The Estate of James L. Decker v. National Casualty Company et al

Filing 53

ORDER denying 22 Motion to Sever and REMANDING case to the Circuit Court of Tishomingo County, Mississippi. CASE CLOSED.. Signed by District Judge Sharion Aycock on 7/20/17. (rel)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF MISSISSIPPI
ABERDEEN DIVISION
THE ESTATE OF JAMES L. DECKER

PLAINTIFF

V.

CIVIL ACTION NO. 1:16-CV-242-SA-RP

NATIONAL CASUALTY COMPANY,
DAVID HUFFMAN,
AUTO-OWNERS INSURANCE, and
DOUBLE D TRANSPORTATION, INC.

DEFENDANTS
ORDER

The Estate of James L. Decker originally filed its Complaint [2] in the Circuit Court of
Tishomingo County, Mississippi against National Casualty Company, Horner Insurance
Services,1 David Huffman, Double D Transportation, and Auto-Owners Insurance. National
Casualty removed the action to this Court premising federal jurisdiction on diversity of
citizenship under 28 U.S.C. § 1332. The parties in this case are not diverse. The Plaintiff is a
citizen of Tennessee, and Defendants Huffman and Double D are also citizens of Tennessee.
Defendant National Casualty is a citizen of Wisconsin and Arizona, and Defendant Auto-Owners
is a citizen of Michigan.
National Casualty now argues that Defendants Huffman and Double D were fraudulently
joined and filed a Motion to Sever [21] requesting that the Court sever and remand the claims
against Huffman and Double D, perfecting federal diversity jurisdiction over the Plaintiffs’
claims against National Casualty and Auto-Owners. The Plaintiff opposes severance and request
remand of the entire case [32].
The Plaintiff’s claims in this case arise from an automobile accident in which James
Decker was killed. At the time of the accident, Decker was employed by Double D
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The Parties dismissed Horner Insurance Services, Inc. by Stipulation [20] on January 26, 2017.

Transportation and was driving a tractor-trailer owned by Huffman. Double D was insured under
a policy by National Casualty, and Decker was insured under a policy by Auto-Owners.
Although the Plaintiff’s claims against each Defendant are styled as claims for
“negligence,” in substance the Plaintiff seeks to recover insurance proceeds from National
Casualty, or in the alternative from Auto-Owners. The Plaintiff’s claim against Decker’s
employer, Double D, also involves the recovery of insurance proceeds as well as unspecified
“employment benefits.” The Plaintiff’s final claim against the truck owner, Huffman, involves
recovery of “benefits from Mr. Decker’s employment at Double D” as well as damages “for
potential malfunction of the vehicle.”
Severance and Jurisdiction
Removal statutes are to be construed against removal and for remand. Shackelford v.
Wooten, No. 3:16-CV-158-M-A, 2016 WL 5795986, at *2 (N.D. Miss. Oct. 4, 2016) (citing
Eastus v. Blue Bell Creameries L.P., 97 F.3d 100, 106 (5th Cir. 1996). Any doubts regarding
whether removal is proper should be resolved against federal jurisdiction. Manguno v. Prudential
Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002) (citing Acuna v. Brown & Root, Inc.,
200 F.3d 335, 339 (5th Cir. 2000)).
For this Court to have subject matter jurisdiction of this matter based on § 1332, complete
diversity must exist among the parties. Harvey v. Grey Wolf Drilling Co., 542 F.3d 1077, 1079
(5th Cir. 2008). As the party invoking diversity jurisdiction, National Casualty bears the burden
of proving it. Getty Oil Corp., a Div. of Texaco Inc. v. Ins. Co. of N. Am., 841 F.2d 1254, 1259
(5th Cir. 1988). “For this court to accept jurisdiction despite the misjoinder of a non-diverse
defendant, the misjoinder must be egregious or grossly improper.” Cooper v. AIG Claim Servs.,
No. 1:08–CV–168-SA, 2009 WL 279101 at *2 (N.D. Miss. Feb. 5, 2009).

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In a case removed to federal court, questions of fraudulent misjoinder are determined by
the state’s joinder rules. Cooper, 2009 WL 279101, at *2 (citing Palmero v. Letourneau Tech.,
Inc., 542 F. Supp. 2d 499, 516 (S.D. Miss. 2008) “To determine if a party has been fraudulently
misjoined, the court applies Rule 20 of the Mississippi Rules of Civil Procedure.” Tri–Miss.
Servs., Inc. v. Fairley, No. 2:12–CV–152-KS, 2012 WL 5611058 (S.D. Miss. Nov. 15, 2012)
(citing Palermo, 542 F. Supp. 2d at 517).
In order for the joinder of the defendants to be proper in this case, the claims against them
must 1) share common questions of law or fact; and 2) arise out of the same transaction,
occurrence, or series of transactions or occurrences. MISS. R. CIV. P. 20(a); Cooper, 2009 WL
279101, at *3 (citing Mercer v. Moody, 918 So. 2d 664, 666 (Miss. 2005).
The Mississippi Supreme Court has held that before an alleged transaction or occurrence
will be sufficient to meet Rule 20(a)’s two factors, there must be a “distinct litigable event
linking the parties.” Hegwood v. Williamson, 949 So. 2d 728, 730 (Miss. 2007). To determine
whether a distinct litigable event exists, the court should consider “whether a finding of liability
for one plaintiff essentially establishes a finding for all plaintiffs, indicating that proof common
to all plaintiffs is significant.” Id.
Looking at the pleadings in this case, including the notice of removal, it appears that the
Plaintiff is asserting a claim against Double D and National Casualty jointly, severally, or in the
alternative. In essence, the Plaintiff is seeking compensation and insurance proceeds from his
employer and from his employer’s insurance company. Notably the Plaintiff is not alleging that
Double D had any involvement in the accident itself, which distinguishes this case from the
situation in Hegwood, where the Mississippi Supreme Court held that third party tort claims and
first party breach of contract and bad faith claims involve distinct litigable events with different

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factual issues and legal issues. Id. at 731. In other words, according to the Plaintiff, its claims
against Double D are for insurance proceeds or other compensation derived from either its
coverage by National Casualty or a potential lack thereof. These claims are exactly the type of
joint, several, or alternative claims contemplated by Rule 20, do not involve distinct litigable
events, and they likely share common issues of both fact and law.
For these reasons, the Court finds that “there is a reasonable probability that the state
court would find [Double D’s] joinder proper,” and thus Double D was not fraudulently joined.
Palermo, 542 F. Supp. 2d at 524. Because the Court finds that Double D was not fraudulently
joined, complete diversity does not exist. Finally, because the lack of diversity between Double
D and National Casualty alone destroys diversity jurisdiction, the Court need not analyze the
joinder of Huffman.
Conclusion
If subject matter jurisdiction is lacking, this Court must remand. 28 U.S.C. § 1447(c). For
all the reasons outlined above, the Court finds that there is not complete diversity between the
parties in this case. National Casualty’s Motion to Sever [22] is DENIED and this case is
REMANDED to the Circuit Court of Tishomingo County, Mississippi. The Clerk of this Court is
directed to forward a certified copy of this Order to the Clerk of the Circuit Court of Tishomingo
County and to close this case.
SO ORDERED on this the 20th day of July, 2017

/s/ Sharion Aycock
UNITED STATES DISTRICT JUDGE

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