Boyer et al v. Hankook Tire Co., Ltd. et al
Filing
28
ORDER granting 16 Motion to Remand. Signed by District Judge Richard Voorhees on 1/30/2015. (cbb)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF NORTH CAROLINA
STATESVILLE DIVISION
CIVIL DOCKET NO.: 5:14CV165-RLV
MARVIN L. BOYER, SR.; SANDRA T.
BOYER; BENNY R. ELLEDGE;
JOANNA L. ELLEDGE; NORMA J.
HELLARD; BRENDA W. JOLLY;
WANDA A. MARTIN; LARRY D.
MATHENY, as Executor of the Estate of
CLOYCE E. MATHENY, deceased;
EDWARD L. MCLELLAND, JR.,
Individually and as Executor of the Estate
of MARSHA E. MCLELLAND, deceased;
JAMIE D. MORRISON, as Administrator
of the Estate of BARBARA E. MORRISON,
deceased; LISA SMITH CASH, as Executor
of the Estate of BRENDA H. SMITH,
deceased; THOMAS L. SMITH; DORIS
P. SWAIM; STEVEN C. SWAIM; and
BEVERLY M. WRIGHT, individually and
as Executor of the Estate of JOHN W.
WRIGHT, deceased,
Plaintiffs,
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v.
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HANKOOK TIRE CO., LTD.; HANKOOK
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TIRE AMERICA CORPORATION; and
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JOHN B. OSWALT, JR., as Administrator
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of the Estate of RANDOLPH L. MORRISON, )
deceased,
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Defendants.
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__________________________________________)
Memorandum and Order
THIS MATTER comes before the Court upon Plaintiffs’ Motion for Remand, filed
November 10, 2014. (Docs. 16, 17, 20). Defendants oppose Plaintiffs’ motion. (Doc. 19). This
matter is fully briefed and ripe for disposition by the Court.
I.
Nature of Case
On October 2, 2013, Plaintiffs and Plaintiffs’ decedents (“Plaintiffs”), a senior adult
group from Front Street Baptist Church (“Front Street Baptist”) in Statesville, North Carolina,
were traveling home from Gatlinburg, Tennessee, towards Statesville, on I-40 East in a 1997
Metrotrans Europa transit passenger bus owned by Front Street Baptist (“church bus”). (Doc. 1 /
Exh. A – Compl. ¶ 1). The church group was returning from a Jubilee in Gatlinburg, Tennessee,
a national worship event for senior adult church groups. Id. During the return trip, at
approximately 2:00 p.m., the church bus experienced difficulty with the left front tire, resulting
in a tragic multi-vehicle accident. Id., ¶ 30. According to Plaintiffs, the front left tire of the
church bus sustained a “sudden, catastrophic, and complete tread / belt separation.” Id., ¶ 1. The
tire was a Hankook AH12 Radial 255/70R22.5 that bore DOT No. 5M54NEH1508 (the “subject
tire”). Id., ¶ 29. After the tire failed, the bus veered left across the median of I-40 and proceeded
through a steel cable barrier into oncoming westbound traffic. Id., ¶ 1. The church bus collided
with a Chevrolet Tahoe and a tractor-trailer. Id. Eight people were killed and fourteen seriously
injured. Id.
On September 3, 2014, Plaintiffs commenced litigation in the North Carolina General
Court of Justice, Superior Court of Iredell County. (State Court Civil No: 14CVS01873).
Plaintiffs brought suit against Defendants Hankook Tire Company, Ltd. (“Hankook Ltd.”),
Hankook Tire America Corp. (“Hankook America”) (collectively, “Hankook”), and Defendant
John B. Ostwalt, Jr. (“Ostwalt”), as Administrator of the Estate of Randolph L. Morrison,
deceased (“R. Morrison Estate”). (Compl.).
Defendant Hankook Ltd., the parent entity of Hankook America, is a corporation
organized and existing under the laws of the Republic of Korea, with its principal place of
2
business in Seoul, Republic of Korea. (Compl., ¶¶ 18, 63; Doc. 2, ¶ 2; Doc. 3 / Hankook Ltd.
Answer, ¶ 4). Hankook America is a corporation organized and existing under the laws of the
State of New Jersey. (Compl., ¶ 20; Hankook America Answer, ¶ 7). Hankook Ltd. is engaged
in the design and manufacture of tires. (Doc. 3 / Hankook America Answer, ¶ 19).
In the Complaint, Plaintiffs claim Hankook was negligent in both its design and in
manufacturing the Hankook AH12 Radial 255/70R22.5.1 (Compl. ¶¶ 50, 51, 56−68). Plaintiffs
also claim that Hankook failed to warn of known defects and unreasonably dangerous conditions
in the subject tire. (Compl. ¶¶ 52−53, 59, 69−73). Plaintiffs seek actual and punitive damages
from Hankook. (Compl., ¶¶ 74−82, Prayer for Relief, ¶ 5).
In addition to the Hankook Defendants, Plaintiffs bring their action against the R.
Morrison Estate, a nondiverse North Carolina defendant.2 The late Randolph L. Morrison (“Mr.
Morrison”) was driving the church bus at the time of the fatal accident. (Compl. ¶ 1). Mr.
Morrison, a diesel mechanic by trade, was delegated one of two drivers of the church bus and
voluntarily “maintained and drove the church bus as his service” to Front Street Baptist. (Compl.
¶ 1; Crossclaim, ¶ 1). Plaintiffs’ Complaint asserts negligence by Mr. Morrison as a potential
concurrent cause of the crash.3 (Compl. ¶¶ 83 88). Specifically, Plaintiffs allege that, “[t]o the
extent Randy Morrison is found to have acted negligently in operating the church bus or in
maintaining the church bus in a safe condition, his actions in conjunction with the acts and
The subject tire was manufactured at Hankook’s Geumsan Plant in the Republic of Korea
during the fifteenth week of 2008. (Compl., ¶¶ 1, 50). Front Street Baptist purchased the subject tire new
on or about September 8, 2008. Id., ¶ 29.
1
2
It is undisputed that the R. Morrison Estate is a nondiverse defendant of legal residence in
North Carolina and that, on its face, Plaintiffs’ inclusion of the R. Morrison Estate precludes removal. See
28 U.S.C. § 1446(b)(2) (prohibiting removal “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”).
The estate of Mr. Morrison’s deceased wife is a named plaintiff: Plaintiff Jamie D. Morrison,
as Administrator of the Estate of Barbara E. Morrison, deceased.
3
3
omissions of the [Hankook] Defendants proximately caused Plaintiffs’ and the decedents’
injuries and deaths.” (Compl., ¶ 87). Plaintiffs allege that Hankook and the R. Morrison Estate
are jointly and severally liable. (Id., ¶ 88).
On October 10, 2014, the Hankook Defendants filed a Notice of Removal asserting
fraudulent joinder. (Doc. 1). The Hankook Defendants argue, as a matter of law, that the Court
can glean from the pleadings that Plaintiffs named the R. Morrison Estate as a party solely to
defeat diversity jurisdiction − that Plaintiffs do not in reality intend to seek a joint judgment
against the R. Morrison Estate and Hankook.
On November 3, 2014, Ostwalt, as Administrator and on behalf of the R. Morrison
Estate, filed an Answer to the Complaint. (Doc. 12). Ostwalt denies that Mr. Morrison was
negligent in any way and asserts numerous defenses to the Complaint, including the affirmative
defenses of Sudden Emergency and Unavoidable Accident. (R. Morrison Estate Answer, Fifth
Defense, 19). Alternatively, Ostwalt claims that any negligent acts of Mr. Morrison were
“passive and secondary in nature” and therefore insulated by other “superseding, intervening and
primary or active negligent acts of others.” (R. Morrison Estate Answer, Sixth Defense, 19).
Ostwalt did not join in removal and asserts that this federal court lacks subject matter
jurisdiction. (R. Morrison Estate Answer, Seventh Defense, 20).
On November 10, 2014, Plaintiffs filed the instant Motion for Remand. (Doc. 16).
Plaintiffs deny that the decision to name the R. Morrison Estate as a Defendant is an effort to
defeat diversity jurisdiction and contend that they sought to sue all potentially responsible parties
so that the jury could have all of the evidence before it in determining liability. Plaintiffs
contend that the negligence claim against the R. Morrison Estate is an alternative theory of
4
liability and permitted under North Carolina law. 4
On November 17, 2014, Hankook America filed an Answer to the Verified Complaint
asserting thirty three (33) defenses.5 (Doc. 3). Notably, Hankook America’s defenses
contemplate negligence by other parties and / or non-parties, failure to maintain the subject tire
in a safe condition, failure to exercise reasonable care, driver error, intervening and superseding
causes, and proportional and comparative negligence as possible bases for reducing any damages
award against Hankook. Id.
On November 25, 2014, Hankook America filed a Memorandum in Opposition to
4
As a procedural matter, North Carolina law allows plaintiffs to plead alternative theories of
liability as well as joint liability. See N.C. GEN. STAT. § 1A-1, Rule 8(a)(2) (“Relief in the alternative or
of several different types may be demanded.”)
5
In its Answer, Hankook America asserts the following defenses: failure to state a claim (First),
venue and jurisdiction are or may be inconvenient or improper (Second), failure to join an indispensable
party (Third), no breach of duty owed to Plaintiffs (Fourth), that if deemed negligent, recovery should be
reduced proportionally in accordance with the negligence of Plaintiffs and any other negligent party or
non-party (Fifth), all statutory and other limitations on damages (Sixth), that damages and injuries were
caused in full or in part by the misuse, improper use, improper maintenance, improper repair, abnormal
use, misapplication, abuse, alteration, modification, or other failure to maintain the vehicle or the tire in a
safe condition and the failure to exercise reasonable care (Seventh), reserves the right to assert negligence
by other persons or companies (Eighth), improper use or use inconsistent with warnings or instructions
(Ninth), that the tire was not in substantially the same condition as when it was manufactured (Tenth),
assumption of risk (Eleventh), failure to mitigate damages (Twelfth), the doctrine of comparative fault
(Thirteenth), that Defendant was unaware of any danger related to its product and that the discovery of
such danger was beyond the state of the art at the time of sale (Fourteenth), subject matter is preempted
by the National Traffic and Motor Vehicle Safety Act (Fifteenth), the doctrine of primary jurisdiction
(Sixteenth), the right to supplement its Answer after discovery (Seventeenth), statute of limitations and
statutes of repose (Eighteenth), set-off (Nineteenth), multi-faceted challenge to claim for punitive
damages including that a non-bifurcated trial would violate Defendant’s due process rights and failure to
plead punitive damages with particularity (Twentieth), fraudulent joinder of the Morrison Estate (TwentyFirst), if tire was defective or in dangerous condition, Plaintiffs knew of defect and dangerous condition
and unreasonably and voluntarily exposed themselves to danger (Twenty-Second), tire was not defective
or unreasonably dangerous at the time it left Defendant’s control (Twenty-Third), intervening / insulating
negligence (Twenty-Fourth), the sole negligence of third parties (Twenty-Fifth), and that any recovery
should be decreased for failure to wear seatbelt (Twenty-Sixth). (Hankook America Answer, 15−22).
Hankook America also invoked provisions of the Tennessee Products Liability Acts of 1978, TENN. CODE
ANN. § 29-28-101 et seq. (Twenty-Seventh, Twenty-Ninth thru Thirty-Second), and the Tennessee
Consumer Protection Act of 1977, TENN. CODE ANN. § 47-18-101 et seq. (Twenty-Eighth, Thirty-Third).
(Id., 22−23).
5
Plaintiffs’ Motion for Remand. (Doc. 19). Hankook Ltd. joined in opposition. (Doc. 19, 2 n. 1).
The same day, Hankook Ltd. filed a Notice of Consent to Removal expressly reserving
all defenses including those found within Rule 12(b).6 (Doc. 18).
On December 5, 2014, Hankook Ltd. filed an Answer asserting the same defenses as
those raised in the Hankook America Answer. (Doc. 20).
On December 19, 2014, a Crossclaim was filed by Ostwalt on behalf of the R. Morrison
Estate against the Hankook Defendants pursuant to Rule 13(g) of both the Federal Rules of Civil
Procedure and North Carolina Rules of Civil Procedure. (Doc. 24). Ostwalt alleges that
Hankook was negligent and breached its duty to Mr. Morrison to exercise reasonable care to
“design, test, manufacture, inspect, and distribute” its Hankook AH12 Radial 255/7OR22.5 tire
bearing DOT No. 5M54NEH1508. (Crossclaim, Count One, ¶¶ 1− 10). Ostwalt further alleges
that Hankook failed to warn Mr. Morrison about “known defects and unreasonably dangerous
conditions in the subject tire.” (Crossclaim, Count Two, ¶¶ 1−14). Ostwalt seeks to recover
actual and punitive damages against the Hankook Defendants. (Crossclaim, Count Three, ¶¶
1−21).
Defendants answered the Crossclaim on January 7, 2015 with thirty one defenses. (Docs.
26, 27). Defendants’ Answers are virtually identical to their respective Answers to Plaintiffs’
Verified Complaint. With respect to the Morrison Estate specifically, Defendants assert that
6
In actions with multiple defendants, 28 U.S.C. §§ 1441 and 1446 require that all defendants join
in or consent to the notice of removal. See McKinney v. Bd. of Trustees of Mayland Community College,
955 F.2d 924, 925 (4th Cir. 1992). Hankook Ltd. was served November 18, 2014 consistent with the
Hague Convention. The Notice of Consent to Removal filed by Hankook Ltd., is timely since consent
was provided within thirty days of service. See Barbour v. Int’l Union, 640 F.3d 599, 607-11 (4th Cir.
2011) (affirming the “McKinney intermediate rule,” which requires a notice of removal to be filed within
the first-served defendant’s 30-day window, but gives later-served defendants 30 days from the date they
were served to join the notice of removal). The fact that Ostwalt did not consent to removal is immaterial
in light of Defendants’ argument that the R. Morrison Estate is fraudulently joined. (Doc. 19, 17).
6
Hankook owed no duty of care to Mr. Morrison and did not breach any duty (Fifth), that the
alleged damages “may have been a direct and proximate result of [Mr.] Morrison’s own
negligence, recklessness or gross negligence” such that the Crossclaim is barred by the doctrine
of comparative negligence (Sixth), that the damages and injuries complained of “may have been
caused in full or in part by the misuse, improper use, improper maintenance, improper repair,
abnormal use, misapplication, abuse, alteration, modification, or other failure to maintain the
vehicle or the tire, or each of them in a safe condition and the failure to exercise reasonable care
under the circumstances in the use or maintenance of the vehicle or the tire, or each of them, by
Morrison or non-parties” (Eighth), improper use or use inconsistent with warnings and
instructions (Tenth), Mr. Morrison’s damages were caused in whole or in part by his failure to
exercise reasonable care and diligence to mitigate damages (Thirteenth), that the “intervening /
insulating negligence” of other parties proximately caused the accident (Twenty-First), and that
Mr. Morrison’s failure to wear a safety belt was the sole proximate cause of, or at least
exacerbated, his injuries (Twenty-Second). (Hankook Defendants’ Answers to Crossclaim,
6−14).
The question presented by Plaintiffs’ Motion for Remand is whether, despite the absence
of complete diversity on the face of the Complaint, 28 U.S.C. § 1332(a), subject matter
jurisdiction may be found to exist in this federal court under the doctrine of fraudulent joinder.
II.
Standard
“Federal courts are courts of limited jurisdiction. They possess only that power
authorized by Constitution and statute.” Kokkonen v. Guardian Life Ins. Co. of America, 511
U.S. 375, 377 (1994). Given this principle, courts must strictly construe removal jurisdiction and
resolve all doubts in favor of remand. See Strawn v. AT&T Mobility LLC, 530 F.3d 293, 297
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(4th Cir. 2008); Mulcahey v. Columbia Organic Chems. Co., Inc., 29 F.3d 148, 151 (4th Cir.
1994). Remand is proper if the complaint “fails to allege facts upon which subject matter
jurisdiction can be based,” or “if the jurisdictional allegations in the complaint [are] not true.”
Kerns v. United States, 585 F.3d 187, 192 (4th Cir. 2009) (quoting Adams v. Bain, 697 F.2d
1213, 1219 (4th Cir. 1982)); see also St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283,
291−93 (1938); B, Inc. v. Miller Brewing Co., 663 F.2d 545, 549 (5th Cir. 1981) (“[T]he
propriety of removal depends on “the facts asserted by the plaintiff as the basis for the liability of
the resident defendant.”)
“A civil case commenced in state court may, as a general matter, be removed by the
defendant to federal district court, if the case could have been brought there originally.” Martin
v. Franklin Capital Corp., 546 U.S. 132, 134 (2005) (citing 28 U.S.C. § 1441). A U. S. District
Court has “original jurisdiction of all civil actions where the matter in controversy exceeds the
sum or value of $75,000, exclusive of interests and costs, and is between — (1) citizens of
different States; (2) citizens of a State and citizens or subjects of a foreign state; (3) citizens of
different States and in which citizens or subjects of a foreign state are additional parties; and (4)
a foreign state, defined in section 1603(a) of this title, as plaintiff and citizens of a State or of
different States.” 28 U.S.C. § 1332. This section requires complete diversity between all parties.
Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 2 L.Ed. 435 (1806). Moreover, in cases in which
the district court’s jurisdiction is based on diversity of citizenship, the privilege of removal is
further limited in that a federal court may exercise jurisdiction only if no defendant is a citizen of
the state where the action has been initiated. See Caterpillar Inc. v. Lewis, 519 U.S. 61, 68–69
(1996).
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III.
Discussion
A. Fraudulent Joinder As An Exception To Complete Diversity
Despite the absence of complete diversity, the doctrine of fraudulent joinder permits
removal of an action from state court to federal court by allowing a district court “to disregard
the citizenship of [a] nondiverse defendant[] and assume jurisdiction.”7 See Barlow v. Colgate
Palmolive Co., 772 F.3d 1001, 1004, n. 2 (4th Cir. 2014) (en banc) (internal citation omitted);
Mayes v. Rapoport, 198 F.3d 457, 261 (4th Cir. 1999). In essence, the doctrine provides that a
defendant’s “right of removal cannot be defeated by a fraudulent joinder of a resident defendant
having no real connection with the controversy. . . .” Wilson v. Republic Iron & Steel Co., 257
U.S. 92, 97 98 (1921) (emphasis added) (internal citations omitted). “If in such a case a resident
defendant is joined, the joinder, although fair upon its face, may be shown by a petition for
removal to be only a sham or fraudulent device to prevent a removal . . . .” Wilson, 257 U.S. at
98 (emphasis added). Within the Fourth Circuit,
“[T]o establish that a nondiverse defendant has been fraudulently joined, the
removing party must establish either:
[A] [T]hat there is no possibility that the plaintiff would be able to
establish a cause of action against the in-state defendant in state court; or
[B] [T]hat there has been outright fraud in the plaintiff’s pleading of
jurisdictional facts.”
Barlow, 772 F.3d at 1004, n. 2; see also Hartley v. CSX Transp., Inc., 187 F.3d 422, 424 (4th
Cir. 1999) (citing Marshall v. Manville Sales Corp., 6 F.3d 229, 232 (4th Cir.1993)).
Defendants must show that Plaintiffs “cannot establish a claim against the nondiverse defendant
even after resolving all issues of fact and law in the plaintiff[s’] favor.” Mayes, 198 F.3d at 464
7
The “fraudulent joinder” term is misleading in that the judicially created doctrine does not
actually require a showing of fraud. See Mayes v. Rapoport, 198 F.3d 457, 261 n. 8 (4th Cir. 1999)
(internal citation omitted). Similarly, the doctrine does not require joinder and is “potentially applicable
to each defendant named by the plaintiff either in the original complaint or anytime prior to removal.” Id.
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and 465 (citing Marshall, 6 F.3d at 232−33). The Defendants’ burden is heavy as the fraudulent
joinder test has been described as more favorable to the Plaintiff than the Rule 12(b)(6) motion
to dismiss standard. See Mayes, 198 F.3d at 464 (quoting Hartley, 187 F.3d at 424) (emphasis
added).
In addition, when examining the viability of a claim, the court is “not bound by the
allegations of the pleadings, but may instead consider the entire record, and determine the basis
of joinder by any means available.” AIDS Counseling & Testing Ctrs. v. Group W Tel., Inc., 903
F.2d 1000, 1004 (4th Cir. 1990); see generally, Richmond, Fredricksburg & Potomac R.R. Co. v.
United States, 945 F.2d 765, 768−69 (4th Cir. 1991) (scope of court’s jurisdictional inquiry). In
disputes over whether removal was proper, however, the Fourth Circuit has cautioned that “a
jurisdictional inquiry is not the appropriate stage of litigation to resolve . . . various uncertain
questions of law and fact . . . [C]ourts should minimize threshold litigation over jurisdiction.”
Hartley, 187 F. 3d at 426. Put another way,
Jurisdictional rules direct judicial traffic. They function to steer litigation to
the proper forum with a minimum of preliminary fuss. The best way to
advance this objective is to accept the parties joined on the face of the
complaint unless joinder is clearly improper. To permit extensive litigation on
the merits of a case while determining jurisdiction thwarts the purpose of
jurisdictional rules.
Hartley, 187 F. 3d at 426 (“The district court erred by delving too far into the merits in deciding
a jurisdictional question.”).
1. Defendants Do Not Allege “Outright Fraud” Or Falsity In Plaintiffs’ Pleading
Of Jurisdictional Facts
Hankook does not allege “outright fraud” by Plaintiffs. Likewise, Hankook does not
contend that the jurisdictional facts alleged are untrue. In fact, there is no disagreement about the
citizenship of the R.Morrison Estate. Mr. Morrison was a citizen of North Carolina. (Compl.,¶
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22). The legal representative of Mr. Morrison’s Estate, Mr. Ostwalt, is, by statute, deemed a
citizen of the same State as the decedent. See 28 U.S.C. § 1332(c)(2) (“the legal representative
of the estate of a decedent shall be deemed to be a citizen only of the same State as the decedent.
. . .”). Unless the R. Morrison Estate is dismissed as a “sham” Defendant with “no real
connection” to this controversy, complete diversity does not exist and remand is required.
2. Defendants Fail To Show “No Possibility” That Plaintiffs Could Establish A
Cause of Action Against The R. Morrison Estate In State Court
Under Fourth Circuit precedent, if Hankook does not negate all possibility of Plaintiffs’
recovery against the R. Morrison Estate, remand is appropriate. See Hartley, 187 F.3d at 425;
Walters v. Holiday Motor Corp., 2012 WL 5465012, * 1 (W.D.Va. May 21, 2012); Geller, 2011
WL 1239835, * 4. The critical inquiry is whether Defendants satisfy the heavy burden to show
that Plaintiffs’ negligence allegations against the R. Morrison Estate do not raise a “slight
possibility of a right to relief” or a “glimmer of hope” that the claim could succeed. Id. at 426
(dicta); Geller, 2011 WL 1239835, * 4.
In determining whether Plaintiffs’ negligence claim against the R. Morrison Estate is
viable under state law, the Court looks to the common law in both North Carolina and
Tennessee.8 See Geller v. Provident Life and Accident Ins. Co., 2011 WL 1239835, * 4
8
With respect to choice of law, the record does not make clear whether the accident occurred on
a section of I-40 found within the State of North Carolina or the State of Tennessee. Plaintiffs assert that
North Carolina law applies, which suggests that the accident occurred in North Carolina. (Compl., ¶ 26).
The North Carolina courts “consistently adhere[] to the lex loci rule in tort actions.” Boudreau v.
Baughman, 368 S.E.2d 849, 853−54 (N.C. 1988) (internal citations omitted). In other words, “matters
affecting the substantial rights of the parties are determined by . . . the law of the situs of the claim . . . .”
Boudreau, 368 S.E.2d at 854 (internal citation omitted). For actions sounding in tort, the state where the
injury occurred is considered the situs of the claim.” Id. On the other hand, Hankook’s memorandum of
law in opposition to remand asserts that the accident occurred in Tennessee, (Doc. 19, 4), and certain of
the Hankook defenses cite Tennessee law. Contemporaneous news accounts of the crash of the church
bus, however, uniformly identify its location as having occurred in Jefferson County, Tennessee. See e.g.,
http://myfox8.com/2013/10/02/nc-church-bus-involved-in-crash-in-tenn-multiple-fatalities-reported,
October 2, 2013; http://www.wbtv.com/story/23592786/at-least-six-dead-in-fatal-bus-crash-carrying-
11
(W.D.N.C. March 30, 2011) (citing Bettius v. Sanderson, P.C. v. Nat’l Union fire Ins. Co. of
Pittsburgh, Pa., 839 F.2d 1009, 1019 (4th Cir. 1988) (“When hearing a case pursuant to diversity
jurisdiction, a federal court must determine issues of state law as it believes the highest court in
the state would determine them.”)); see also Trustees of Hackberry Baptist Church v. Womack,
2014 WL 5332714, * 4 (W.D.Va. October 20, 2014) (state pleading requirements control
motions to remand).
Defendants argue that Plaintiffs clearly seek to avoid removal to federal court in that they
“stop[] short of asserting any wrongdoing by the local defendant.” (Doc. 19, 3). In an attempt
to show that Plaintiffs’ factual allegations are deficient, Hankook faults Plaintiffs for failing to
allege within the Complaint that Mr. Morrison breached his duty of care − an essential element
of any negligence action. (Doc. 19, 3) (citing Complaint, ¶¶ 84, 85). Under North Carolina law:
In order to establish actionable negligence, plaintiff must show (1) that
there has been a failure to exercise proper care in the performance of some legal
duty which defendant owed to plaintiff under the circumstances in which they
were placed; and (2) that such negligent breach of duty was a proximate cause of
the injury.
***
Proximate cause is a cause which in natural and continuous sequence,
unbroken by any new and independent cause, produced the plaintiff[s’] injuries,
and without which the injuries would not have occurred, and one from which a
person of ordinary prudence could have reasonably foreseen that such a result, or
consequences of a generally injurious nature, was probable under all the facts as
they existed. Foreseeability is thus a requisite of proximate cause, which is, in
turn, a requisite for actionable negligence.
***
There may be more than one proximate cause of an injury. When two or
more proximate causes join and concur in producing the result complained of, the
author of each cause may be held for the injuries inflicted. The defendants are
jointly and severally liable.
church-group-from-Statesville, October 2, 2013. The crash occasioned widespread media coverage, and
there seems to be no doubt as to the state – Tennessee − in which it occurred.
12
Hairston v. Alexander Tank and Equipment Co., 311 S.E.2d 559, 565 (N.C. 1984) (internal
citations and quotation marks omitted). The elements of a common law negligence claim in
Tennessee are not substantively different.9
In this case, Plaintiffs’ Verified Complaint alleges that Mr. Morrison “owed a duty of
care to operate the church bus in a safe and prudent manner” and also “undertook a duty to
maintain the church bus in a safe condition on behalf of Front Street Baptist Church.” (Compl.,
¶¶ 84, 85). Plaintiffs then suggest the possibility that Mr. Morrison failed to exercise ordinary
care in the operation and / or maintenance of the church bus.10 (Compl., ¶ 87) (“To the extent
Randy Morrison is found to have acted negligently . . . .”). Resolving all issues of fact and law
in Plaintiffs’ favor, Mayes, 198 F.3d at 464, the Court finds that the R. Morrison Estate is not
fraudulently joined. Mr. Morrison spent his career working on large commercial vehicles and
gratuitously assumed at least partial responsibility for the maintenance of the church bus. By all
accounts, the subject tire was some five or six years old. That the driver of the church bus, who
is also at least in part the individual tasked with maintenance of the bus, owed a duty of care to
the passengers cannot be denied. Nonetheless, the underlying factual issues have yet to be
fleshed out and the undersigned need not prescribe the legal framework under state law for
Under Tennessee law, the elements of a cause of action for common-law negligence are: “(1) a
duty of care owed by the defendant to the plaintiff; (2) conduct by the defendant falling below the
standard of care amounting to a breach of that duty; (3) an injury or loss; (4) causation in fact; and (5)
proximate or legal cause.” Satterfield v. Breeding Insulation Co., 266 S.W.3d 347, 355 (Tenn. 2008).
Similarly, “[a]n injury that is the natural and probable consequence of an act of negligence is actionable,
and such an act is the proximate cause of the injury. But an injury which could not have been foreseen or
reasonably anticipated as the probable result of an act of negligence is not actionable and such an act is
either the remote cause, or no cause whatever, of the injury.” Doe v. Linder Constr. Co., Inc., 845 S.W.2d
173, 181 (Tenn. 1992).
9
10
Plaintiffs request leave to amend the Verified Complaint in the event the Court has concern
about the sufficiency of the factual allegations against the R. Morrison Estate. (Doc. 21). Applying
Fourth Circuit precedent, and in light of the Court’s analysis, amendment of the pleadings is not before
this federal district court as the legal question presented is purely jurisdictional.
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analyzing concurrent causes, insulating negligence, or the other defenses and counterclaims
asserted by the parties. In short, the Hankook Defendants seem to misconstrue the legal
standard. The undersigned is not tasked with testing the sufficiency of Plaintiffs’ Verified
Complaint. See Hartley, 187 F.3d at 426. Likewise, whether Plaintiffs are ultimately successful
against Hankook, the R. Morrison Estate, or both, is not the question. Id. As such, the
Complaint’s omission of the term “breach” is not determinative of the fraudulent joinder issue.
Hartley, 187 F.3d at 424−26; see also Walters v. Holiday Motor Corp., 2012 WL 5465012, * 1
(W.D.Va. May 21, 2012) (question of whether a cause of action exists against a non-diverse
party is a state law issue to be decided by a state court).
As further evidence that the R. Morrison Estate is fraudulently joined, Hankook points to
the relationship between the parties, namely, Mr. Morrison’s prior connection to Plaintiffs.
Defendants rely on Smalls v. Great American Lines, Inc., in which the District of South Carolina
denied plaintiff’s motion to remand and retained federal jurisdiction on fraudulent joinder
grounds. 2011 WL 3490007 (D.S.C. August 9, 2011). Smalls is easily distinguishable from the
instant facts. In Smalls, plaintiff, an independent contractor working with nondiverse defendant,
Joe Smalls Boyz, LLC (“JSB”), sustained injuries as heavy equipment was loaded onto a wooden
trailer by a crane. Id., * 2. Plaintiff brought suit in state court alleging negligence and gross
negligence against the entity that provided the trailer to JSB for the job, the company that the
crane operator worked for, JSB, and multiple unidentifiable parties. Id. Defendants removed the
case to federal court alleging fraudulent joinder of JSB, a limited liability company owned by
plaintiff’s wife, Tiffany Smalls. Id. The removing defendants persuasively argued that Plaintiff
had no intention of seeking a joint judgment against the nondiverse entity owned by his wife and
operating out of his own home; that Plaintiff would “have to establish his own negligence” and
14
threaten the family’s livelihood (Plaintiff’s household income) in order to obtain a joint
judgment. Id.,* 3. Judge Norton explained that these facts tended to show that JSB was a
“sham” defendant in that Plaintiff had “no real intention to get a joint judgment.” 11 Id.,* 4
(quoting AIDS Counseling, 903 F.2d at 1003). As for the “no possibility” standard, the Court
noted that there were no specific factual allegations in the complaint setting forth any theory of
negligence or gross negligence against the nondiverse defendant, JSB. Id.,* 4. Instead, the
complaint only asserted general allegations attributable to the entire group of defendants. Id.,* 1.
Judge Norton found that, given the facts as alleged in the original complaint, Plaintiff was unable
to establish a cause of action against JSB in state court. Id.,* 4 (seemingly applying the Rule
12(b)(6) standard for testing sufficiency of the allegations in the complaint). Plaintiff’s motion
to remand was denied. Id., * 5.
Here, Defendants are not able to show that the R. Morrison Estate is a mere sham
defendant. As discussed, supra, Plaintiffs’ allegations concerning the R. Morrison Estate, which
is represented by counsel in this lawsuit, are consistent with North Carolina law and contemplate
joint and several liability.12 The R. Morrison Estate is represented by legal counsel and has
11
The Smalls facts raised lots of questions about the legitimacy of the action against JSB.
Plaintiff submitted an affidavit claiming that he was “solely the driver of the company established and
operated by Tiffany Smalls.” Id., * 2. Plaintiff represented to the court that he knew little about JSB or
the relationship between him and his wife, the purported sole member of JSB. Id.,* 4. Plaintiff’s wife
was listed with the South Carolina Secretary of State as the registered agent for JSB. Id., * 4. JSB’s
business address was Plaintiff’s home address. Id., ** 2, 4. In addition, JSB had not been served until a
month prior to the motion hearing and had failed to respond, yet Plaintiff had not taken any steps towards
securing default judgment against JSB. Id.,* 4.
12
Plaintiffs proffer a copy of a Complaint brought by different counsel on behalf of the Trent
Roberts Estate commencing a related lawsuit. (Doc. 21 / Exh. A – Bobby Roberts, as Administrator of the
Estate of Trent Roberts v. Hankook Tire Co., Ltd.; Hankook Tire America Corp.; General Motors LLC;
and John B. Ostwalt, Jr., as Personal Representative of the Estate of Randolph L. Morrison, No. 14-CV02106, Superior Court of Iredell County). The Roberts Estate action was also filed in the Superior Court
of Iredell County and names both the Hankook Defendants, the R. Morrison Estate, and General Motors.
The Estate’s decedent, Trent Roberts, was a passenger in the GM Tahoe with which the church bus
collided after crossing the median of I-40 and was ejected from his vehicle despite wearing the seatbelt
15
responded to the Verified Complaint with its own Crossclaim against the Hankook Defendants.
Plaintiffs further represent that, as a driver of the bus belonging to Front Street Baptist, Mr.
Morrison was covered by the church’s substantial insurance policy which “provides millions of
dollars of insurance coverage to Mr. Morrison’s Estate.” (Doc. 17 / Exh. B – Declarations Page
for Front Street Baptist, 12 n. 10). Significantly, Hankook’s fraudulent joinder position is
undermined by the fact that the Hankook Defendants, like Plaintiffs, assert that Mr. Morrison’s
negligence could be deemed a possible proximate cause, maybe the sole cause, of the wreck.
Finally, Defendant Hankook contends that there is a risk of local prejudice to the
removing defendants if this lawsuit is litigated in the state court. Hankook points to the fact that
all of the Plaintiffs are North Carolina residents (most are residents of the City of Statesville),
that Front Street Baptist is located within the North Carolina General Court of Justice, Superior
Court of Iredell County, and that the media coverage surrounding the accident was extensive.
(Doc. 19, 5). However, Hankook’s asserted statutory “right to removal” is not aided by the risk
of local prejudice where original jurisdiction in the federal court does not exist. See 28 U.S.C. §
1441(a).
IV.
Order
IT IS, THEREFORE, ORDERED that Plaintiffs’ Motion for Remand is hereby
GRANTED.
restraint. (Roberts Estate Compl., ¶¶ 16, 21). The Roberts Estate, like Plaintiffs here, allege that Mr.
Morrison may be shown to have been negligent in the operation or maintenance of the church bus which
would render the Morrison Estate jointly and severally liable. (Roberts Estate Complaint, ¶¶ 87−92).
16
Signed: January 30, 2015
17
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