Howard et al v. Wal-Mart Stores Inc et al

Filing 31

ORDER signed by Judge J.P. Stadtmueller on 10/11/2018: REMANDING CASE to state court for lack of subject-matter jurisdiction and DIRECTING Clerk of Court to take all appropriate steps to effectuate the remand of this case back to the Milwaukee County Circuit Court. (cc: all counsel)(jm)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
JACQUELINE HOWARD,
Plaintiff,
and

Case No. 18-CV-431-JPS

UNITEDHEALTHCARE OF
WISCONSIN INC. and U.S.
DEPARTMENT OF HEALTH AND
HUMAN SERVICES,
Subrogated Plaintiffs,
v.
WAL-MART STORES EAST I, LP,
BLUME SPE SAUKVILLE LLC,
NATE’S LAWN MAINTENANCE,
INC., and ABC INSURANCE
COMPANY,

ORDER

Defendants.
Plaintiff alleges that she slipped and fell on a patch of ice outside of
a Walmart store in Saukville, Wisconsin. (Docket #1-2). Plaintiff’s original
complaint named a fictitious entity of unknown citizenship which she
believed may have performed maintenance on that Walmart property. Id.
at 6. This action was removed from state court by Walmart on the basis of
diversity jurisdiction. (Docket #1). Plaintiff determined the identity of the
fictitious entity, Nate’s Lawn Maintenance (“Nate’s”), in discovery. She
thereafter amended her complaint to identify Nate’s by name, state its
citizenship, and specifically allege that it failed to perform its contractual

ice removal duties. (Docket #21 at 3–5). Indeed, right after Plaintiff’s fall, a
Walmart employee told her that the iciness was a result of Nate’s failure to
salt the area. Id. at 5.
Plaintiff is a Wisconsin citizen and Nate’s is a Wisconsin corporation.
Thus, complete diversity of the parties is destroyed, along with the Court’s
subject-matter jurisdiction. Defendants seek to stave off remand by
asserting the “time-of-filing” rule. The time-of-filing rule states that
“jurisdiction once properly invoked is not lost by developments after a suit
is filed, such as a change in the state of which a party is a citizen that
destroys diversity.” Cunningham Charter Corp. v. Learjet, Inc., 592 F.3d 805,
807 (7th Cir. 2010). That is not what happened here, however. A company
in the role Nate’s now occupies was contemplated from the outset of this
lawsuit, but Plaintiff did not know its true role in the case or its citizenship.
Of course, Defendants themselves have always known of Nate’s existence
and its Wisconsin citizenship. Having finally obtained that information
herself, Plaintiff substituted Nate’s for the fictitious maintenance company.
Nothing about any of the parties themselves has changed; for instance,
Plaintiff did not move to Arkansas to defeat diversity with Walmart. See
BI3, Inc. v. Hamor, No. 08-CV-2384, 2011 WL 5023394, at *4–11 (N.D. Ill. Oct.
20, 2011) (denying a motion to dismiss on the time-of-filing principle where,
during the pendency of the lawsuit, a plaintiff moved to a state where a
defendant also resided).
Walmart, as the removing party, “has the burden of establishing
federal jurisdiction, and federal courts should interpret the removal statute
narrowly, resolving any doubt in favor of the plaintiff's choice of forum in
state court.” Schur v. L.A. Weight Loss Ctrs., Inc., 577 F.3d 752, 758 (7th Cir.
2009). It has not carried this burden. Plaintiff has substituted in an
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indispensable defendant which was contemplated by her, and known to
Defendants, from the beginning of this case. See Cunningham, 592 F.3d at
807 (subject-matter jurisdiction does not continue if it is later discovered
that there was no such jurisdiction at the outset, even when jurisdiction was
not questioned at the time of removal). Defendants concede that Nate’s
inclusion defeats diversity, (Docket #27 at 3), and do not argue that Nate’s
is a dispensable party or that Plaintiff seeks to join Nate’s in this case
fraudulently, id. at 4; Schur, 577 F.3d at 763–67. This action must, therefore,
be remanded to state court for lack of subject-matter jurisdiction.
Accordingly,
IT IS ORDERED that the Clerk of the Court take all appropriate
steps to effectuate the remand of this case back to the Milwaukee County
Circuit Court.
Dated at Milwaukee, Wisconsin, this 11th day of October, 2018.
BY THE COURT:

____________________________________
J. P. Stadtmueller
U.S. District Judge

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