KEMP v. HOFFMAN et al

Filing 10

MEMORANDUM OPINION; ETC.. SIGNED BY HONORABLE NITZA I QUINONES ALEJANDRO ON 1/7/22. 1/7/22 ENTERED AND E-MAILED, NOT MAILED TO UNREP.(JL)

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IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
CHERRI KEMP
Plaintiff

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v.
KAYLA HOFFMAN, et al.
Defendants
NITZA I. QUIÑONES ALEJANDRO, J.

CIVIL ACTION
NO. 21-3447

JANUARY 7, 2022

MEMORANDUM OPINION
INTRODUCTION
Before this Court are the parties’ responses, [ECF 7, 8], to the Rule to Show Cause Order,
[ECF 6], which directed them to address whether Defendant Kayla Hoffman was fraudulently
joined for the purpose of destroying diversity jurisdiction and whether this Court has subjectmatter jurisdiction over this matter. In her submission, Plaintiff Cherri Kemp (“Plaintiff”), a
citizen of Pennsylvania, contends that this matter was improperly removed on the basis of diversity
jurisdiction because one of the named defendants—Defendant Kayla Hoffman (“Defendant
Hoffman”)—is also a Pennsylvania citizen. The remaining defendants, Walnut Street Lessee, L.P.,
doing business as The Radian, Walnut Street Lessee, L.P., Walnut Street GP LLC, and The Scion
Group LLC, (collectively, the “Walnut Street Defendants”), which removed this action to this
Court, argue that Defendant Hoffman was “fraudulently joined” for the purpose of destroying
federal diversity jurisdiction. The issues raised by the Court’s Order and the parties’ filings have
been fully briefed and are ripe for disposition. For the reasons set forth herein, Defendant Hoffman
is dismissed from this matter as fraudulently joined.
BACKGROUND

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Plaintiff commenced this personal injury action in state court by filing a complaint
premised on negligence. In the complaint, Plaintiff alleges that on December 18, 2020, while
patronizing a property located at 3925 Walnut Street, Philadelphia, Pennsylvania, (the “Property”),
she slipped and fell on a snow/ice-covered sidewalk outside the Property, causing her to suffer
various physical injuries. Plaintiff further asserts that Defendant Hoffman, who is alleged to have
been the “owner, lessor, lessee and/or otherwise legally responsible for the care, control and/or
safety of the” Property at the time, and the Walnut Street Defendants are jointly and severally
liable to Plaintiff for the injuries she suffered.
On August 3, 2022, the Walnut Street Defendants timely removed Plaintiff’s case to federal
court pursuant to 28 U.S.C. § 1441. In the notice of removal, the Walnut Street Defendants contend
that Plaintiff fraudulently joined Defendant Hoffman solely as a means of defeating federal
diversity jurisdiction.1 Specifically, they argue that Plaintiff failed to allege a colorable and legally
viable claim against Defendant Hoffman under applicable Pennsylvania law, and, therefore, this
Court should disregard Defendant Hoffman’s Pennsylvania citizenship for purposes of exercising
diversity jurisdiction. In response, Plaintiff seeks remand of this case to state court, arguing that
she has asserted a viable claim against Defendant Hoffman under the participation theory, and,
thus, Defendant Hoffman was not “fraudulently joined.”
LEGAL STANDARD
Removal of a civil action from state to federal court is proper only if the action initially
could have been brought in federal court. 28 U.S.C. § 1441(a). The removal statutes “are to be

Absent the inclusion of Defendant Hoffman as a party in this action, it is undisputed that complete
diversity of citizenship exists for purposes of 28 U.S.C. § 1332 jurisdiction as none of the Walnut Street
Defendants is incorporated or maintains a principal place of business in Pennsylvania, and Plaintiff is a
citizen of Pennsylvania. The parties also do not dispute that the amount in controversy exceeds $75,000.00.
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strictly construed against removal and all doubts should be resolved in favor of remand.” Boyer
v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990).

District courts have original

jurisdiction over all civil actions involving citizens of different states where “the matter in
controversy exceeds the sum or value of $75,000, exclusive of interest and costs.” 28 U.S.C.
§ 1332(a). To ascertain jurisdiction, individuals are deemed to be citizens of the state wherein
they reside, Swiger v. Allegheny Energy, Inc., 540 F.3d 179, 181 (3d Cir. 2008), while a
corporation is deemed a citizen of every state in which it has been incorporated and where it has
its principal place of business, 28 U.S.C. § 1332(c)(1).
Under the forum defendant rule, a civil action that is “otherwise removable solely on the
basis of [diversity jurisdiction] 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.
§ 1441(b)(2). If at any time before final judgment, it appears that the district court lacks subject
matter jurisdiction, the case shall be remanded. 28 U.S.C. § 1447(c). As will be discussed more
fully below, the citizenship of a defendant that has been “fraudulently joined” should be
disregarded for purposes of determining the existence of diversity jurisdiction. In re Briscoe, 448
F.3d 201, 216 (3d Cir. 2006). The party removing the case bears the burden of showing that federal
jurisdiction is proper at all stages of the litigation. Samuel-Bassett v. KIA Motors Am., Inc., 357
F.3d 392, 396 (3d Cir. 2004).
DISCUSSON
Plaintiff seeks to remand this matter pursuant to the forum defendant rule and because
diversity jurisdiction is lacking, as both Plaintiff and Defendant Hoffman are citizens of
Pennsylvania. As noted, the Walnut Street Defendants argue that this Court should disregard the
citizenship of Defendant Hoffman for jurisdictional purposes because she has been “fraudulently
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joined,” meaning that Plaintiff has failed to state a viable and colorable claim against Defendant
Hoffman under applicable Pennsylvania law.
In the diversity jurisdiction context, the doctrine of fraudulent joinder serves as an
exception to the requirement that removal be predicated solely upon complete diversity. In re
Briscoe, 448 F.3d at 215–16.

This doctrine prevents a plaintiff from joining non-diverse

defendants with no real connection or interest to the controversy in order to defeat federal removal
jurisdiction. Id. Removing parties (such as the Walnut Street Defendants) who assert that the
plaintiff has fraudulently joined a party in order to destroy diversity jurisdiction carries “a heavy
burden of persuasion.” Steel Valley Auth. v. Union Switch & Signal Div., 809 F.2d 1006, 1012 n.6
(3d Cir. 1987).
A district court may base a finding of fraudulent joinder on factual or legal grounds. In re
Zoloft Prods. Liab. Litig., 2013 WL 6050627, at *1 (E.D. Pa. Nov. 14, 2013). Such a finding is
appropriate “where there is no reasonable basis in fact or colorable ground supporting the claim
against the joined defendant, or no real intention in good faith to prosecute the action against the
defendant or seek a joint judgment.” Id. (quoting Abels v. State Farm Fire & Cas. Co., 770 F.2d
26, 32 (3d Cir. 1985)). A claim is colorable if it is not “wholly insubstantial and frivolous” in light
of the relevant law. Batoff v. State Farm Ins. Co., 977 F.2d 848, 852 (3d Cir. 1992). When
evaluating fraudulent joinder, the district court “must resolve all contested issues of substantive
fact . . . and . . . any uncertainties as to the current state of controlling substantive law in favor of
the plaintiff.” Boyer, 913 F.2d at 111 (citations omitted). “If there is even a possibility that a state
court would find that the complaint states a cause of action against any one of the resident
defendants, the federal court must find that joinder was proper and remand the case to state court.”
Id. (citation omitted). A court should not find a joinder fraudulent “[s]imply because [it] come[s]

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to believe that, at the end of the day, a state court would dismiss the allegations against a defendant
for failure to state a cause of action.” Kallman v. Aronchick, 2013 WL 5964444, at *5 (E.D. Pa.
Nov. 8, 2013) (quoting Lyall v. Airtran Airlines, Inc., 109 F. Supp. 2d 365, 367–68 (E.D. Pa.
2000)). Rather, a finding of fraudulent joinder is usually reserved for situations where recovery
from the non-diverse defendant is a clear legal impossibility. West v. Marriott Hotel Servs., Inc.,
2010 WL 4343540, at *3 (E.D. Pa. Nov. 2, 2010) (citations omitted). “Fraudulent joinder should
not be found simply because plaintiff has a weak case against a non-diverse defendant.” Id.; see
also Boyer, 913 F.2d at 111.
Here, the issue is whether Plaintiff has pled a reasonable basis in fact or a colorable ground
supporting her negligence claim against Defendant Hoffman, or if the claim pled against
Defendant Hoffman is “wholly insubstantial and frivolous.” See Batoff, 977 F.2d at 852. If this
Court determines that the joinder of Defendant Hoffman was fraudulent, her Pennsylvania
citizenship can be disregarded, and this Court can assume and retain jurisdiction over this matter
and dismiss Defendant Hoffman from this action. See In re Briscoe, 448 F.3d at 216. On the other
hand, if this Court determines that it has no jurisdiction over the action because the joinder of
Defendant Hoffman was not fraudulent, the case must be remanded to state court. See id. (citing
28 U.S.C. § 1447(c)). The Walnut Street Defendants maintain that Plaintiff’s negligence claim
against Defendant Hoffman is legally deficient because Plaintiff has not alleged facts sufficient to
satisfy the requirements of Pennsylvania’s “participation theory”—the only viable theory under
which a corporate manager, such as Defendant Hoffman, could be personally liable for
negligence. 2 This Court agrees.
While, ordinarily, a district court exercising diversity jurisdiction must undertake a choice-of-law
analysis to determine which state’s substantive law to apply to a plaintiff’s claims, federal courts “cannot
engage in a choice of law analysis where diversity jurisdiction is not first established.” Abels v. State Farm

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In Wicks v. Milzoco Builders, Inc., the Pennsylvania Supreme Court confirmed that
Pennsylvania law recognizes the participation theory as a basis of liability for the manager of a
corporation. 470 A.2d 86, 90 (Pa. 1983); see also Moore, 907 F. Supp. 2d at 663; Sherfey v.
Johnson & Johnson, 2014 WL 715518, at *6 (E.D. Pa. Jan. 29, 2014). Under this theory, a
corporate officer or manager can be held personally liable for participating in the tortious activity
of the company, but only where the manager “specifically direct[s] the particular act to be done or
participate[s], or cooperate[s] therein.” Wicks, 470 A.2d. at 90 (internal quotation marks and
citation omitted); see also Shay v. Flight C. Helicopter Servs., Inc., 822 A.2d 1, 17–20 (Pa. Super.
Ct. 2003). A manager can be held personally liable for her own “misfeasance,” i.e., the “improper
performance of an act,” but not for mere “nonfeasance,” i.e., “the omission of an act which a person
ought to do.” Brindley v. Woodland Vill. Rest., Inc., 652 A.2d 865, 868 (Pa. Super. Ct. 1995)
(relying on Wicks). “[T]he mere averment that a corporate officer should have known the
consequences of the liability-creating corporate act is . . . insufficient to impose liability.” Wicks,
470 A.2d at 90.
Thus, the precise issue before this Court is whether Plaintiff has alleged sufficient facts to
show that Defendant Hoffman committed misfeasance rather than mere nonfeasance. If Plaintiff
has alleged only nonfeasance, i.e., Defendant Hoffman’s mere omission or failure to act, Plaintiff
has not alleged a viable claim against Defendant Hoffman. After a careful review of the complaint,

Fire & Cas. Co., 770 F.2d 26, 33 n.10 (3d Cir. 1985). A district court assessing the viability of state law
claims at the fraudulent joinder stage “should instead apply the body of law suggested by the plaintiff, so
long as that choice of law is itself colorable.” Moore v. Johnson & Johnson, 907 F. Supp. 2d 646, 662
(E.D. Pa. 2012). Notably, Plaintiff appears to acknowledge that Pennsylvania law applies to her claims,
relying on Pennsylvania substantive law in her opposition. Moreover, Plaintiff is a Pennsylvania citizen,
and her alleged injury occurred in Pennsylvania and was caused by the alleged negligence of Defendants.
It appears, therefore, that Pennsylvania law would apply to Plaintiff’s alleged negligence claims against
Defendants. As such, this Court will analyze whether Plaintiff’s alleged claim against Defendant Hoffman
is colorable under Pennsylvania law.
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this Court finds that the complaint is devoid of any allegation against Defendant Hoffman or that
the existing dangerous condition, i.e., the snow/ice-covered sidewalk, was the “result of an active,
knowing participation by” Defendant Hoffman. Brindley, 652 A.2d at 870. At most, the complaint
alleges that as the person in charge of the Property, Defendant Hoffman was responsible for its
condition, (see Compl. at ¶ 2), and that she had either actual or constructive knowledge of the
snow/ice-covered sidewalk. (See id. at ¶ 14a–d). The complaint includes a laundry list of
allegations or actions that Defendant Hoffman failed or omitted to take. (See id. at ¶ 14f–p). For
example, Plaintiff alleges that Defendant Hoffman:
fail[ed] to properly store/move the dangerous condition; fail[ed] to
implement policies and procedures related to safety; fail[ed] to
regard the rights, safety and position of the Plaintiff in and about the
area of the aforementioned accident; fail[ed] to request and
supervise periodic inspections of the premises in and around the area
where Plaintiff fell by Defendant’s employees and/or agents;
fail[ed] to reasonably inspect, maintain and/or otherwise exercise
due and reasonable care under the circumstances in view of the
foreseeable dangers, accidents and/or injuries that could occur as a
result of the conditions on the premises; fail[ed] to provide sufficient
warning to the Plaintiff as to the existence of the reasonably
foreseeable, defective, dangerous, and unsafe conditions giving rise
to the instant action; fail[ed] to provide adequate safeguards to
prevent the injury to Plaintiff; fail[ed] to exercise the proper care,
custody and control over the aforesaid premises; fail[ed] to follow
internal safety protocols; fail[ed] to properly train employees . . . .
(Id. at ¶ 14f–p) (emphasis added). While Plaintiff’s list contains numerous alleged “failures,” such
failures or omissions constitute, at best, nonfeasance on the part of Defendant Hoffman. Nowhere
does Plaintiff allege that Defendant Hoffman “specifically directed the particular act” or acts that
caused Plaintiff’s injuries. Wicks, 470 A.2d at 90. Plaintiff alleges only that it was Defendant
Hoffman’s lack of action or omissions that led to the snow/ice-covered state of the sidewalk or
Plaintiff’s exposure to it. Such allegations do not rise to the requisite level of actionable
misfeasance under Pennsylvania law to support personal liability under the participation theory.
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Consequently, this Court finds that Plaintiff has failed to assert a viable or colorable
negligence claim against Defendant Hoffman personally. As such, because Defendant Hoffman
has been “fraudulently joined,” her citizenship is disregarded, and the claims against her are
dismissed. Therefore, Plaintiff’s request to remand is denied, and this Court retains jurisdiction
over this action.
CONCLUSION
For the reasons stated herein, Plaintiff’s request to remand is denied. An Order consistent
with this Memorandum Opinion follows.

NITZA I. QUIÑONES ALEJANDRO, U.S.D.C. J.

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