Cook et al v. Sun Healthcare Group, Inc. et al

Filing 19

MEMORANDUM AND OPINION as set forth in following order. Signed by District Judge Thomas W Phillips on 7/9/13. (ABF)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF TENNESSEE
AT KNOXVILLE

ARCHIE COOK, JR., Individually and
on behalf of the wrongful death
beneficiaries of Shirley I. Cook,
Plaintiffs,
v.
SUN HEALTHCARE GROUP, INC.,
SUNBRIDGE HEALTHCARE, LLC,
SUNBRIDGE OF HARRIMAN, LLC, d/b/a
RENAISSANCE TERRACE CARE, and
REHABILITATION CENTER,
Defendants.

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No. 3:12-CV-641
(Phillips)

MEMORANDUM OPINION

Plaintiff Archie Cook, Jr., brings this action to recover damages resulting from
the wrongful death of his mother, Shirley I. Cook. Ms. Cook was a resident at a nursing
home operated by defendants. This matter is before the court on plaintiff’s motion to
remand the case to state court on the grounds that the joinder of a non-diverse defendant
has destroyed diversity jurisdiction. Defendants oppose remand. For the reasons which
follow, plaintiff’s motion to remand will be granted.

Plaintiff filed his initial complaint against defendants in the Circuit Court for
Roane County, Tennessee, on November 8, 2012. Defendants removed the case to this

court based upon diversity jurisdiction pursuant to 28 U.S.C. § 1332(a)(1). On December
19, 2012, plaintiff moved the court for leave to file an amended complaint, seeking to add
an additional defendant, Melissa Ann Franklin, who was the licensed administrator for
defendant Renaissance where defendant’s mother was a resident and where she suffered
the injuries leading to her death. Plaintiff states that on or about December 15, 2012, he
discovered that Renaissance has been under the direction of Administrator Franklin at the
time of the injuries alleged in his complaint. Plaintiff states that Franklin is a Tennessee
resident and is a necessary party to this action. Because the parties are no longer diverse,
plaintiff moves the court for an order remanding this case to the Circuit Court of Roane
County, Tennessee.

Defendants respond that plaintiff’s motion to remand should be denied
because Melissa Franklin was fraudulently joined solely for the purpose of defeating
jurisdiction. Defendants also argue that plaintiff’s First Amended Complaint was untimely
filed against Franklin on January 17, 2013, after the expiration of the statute of limitations.

No specific statute of limitations is contained in the Tennessee Wrongful
Death Statutes, but Tennessee courts have uniformly applied the one-year statute on
actions for personal injuries. See Tenn. Code Ann. § 28-3-104; Jones v. Black, 539
S.W.2d 123 (Tenn. 1976); Collier v. Memphis Light, Gas & Water Dist., 657 S.W.2d 771
(Tenn.Ct.App. 1983). In this case, Shirley Cook died on December 20, 2011. Plaintiff filed
his original complaint on December 12, 2012, and sought leave to amend his complaint on
December 19, 2012, before the expiration of the one year statute of limitations. No
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opposition was received to the motion, which the court granted on January 15, 2013, and
plaintiff filed his First Amended Complaint naming Melissa Franklin as a defendant on
January 17, 2013. Because plaintiff moved the court to amend his complaint prior to the
expiration of the statute of limitations, the court finds the amended complaint timely filed
under the Tennessee statute. See Frazier v. East Tenn. Baptist Hosp, Inc., 55 S.W.3d
925, 929 (Tenn. 2001) (Once the plaintiff has filed its proposed amended complaint
accompanied by a motion for leave to amend within the statutory period, the statute of
limitations is tolled even though the court order granting leave to amend and the technical
filing of the amended complaint occur after the running of the statute of limitations.)

Next, the court turns to the question of jurisdiction. In a case premised upon
diversity jurisdiction, the parties must be citizens of different states.

28 U.S.C. §

1332(a)(1). A defendant may remove an action originally filed in state court to federal court
on the basis of diversity jurisdiction “if there is complete diversity between all named
plaintiffs, and all named defendants . . . .” Lincoln Prop. Co. v. Roche , 546 U.S. 81, 84
(2005). In this case, at the time of removal, complete diversity existed between the named
plaintiffs and all named defendants, and removal was proper.

However, even if removal was proper, “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). Further, “if after removal, the plaintiff seeks to join
additional defendants whose joinder would destroy subject matter jurisdiction, the court
may deny joinder, or permit joinder and remand the action to state court.” 28 U.S.C. §
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1447(e). Persuasive authority counsels that in a situation such as this where an amended
complaint is filed to include the identity of a previously unidentified defendant, diversity
must be determined at the time of the filing of the amended complaint. As the leading civil
procedure treatise explains:
Although jurisdiction will not be ousted by a subsequent
change in parties who are ancillary to the suit and whose
presence . . . is not essential to an adjudication on the merits,
a change in parties that goes to the very essence of the district
court’s ability to adjudicate the merits of the dispute effectively
– most notably the addition of indispensable parties – may
destroy it. The cases indicate that the court will take account
of whether the plaintiff has been dilatory or is trying to destroy
diversity, whether the plaintiff will be significantly
disadvantaged if the amendment is not allowed, and whether
remanding the action to the state court will prejudice the
defendant.
14B CHARLES ALAN WRIGHT, ARTHUR R. MILLER, & EDWARD H. COOPER,
FEDERAL PRACTICE AND PROCEDURE § 3723 (3d ed. 1998). See also Curry v. U.S.
Bulk Transport, Inc., (6th Cir. 2006) (substitution of Ohio residents for two John Doe
defendants destroyed diversity and thus, district court’s subject-matter jurisdiction).

Defendants allege that plaintiff joined Franklin for the sole purpose of
destroying diversity jurisdiction. To establish fraudulent joinder, a removing party must
demonstrate either “outright fraud in the plaintiff’s pleading of jurisdictional facts,” or that
“there is no possibility that the plaintiff would be able to establish a cause of action against
the in-state defendant in state court.” Hartley v. CSX Transp. Inc., 187 F.3d 422, 424 (4th
Cir. 1999). Defendants argue that Franklin was fraudulently joined in this action because
a state-law cause of action cannot be maintained against her after the expiration of the
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applicable statute of limitations. However, as the court has found that the motion to amend
the complaint was timely filed before the expiration of the statute of limitations, the
amended complaint is also timely under the statute.

Plaintiff has alleged a valid cause of action against defendant Franklin.
Plaintiff discovered that Franklin was the Administrator of the nursing home at the time
Shirley Cook was injured. The First Amended Complaint alleges that Franklin, as the
Administrator of the nursing home, was responsible for ensuring that the facility complied
with state and federal regulations related to nursing facilities and had a duty to administrate
the facility in a manner that enabled the use of resources effectively and efficiently to attain
or maintain the highest practicable, physical, mental, and psychological well-being of each
resident. The First Amended Complaint further alleges that the nursing facility, under the
leadership of its Administrator, is required to operate and provide services in compliance
with all applicable federal, state, and local laws, regulations, and codes. The First
Amended Complaint further alleges that Franklin breached these duties of care to Shirley
Cook and that these breaches caused her injuries, and ultimately, her death.

The First Amended Complaint specifically alleges that Franklin violated her
duty to provide the minimum number of custodial staff necessary to care for the residents;
to supervise, train, and evaluate the custodial staff; to provide Shirley Cook with basic and
necessary custodial care and supervision; and to generally protect Shirley Cook from
abuse and neglect. Thus, plaintiff states the negligence actions of Franklin caused or
contributed to the injuries and death of Shirley Cook, and as such, Franklin was joined as
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a necessary party. The joinder of an indispensable party defendant with the same
citizenship as the plaintiff destroys jurisdiction under 28 U.S.C. § 1332. Because plaintiff
and defendant Franklin are residents of Tennessee, diversity jurisdiction no longer exists.
Accordingly, because the post-removal joinder of defendant Franklin destroys diversity
jurisdiction in this matter, the case must be remanded to state court.

In sum, the court finds that plaintiff timely brought the motion to amend the
complaint after discovering the identity of the joined defendant; the parties will be
disadvantaged if they have to pursue claims arising out of the same occurrence in both
state and federal court; and that defendants have not shown that they will be prejudiced
by a remand of the case to state court. Accordingly, plaintiff’s motion to remand [Doc. 8]
is GRANTED, and this action is REMANDED to the Circuit Court for Roane County,
Tennessee.

ENTER:
s/ Thomas W. Phillips
United States District Judge