Ray v. FCA US LLC et al
ORDER granting Defendant FCA USA L.L.C.s Motion for Leave to File Sur-Reply, Dkt. No. 12; granting 7 Motion to Remand. Suit remanded to the 229th District Court of Duval County, Texas.(Signed by Judge Hilda G Tagle) Parties notified.(mserpa, 2)
United States District Court
Southern District of Texas
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
CORPUS CHRISTI DIVISION
FCA US LLC; dba CHRYSLER, et al,
July 18, 2017
David J. Bradley, Clerk
CIVIL NO. 2:17-CV-86
BE IT REMEMBERED, that on July 18, 2017, the Court GRANTED
Defendant FCA USA L.L.C.’s Motion for Leave to File Sur-Reply, Dkt. No. 12; and
GRANTED Plaintiff’s Opposed Motion to Remand, Dkt. No. 7.
This is an automotive products liability action brought by Plaintiff Eloise Ray
(“Ray”) against Defendants FCA USA, L.L.C. d/b/a/ Chrysler (“FCA US”) and Love
Chrysler, Dodge, Jeep, L.L.C. (“Love Chrysler”). On January 28, 2017, Ray filed an
original petition in the 229th District Court of Duval County, Texas, alleging claims
of negligence and strict products liability against FCA US, and negligence,
negligent misrepresentation, and strict products liability against Love Chrysler.
Dkt. No. 1-2, Ex. B [hereinafter “Pl.’s Orig. Compl.”] ¶¶ 5.1-5.4, 5.11, 5.12, 6.1. FCA
US was the manufacturer of a 2014 Dodge Ram 1500 purchased by Ray on July 7,
2014 and Love Chrysler was its non-manufacturing seller. Id. ¶¶ 4.2, 4.3; Dkt. No. 9
Ray’s original petition states that on or around October 20, 2016 her 2014
Dodge Ram 1500 rolled over her while she was unloading the car in her driveway.
Pl.’s Orig. Compl. ¶ 4.1. Ray alleges that the rollover occurred when the vehicle’s
electronic transmission shifter disengaged from park into forward gear without
driver input. Id. She seeks general and special compensatory damages in excess of
one million dollars. Id. ¶ 8.1. Love Chrysler filed an answer to Ray’s complaint on
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February 21, 2017. Dkt. No. 1-2, Ex. E. FCA US filed an answer to Ray’s complaint
on February 24, 2017. No. 1-2, Ex. F. On March 3, 2017, Defendant FCA US timely
filed a notice of removal in this court pursuant to 28 U.S.C. §§ 1441 and 1446, citing
28 U.S.C. 1332 as the basis for this Court’s subject matter jurisdiction over Ray’s
claims. Dkt. No. 1 at 1. Both FCA US and Love Chrysler consented to removal.1
Dkt. No. 1 at 6.
FCA US is a foreign defendant. Dkt. No. 1 at 3. Ray is a resident of Duval
County, Texas, and her alleged injury occurred at home. Pl.’s Orig. Compl. ¶¶ 2.1,
3.1. Love Chrysler, like Ray, is a resident of Texas. Dkt. No. 7 at 7. FCA US,
however, asks the Court to disregard Love Chrysler’s citizenship for the purposes of
diversity jurisdiction, on the basis that Love Chrysler was improperly joined in this
action to defeat diversity jurisdiction. Dkt. No. 1 at 3; Dkt. No. 8 at 1. On April 3,
2017, Ray filed an opposed motion to remand, alleging that Love Chrysler is an
improperly joined party, whose presence in this action defeats complete diversity
and strips this Court of jurisdiction. Dkt. No. 7. On April 21, 2017, FCA US filed a
response to Ray’s motion to remand. Dkt. No. 8. Ray replied to this response on
April 26, 2017. Dkt. No. 9. On May 3, 2017, FCA US filed a sur-reply to Ray’s
motion for remand along with a motion for leave to file a sur-reply.2 Dkt. Nos. 12,
II. Legal Standard
a. Subject Matter Jurisdiction
The federal courts are courts of limited jurisdiction. Kokkonen v. Guardian
Life Ins. Co. of America, 511 U.S. 375, 377 (1994). The federal diversity statute
If Love Chrysler is improperly joined, its consent is legally irrelevant. See Jernigan v. Ashland Oil
Inc., 989 F.2d 812, 815 (5th Cir. 1993).
2 According to this Court’s Local Rules, “once a motion, response, and reply are filed, the Court will
not entertain any additional or supplemental filings unless they are accompanied by a motion for
leave to file explaining why the additional filing is necessary in the interests of justice.” L.R. 5.E.
FCA US has complied with this local rule by filing an opposed motion for leave to file a sur-reply to
Ray’s motion for remand. Dkt. No. 12 at 1. In this motion, FCA US states a sur-reply is necessary
because Ray brought forth new arguments and additional evidence in her reply. Dkt. No. 12 at 1.
Without opining here on the merits of FCA US’ sur-reply, the Court therefore finds that the interests
of justice are served by, and little prejudice to Plaintiff Ray will result from, granting FCA US’
opposed motion to file this sur-reply.
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provides the federal district courts with original jurisdiction over civil actions where
the amount in controversy exceeds $75,000 and where the parties are citizens of
different states. See 28 U.S.C. § 1332(a). This statute requires “complete diversity,”
meaning that the statute “applies only to cases in which the citizenship of each
plaintiff is diverse from the citizenship of each defendant.” Caterpillar, Inc. v.
Lewis, 519 U.S. 61, 68 (1996).
Federal district courts also have removal jurisdiction over civil actions that
could have originally been brought in federal court. 28 U.S.C. § 1441(a); Gutierrez v.
Flores, 543 F.3d 248, 251 (5th Cir. 2008). The federal removal statute provides that
a suit may be removed from state court “only if none 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); Smallwood v. Illinois Cent. R. Co., 385 F.3d
568, 572 (5th Cir. 2004); Moreno Energy, Inc. v. Marathon Oil Co., 884 F. Supp. 2d
577, 588 (S.D. Tex. 2012) (noting that an improperly joined defendant’s citizenship
is disregarded for the purposes of diversity jurisdiction).
Critically, “because the effect of removal is to deprive the state court of an
action properly before it, removal raises significant federalism concerns.” Carpenter
v. Wichita Falls Indep. Sch. Dist., 44 F.3d 362, 365-66 (5th Cir.1995) (citing Merrell
Dow Pharm., Inc. v. Thompson, 478 U.S. 804, 809 (1986)). Accordingly, the removal
statute is “strictly construed, and any doubt about the propriety of removal must be
resolved in favor of remand.” Gasch v. Hartford Acc. & Indem. Co., 491 F.3d 278,
281-82 (5th Cir. 2007).
b. Improper Joinder Standard
The burden of proving that complete diversity exists rests upon the party
seeking to invoke the court's diversity jurisdiction. Getty Oil Corp. v. Insurance Co.
of North America, 841 F.2d 1254, 1259 (5th Cir. 1988). Accordingly, a removing
defendant has the “heavy burden” of establishing that removal was proper.
Smallwood v. Illinois Cent. R. Co., 385 F.3d 568, 574 (5th Cir. 2004). There are two
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ways to establish improper joinder:3 (1) actual fraud in the pleading of jurisdictional
facts, or (2) the inability of a plaintiff to establish a cause of action against the nondiverse party in state court. Travis v. Irby, 326 F.3d 644, 647 (5th Cir. 2003)
(citation omitted). Here, FCA US relies only on the second test, under which the
court evaluates “whether the defendant has demonstrated that there is no
possibility of recovery by the plaintiff against an in-state defendant, which stated
differently means 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.”
Smallwood, 385 F.3d at 573 (5th Cir. 2004). For remand to be granted, a plaintiff
should have more than a “mere theoretical possibility of recovery under local law.”
Badon v. RJR Nabisco, Inc., 236 F.3d 282, 286 n.4 (5th Cir. 2000) (emphasis
Ordinarily, a plaintiff can show a reasonable basis of recovery if he can
survive a 12(b)(6) motion to dismiss for failure to state a claim. Davidson v. GeorgiaPacific, L.L.C., 819 F.3d 758, 765 (5th Cir. 2016) (citations omitted). This means a
plaintiff’s complaint must contain “enough facts to state a claim to relief that is
plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). “A claim
has facial plausibility when the plaintiff pleads factual content that allows the court
to draw the reasonable inference that the defendant is liable for the misconduct
alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 677 (2009). The facts alleged “must be
enough to raise a right to relief above the speculative level ... on the assumption
that all the allegations in the complaint are true (even if doubtful in fact).”
Twombly, 550 U.S. at 555.
When assessing whether a plaintiff seeking remand has satisfied the 12(b)(6)
standard in stating a cause of action against an in-state defendant, a court
considers the allegations in the complaint available at the time of removal.
The Fifth Circuit uses the term “improper joinder” instead of “fraudulent joinder” when referring to
the joinder of a defendant to defeat diversity jurisdiction. See Smallwood, 385 F.3d at 571 n.1 (noting
“improper joinder” is equivalent to “fraudulent joinder” in the context of removal jurisdiction.)
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Davidson v. Georgia-Pacific, L.L.C., 819 F.3d 758, 765 (5th Cir. 2016) (citation
omitted); Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir.
2002) (“To determine whether jurisdiction is present for removal, we consider the
claims in the state court petition as they existed at the time of removal.”) Because
the purpose of improper joinder inquiry is to determine a procedural matter, the
focus of this inquiry must be on the joinder, not on the merits of the plaintiff’s case.
Smallwood, 385 F.3d at 573 (5th Cir. 2004). The Court does not consider “whether
the plaintiff will actually or even probably prevail on the merits of the claim,” but
only the “possibility that the plaintiff might do so.” Burden v. General Dynamics
Corp., 60 F.3d 213, 216 (5th Cir. 1995).
In some cases, a complaint can meet the 12(b)(6) standard, but “misstat[e] or
omi[t] discrete facts that would determine the propriety of joinder.” Smallwood, 385
F.3d at 573. In such cases, “hopefully few in number,” a court may “pierce the
pleadings” and conduct a summary inquiry. Id. In this inquiry, a court may consider
additional, summary-judgment type evidence, such as affidavits and deposition
testimony, to determine whether the plaintiff “truly has a reasonable possibility of
recovery in state court.”4 Griggs v. State Farm Lloyds, 181 F.3d 694, 700 (5th Cir.
1999) (citation omitted); Gray ex rel. Rudd v. Beverly Enterprises-Mississippi, Inc.,
390 F.3d 400, 405 (5th Cir. 2004).
As a summary inquiry “is appropriate only to identify the presence of discrete
and undisputed facts that would preclude plaintiff's recovery against the in-state
defendant,” courts should keep summary inquiry on a “tight judicial tether;”
“discovery by the parties should be sharply tailored to the question at hand, and
only after a showing of its necessity.” Smallwood, 385 F.3d at 574. In keeping with
the nature of improper joinder analysis, summary inquiry should be “a simple and
quick exposure of the chances of the claim against the in-state defendant alleged to
be improperly joined.” Id. Any contested issues of fact or ambiguous questions of
state law involved in the inquiry must be resolved in favor of remand. African
During summary inquiry, however, post-removal filings “may not be considered to the extent that
they present new causes of action or theories not raised in the controlling petition filed in state
court.” Griggs, 181 F.3d at 700 (citation omitted).
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Methodist Episcopal Church v. Lucien, 756 F.3d 788, 793 (5th Cir. 2014) (citations
omitted). If it is uncertain whether Ray “will be able to prove [her] allegations” of
Love Chrysler’s actual knowledge “to the satisfaction of the trier of fact,” then
remand will be appropriate. Gray ex rel. Rudd v. Beverly Enterprises-Mississippi,
Inc., 390 F.3d 400, 410 (5th Cir. 2004).
FCA US alleges that removal of this case to this Court was proper because
Ray has failed to state a claim against Love Chrysler on which she has a possibility
of prevailing under Texas law. See Dkt. No. 1. Ray’s original petition, her operative
pleading, alleges that Love Chrysler was negligent in selling the 2014 Dodge Ram
1500 to Ray on the basis that Love Chrysler had actual knowledge of a defective
condition in the vehicle’s electronic transmission shifter. Pl.’s Orig. Compl. ¶¶ 4.5,
4.6. Ray brings this claim under Chapter 82 of the Texas Civil Practice and
Remedies Code, which governs products liability actions.
a. Seller Liability under Texas Civil Practice and Remedies Code
i. Texas Civil Practice and Remedies Code Chapter 82
In general, Chapter 82 allows actions “against a manufacturer or seller for
recovery of damages arising out of personal injury, death, or property damage
allegedly caused by a defective product whether the action is based in strict tort
liability, strict products liability, negligence, misrepresentation, breach of express or
implied warranty, or any other theory or combination of theories.” TEX. CIV. PRAC.
& REM. CODE § 82.001(2). Since its enactment in 2003, § 82.003 has limited
products liability actions against non-manufacturing sellers like Love Chrysler.5 See
Garcia v. Nissan Motor Co., 2006 WL 869944 (S.D. Tex. Mar. 30, 2006). As the
Texas Supreme Court has explained, this limitation was enacted by the Texas to
No party disputes that Love Chrysler is a seller under Chapter 82, which defines a “seller” as “a
person who is engaged in the business of distributing or otherwise placing, for any commercial
purpose, in the stream of commerce for use or consumption a product or any component part
thereof.” TEX. CIV. PRAC. & REM. CODE § 82.001(3).
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protect “innocent sellers” from the costs of products liability litigation they are
“drawn into. . . solely because of the vicarious nature of that liability[.]”6 General
Motors Corp. v. Hudiburg Chevrolet, Inc., 199 S.W.3d 249, 262 (Tex. 2006).
Accordingly, § 82.003 generally excludes sellers like Love Chrysler for harm caused
by the products they sell, unless one of seven statutory exceptions applies. TEX. CIV.
PRAC. & REM. CODE § 82.003(a). The only exception at issue in this case is the
“actual knowledge” exception set out in § 82.003(a)(6), which provides that:
(a) A seller that did not manufacture a product is not liable for harm caused
to the claimant by that product unless the claimant proves:
(A) the seller actually knew of a defect to the product at the time the seller
supplied the product; and
(B) the claimant's harm resulted from the defect[.]
TEX. CIV. PRAC. & REM. CODE § 82.003.
This case thus turns on whether there is a reasonable basis to find that Love
Chrysler had actual knowledge of the defect Ray alleges at the time it sold Ray her
2014 Dodge Ram 1500.
ii. Actual Knowledge Exception under § 82.003(a)(6)
Judicial application of Chapter 82’s actual knowledge exception is “scant and
largely confined to federal district courts applying it in improper joinder cases” such
as this one. Garcia v. Ford Motor Co., 2013 WL 12137090, at *3 (S.D. Tex. May 10,
2013); see also Rubin v. Daimlerchrysler Corp, 2005 WL 1214605, at *6-7 (S.D. Tex.
May 20, 2005); Reynolds v. Ford Motor Co., 2004 WL 2870079, at *3-4 (N.D. Tex.
Dec. 13, 2004). As construed by federal district courts, §82.003(a)(6)’s “actual
knowledge” requirement means just what it says, and cannot be satisfied with a
showing of negligent oversight, constructive knowledge, or similar allegations that a
seller could or “should have known of a defect in a product.” Garcia v. Ford Motor
Co., 2013 WL 12137090, at *3 (S.D. Tex. May 10, 2013) (citations omitted);
Primary liability is effectively placed on the manufacturer based on the reasoning that
manufacturers are usually in a better position to recognize and remedy product defects. See Graco,
Inc. v. CRC, Inc. of Texas, 47 S.W.3d 742, 745 (Tex.App. 2001).
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Benavides v. Chrysler Group LLC., 2014 WL 5507716, at *4 (S.D. Tex. Oct. 9, 2014).
See also Mix v. Target Corp., 759 F.Supp.2d 876, 879 (S.D. Tex. 2010) (“It is
particularly instructive that, in drafting Chapter 82, the Texas Legislature “used
‘knew,’ not ‘should have known’” of a defect.”) (citation omitted). Additionally, “the
defendant’s actual knowledge must relate to the defect itself.” Blythe v. Bumbo Int’l
Trust, 2013 WL 6190284, at *5 (S.D. Tex. Nov. 26, 2013) (citing Mix, 759 F.Supp.2d.
In cases litigated under § 82.003(a)(6), a plaintiff may establish a seller’s
actual knowledge with evidence including, e.g., recall notices about a defect,
customer complaints relating to the defect, safety testing reports, and internal
communications showing a seller’s employees knew of a problem at the time of sale.
See Rubin v. Daimlerchrysler Corp., 2015 WL 1214605, at 6-7 (S.D. Tex. May 20,
2005); Blythe, 2013 WL 6190284 at *6; Gonzalez v. Reed-Joseph Int’l, 2013 WL
1578475, at *11-12 (S.D. Tex. Apr. 11, 2013). Yet courts addressing § 82.003(a)(6) on
summary judgment have not offered uniform or precise guidance on the showing
required to prove actual knowledge. Compare Mix, 759 F.Supp.2d. at 880-81
(finding that evidence of other product liability lawsuits and one or two previous
customer complaints was insufficient to make out a factual issue about actual
knowledge) with Blythe, 2013 WL 6190284 at *6–7 (holding plaintiff’s evidence of
customer complaints about similar accidents and injuries, previous lawsuits, and
international safety agency finding was sufficient to create a factual issue about
b. Ray’s Complaint
misrepresentation, and strict products liability claims against Love Chrysler. Pl.’s
Orig. Compl. ¶ 6.1. Texas Civil Practice and Remedies Code § 82.003 applies to all
of Ray’s enumerated claims, because negligence, misrepresentation, and strict
products liability are all products liability claims governed by Chapter 82. TEX. CIV.
PRAC. & REM. CODE § 82.003(2). Typically, if a plaintiff’s pleadings against a
defendant would survive a 12(b)(6) motion to dismiss, this defendant has not been
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improperly joined.7 Smallwood, 385 F.3d at 573. Thus, Ray must sufficiently plead
that one of Chapter 82’s exceptions to seller immunity applies in order to state a
claim against Love Chrysler.
Ray’s primary claim alleges that “on or around October 20, 2016. . . [her]
2014 Dodge Ram 1500 rolled over her in forward gear after the electronic
transmission shifter disengaged from the parking position on its own as Plaintiff
was unloading items from her vehicle.” Pl.’s Orig. Compl. ¶ 4.1. As to Love
Chrysler’s alleged liability for this injury, Ray pleads Chapter 82’s actual knowledge
exception in her complaint in two separate sections: first, where she states the
factual bases for her allegations, and second, where she details her cause of action
against Love Chrysler for negligence. Specifically, in the “Cause of Action” section of
her complaint, Ray invokes § 82.003(6) and alleges that “[Love Chrysler] and its
employees had direct, personal knowledge that there was a defect in the electronic
transmission shifter in the subject vehicle, and [her] harm resulted from the defect.”
Id. ¶¶ 6.4, 6.5. In the “Background” section of her complaint, Ray alleges that Love
Chrysler had actual knowledge of the defect that caused her injury “through recall
notices and deal[er] information provided to it by [Love Chrysler].” Pl.’s Orig.
Compl. ¶¶ 4.6, 4.7. She also alleges that Love Chrysler had actual knowledge “by
and through its employees.” Id. ¶ 4.5. Her complaint further cites to the existence
of: (i) a nationwide recall of the relevant Dodge Ram model, and (ii) a National
Highway Transportation Safety Administration (NHTSA) investigation into related
Chrysler vehicles. Id. ¶¶ 4.8, 4.9.8
In improper joinder cases, federal district courts assess the sufficiency of complaints under the
federal pleading standards, not, as Ray asserts, under state pleading standards. Dkt. No. 7 at 5; See
Int’l Energy Ventures Mgmt., L.L.C. v. United Energy Group, Ltd., 818 F.3d 193, 202-204 (5th Cir.
8 In full, the “Background” section of Ray’s complaint concerning Love Chrysler reads:
4.3 The subject 2014 Dodge Ram 1500 was sold, marketed, warranted and expressly
represented by LOVE CHRYSLER.
4.4 The subject 2014 Dodge Ram 1500 was equipped with a defective electronic transmission
shifter designed by CHRYSLER.
4.5 Furthermore, LOVE CHRYSLER, by and through its employees, had actual knowledge of
the defective condition of the 2014 Dodge Ram 1500 at the time it was sold. Specifically,
LOVE CHRYSLER had knowledge of the defectively designed and manufactured electronic
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As federal courts “construe pleadings in their entirety when assessing their
sufficiency” under the 12(b)(6) standard, the Court reads Ray’s section on her causes
of action together with the factual bases alleged in the background section of her
complaint. Arbuckle Mountain Ranch of Texas, Inc. v. Chesapeake Energy Corp., 810
F.3d 335, 340 (5th Cir. 2016) (citations omitted). In so doing, while reading Ray’s
complaint in the light most favorable to her, the Court finds that Ray has pled a
negligence cause of action sufficient to show a possible basis of recovery against
Love Chrysler under Texas law.
In its notice of removal, FCA US contends that Ray has not sufficiently pled a
Texas products liability claim against Love Chrysler on the basis that no evidence
could show that Love Chrysler had actual knowledge of a defect in Ray’s 2014
Dodge Ram 1500 at the time of its sale. Dkt. No. 1 at 5. Specifically, in its response
to Ray’s motion to remand, FCA US argues that Ray’s claim fails under § 82.003
because “there has never been a recall applicable or relating to” the component of
her 2014 Dodge Ram 1500 she alleges was defective—and posits that if such a recall
existed, Ray would have attached related evidence to her motion. Dkt. No. 8 at 8.
FCA US also argues that the NHTSA investigation Ray refers to in her complaint is
not relevant to this case, as it was initiated on December 16, 2016, more than two
years after Ray purchased her 2014 Dodge Ram 1500 from Love Chrysler on July 7,
2014. Id. at 8-9. In support of its assertions FCA US offers a news article on the
NHTSA recall dated December 20, 2016, and three affidavits, from: (i) the
company’s President, Marion Brem, (ii) Mac McCarley, the company’s Service
4.6 LOVE CHRYSLER had knowledge about the Dodge Ram gear shifter defect through
recall notices and deal information provide to it by CHRYSLER.
4.7 This defect caused Eloisa Ray’s injuries.
4.8 Dodge Rams of the year model of the subject Dodge Ram were subject of a nationwide
recall of Dodge Rams.
4.9 In addition, the National Highway Transportation Safety Administration has expanded
its defect investigation into various other Chrysler model vehicles –
WASHINGTON – The National Highway Transportation Safety Administration (NHTSA)
has launched a “preliminary evaluation: of approximately 1 million Ram pickups and Dodge
Durango SUVs following 43 complaints alleging roll-aways when the vehicles are in the
4.10 Reports indicate that the unintended motion occurred after the driver moved the
transmission gear selector to park and exited the vehicle.
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Manager, and (iii) Michael Royek, a Product Specialist in FCA US’s Product
Analysis Department. Dkt. No. 8-1, Exs. A-D.
In her affidavit, Brem testifies that at the time Love Chrysler sold Ray her
2014 Dodge Ram 1500, the company had not been provided and was not aware of
communications, internal communications, media reports, or “any unusual or
frequent customer complaints or repairs relating to the electronic transmission
shifter of the 2014 Dodge Ram 1500.” See Dkt. No. 8-1, Ex. A, Aff. of Brem. In his
affidavit, McCarley effectively corroborates Brem’s testimony based on his
knowledge as a Service Manager “personally involved in the daily operations of the
service department” at Love Chrysler. See Dkt. No. 8-1, Ex. B, Aff. of McCarley.
Finally, in his affidavit, Royek attests that “in the scope of [his] duties as a Product
Analysis Specialist, [he] personally researched” whether any recalls or NHTSA
investigations were extant at the time Ray purchased her 2014 Dodge Ram 1500,
and states that as of the date Ray purchased this vehicle, no such recalls or
investigations had been issued or initiated “relating to the electronic gear shift
selector or transmission shift system” in this vehicle. See Dkt. No. 8-1, Ex. C, Aff. of
These affidavits and the article FCA US provides are summary-judgment type
evidence that FCA US urges the Court to pierce the pleadings and consider, on the
basis that Ray misstated facts in her complaint and motion to remand relating to
Love Chrysler’s actual knowledge of a defect. Dkt. No. 8 at 14. FCA US particularly
focuses on Ray’s statements about a recall and investigation of the relevant model,
which it describes as misleading. Dkt. No. 8 at 8. FCA US argues that if the Court
pierces the pleadings, FCA US can establish the lack of any actual knowledge by
Love Chrysler as a discrete and undisputed fact. Dkt. No. 8 at 8-9, 14. Ray, in turn,
urges the Court to refuse to pierce the pleadings, arguing that FCA US has not
identified any “discrete” fact that could be ascertained through a summary inquiry,
and that going beyond the pleadings would require the Court to impermissibly try
the merits of her case. Dkt. No. 9 at 2. In support of her argument, Ray cites a host
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of remand decisions where district courts have declined to pierce the pleadings so as
to avoid reaching merits decisions, Dkt. No. 9 at 3-6, and offers an NHTSA report
dated April 1, 2014, relating to a recall of certain models of “2014 Ram 1500 4x4
vehicles,” manufactured between January 24, 2014 and February 05, 2014, she
argues support her claim that Love Chrysler had actual knowledge of a defect with
her vehicle. Dkt. No. 9, Ex. A. In its sur-reply, FCA US argues that this recall does
not actually apply to Ray’s vehicle or the part she alleges was defective, and that
her proffer of this information constitutes an attempt to improperly inject a “new
theory of liability” into this litigation after its removal to federal court. See Dkt. No.
12-1. In support of this claim FCA US attaches a second affidavit from its Product
Specialist Royek, in which he testifies, based on his expertise and knowledge, that
the recall Ray cites in her reply does not apply to the 2014 Dodge Ram 1500 she
purchased from Dodge Chrysler. Dkt. No. 12-1, Ex. E, Second Aff. of Royek.
The Court considers the conflicting allegations of the parties’ pleadings and
exhibits here only to the extent required to find they demonstrate substantive fact
issues exist between the parties requiring remand of this case. FCA US has brought
forth affidavits purporting to foreclose any possibility Love Chrysler may have
possessed actual knowledge of a defect with the electronic transmission shifter in
Ray’s 2014 Dodge Ram 1500. Ray, in turn, argues that FCA US’s “‘no knowledge of
recall or investigation’ affidavits go to the merits, not the legal cognizability of [her]
claims against Defendant Love Chrysler.” Dkt. No. 9 at 5. While the affidavits FCA
US proffers are specific and thorough, the Court is unwilling to find that they
identify a dispositive “discrete and undisputed fact” misstated in or omitted from
Ray’s operative pleading that might be disproved through a summary inquiry at
this early stage in litigation.
In declining to pierce the pleadings, the Court notes that summary inquiry is
appropriate only in “rare” instances. Lott v. Dutchmen Mfg., Inc., 422 F. Supp. 2d
750, 755 (E.D. Tex. 2006). Moreover, “actual knowledge” by a non-manufacturing
seller is not typically the kind of “discrete and undisputed fac[t]” summary inquiry
is meant to establish. See Garcia v. Ford Motor Co., 2013 WL 12137090, at *6-7
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(S.D. Tex. May 10, 2013). Instead, the Fifth Circuit has repeatedly commented that
it is facts “that easily can be disproved if not true” which are best suited for
summary inquiry. Smallwood, 385 F.3d at 574 (citing Travis v. Irby, 326 F.3d 644,
648-49 (5th Cir. 2003)) (identifying such “discrete and undisputed facts” as: “[T]he
in-state doctor defendant did not treat the plaintiff patient, the in-state pharmacist
defendant did not fill a prescription for the plaintiff patient, a party’s residence was
not as alleged[.]”)) Accordingly, this Court has in the past rejected the notion that a
“general averment” of actual knowledge, of the type Ray alleges in her operative
pleading, is a “discrete” factual issue. See Garcia v. Ford, 2013 WL 12137090 at *7.
Notably, even if the Court were willing to pierce the pleadings to let FCA US
present further summary judgment-type evidence purporting to vitiate every
possible argument Ray might make as to recalls or NHTSA investigations
applicable to her 2014 Dodge Ram 1500, Ray’s allegation that Love Chrysler had
actual knowledge of a defect with the vehicle’s electronic transmission shifter “by
and through its employees” would still stand. Pl.’s Orig. Compl. ¶ 4.5. FCA US’s
affiants do not discuss employee knowledge in any detail, nor provide any allegation
based on personal knowledge as to the actual knowledge of the specific employees
who participated in Love Chrysler’s sale of the 2014 Dodge Ram 1500 to Ray. Dkt.
No. 8-1, Exs. A-C. Therefore, viewing her complaint in the light most favorable to
Ray, the Court cannot say there is no possibility she will be able to recover on her
negligence claim against Love Chrysler.
In so finding, the Court emphasizes that in an improper joinder analysis,
“[t]he Court must not ‘pre-try’ substantive factual issues in order to answer the
discrete threshold question of whether the joinder of an instate defendant is
fraudulent.” Watkins v. General Motors, LLC, 2011 WL 3567017 at *3 (S.D. Tex.
Aug. 12, 2011) (citing Reynolds v. Ford Motor Co., 2004 WL 2870079 at *2 (N.D.
Tex. Dec. 13, 2004)); see also Smallwood, 385 F.3d at 573 (“[T]he focus of the inquiry
must be on the joinder, not the merits of the plaintiff’s case.”) Additionally, this
Court “do[es] not determine whether the plaintiff will actually or even probably
prevail on the merits of [her] claim” against Love Chrysler, but only finds that there
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is a “possibility that plaintiff might do so.” Guillory v. PPG Industries, Inc., 434 F.3d
303, 308-09 (5th Cir. 2005).
Pursuant to the foregoing analysis, the Court finds that FCA US has not met
its “heavy burden” of demonstrating that Love Chrysler was improperly joined in
this action. See Smallwood, 385 F.3d at 574. Therefore, lacking subject matter
jurisdiction over Ray’s claims, the Court GRANTS Ray’s motion to remand, Dkt. No.
Pursuant to the foregoing analysis, the Court:
GRANTS Defendant FCA USA L.L.C.’s Motion for Leave to File Sur-Reply,
Dkt. No. 12;
GRANTS Plaintiff’s Opposed Motion to Remand, Dkt. No. 7; and
ORDERS this suit remanded to the 229th District Court of Duval County,
SIGNED this 18th day of July, 2017.
Senior United States District Judge
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