Jones v. Old Dominion Freight Line, Inc. et al
Filing
24
OPINION and ORDER adopting 21 the Report and Recommendation; granting 7 Plaintiff's Motion to Remand, but Plaintiff's request for attorney's fees is DENIED; denying as moot 4 Defendants' Motion to Dismiss for Failure to State a Claim. Signed by Judge Michael H. Watson on 9/28/18. (jk)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
Richard Jones,
Plaintiff,
v.
Case No. 2:17-cv-1127
Old Dominion Freight Line, Inc., et al.,
Defendants.
Judge Michael H. Watson
Magistrate Judge Jolson
OPINION AND ORDER
Richard Jones (“Plaintiff”), a truck driver, filed this suit in the Franklin
County Court of Common Pleas against his former employer, Old Dominion
Freight Line, Inc. (“Old Dominion”) and his former terminal manager, John
Zielinski (“Zielinski”) 1 (collectively “Defendants”). Compl. 1, ECF No. 3.
Defendants removed the case to this Court on December 21, 2017,
asserting diversity jurisdiction under 28 U.S.C. § 1332. ECF No. 1. Defendants
asserted that Old Dominion is a corporation organized under the laws of Virginia
with a principal place of business in North Carolina. Id. ¶ 6. Defendants
conceded that Zielinski is a citizen of Ohio but claimed that he was fraudulently
joined because Plaintiff had “no reasonable cause of action” against Zielinski. Id.
¶ 7.
1
Plaintiff incorrectly spelled Zielinski as “Zlinski” in the Complaint, but the Court will use
the correct spelling throughout this Opinion and Order.
The following week, Defendants moved to dismiss all claims against
Zielinski pursuant to Federal Rule of Civil Procedure 12(b)(6). ECF No. 4.
Shortly thereafter, Plaintiff filed an Amended Complaint that bolstered the
allegations against Zielinski. ECF No. 6. Plaintiff also filed a motion to remand
based on a lack of subject matter jurisdiction. ECF No. 7.
On April 3, 2018, Magistrate Judge Jolson issued a Report and
Recommendation and Order (“R&R”), ECF No. 21, recommending that Plaintiff’s
motion to remand be granted and denying Plaintiff’s request for attorney’s fees.2
Specifically, Magistrate Judge Jolson found that Zielinski was not fraudulently
joined but also concluded that Defendants had an objectively reasonable basis
for removal; therefore, attorney’s fees were denied. R&R 8, ECF No. 21.
Magistrate Judge Jolson issued the R&R pursuant to Federal Rule of Civil
Procedure 72(b). Under that rule, the Undersigned must conduct a de novo
review of any part of the Magistrate Judge’s recommendation on a “matter
dispositive of a claim or defense” that has received proper objections. Fed. R.
Civ. P. 72(b)(3). The Undersigned may accept, reject, or modify the R&R,
receive further evidence, or return the matter to the Magistrate Judge with
instructions. Id. With respect to any non-dispositive matter, the Undersigned
2
The R&R also denied Plaintiff’s motion to conduct limited jurisdictional discovery, but
that order is not relevant to Plaintiff’s objection.
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must consider timely objections and modify or set aside any part of the order that
is clearly erroneous or contrary to law. Fed. R. Civ. P. 72(a).3
Despite receiving an unfavorable ruling on the motion to remand,
Defendants did not object to the R&R. However, Plaintiff timely objected to four
specific portions of the R&R: 1) the denial of attorney’s fees; 2) the decision to
not allow Plaintiff to file a reply memorandum in support of the motion to remand;
3) the denial of Plaintiff’s motion for jurisdictional discovery; and 4) the decision
to not consider the First Amended Complaint when ruling on the motion to
remand. See generally, ECF No. 22. The latter two objections were raised in the
event that Defendants objected to the R&R; therefore, because Defendants did
not object, the Court will not address them. See id. at 15–16.
A. Plaintiff’s Lack of Reply
The Court begins by briefly addressing Plaintiff’s second objection—that
Magistrate Judge Jolson erred by deciding the motion to remand before Plaintiff
filed a reply. Magistrate Judge Jolson addressed this issue in her R&R in a
footnote, stating that “[a]lthough Plaintiff did not have an opportunity to file a
3
Plaintiff assumes throughout his objection that Magistrate Judge Jolson’s ruling with
respect to attorney’s fees was dispositive and therefore subject to de novo review.
Defendants do not reference the appropriate standard of review. The Court is not
convinced that the denial of attorney’s fees was a recommendation on a matter
dispositive of a claim or defense, particularly given the language used in the R&R which
“recommended that Plaintiff’s Motion to Remand be granted,” but stated that the request
for attorney’s fees was denied without phrasing it as a recommendation. R&R 1, ECF
No. 21 (emphasis removed). Nevertheless, because the parties do not brief the issue
and it does not change the Court’s decision, this opinion will assume de novo review is
appropriate.
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Reply to the Motion to Remand, because the Court’s recommendation is in
Plaintiff’s favor, there is no prejudice.” R&R 3, n.1, ECF No. 21. Plaintiff does
not cite any case law to support the argument that the failure to consider a reply
is reversible error. In the absence of such support, the Court does not find that
the failure to consider a reply alone dictates reversal of an otherwise wellreasoned R&R.4
B. Denial of Attorney’s Fees
This leaves one primary objection to the R&R: Magistrate Judge Jolson
erred by denying Plaintiff’s motion for attorney’s fees. Plaintiff raises three
specific objections to the R&R’s denial of attorney’s fees: 1) the R&R did not
articulate its specific reasoning; 2) the R&R did not apply the correct legal
standard; and 3) the R&R erred in finding removal was objectively reasonable.
Obj. 2–14, ECF No. 22.
1. The R&R did not articulate its specific reasoning
Plaintiff first asserts that the R&R did not articulate specific reasoning for
denying the motion for attorney’s fees. Obj. 2, ECF No. 22. Plaintiff cites cases
for the proposition that courts must explain their reasoning and not simply issue
4
Plaintiff asserts that he was prejudiced by the lack of a reply because it “may have
precluded [him] from preserving arguments should Defendants object to the R&R[],”
which they did not, and because Plaintiff did not receive the benefit of a reply in support
of his motion for attorney’s fees. Obj. 15, ECF No. 22. Plaintiff’s contention that his
lack of a reply could result in his failure to preserve arguments rings hollow. A party is
not permitted to raise new arguments on reply in any event, so a reply would not have
expanded the scope of arguments for review.
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conclusory opinions. Id. at 2–3. This is certainly true, but it does not apply to the
R&R. While it is true that the specific discussion of attorney’s fees in the R&R
was limited to one paragraph that simply stated the applicable standard and
concluded that “[i]t cannot be said here that Defendants lacked an objectively
reasonable basis for removal,” R&R 8, ECF No. 21, the preceding seven pages
of the R&R addressed the basis for removal and the strength of Defendants’
arguments for removal in depth. The R&R stated that “the Complaint has few
explicit allegations against Defendant Zielinski as an individual” and that “the
allegations are somewhat terse.” R&R 6–7, ECF No. 21. Nevertheless, the R&R
also considered the allegations against “Defendants” generally, instead of simply
those that specifically mentioned Zielinski, and credited the allegation that
Zielinski “was an individual responsible for firing” Plaintiff. Id. at 6. When
Magistrate Judge Jolson applied the deferential standard Plaintiff is entitled to on
a motion to remand challenging fraudulent joinder, she found that remand was
appropriate. Id. at 7. The R&R provides more than enough reasoning for the
Court to review Magistrate Judge Jolson’s decision to deny attorney’s fees.
The cases Plaintiff cites to support his argument are inapposite. See, e.g.,
Bridgeport Music, Inc. v. Univ.-Mca Music Pub., Inc., 481 F.3d 926 (6th Cir.
2007) (considering whether “nearly identical” one-page orders granting voluntary
dismissal with no analysis were sufficient to allow an abuse-of-discretion review);
DWG Corp. v. Granada Invest., Inc., 962 F.2d 1201, 1202 (6th Cir. 1992)
(remanding for additional analysis when the initial district court order was totally
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silent on whether fees were appropriate). The R&R recited the applicable legal
standards with supporting case law and applied the facts of this case. The R&R
provided sufficient reasoning.
2. The R&R Did Not Apply the Correct Legal Standard
Plaintiff next argues that the R&R did not apply the correct legal standard
for assessing attorney’s fees for improper removal based upon fraudulent joinder.
The R&R cited the following standards for assessing attorney’s fees: “Under 28
U.S.C. § 1447, it is within the Court’s discretion whether to award such fees and
costs. When an objectively reasonable basis exists for seeking removal,
however, fees should be denied. Paul v. Kaiser Found. Health Plan of Ohio, 701
F.3d 514, 523 (6th Cir. 2012).”
Plaintiff contends that this standard was applied in error because it “did not
refer to the Sixth Circuit’s “seminal case” interpreting that standard for fraudulent
joinder removals,” which Plaintiff contends is found in Kent St. Univ. Bd. of
Trustees v. Lexington Ins. Co., 512 F. App’x 485 (6th Cir. 2013). Setting aside
the parties’ disagreement over whether this unpublished Sixth Circuit opinion
represents the seminal case on attorney’s fees awards in fraudulent joinder
cases, the standard cited in the R&R is fully consistent with the law articulated in
Kent State. In Kent State, the Sixth Circuit started by referencing the Supreme
Court’s decision in Martin v. Franklin Capital Corp., 546 U.S. 132, 136–37 (2005),
which “limited a district court’s discretion to award fees, absent unusual
circumstances, to those cases where ‘the removing party lacked an objectively
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reasonable basis for seeking removal.’” Kent State, 512 F. App’x at 488 (quoting
Martin, 546 U.S. at 141). This Supreme Court precedent is what was applied in
the R&R.
Plaintiff asserts that Kent State added to the standard that “the
reasonableness of a fraudulent joinder removal ‘must be viewed through the lens
of Coyne’ and its well-settled fraudulent joinder standard that imposes a ‘heavy
burden’ on the removing defendants.” Obj. 4, ECF No. 22. But the Kent State
opinion did not purport to change the applicable standard for awarding fees or
mandate analysis other than whether removal was objectively reasonable. See
Kent State, 512 F. App’x at 488–89. Even if it did, in the R&R’s analysis of the
fraudulent joinder issue, Magistrate Judge Jolson cited Coyne, stated that “the
removing party bears the burden of demonstrating that no colorable cause of
action exists under state law,” and described Defendants’ burden as “an uphill
struggle.” R&R 4–5, ECF No. 21 (quoting Murray Energy Holdings Co. v.
Bloomberg, L.P., No. 2:15-cv-2845, 2016 WL 3355456, at *2 (S.D. Ohio June 17,
2016) and Eckhart v. Depuy Orthopaedics, Inc., No. 2:03-cv-1063, 2004 WL
524916, at *2 (S.D. Ohio Mar. 3, 2004)). This is the standard Plaintiff seeks.
The R&R simply did not unnecessarily repeat this analysis in the portion of the
R&R specifically discussing attorney’s fees.
3. The R&R Erred in Finding an Objectively Reasonable Basis for
Removal
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Plaintiff’s final argument is a general objection that the R&R erred in
finding that removal was objectively reasonable. Opp. 5, ECF No. 22. This
objection states that “the three arguments by Defendants were objectively
unreasonable,” and construes Defendants’ arguments this way: 1) that failure to
satisfy federal pleading standards constitutes fraudulent joinder; 2) that Plaintiff’s
intent to make the case non-removable is relevant; and 3) that a fact dispute
between the parties supports fraudulent joinder. Id. at 5–14. This is an
inaccurate and incomplete summary of Defendants’ arguments, and none of
these arguments were relied upon by Magistrate Judge Jolson.
In their opposition to the motion to remand, Defendants correctly focused
on the allegations included in the original Complaint, not the Amended
Complaint, and argued that the Court should disregard Plaintiff’s generic use of
the term “Defendants” and find that the allegations specifically referencing
Zielinski were insufficient. Br. in Opp. 6–9, ECF No. 14. Defendants supported
this argument with reference to relevant case law from within the Sixth Circuit.
Magistrate Judge Jolson also did not rely on any of these three arguments
to support her recommendation for remand or in finding removal was objectively
reasonable. First, with respect to the pleading standard to be applied, the R&R
analyzed whether the complaint was sufficient under state law and did not
mention federal pleading standards other than to say that the fraudulent joinder
inquiry is even more deferential than a motion to dismiss under Rule 12(b)(6).
R&R 5, ECF No. 21. Second, regarding Plaintiff’s intent in naming Zielinski, the
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R&R states that “a court does not probe a plaintiff’s motive for joining a nondiverse defendant to the lawsuit because motive is immaterial to the analysis.”
Id. at 4. Finally, with respect to any attempt by Defendants to create a factual
dispute to support fraudulent joinder, the R&R relied completely on the
allegations in the Complaint, not factual disputes, and stated that “[b]ecause
there is ‘a reasonable possibility that [Plaintiff’s] factual allegations state a claim
under state law,’ the actual ‘truth of the allegations and merits’ are to be left to
the trier of fact—and are not to be resolved at this juncture.” Id. at 7.
After reviewing the R&R’s thorough analysis of the motion to remand and
conducting its own de novo review, the Court finds that, based upon the sparse
allegations related to Zielinski in the original Complaint, it was objectively
reasonable for Defendants to remove this case. As Defendants pointed out in
their opposition to the motion to remand, “[t]he factual insufficiency of a plaintiff’s
claim may be a basis for removal based upon fraudulent joinder.” Clarkwestern
Dietrich Bldg. Sys. LLC v. Certified Steel Stud Ass’n, Case No. 1:13-cv-818,
2013 U.S. Dist. LEXIS 194260, at *20 (S.D. Ohio Dec. 20, 2013). Plaintiff’s
Amended Complaint added substantially to the allegations related to Zielinski,
but in the original Complaint there was very little connection between Zielinski
and the allegedly offending conduct other than conclusory statements.
C. Conclusion
For all of these reasons, Plaintiff’s objections are OVERRULED, the R&R,
ECF No. 21, is ADOPTED. Plaintiff’s motion to remand, ECF No. 7, is
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GRANTED, but Plaintiff’s request for attorney’s fees is DENIED. Defendants’
motion to dismiss, ECF No. 4, is DENIED as MOOT. The Clerk shall remove
ECF Nos. 4, 7, and 21 from the Court’s pending motions list.
IT IS SO ORDERED.
s/Michael H. Watson
MICHAEL H. WATSON, JUDGE
UNITED STATES DISTRICT COURT
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