Cook v. Quickspray, Inc. et al
Filing
37
Memorandum Opinion and Order denying Plaintiff Edward Cook's 21 Motion to Remand and 23 Supplemental Motion to Remand. Signed by District Judge Halil S. Ozerden on September 15, 2014. (RW)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
SOUTHERN DIVISION
EDWARD COOK
PLAINTIFF
v.
CIVIL NO.: 1:13cv389-HSO-RHW
QUICKSPRAY, INC., PPG INDUSTRIES,
EDGEN MURRAY, ACCU-FAB AND CONSTRUCTION, INC.,
A/K/A ACCU-FAB MANUFACTURING, LLC, AKA
ACCU-FAB MANUFACTURING
DEFENDANTS
MEMORANDUM OPINION AND ORDER DENYING PLAINTIFF’S MOTION TO
REMAND AND SUPPLEMENTAL MOTION TO REMAND
BEFORE THE COURT is Plaintiff Edward Cook’s Motion to Remand [21]
and Supplemental Motion to Remand [23]. Defendants PPG Industries (“PPG”),
Quickspray, Inc. (“Quickspray”), and Accu-Fab Construction, Inc. (“Accu-Fab”) have
filed Responses. Defendant Edgen Murray (“Edgen”) has joined in Quickspray’s
Response, and Plaintiff has filed a Reply. Having considered the Motions, the
Responses and Reply, the pleadings, and relevant legal authority, the Court finds
that Plaintiff’s Motion to Remand [21] and Supplemental Motion to Remand [23]
should be denied.
I. BACKGROUND
This suit involves personal injuries suffered by Plaintiff Edward Cook
(“Plaintiff”) arising out of an industrial accident which occurred in Moss Point,
Mississippi, on April 10, 2012. Pl.’s Compl. [1-1] at 1. Plaintiff was employed by
Global Employment Services, Inc. (“Global”), and was assigned to work at Accu-
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Fab’s facility as a temporary contract worker. Id. at 3, 5. Accu-Fab had entered into
a “Contract Labor Agreement” with Global, which provided Global would:
(a)
(b)
(c)
(d)
(e)
Assume responsibility for the payment of wages to each of the
employees furnished to [Accu-Fab].
Assume responsibility for the payment of payroll taxes and the
collection of taxes from payroll for each employee furnished to
[Accu-Fab].
Retain the right of direction and control over the management of
Worker’s Compensation claims, claim filing, and related
procedures and statutory compliance with respect to employees
furnished to [Accu-Fab].
Implement and comply with all appropriate state and federal laws
relating to reporting, sponsoring, filing, and maintaining benefit
and welfare plans and be solely responsible for providing benefit
and welfare plans for employees provided to [Accu-Fab].
Perform drug testing of all employee’s prior to being sent to [AccuFab] (if so desired).
Contract Labor Agreement [21-1] at p. 32.
Plaintiff’s job at Accu-Fab’s facility was to sandblast and spray a protective
coating called “Amercoat” on large pipes. Pl.’s Compl. [1-1] at 3.1 On the day of the
accident giving rise to this suit, Plaintiff was working on a project that required
coating large sections of pipe for Defendant Edgen. Id.; Aff. of Paul Bosarge [26-1]
at p. 2. The work took place in the “blast yard,” an area of the Accu-Fab facility
which was segregated from other parts of the facility so as not to interfere with
other projects. Pl.’s Compl. [1-1] at 3; Aff. of Bosarge [26-1] at p. 2. Plaintiff was
filling a Quickspray hopper with the “Amercoat” coating when the material line
connecting the pump to the spray gun ruptured. Pl.’s Compl. [1-1] at 3. Plaintiff was
1
“Amercoat” is manufactured by Defendant PPG. Pl.’s Compl. [1-1] at 4.
2
then drenched with “Amercoat” from the pump and the fully loaded Quickspray
hopper. Id.
On August 20, 2013, Plaintiff filed suit in the Circuit Court of Jackson
County, Mississippi, alleging negligence and gross negligence claims against
Defendants Quickspray, PPG, Accu-Fab, and Edgen, and products liability claims
against Defendants Quickspray and PPG. Pl.’s Compl. [1-1] at pp. 7-11. The
Complaint asserts that as a result of Defendants’ tortious conduct, Plaintiff
developed a silica-related lung disease. Defendant Quickspray filed a Notice of
Removal [1] on October 8, 2013, arguing that the Court has subject matter
jurisdiction based on diversity of citizenship because in-state Defendant Accu-Fab
has been improperly joined, as it is exempt from liability under the “loaned servant”
doctrine.2 PPG and Edgen consented to the removal. PPG filed a Supplemental
Notice of Removal [8] on October 15, 2013, arguing an alternative theory of
improper joinder, namely that Accu-Fab has been improperly joined because it is
not liable to Plaintiff under the “up-the-line” immunity doctrine. Plaintiff now
seeks remand to state court.
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Plaintiff is a citizen of Alabama. Accu-Fab is the only Defendant that is
considered a citizen of Mississippi, with its principal place of business in
Pascagoula, Mississippi. Quickspray is a foreign corporation with its principal place
of business in Ohio. PPG is a foreign corporation with its principal place of business
in Pennsylvania. Edgen is a foreign corporation with its principal place of business
in Louisiana.
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II. DISCUSSION
A.
Removal Standard
Congress has provided that a civil action brought in State court may be
removed where a United States district court has original jurisdiction. 28 U.S.C.
§1441(a). 28 U.S.C. § 1332 provides that district courts have “original jurisdiction of
all civil actions where the matter in controversy exceeds the sum or value of
$75,000, exclusive of interest and costs, and is between . . . citizens of different
States . . . .” Id. § 1332(a)(1). However, under the forum defendant rule, “[a] civil
action otherwise removable solely on the basis of the jurisdiction under section
1332(a) of this title may not be removed if any of the parties in interest properly
joined and served as defendants is a citizen of the State in which such action is
brought.” 28 U.S.C. §1332(b)(2).
B.
Improper Joinder
Where federal diversity jurisdiction would exist in the absence of an in-state
defendant, a removing party can establish jurisdiction by demonstrating that the
plaintiff improperly joined the forum defendant. African Methodist Episcopal
Church v. Lucien, 756 F.3d 788, 793 (5th Cir. 2014). To prove improper joinder, the
removing party must show either “(1) actual fraud in the pleading of jurisdictional
facts, or (2) inability of the plaintiff to establish a cause of action against the nondiverse party in state court.” Smallwood v. Ill. Cent. R. Co., 385 F.3d 568, 573 (5th
Cir. 2004). Where the removing party alleges a plaintiff’s inability to establish a
cause of action against the forum defendant, the Court must determine “whether
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the defendant has demonstrated 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.” Id. A mere theoretical possibility of recovery will not preclude a finding
that a forum defendant was improperly joined. Lucien, 756 F.3d at 793. The
removing party bears the heavy burden of demonstrating improper joinder, and
“any contested issues of fact and any ambiguities of state law must be resolved in
favor of remand.” Id.
When deciding whether a plaintiff has a reasonable basis for recovery, a
district court typically performs a Rule 12(b)(6)-type analysis. Smallwood, 385 F.3d
at 573. However, where a plaintiff has stated a claim but has “misstated or omitted
discrete facts that would determine the propriety of joinder,” the Court in its
discretion may pierce the pleadings and conduct a summary inquiry. Id. Because
Plaintiff’s Complaint has omitted discrete facts that would assist the Court in
determining whether the joinder of Accu-Fab was proper, the Court will conduct a
summary inquiry to evaluate Plaintiff’s possibility of recovery from Accu-Fab.
C.
Analysis
Defendants have asserted two alternative theories under which the Motions
to Remand should be denied. Both theories rest on the premise that Defendant
Accu-Fab is a statutorily exempt employer under the Mississippi Workers’
Compensation Act, Miss. Code Ann. § 71-3-1, et seq. (“MWCA”). The MWCA
provides that “[t]he liability of an employer to pay compensation shall be exclusive
and in place of all other liability of such employer to the employee . . . .” Miss. Code
5
Ann. §71-3-9. Therefore, if Accu-Fab qualifies as Plaintiff’s “employer” under the
MWCA, Plaintiff has no possibility of recovery against Accu-Fab under a commonlaw negligence claim, as his exclusive remedy lies with the MWCA.
1.
Defendants’ Up-the-line Immunity Argument
Defendant PPG contends that Accu-Fab is statutorily immune from liability
because workers’ compensation immunity extends to general contractors for injuries
sustained by its subcontractors’ employees. In support of its argument, PPG cites
the Mississippi Supreme Court decision in Doubleday v. Boyd Construction
Company, 418 So. 2d 823 (Miss. 1982). In Doubleday, the Court held that a highway
construction project general contractor that subcontracted a portion of the
construction project and required the subcontractor to secure compensation benefits
for its employees, became a statutory employer entitled to the protection of the
exclusiveness of liability provisions of the MWCA. Id. at 826-27. In so holding, the
Court relied on Miss. Code Ann. § 71-3-7. Id. at 825.3 PPG urges that the same
conclusion holds in this case and that Accu-Fab is immune from liability. PPG
reasons that this is so because Accu-Fab, as a contractor, required Global to
maintain workers’ compensation insurance for employees such as Plaintiff.
3
Miss. Code Ann. §71-3-7 provides “[e]very employer to whom this chapter
applies shall be liable for and shall secure the payment to his employees of the
compensation payable under its provisions. In the case of an employer who is a
subcontractor, the contractor shall be liable for and shall secure the payment of
such compensation to employees of the subcontractor, unless the subcontractor has
secured such payment.”
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However, in order for Accu-Fab to be statutorily immune under this theory,
PPG would have to establish that Accu-Fab was a prime or general contractor
within the meaning of Doubleday and the MWCA. Nash v. Damson Oil Corporation,
480 So. 2d 1095, 1098 (Miss. 1985); Falls v. Mississippi Power & Light Co., 477 So.
2d 254, 258 (Miss. 1985). The Mississippi Supreme Court in Nash clarified that a
defendant could not be considered a statutory employer entitled to immunity simply
because the defendant obligated a subcontractor to procure workers’ compensation
insurance. Rather, the inquiry focuses on whether the defendant “was the kind of
‘contractor’ contemplated by the statute.” Nash, 480 So. 2d at 1098. Thus, it is not
enough for PPG to simply argue that Accu-Fab is immune from tort liability
because it required Global to procure workers’ compensation insurance, or because
Plaintiff alleged in his Complaint the existence of a “contractor and sub-contractor
relationship.” As Nash explained, a defendant can be a contractor in the general
sense of the term without being a contractor within the meaning of the statute. Id
at 1100. The inquiry turns on whether the “interest, use and activities with respect
to the premises are wholly different in nature from those of one ordinarily
considered a general or prime contractor- the sort of contractor . . . contemplated by
Doubleday.” Id. The Court need not resolve this question because it finds Defendant
Quickspray’s alternative argument requires denial of the Motions to Remand.
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2.
Defendants’ Loaned Servant Immunity Argument
Defendant Quickspray argues that Plaintiff was a loaned servant of Accu-Fab
at the time of the injury. Therefore, Plaintiff cannot maintain a common-law
negligence action against Accu-Fab as Plaintiff’s exclusive remedy lies with the
MWCA. In Mississippi, an employee may be employed by more than one employer,
and both employers can be entitled to immunity from common-law tort actions
under the MWCA. Northern Elec. Co. v. Phillips, 660 So. 2d 1278, 1282 (Miss.
1995). This can occur “where a temporary employment agency assigns an employee
to [that] employer and the employee performs the normal work of the second
employer and is controlled and supervised by that employer.” Id. Thus, if the Court
determines that Plaintiff was a “loaned or borrowed employee . . . the only available
remedy against [Accu-Fab] is workers’ compensation and [Plaintiff] would be barred
from bringing a common-law negligence claim against [Accu-Fab].” Id. at 1281.
Application of the loaned servant doctrine in the workers’ compensation
context is guided by three inquiries: “(1) whose work is being performed, (2) who
controls or has the right to control the workman as to the work being performed,
and (3) has the workman voluntarily accepted the special employment.” Quick
Change Oil and Lube, Inc. v. Rogers, 663 So. 2d 585, 589 (Miss. 1995). A review of
the Complaint along with affidavits submitted by Defendants persuades the Court
that Plaintiff was a loaned servant of Accu-Fab, which entitles Accu-Fab to
statutory immunity. First, Plaintiff was performing solely the work of Accu-Fab,
and was working with Accu-Fab tools and materials. Aff. of Bosarge [26-1] at p. 2.
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Second, Accu-Fab production managers and other Accu-Fab personnel controlled
and directed Plaintiff in the work he was performing, and had the right to discharge
Plaintiff based on his work performance. Id. Finally, the pleadings and record
indicate that Plaintiff voluntarily accepted the employment. Plaintiff had been
working at the Accu-Fab facility for a period of five months after assignment there
by Global. Id.; Pl.’s Compl. [1-1] at p. 3.
Plaintiff disputes his status as a loaned servant of Accu-Fab by arguing he
was not performing the “normal work” of Accu-Fab. Plaintiff relies on the allegation
contained in the Complaint that “Plaintiff’s job assignment was not the normal
work of Accu-Fab. Accu-Fab until the time of the Edgen contract, had not used
Tideguard/Amercoat or the Quikspray [sic] pump before. Accu-Fab’s normal
business was the fabricating and manufacture of storage tanks for industrial
purposes.” Pl.’s Compl. [1-1] at p. 6. Defendant has presented evidence to disprove
Plaintiff’s assertion. According to Paul Bosarge, the President of Accu-Fab, “AccuFab operates a versatile fabrication shop with emphasis on structural steel, pipe
and tank fabrication. . . . [P]ipe fabrication and coating is an integral part of AccuFab’s expertise and Accu-Fab’s normal work.” Aff. of Bosarge [26-1] at p. 1-2. On the
day of the injury, Plaintiff was spraying protective coating on pipes. Pl.’s Compl. [11] at p. 3. The fact that Accu-Fab may not have used this particular type of coating
or pump before does not detract from a finding that Plaintiff was engaged in the
normal work of Accu-Fab.
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Because Plaintiff was a loaned servant of Accu-Fab, Accu-Fab is statutorily
immune from Plaintiff’s common-law negligence claims under the MWCA.
Plaintiff’s exclusive remedy against Accu-Fab lies with the MWCA. Therefore,
Plaintiff has no reasonable possibility of recovery against Accu-Fab under state law,
and Accu-Fab was improperly joined to this action. Accu-Fab should be dismissed,
thereby vesting the Court with diversity jurisdiction over this case. The Motions to
Remand should be denied.
III. CONCLUSION
For the foregoing reasons, Plaintiff’s Motion to Remand and Supplemental
Motion to Remand should be denied, and Defendant Accu-Fab should be dismissed
from this action.
IT IS, THEREFORE, ORDERED AND ADJUDGED, that the Motion to
Remand [21] and Supplemental Motion to Remand [23] filed by Plaintiff Edward
Cook are DENIED.
IT IS, FURTHER, ORDERED AND ADJUDGED, that Defendant AccuFab Construction, Inc. is DISMISSED WITH PREJUDICE.
SO ORDERED AND ADJUDGED, this the 15th day of September, 2014.
s/ Halil Suleyman Ozerden
HALIL SULEYMAN OZERDEN
UNITED STATES DISTRICT JUDGE
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