiff has no possibility of recovering against
Mr. Harris.
A defendant who contends that a non-diverse party is improperly joined has a
heavy burden of proof.3 The court must ordinarily evaluate all of the factual
allegations in the plaintiff's state-court pleadings in the light most favorable to the
plaintiff, resolving all contested issues of substantive fact in favor of the plaintiff.4
If the court then finds that there is no possibility of recovery against the non-diverse
party, the non-diverse party has been improperly joined, and its citizenship must be
disregarded for jurisdictional purposes. The test to be applied in evaluating improper
joinder is “whether the defendant has demonstrated that there is no possibility of
recovery by the plaintiff against an in-state defendant, which stated differently means
that there is no reasonable basis for the district court to predict that the plaintiff might
be able to recover against an in-state defendant.”5

2

Gasch v. Hartford Accident & Indemnity Co., 491 F.3d 278, 281 (5th Cir. 2007);
Crockett v. R.J. Reynolds Tobacco Co., 436 F.3d 529, 532 (5th Cir. 2006); Travis v. Irby, 326 F.3d
644, 646–47 (5th Cir. 2003).
3

Green v. Amerada Hess Corp., 707 F.2d 201, 205 (5th Cir. 1983).

4

Guillory v. PPG Indus., Inc., 434 F.3d 303, 308 (5th Cir. 2005); Green v. Amerada
Hess, 707 F.2d at 205.
5

Smallwood v. Illinois Cent. R. Co., 385 F.3d 568, 577 (5th Cir. 2004).

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Employing that test, the court first looks to the allegations of the complaint to
determine whether it states a claim against the in-state defendant,6 reading them
leniently in favor of remand, under a standard similar to that used in evaluating a Rule
12(b)(6) motion to dismiss.7 If the defendant argues that the plaintiff has misstated
or omitted discrete facts that would preclude recovery against the in-state defendant,
however, the court may, in its discretion, pierce the pleadings and conduct a summary
inquiry.8 In such cases, the court may consider summary judgment-type evidence.9
The burden of proof remains with the removing parties to show that there is no
possibility of recovery against the nondiverse defendant.10
Here, the removing defendants argue that any claim against Mr. Harris has
perempted. It is undisputed that the timeliness of the plaintiff’s claim against Mr.
Harris is governed by La. R.S. 9:5606(A), which reads as follows:
No action for damages against any insurance agent, broker,
solicitor, or other similar licensee under this state, whether
based upon tort, or breach of contract, or otherwise, arising
out of an engagement to provide insurance services shall be
6

Smallwood v. Illinois Cent. R. Co., 385 F.3d at 573.

7

Boone v. Citigroup, Inc., 416 F.3d 382, 388 (5th Cir. 2005).

8

Smallwood v. Illinois Cent. R. Co., 385 F.3d at 573.

9

Campbell v. Stone Ins., Inc., 509 F.3d 665, 669 (5th Cir. 2007); Travis v. Irby, 326

F.3d at 649.
10

Gasch v. Hartford, 491 F.3d at 281.

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brought unless filed in a court of competent jurisdiction
and proper venue within one year from the date of the
alleged act, omission, or neglect, or within one year from
the date that the alleged act, omission, or neglect is
discovered or should have been discovered. However,
even as to actions filed within one year from the date of
such discovery, in all events such actions shall be filed at
the latest within three years from the date of the alleged
act, omission, or neglect.
Subsection D of the same statute makes it clear that both the one-year time period and
the three-year time period established in the statute are peremptive periods that cannot
be renounced, interrupted, or suspended. Therefore, to be timely, the plaintiff’s claim
must have been brought not more than one year after the date or discovery of a
negligent act or omission but in no case more than three years after the date on which
the negligent act or omission occurred.
The restated petition alleges that the plaintiff used defendant AssuredPartners
as its insurance agent and that Mr. Harris was employed by AssuredPartners as an
insurance and risk advisor. The plaintiff alleges that Mr. Harris and AssuredPartners
were responsible for procuring a business owners insurance policy through defendant
Liberty Mutual, which was underwritten by defendant Peerless. The restated petition
alleges that “[t]he most recent date of renewal was November 15, 2013. . . .” (Rec.
Doc. 1-1 at 13). It also alleges that “when it first sought to obtain property and

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liability insurance, and at all pertinent times thereafter, Practical [Supply]11 made it
clear to Mr. Harris that it should be listed as a named insured under the Policy and
afforded full property and liability coverage.” (Rec. Doc. 1-1 at 12). The plaintiff
further alleges that “Mr. Harris’s negligence. . . was repeated on a yearly basis, as the
policy was renewed.” (Rec. Doc. 1-1 at 13). However, the petition does not allege
when the first Peerless policy was issued, nor does it allege the dates on which Mr.
Harris was allegedly instructed by the plaintiff as to the type of insurance desired.
Consequently, the restated petition does not allege the dates on which the alleged
negligence occurred. The dates of occurrence of the alleged negligence are critically
important in evaluating whether a claim against an insurance agent has perempted.
Because those critical facts were omitted from the restated petition, it is appropriate
to look beyond the four corners of the plaintiff’s allegations in deciding the pending
remand motion.
Liberty Mutual’s denial of coverage letter (Rec. Doc. 1-1 at 5-8) was attached
as an exhibit to the restated petition. It is dated September 18, 2014, and explains that
Peerless issued a business owner’s policy, Policy No. BOP 8560502, effective from
November 15, 2013 to November 15, 2014, to Lafayette Bone & Joint Clinic. It also

11

The plaintiff is referred to herein as “Practical Supply” to distinguish it from Practical
Health Care LLC.

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states that Practical Supply is not an insured under the policy. It was addressed to
both Lafayette Bone & Joint Clinic and Pracitial [sic] Healthcare Supply, Inc. at the
same address.
A supplemental denial letter (Rec. Doc. 1-1 at 19-23) was also attached to the
plaintiff’s restated petition. It is dated November 20, 2014, and was issued by Liberty
Mutual. This letter noted that Practical Supply is not shown as an insured under the
policy while Practical Health Care LLC is shown in the policy as having coverage but
only with respect to liability as a co-owner of a premises with a Lafayette, Louisiana
address. Practical Healthcare Supply, Inc. and Practical Health Care LLC are clearly
two different entities. According to the letters from Liberty Mutual, Practical Supply
is not covered by the policy at all and Practical Health Care is afforded limited
coverage. The second letter states: “‘Practical Healthcare Supply, Inc.,’ the named
defendant in this [the underlying] lawsuit, is not identified anywhere on the Policy.
Instead, a similarly named entity ‘Practical Health Care LLC’ appears listed only on
the Policy’s Declarations Extension.” (Rec. Doc. 1-1 at 20).
The affidavit of Donna Hacholski, a Senior Commercial Lines Underwriter
with Liberty Mutual, states that the policy was originally issued effective November
1, 2008, then cancelled and rewritten with a new effective date of November 15, 2008
and covering the time period from November 15, 2008 through November 15, 2009.
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(Rec. Doc. 1-2 at 8). She further states that, thereafter, the policy was renewed
annually, most recently covering the time period from November 15, 2013 to
November 15, 2014. (Rec. Doc. 1-2 at 9).
The plaintiff argues that its claim is timely because this lawsuit was filed not
more than one year after the discovery of Mr. Harris’s alleged negligence. The
restated petition alleges that “[i]t was only on September 18, 2014 – after Mr. Nguyen
filed suit against Practical [Supply] – that Practical [Supply] discovered that it was
not afforded the full coverage it instructed Mr. Harris to procure.” (Rec. Doc. 1-1 at
12). But the Louisiana Supreme Court has held that an injured party’s constructive
knowledge – not just his actual knowledge – can start a prescriptive or peremptive
period running.
A prescriptive period will begin to run even if the injured
party does not have actual knowledge of facts that would
entitle him to bring a suit as long as there is constructive
knowledge of same. Constructive knowledge is whatever
notice is enough to excite attention and put the injured
party on guard and call for inquiry. Such notice is
tantamount to knowledge or notice of everything to which
a reasonable inquiry may lead. Such information or
knowledge as ought to reasonably put the alleged victim on
inquiry is sufficient to start running of prescription.12

12

Campbell v. Stone Ins., Inc., 509 F.3d at 671, quoting Campo v. Correa, 2001-C-2707
(La. 06/21/02), 828 So.2d 502, 510-11.

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Practical Supply does not argue that it did not receive a copy of the policy.
Instead, it argues that “it could not decipher from the policy that it was not afforded
full coverage.” (Rec. Doc. 16 at 4). Two logical inferences can be made from this
assertion: first, the plaintiff was provided with a copy of the policy; and second, it
had notice “to excite attention and put the injured party on guard and call for inquiry.”
The inescapable conclusion is that the plaintiff had constructive knowledge of the
contents of the policy.
Despite this, however, the plaintiff argues that whether a party has constructive
knowledge of a policy’s terms is an issue of fact13 and argues that, at this stage,
unchallenged issues of fact must be decided in favor of remand.14 But, in this case,
there is no unresolved issue as to the plaintiff’s constructive knowledge. Even if the
plaintiff had not admitted that it attempted to decipher the allegedly obtuse provisions
of the policy, Louisiana law imposes a duty on an insured to read the insurance
policies issued to it and to know the provisions of those policies. In fact, “[i]t is well
settled that it is the insured's obligation to read the policy when received, since the

13

In support of this proposition, the plaintiff cites Argonaut Great Cent. Ins. Co. v.
Hammett, 44,308 (La. App. 2 Cir. 06/03/09), 13 So. 3d 1209, 1213, writ denied, 2009-1491 (La.
10/2/09), 18 So. 3d 122.
14

The plaintiff cites Ross v. Citifinancial, Inc., 344 F.3d 458, 463 (5th Cir. 2003), in
support of this argument.

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insured is deemed to know the policy contents.”15 Accordingly, the plaintiff in this
lawsuit is charged with constructive knowledge of the contents of the policies it
claims provided coverage to it, starting in 2008 when the policy was originally issued,
and the plaintiff is deemed to have known, from that point forward, that the policy
does not provide it with coverage.
Therefore, the peremptive period did not begin to run on September 18, 2014
when the plaintiff claimed to have first discovered that the policy affords no
coverage, and the plaintiff is not entitled to rely on the part of the applicable statute
that provides a one-year peremptive period from the date of discovery of a negligent
act or omission.
The plaintiff argues that Mr. Harris was negligent at the time that the policy
was originally issued because the policy does not include Practical Supply as a named
insured and that he was again negligent every time the policy was renewed because
the policy renewals fail to provide Practical Supply with coverage. Thus, Practical
Supply argues that every renewal of the insurance policy started a new peremptive

15

Seruntine v. State Farm Fire & Cas. Co., 2010-1108 (La. 09/03/10), 42 So. 3d 968,
968, citing Isidore Newman School v. J. Everett Eaves, Inc., 09–2161 (La. 07/06/10), 42 So.3d 352,
359. See, also, Motors Ins. Co. v. Bud's Boat Rental, Inc., 917 F.2d 199, 205 (5th Cir. 1990) (noting
that insureds are responsible for reading the clear provisions of an insurance policy).

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period. Such an interpretation of Louisiana law is not supported by the relevant
jurisprudence.
Generally, subsequent renewals of insurance policies do
not operate to restart peremption. However, renewals can
be the basis of separate torts, if the complained of conduct
constitutes separate and distinct acts, which give rise to
immediately apparent damages. The inquiry is whether the
actions of the insurance agent at the time of renewal can be
construed to constitute an act separate from the initial
policy procurement.16
Thus, for example, a renewal may constitute a separate act if an insured requests
specific coverage at the time of renewal that is not included in the renewed policy.17
In support of its contrary argument, the plaintiff relies primarily upon Southern
Athletic Club, LLC v. Hanover Ins. Co., No. 06-2605, 2006 WL 2583406 (E.D. La.
Sept. 6, 2006). But, Southern Athletic presented a situation where “each renewal was
a separate and distinct act since the parties discussed increases in property value and
adjusted the policy limits accordingly.”18 Absent such discussions at renewal time,
there is no new peremptive period.

16

Sitaram, Inc. v. Bryan Ins. Agency, Inc., 47,337 (La. App. 2 Cir. 09/19/12), 104 So.
3d 524, 530 writ denied, 2012-2283 (La. 11/30/12), 103 So. 3d 375 (internal citations omitted). See,
also, Arceneaux v. Schaumberg, No. 07-8741, 2008 WL 2355849 (E.D. La. June 6, 2008), which
explained that “[r]enewals of an insurance policy do not normally restart the peremptive period.”
17

Sonnier v. Louisiana Farm Bureau Mut. Ins. Co., 2005-1006 (La. App. 3 Cir.
03/01/06), 924 So. 2d 419, writ denied, 2006-0704 (La. 5/26/06), 930 So. 2d 33.
18

Arceneaux v. Schaumberg, 2008 WL 2355849, at *2.

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The second case primarily relied upon by the plaintiff is Sitaram, Inc. v. Bryan
Ins. Agency, Inc. There, the insurance policy was originally issued in 2004 and
renewed every year thereafter. In 2008, the property flooded during Hurricane
Gustav, and it was discovered that the flood coverage afforded by the policy pertained
to only one of the three buildings on the property. Although the property had been
automatically renewed every year – meaning that no new application for coverage
was required – the agent had contacted the insured every year, prior to each renewal,
and they had discussed possible changes to coverage.19 The court found that each
time the insured sought flood insurance coverage “to the maximum extent” and the
agent failed to obtain such coverage was a separate and distinct act because “[e]ach
year, prior to the policy renewal date, from 2004 until at least 2007, [the insured] and
[the agent] discussed his coverage.”20
Another case illustrating these concepts is Arceneaux v. Schaumberg. There,
the insurance policy at issue was a homeowner’s policy that was originally issued in
2002 and renewed annually thereafter. The plaintiff’s home was damaged by
Hurricane Katrina in 2005, and the plaintiff claimed that his agent had falsely
represented that the policy covered hurricane damage even though it excluded

19

Sitaram, Inc. v. Bryan Ins. Agency, Inc., 104 So. 3d at 527.

20

Sitaram, Inc. v. Bryan Ins. Agency, Inc., 104 So. 3d at 531.

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coverage for flood damage. The plaintiff argued that his suit was timely because a
new peremptive period began every time the insurance policy was renewed. The
court explained that “[r]enewals of an insurance policy do not normally restart the
peremptive period.”21 Notably,“the policy was renewed every year by mail and did
not involve negotiations or substantive changes; in other words, the renewal was not
a ‘separate and distinct act.’”22 The Arceneaux court also found that the insured was
presumed to have read and had knowledge of the contents of the policy from the time
it was issued in 2002, finding that “the peremptive period began to run in April of
2002, when plaintiff discovered, or should have discovered, that the alleged
misrepresentation by the insurance agent contradicted the terms of the policy.”23 The
court then denied the plaintiff’s motion to remand because there was no reasonable
basis for the court to predict that the plaintiff might be able to recover against the instate insurance agent.
Thus, Southern Athletic Club and Sitaram present factual scenarios very
different from that presented in Arceneaux and in this case. Here, the plaintiff’s claim
against Mr. Harris is premised upon the allegation that Mr. Harris failed to follow its

21

Arceneaux v. Schaumberg, 2008 WL 2355849, at *2.

22

Arceneaux v. Schaumberg, 2008 WL 2355849, at *3.

23

Arceneaux v. Schaumberg, 2008 WL 2355849, at *2.

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instructions and failed to obtain the type of liability insurance coverage that the
plaintiff requested. Since the discovery rule does not apply, one-year and three-year
peremptive periods apply but those time periods begin to run from the date on which
Mr. Harris’s negligent act or omission occurred. The insurance policy was issued in
2008 without any coverage for the plaintiff; therefore, any negligence on Mr. Harris’s
part occurred before the policy was issued and the claim perempted three years later,
well before this lawsuit was filed.
In similar cases, state and federal courts in Louisiana have noted that the
relevant inquiry “is whether the actions of the insurance agent at the time of renewal
can be construed to constitute an act separate from the initial policy procurement.”24
A policy renewal will restart the peremptive period only if the insured and his agent
renegotiate the terms and provisions of the policy or discuss substantive changes to
the policy at the time of the renewal and those changes are not accurately reflected
in the renewed policy. Absent any such communications, discussions, or negotiations
at renewal time that evidence a negligent act or omission when compared to the
policy’s contents, the peremptive period will run from the date on which the policy
was originally issued.

24

Sitaram, Inc. v. Bryan Ins. Agency, Inc., 104 So. 3d at 530, citing Branton v. Maddox,
42,853 (La. App. 2 Cir. 01/9/08), 974 So.2d 190, 193, and White v. Allstate Ins. Co., 513 F.Supp.2d
674, 681 (E.D. La. 2007).

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The plaintiff in this case has not established that there were discussions with
Mr. Harris at any date after the issuance of the insurance policy in 2008 that are
sufficient to demonstrate that any one or more of the policy renewals started a new
prescriptive period running. As noted by Liberty Mutual and Peerless in their
briefing, the plaintiff “failed to allege any meeting, conversation, or communication
between it and Harris regarding its alleged coverage needs prior to each renewal of
the Policy, much less a date of any such communication.” (Rec. Doc. 15 at 4
(emphasis in original)). Even when the plaintiff’s claim is viewed as generously as
possible, the plaintiff’s argument fails. AssuredPartners and Mr. Harris submitted
Mr. Harris’s affidavit, which states: “[AssuredPartners’s] account file reflects that
the last communication with Lafayette Bone & Joint Clinic regarding coverage for
Practical Healthcare Supply, Inc. as a named insured was on or about May 25, 2010.”
(Rec. Doc. 14-1 at 2). Mr. Harris’s affidavit testimony is important. That date was
more than three years before the suit was filed, and any claim arising out of any
discussions had at that time had already perempted before this lawsuit was filed.
Practical Supply has offered no evidence contradicting Mr. Harris’s affidavit
testimony. Instead, the plaintiff argued that the allegations of the restated complaint
were broad enough to counter the effect of the affidavit or, alternatively, that

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discovery is needed to determine what communications were had and when they
occurred. Neither of those arguments is persuasive.
First, if the undersigned was resolving the pending motion using an analysis
similar to that employed in the context of a Fed. R. Civ. P. 12(b)(6) motion,
conclusory allegations and unwarranted deductions of fact would not be accepted as
true.25 The plaintiff’s allegation that Mr. Harris was instructed “when [the plaintiff]
first sought to obtain property and liability insurance, and at all times pertinent
thereafter” (Rec. Doc. 1-1 at 12) is too vague, speculative, and conclusory to be
accepted as true.
Second, as noted previously, the lack of specific allegations in the restated
complaint concerning the date on which substantive communications concerning
insurance coverage were conducted is an omission of critical details that permits the
undersigned to pierce the pleadings and rely upon summary-judgment-type evidence,
such as Mr. Harris’s affidavit.
Third, the plaintiff has had ample time since this lawsuit was first filed in
November 2014 to conduct any necessary discovery with regard to the critical issue
now before the court, i.e., the specific dates on which the plaintiff instructed Mr.

25

Kaiser Aluminum & Chemical Sales v. Avondale Shipyards, 677 F.2d 1045, 1050 (5th
Cir. 1982); Associated Builders, Inc. v. Alabama Power Company, 505 F.2d 97, 100 (5th Cir. 1974);
Collins v. Morgan Stanley Dean Witter, 224 F.3d 496, 498 (5th Cir. 2000).

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Harris to obtain the type of coverage that Practical Supply now contends Mr. Harris
failed to procure.
Finally, in its reply brief, Practical Supply also argued that since there were emails between Sherry Rue at Practical Supply and Tabitha Holt at Landry Harris in
connection with the most recent renewal of the policy – even though the conversation
had nothing whatsoever to do with Practical Supply – there was a new failure on the
part of the insurance agent upon issuance of the renewed policy. Arguments raised
for the first time in a reply brief generally are not considered,26 and these e-mails
arguably did not constitute summary-judgment-type evidence because they were not
supported by an affidavit or certified as being business records. However, even if the
e-mails were accepted as summary-judgment-type evidence and even if the reply brief
and the e-mails attached to it were read as liberally as possible, there is still no basis
for finding that Mr. Harris was negligent in failing to obtain coverage for Practical
Supply at the time of the e-mail exchange between Ms. Rue and Ms. Holt. The emails have nothing to do with coverage for Practical Supply but address only a
change in the policy with regard to Dr. Sledge, Falcon Pharmacy, LLC, and UM

26

United States v. Transocean Deepwater Drilling, Inc., 767 F.3d 485, 492 (5th Cir.
2014); DePree v. Saunders, 588 F.3d 282, 290 (5th Cir. 2009); United States v. Clinical Leasing
Serv., Inc., 982 F.2d 900, 902 n. 4 (5th Cir. 1992); Peteet v. Dow Chem. Co., 868 F.2d 1428, 1437
(5th Cir. 1989).

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coverage. (Rec. Doc. 16-1 and 16-2). Thus, there is no connection between the
topics covered in the e-mail correspondence and the lack of coverage provided by the
insurance policy for Practical Supply; consequently, the e-mails when compared to
the contents of the policy do not evidence negligence on the part of Mr. Harris.
Moreover, if Ms. Rue was, as the plaintiff represented, the “individual responsible for
overseeing the contested policy on behalf of Practical [Supply]” (Rec. Doc. 16 at 6),
then it is clear that she (and therefore Practical Supply) had constructive knowledge
of the contents of the policy on October 11, 2013, which is more than one year before
this lawsuit was filed in November 2014.
The removing defendants, Liberty Mutual and Peerless, have satisfied the
burden of establishing that the plaintiff’s claim against Mr. Harris has perempted, and
the plaintiff consequently has no possibility of recovering against Mr. Harris.
Therefore, it is appropriate that the motion to remand be denied.
Additionally, it is equally appropriate that the plaintiff’s claim against Mr.
Harris be dismissed. The Fifth Circuit has stated that “summary judgment will always
be appropriate in favor of a defendant against whom there is no possibility of
recovery,”27 and courts within the Fifth Circuit have summarily dismissed improperly

27

Carriere v. Sears, Roebuck & Co., 893 F.2d 98, 102 (5th Cir. 1990).

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joined defendants on numerous occasions.28

The undersigned will, therefore,

recommend that the plaintiff’s claim against Mr. Harris be dismissed.
CONCLUSION
The defendants removed this action from state court, contending that the
amount in controversy exceeds the jurisdictional threshold, that the plaintiff is diverse
in citizenship from the defendants other than Mr. Harris, and that Mr. Harris’s
citizenship must be disregarded because he was improperly joined as a defendant in
the suit. Accordingly, the plaintiff’s motion for remand (Rec. Doc. 8) is DENIED.
Signed at Lafayette, Louisiana, this 17th day of June 2015.

____________________________________
PATRICK J. HANNA
UNITED STATES MAGISTRATE JUDGE

28

See, e.g., Rojas v. Wells Fargo Bank, N.A., 571 Fed. App'x 274, 278 (5th Cir. 2014)
(“Because the district court properly found that HLC, Alexander, and BDFTE were improperly
joined, it did not err in dismissing them. . . .”); Michels v. Safeco Ins. Co. of Indiana, 544 F. App'x
535, 540 (5th Cir. 2013) (“the district court correctly dismissed Womack as improperly joined. . . .”);
Butler v. Louisiana State Univ. Health Sciences Ctr., No. 12–cv–1838, 2012 WL 7784402 (W.D.La.
Nov. 19, 2012) (“A finding of improper joinder is tantamount to dismissal of the defendant who was
improperly joined.”), report and recommendation adopted sub. nom., 2013 WL 1180873 (W.D.La.
Mar. 20, 2013); Moss v. Unum Grp. Corp., No. 10–cv–0002, 2010 WL 3190399, at *3 (W.D.La.
July 14, 2010) (recommending “that the court grant summary judgment sua sponte and dismiss all
claims” against the improperly joined parties), report and recommendation adopted sub. nom. 2010
WL 3199728, at *4 (W.D.La. Aug. 11, 2010).

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