Fraudulent Joinder (or Misjoinder) — If the Case Commences in State Court, Is the Propriety of Joinder Determined under the State or Federal Joinder Standard? — Case Law Split

Two Cases:

1.  Tampa Elec. Co. v. Travelers Indem. Co. of Am., 2017 U.S. Dist. LEXIS 144524 (M.D. Fla. Sept. 7, 2017):

  This matter comes before the Court upon consideration of Plaintiff Tampa Electric Company's ("TECO") Motion to Remand, filed on July 28, 2017 (Doc. # 10), Defendant Pipeline Distribution, Inc.'s ("PDI") response in opposition, filed on August 11, 2017 (Doc. # 24), and Defendant The Travelers Indemnity Company of America, Inc.'s ("Travelers") response in opposition, also filed on August 11, 2017 (Doc. # 25). For the reasons that follow, the Motion to Remand is GRANTED.

I. Background

TECO originally filed this action in state court, seeking declaratory relief and damages based on PDI's [*2]  and Travelers' refusal to defend and indemnify TECO in an underlying action. (Doc. # 2). Invoking diversity jurisdiction, Travelers removed the case to this Court. (Doc. # 1). Although TECO and PDI are both citizens of Florida, and complete diversity is therefore lacking, Travelers maintains that PDI is fraudulently joined and that its citizenship can be disregarded for diversity purposes. A brief review of the facts follows.

TECO's claims against Travelers and PDI arise from a personal-injury action filed by Mario Santos against TECO, PDI, and two other defendants, Posen Construction Co. ("Posen") and Johnson Engineering, Inc. (Doc. # 2 at ¶¶ 2, 10). Mr. Santos was employed by Posen, which was the prime contractor on a road expansion project. (Id. at ¶ 11). While Mr. Santos was operating a mixer, he struck an underground gas line, which exploded and caused him to suffer severe burns and permanent injuries. (Id. at ¶¶ 12, 13, 17). Mr. Santos alleged that TECO and PDI were negligent for failing to properly install, reposition, maintain, and mark the gas line. (Id. at ¶¶ 15-16).

Before the accident, TECO hired PDI to reposition the gas line in order to allow Posen to perform necessary [*3]  construction. (Id. at ¶ 14). TECO and PDI entered into a General Agreement for Contracted Work ("General Agreement"). (Id. at ¶ 18). Among other provisions, the General Agreement required PDI to obtain a commercial general liability policy and to name TECO as an additional insured on the policy. (Id. at ¶¶ 18, 20, 69). In addition, the General Agreement included a hold-harmless provision, which required PDI to defend and indemnify TECO for certain claims, including personal-injury claims arising from TECO's sole, contributory, or concurrent negligence. (Id. at ¶¶ 18-19; Doc. # 2 at 129-129).

PDI obtained a Commercial Insurance Policy from Travelers that named TECO as an additional insured ("the Policy"). (Doc. # 2 at ¶ 1). In the Santos action, Travelers initially defended TECO under the Policy pursuant to a reservation of rights. (Id. at ¶¶ 22, 25). Travelers also defended PDI. (Id. at ¶ 23).

Ultimately, Travelers settled Mr. Santos's claims against PDI. (Id. at ¶ 24). After the settlement, Mr. Santos filed a Fifth Amended Complaint, which asserted two negligence claims against TECO. (Id. at ¶ 31; Doc. # 1-1 at 173-179). In contrast to his prior complaint, Mr. Santos did not allege [*4]  that PDI was TECO's agent. (Id. at ¶ 32).

Based on that change, Travelers withdrew its defense of TECO. (Id. at ¶¶ 33, 40). In particular, Travelers maintained that TECO was no longer an "additional insured" because the Policy specified that a "person or organization does not qualify as an additional insured with respect to the independent acts or omissions of such person or organization." (Id. at ¶¶ 33, 35; Doc. # 1-1 at 181-82). Travelers characterized the Fifth Amended Complaint as alleging claims based on TECO's independent negligence. (Doc. # 1-1 at 181).

In this action, TECO asserts six claims. (Doc. # at ¶¶ 43-74). With respect to Travelers, TECO alleges that Travelers breached the Policy by failing to defend and indemnify TECO in the Santos action (Count I), TECO seeks a declaratory judgment with respect to Travelers' duty to defend and indemnify TECO in the Santos action (Count II), and TECO alleges that Travelers tortiously interfered with the General Agreement between TECO and PDI by settling PDI's claims in the Santos action. (Id. at ¶¶ 49-60).

With respect to PDI, TECO alleges that PDI breached the General Agreement by failing to defend and indemnify TECO in the Santos action [*5]  (Count IV), TECO alleges that PDI breached the General Agreement by failing to procure insurance for TECO (Count V), and TECO seeks contribution in the Santos action, pursuant to Fla. Stat. § 768.31 (Count VI). (Doc. # 2 at ¶¶ 61-74).

While the case was still pending in state court, PDI filed a Motion to Dismiss TECO's Complaint on July 17, 2017. (Doc. # 3). That same day, Travelers removed the case to this Court, with PDI's consent. (Doc. # 1). On July 28, 2017, TECO filed the instant Motion to Remand. (Doc. # 10). On July 31, 2017, PDI filed a memorandum of law in support of its Motion to Dismiss. (Doc. # 14). On August 7, 2017, the Court granted TECO's motion to stay consideration of PDI's Motion to Dismiss pending a decision on TECO's Motion to Remand. (Doc. ## 12, 23).

On August 11, 2017, PDI and Travelers filed separate responses in opposition to the Motion to Remand. (Doc. ## 24, 25). Accordingly, the Motion to Remand is ripe for review.

II. Discussion

As a general rule, a civil action filed in state court may be removed by a defendant to federal district court if the federal court possesses original jurisdiction. 28 U.S.C. § 1441(a). Travelers removed this action pursuant to 28 U.S.C. § 1332(a), which confers diversity jurisdiction when [*6]  an action is between citizens of different states and the amount in controversy exceeds $75,000. "Diversity jurisdiction requires complete diversity; every plaintiff must be diverse from every defendant." Triggs v. John Crump Toyota, Inc., 154 F.3d 1284, 1287 (11th Cir. 1998).

The parties agree that TECO is a Florida corporation with its principal place of business in Florida, that Travelers is a Connecticut corporation with its principal place of business in Connecticut, and that PDI is a Florida corporation with its principal place of business in Florida. (Doc. # 2 at ¶¶ 4-6; Doc. # 1 at ¶¶ 1-3). Therefore, for diversity purposes, TECO is a Florida citizen, Travelers is a Connecticut citizen, and PDI is a Florida citizen. 28 U.S.C. § 1332(c)(1) ("a corporation shall be deemed to be a citizen of every State and foreign state by which it has been incorporated and of the State or foreign state where it has its principal place of business").

Travelers concedes in the Notice of Removal that complete diversity is lacking because TECO and PDI are both Florida citizens. (Doc. # 1 at ¶ 1). In addition, 28 U.S.C. § 1441(b)(2) prohibits removal when a properly-served defendant is a citizen of the state in which the action is filed, as PDI is here. Nonetheless, Travelers maintains that removal was proper because [*7]  PDI was fraudulently joined as a party-defendant. (Doc. # 1 at ¶¶ 1, 6-7).

The judicially-created doctrine of fraudulent joinder provides an exception to the requirement of complete diversity and to the forum-defendant rule in 28 U.S.C. § 1441(b)(2). Triggs, 154 F.3d at 1287; Cabalceta v. Standard Fruit Co., 883 F.2d 1553, 1561 (11th Cir. 1989). Fraudulent joinder may be found in three situations: (1) "when there is no possibility that plaintiff can prove the claims against the resident [or non-diverse] defendant," (2) "when there is outright fraud in the pleading of jurisdictional facts," and (3) when "a diverse defendant is joined with a nondiverse defendant as to whom there is no joint, several or alternative liability and where the claim against the diverse defendant has no real connection to the claim against the nondiverse defendant." Triggs, 154 F.3d at 1287.

In this case, Travelers asserts that the first and third theories apply, which are addressed in turn below. (Doc. # 25 at 2-3). As the removing party, Travelers bears the "heavy" burden of establishing fraudulent joinder. Crowe v. Coleman, 113 F.3d 1536, 1538 (11th Cir. 1997). The Court "evaluate[s] the factual allegations in the light most favorable to the plaintiff and must resolve any uncertainties about state substantive law in favor of the plaintiff." Id.

A. TECO possesses a possible cause of action against PDI

In order [*8]  to demonstrate fraudulent joinder under the first theory, Travelers must establish by clear and convincing evidence that "there is no possibility [TECO] can establish a cause of action against [PDI]." Henderson v. Wash. Nat'l Ins. Co., 454 F.3d 1278, 1281 (11th Cir. 2006). Conversely, remand is warranted if there exists "a reasonable basis for predicting that the state law might impose liability on the facts involved." Crowe, 113 F.3d at 1542 (emphasis in original). The potential for liability "must be reasonable, not merely theoretical." Legg v. Wyeth, 428 F.3d 1317, 1325 n.5 (11th Cir. 2005).

Because PDI is the non-diverse and forum defendant, the relevant issue is whether TECO possesses a possible claim against PDI. As explained below, PDI is potentially liable on the breach-of-contract claim in Count IV of the Complaint. Therefore, the Court does not evaluate TECO's possibility of success on Counts V and VI. Cabalceta, 883 F.2d at 1561 (explaining that the issue is whether "the plaintiff can establish any cause of action against the resident defendant") (emphasis added)).

Under Florida law, a claim for breach of contract requires (1) a valid contract, (2) a material breach, and (3) damages. Abbott Labs., Inc. v. Gen. Elec. Capital, 765 So. 2d 737, 740 (Fla. 5th DCA 2000). TECO alleges that PDI breached the General Agreement's hold-harmless provision by failing to defend and indemnify TECO for Mr. Santos's personal-injury claims. (Doc. [*9]  # 1 at ¶¶ 62, 64, 65). TECO maintains that PDI's obligations extended to claims based on TECO's sole, contributory, and concurrent negligence. (Id. at ¶ 63).

In response to the Motion to Remand, Travelers argues that there is no possibility of success on this claim for the reasons stated in PDI's response in opposition, as well as in PDI's Motion to Dismiss the Complaint. (Doc. # 25 at 8, 13-14). Although the Motion to Dismiss is currently not at issue — and the Court expresses no opinion as to its merits — the Court will consider PDI's arguments in assessing whether TECO has a possible claim.

PDI first argues that Count IV fails as a matter of law because the hold-harmless provision expressly excludes claims "for statutory violation." (Doc. # 14 at 6-7; Doc. # 24 at 6). PDI contends that both of the claims in the Santos action are based on statutory violations.

Mr. Santos asserts two claims against TECO in his Fifth Amended Complaint: negligence (Count 1) and negligence per se (Count 2). (Doc. # 1-1 at 176-179). The negligence claim in Count 1 is based on TECO's alleged failure (a) to properly install and relocate its natural gas line, (b) to maintain the gas line at a reasonably safe [*10]  depth as required by 49 C.F.R. § 192.327 and the Florida Department of Transportation's Utility Accommodation Manual § 9.3, and (c) to notify others working on the project of the depth of the gas line. (Doc. # 1-1 at 177, ¶ 19). The negligence per se claim in Count 2 is based on TECO's alleged failure to comply with its statutory duty to mark the route of the gas line, pursuant to Florida's Underground Facility Damage and Prevention Act, Fla. Stat. §§ 556.101 et seq. (Doc. # 1-1 at 178, ¶¶ 22, 24).

The Court is not persuaded that Mr. Santos's tort claims necessarily fall outside the scope of the hold-harmless provision, so as to eliminate PDI's duty to indemnify. The hold-harmless provision states, in relevant part:

[PDI's] indemnification obligations hereunder shall not include claims of, or damages resulting from, gross negligence, or willful, wanton or intentional misconduct of [TECO] or its officers, directors, agents, or employees, or for statutory violation or punitive damages except and to the extent the statutory violation or punitive damages are caused by or result from the acts or omissions of [PDI].

(Doc. # 2 at 129 (emphasis added)). One plausible reading of the hold-harmless provision is that it excludes "claims . . . for statutory [*11]  violation" — that is, claims alleging a private right of action pursuant to a statute.

Here, Mr. Santos does not assert a private right of action under a statute. Of course, the negligence per se claim in Count 2 is premised on an underlying statutory violation. See Hesterly v. Royal Caribbean Cruises, Ltd., 515 F. Supp. 2d 1278, 1287 n.6 (S.D. Fla. 2007) ("negligence per se is the violation of a statute which establishes a duty upon a party to take precautions to protect a particular class of persons from a particular injury or type of injury."). But there is at least a question as to whether the phrase "claims . . . for statutory violation" is properly interpreted to cover a common-law negligence claim in which a statutory violation merely supplies the duty of care. Also notably, the hold-harmless provision specifies that PDI is not responsible for claims involving TECO's "gross negligence," but the provision does not absolve PDI of responsibility for claims involving regular negligence. See Mason v. Fla. Sheriffs' Self-Ins. Fund, 699 So. 2d 268, 270 (Fla. 5th DCA 1997) ("the inclusion of one thing implies the exclusion of the other").

To address this issue further would require a definitive interpretation of the General Agreement, which is not appropriate on a motion to remand. The jurisdictional inquiry "must not subsume substantive determination," [*12]  and this Court may not "weigh the merits of a plaintiff's claim beyond determining whether it is an arguable one under state law." Crowe, 113 F.3d at 1538.

For this same reason, the Court does not resolve PDI's argument that the exclusion applies not only to "claims . . . for statutory violation" but to "damages resulting from . . . for statutory violation." See Doc. # 2 at 129 ("[PDI's] indemnification obligations hereunder shall not include claims of, or damages resulting from, gross negligence, or willful, wanton or intentional misconduct of [TECO] or its officers, directors, agents, or employees, or for statutory violation" (emphasis added)). The Court simply notes that "damages resulting from . . . for statutory violation" arguably is an unnatural reading of the provision, and, as a general rule, courts are discouraged from applying a "strained and unnatural construction" to a contract. Health Options, Inc. v. Kabeller, 932 So. 2d 416, 420 (Fla. 2d DCA 2006) (internal quotation marks omitted); see also Goldberg v. Companion Life Ins. Co., 910 F. Supp. 2d 1350, 1352-53 (M.D. Fla. 2012) (discussing interpretative canons of "nearest referent" and "rule of the last antecedent").

Accordingly, Travelers fails to demonstrate that Mr. Santos's negligence per se claim in Count 2 is excluded by the hold-harmless provision. Travelers' argument is similarly unavailing [*13]  with respect to Count 1, which asserts regular negligence. Indeed, that claim does not mention any statutory violation. Rather, Mr. Santos alleges that TECO breached its duty of care under the common law, under a federal regulation, 49 C.F.R. § 192.327, and under a Florida transportation manual. (Doc. # 1-1 at 177, ¶ 19).

In its Motion to Dismiss, PDI also briefly argues that TECO's claims are barred as a matter of law pursuant to a General Release executed by Mr. Santos when he settled his claims against PDI. (Doc. # 14 at 12-13). The General Release, which is attached to the Motion to Dismiss, discharges not only Mr. Santos's claims against PDI, but his claims for vicarious liability based on PDI's conduct. (Doc. # 14-1 at 2-3). However, the General Release expressly preserves Mr. Santos's claims against TECO to the extent they are based on TECO's own negligence. (Id. at 3).

In support of its argument, PDI relies on General Asphalt Co. v. Bob's Barricades, Inc., 22 So. 3d 697 (Fla. 3d DCA 2009), which held that a subcontractor had no duty to indemnify a general contractor where the subcontractor entered into a settlement agreement in which the injured party released claims against the subcontractor as well as claims against the contractor based on vicarious liability. Id. at 698-99. Similar to this [*14]  case, the settlement agreement preserved the injured party's claims against the contractor for the contractor's own negligence. Id. at 698. The Third District Court of Appeal affirmed summary judgment in favor of the subcontractor, holding that it had satisfied its contractual duty to defend and indemnify. Id. at 698-99.

Despite these facial similarities, General Asphalt Co. is not controlling for purposes of the Motion to Remand. In this case, the General Agreement required PDI to defend and indemnify TECO for TECO's sole negligence. (Doc. # 2 at ¶ 63); cf. Gen. Asphalt Co., 22 So. 3d at 699 (noting that subcontractor only had a duty to indemnify for claims arising from subcontractor's negligence). Because the General Release does not waive claims based on TECO's own negligence, PDI may still have a contractual duty to defend and indemnify TECO for those claims.

PDI also relies on Florida's Uniform Contribution Among Tortfeasors Act, which provides that a release given in good faith to one tortfeasor "discharges the tortfeasor to whom it is given from all liability for contribution to any other tortfeasor." Fla. Stat. § 768.31(5)(b). However, the Act specifically provides that a release "does not discharge any of the other tortfeasors from liability for the injury [*15]  . . . unless its terms so provide[.]" Fla. Stat. § 768.31(5)(a). Again, the General Release preserves claims against TECO for TECO's own negligence. Because the hold-harmless provision applies to such claims, TECO retains a potential claim for contractual indemnification. Eller & Co. v. Morgan, 393 So. 2d 580, 582 (Fla. 1st DCA 1981); SEFC Bldg. Corp. v. McCloskey Window Cleaning, Inc., 645 So. 2d 1116, 1117 (Fla. 3d DCA 1994) (noting that contract to indemnify a party for its own wrongful acts will be enforced if the terms are clear and unequivocal).

Accordingly, for purposes of the Motion to Remand, the Court finds that Travelers has failed to sustain its heavy burden to demonstrate fraudulent joinder. Mr. Santos alleges claims against TECO that arguably fall within the hold-harmless provision, and PDI has refused to defend and indemnify TECO for those claims. TECO therefore possesses a possible action for breach of the hold-harmless provision.

B. PDI is properly joined under Fed. R. Civ. P. 20

Travelers alternatively argues that PDI is not properly joined in this action under Rule 20 of the Federal Rules of Civil Procedure, which sets forth the standard for permissive joinder of parties. (Doc. # 25 at 14-17). Relying on two Eleventh Circuit opinions, Tapscott v. MS Dealer Service Corp., 77 F.3d 1353 (11th Cir. 1996),1 and Triggs v. John Crump Toyota, Inc., 154 F.3d 1284 (11th Cir. 1998), Travelers argues that the misjoinder is so egregious as to be fraudulent. Again, the Court disagrees.

Before reaching the merits of Travelers' joinder argument, [*16]  TECO asserts that Florida's more lenient joinder rule governs, rather than Rule 20 of the Federal Rules of Civil Procedure. (Doc. # 10 at 25 n.2). Outside the Eleventh Circuit, courts are split on whether the state or federal rule supplies the relevant standard for the fraudulent-joinder analysis. In re Prempro Prods. Liab. Litig., 591 F.3d 613, 622 n.6 (8th Cir. 2010). But in both Triggs and Tapscott, the Eleventh Circuit evaluated joinder under the federal rule without acknowledging the parallel state rule. Triggs, 154 F.3d at 1288; Tapscott, 77 F.3d at 1360. In light of this authority, and because TECO satisfies the more stringent standard under Rule 20, the Court likewise evaluates joinder under the federal rule. In re Prempro Prods. Liab. Litig., 591 F.3d at 622 n.6; Driver v. Protective Life Ins. Co., No. 6:17-CV-00186-RDP, 2017 U.S. Dist. LEXIS 87253, 2017 WL 2462650, at *3 n.6 (N.D. Ala. June 7, 2017).

Pursuant to Rule 20(a)(2), defendants may be joined in one action if:

(A) any right to relief is asserted against them jointly, severally, or in the alternative with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences; and

(B) any question of law or fact common to all defendants will arise in the action.

Fed. R. Civ. P. 20(a)(2)(A)-(B).

The gist of TECO's Complaint is alternative liability, which "typically arises when the substance of plaintiff's claim indicates that plaintiff is entitled to relief from someone, but the plaintiff does not know which of two or more defendants is liable [*17]  under the circumstances set forth in the complaint." Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1654 (3d ed.); Saunders v. Duke, 766 F.3d 1262, 1268 n.2 (11th Cir. 2014). TECO's primary claim is that Travelers possessed a duty to defend and indemnify TECO as an additional insured under the Policy. (Doc. # 2 at ¶¶ 46-47). But assuming that Travelers had no such duty, TECO alleges that PDI is liable for failing to procure the necessary insurance, as required by the General Agreement. (Id. at ¶ 70). Both of these claims turn on one issue: whether TECO is covered under the Policy. PDI's joinder thus satisfies Rule 20.

Even if PDI's joinder were not proper under Rule 20, the Eleventh Circuit instructs that misjoinder is fraudulent only when "the claim against the diverse defendant has no real connection to the claim against the nondiverse defendant." Triggs, 154 F.3d at 1287, 1289-90. In this case, there exists a real connection between the claims against Travelers and PDI: the claims arise from the same accident, the claims require interpretation of the same insurance policy, and TECO seeks a defense and indemnity for the same underlying action. See Hyde Park Place II Condo. Ass'n v. London, No. 8:16-cv-1935-T-36AEP, 2016 U.S. Dist. LEXIS 162979, 2016 WL 6821126, at *3 (M.D. Fla. Nov. 14, 2016) (finding no fraudulent joinder where the plaintiff [*18]  pursued multiple insurers in the same action to recover for the same loss); Harvey v. GEICO Gen. Ins. Co., No. 14-80078-CIV, 2014 U.S. Dist. LEXIS 106524, 2014 WL 3828434, at *4 (S.D. Fla. Aug. 4, 2014) (finding no fraudulent joinder where the claims arose from the same accident and the same settlement negotiations).

In a final challenge, Travelers argues that the joinder of claims against PDI and Travelers in the same action violates Florida's "nonjoinder of insurers" statute, Fla. Stat. § 627.4136. (Doc. # 25 at 16-17). The nonjoinder statue provides, in relevant part:

It shall be a condition precedent to the accrual or maintenance of a cause of action against a liability insurer by a person not an insured under the terms of the liability insurance contract that such person shall first obtain a settlement or verdict against a person who is an insured under the terms of such policy for a cause of action which is covered by such policy.

Fla. Stat. § 627.4136(1).

Travelers cites no authority, nor has the Court located any authority, to hold that non-compliance with a nonjoinder statute demonstrates "egregious" misjoinder under the Tapscott and Triggs line of cases. And in any event, Travelers fails to demonstrate that the statute applies to TECO's claims. "By its terms, the nonjoinder statute applies only to a [*19]  cause of action which is covered by a liability insurance contract, i.e., a tort action." Hazen v. Allstate Ins. Co., 952 So. 2d 531, 538 (Fla. 2d DCA 2007). Here, TECO is not asserting any claim that is covered by the Policy. TECO instead seeks coverage as an "additional insured" under the Policy, which "essentially is a claim against its own insurer for coverage" and is not barred by the nonjoinder statute. Gen. Star Indem. Co. v. Boran Craig Barber Engel Constr. Co., 895 So. 2d 1136, 1138 (Fla. 2d DCA 2005).

Based on the foregoing, the Court holds that PDI's joinder in this action is not fraudulent. Because complete diversity is lacking, and because Travelers identifies no other basis for jurisdiction, the Court must remand the case to state court. See 28 U.S.C. § 1447(c) ("If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.").

C. Costs

Pursuant to 28 U.S.C. § 1447(c), "[a]n order remanding the case may require payment of just costs and any actual expenses, including attorney fees, incurred as a result of the removal." However, "[a]bsent unusual circumstances, courts may award attorney's fees under § 1447(c) only where the removing party lacked an objectively reasonable basis for seeking removal." Martin v. Franklin Capital Corp., 546 U.S. 132, 141, 126 S. Ct. 704, 163 L. Ed. 2d 547 (2005).

In the Motion for Remand, TECO requests costs including attorneys' fees. (Doc. #10 at 27-29). But as the above analysis indicates, [*20]  the parties provided reasonable arguments on both sides. Although Travelers was ultimately unsuccessful, the Court does not find that an award of costs and attorneys' fees is warranted.

III. Conclusion

Based on the foregoing, it is ORDERED, ADJUDGED, and DECREED that:

(1) Plaintiff Tampa Electric Company's Motion to Remand (Doc. # 10) is GRANTED;

(2) The Clerk is directed to REMAND the case to the Thirteenth Judicial Circuit in and for Hillsborough County, to TERMINATE any pending motion, including the Motion to Dismiss (Doc. # 3), and to CLOSE this case.

DONE and ORDERED in Chambers in Tampa, Florida, this 7th day of September, 2017.

2. In re Prempro Prods. Liab. Litig., 591 F.3d 613 (8th Cir. 2010):

The plaintiffs, women and next-of-kin of deceased women, sued a number of manufacturers of hormone replacement therapy drugs, asserting the drugs caused breast cancer. The defendants, manufacturers of hormone replacement therapy drugs ("manufacturers"), removed the cases to federal court. The plaintiffs moved to remand to state court on the grounds that complete diversity of citizenship was lacking, thereby depriving the court of subject matter jurisdiction. The district court concluded that the plaintiffs' claims were misjoined to defeat diversity jurisdiction, dropped the non-diverse plaintiffs, and dismissed these cases. Plaintiffs appeal, and we reverse the district court's orders denying plaintiffs' motions to remand and granting the manufacturers' motions to dismiss duplicative cases.

I. BACKGROUND

A. Hormone Replacement Therapy

Hormone replacement therapy ("HRT") drugs are used in the treatment of menopausal symptoms. Such symptoms include hot flashes, chills, headache, irritability, and vaginal atrophy. HRT  [**5] drugs consist of a combination of estrogen and progestin. The Women's Health Initiative (WHI), a group focused on defining the risks and benefits of strategies that could reduce heart disease, cancer, and fractures in post-menopausal women, began studying the effects of HRT drugs in the 1990s. The WHI enrolled 161,809 post-menopausal  [*617]  women between 50 and 79 years of age into a set of clinical trials.

WHI studied the effect of estrogen plus progestin in 16,608 women with an intact uterus. Women were either assigned a daily dose of estrogen plus progestin or a placebo. In 2002, an independent data and safety monitoring board revealed that the number of cases of breast cancer in the estrogen plus progestin group had crossed the boundary established as a signal of increased risk. The independent board recommended that the trial be ended early based on an increased breast cancer risk. The results of the WHI study were published in The Journal of the American Medical Association. See Risks and Benefits of Estrogen Plus Progestin in Healthy Postmenopausal Women, 288 J. Am. Med. Ass'n. 321-333 (2002), available at http://jama.ama-assn.org/cgi/content/full/288/3/321.

B. The Lawsuits

This case  [**6] concerns three lawsuits. The Kirkland suit was brought by 57 women who each alleged injuries resulting from their use of HRT medications. The Kirkland plaintiffs alleged they each developed breast cancer after taking HRT drugs that were manufactured, marketed, and sold by one or more of eleven manufacturers. Fourteen Kirkland plaintiffs are citizens of the same state as at least one of the manufacturers. Three of those fourteen plaintiffs asserted claims against manufacturers with the same citizenship. For example, Nancy States is a citizen of Pennsylvania, the same state as Wyeth Pharmaceuticals, Inc., a company that manufactured and marketed HRT drugs she took.

The Jasperson suit was brought by Rick Jasperson, as trustee of the next-of-kin of six decedents who used HRT drugs. The Jasperson plaintiffs alleged that in each case, the next-of-kin sustained injuries when a woman family member developed breast cancer as a result of taking HRT drugs that were manufactured, marketed, and sold by one or more of six defendants. One of the six decedents, Elizabeth Mendelson, was a citizen of New Jersey, the same state as Pharmacia Corporation, Wyeth, and Pharmacia & Upjohn Company, companies  [**7] that manufactured and marketed HRT drugs that Mendelson took.

The Allen suit was brought by 60 women who also alleged they each developed breast cancer as a result of HRT medications manufactured, marketed, and sold by one or more of eight defendants. Five Allen plaintiffs are citizens of the same state as at least one of the defendants. Three of these five plaintiffs asserted claims against manufacturers who were citizens of the same state. For example, Rachel Epstein is a citizen of New York, the same state as Pfizer, a company that manufactured and marketed HRT drugs that she took.

C. Procedural History

The Kirkland, Jasperson, and Allen plaintiffs filed suits for damages in Minnesota state court in July 2008. In each of the three consolidated cases, the plaintiffs alleged they or a decedent family member had developed breast cancer from taking HRT medications. The plaintiffs asserted state law claims for negligence, strict liability, breach of implied warranty, breach of express warranty, fraud, negligent misrepresentation, and statutory violations of the False and Misleading Advertising Act, the Prevention of Consumer Fraud Act, and the Uniform Deceptive Trade Practices Act.

The manufacturers  [**8] removed all three cases to the United States District Court for the District of Minnesota. In the manufacturers' removal petitions, they argued  [*618]  diversity jurisdiction existed under the fraudulent misjoinder doctrine. They alleged that the plaintiffs joined their claims together against the manufacturers to defeat diversity jurisdiction. The manufacturers argued that the plaintiffs' claims were fraudulently misjoined, stating that those claims did not arise out of the same transaction or occurrence, a requirement for joinder under Federal Rule of Civil Procedure 20(a).

The plaintiffs filed motions to remand the cases to state court for lack of subject matter jurisdiction, asserting that complete diversity between the plaintiffs and defendants did not exist. Before the plaintiffs' motions were addressed, the litigation came before the United States Judicial Panel on Multidistrict Litigation ("MDL"). The Kirkland and Jasperson cases were transferred to the Eastern District of Arkansas and assigned to an MDL judge. Plaintiffs requested that the MDL court rule on their pending motions to remand to state court.

Before the MDL court ruled on the question of remand, on December 19, 2008, the  [**9] manufacturers moved to dismiss most of the claims brought by the Kirkland plaintiffs and all of the claims brought on behalf of the Jasperson decedents on the grounds that the plaintiffs' claims were duplicative of earlier filed California claims. 1 Plaintiffs' oppositions to the motions were due on December 30, 2008, and they requested an extension of time to reply to the manufacturers' motions to dismiss.

On December 29, 2008, the court denied plaintiffs' requests for an extension, stating that it "did not grant your Motion for Extension of Time to Respond, because I'm satisfied that you couldn't say anything that would change my mind on the issues involved here." On that same day, the court denied in part plaintiffs' motions to remand the Kirkland and Jasperson cases to state court, concluding that the plaintiffs were misjoined. The court stated that there was no reason for the joinder of the nondiverse plaintiffs other than to defeat diversity jurisdiction, and explained

MDL courts have repeatedly held that misjoined plaintiffs will not defeat diversity . . . .

[E]ven if a non-diverse plaintiff [has] a valid cause  [**10] of action against a defendant, that plaintiff may not prevent removal based on diversity of citizenship if there is no reasonable basis for the joinder of that nondiverse plaintiff with the other plaintiffs. (Quotations omitted).

Appellants' Add. at 134-35.

The court concluded that the plaintiffs had failed to properly join under Rule 20 because "[t]he only thing common among Plaintiffs is that they took an HRT drug -- but not necessarily the same HRT drug. Plaintiffs are residents of different states and were prescribed different HRT drugs by different doctors, for different lengths of time, in different amounts, and they suffered different injuries." Id. at 135.

The court granted four of the Kirkland and Jasperson plaintiffs' motions to remand because those plaintiffs had asserted claims against a defendant who was from the same state. The court denied 59 Kirkland and Jasperson plaintiffs' motions to remand because the plaintiffs were not asserting claims against manufacturers from the same state. The court granted the manufacturers' motions to dismiss as to these 59 plaintiffs. The court dropped the 59 plaintiffs from the lawsuit and dismissed their claims, because they duplicated  [**11] previously-filed California claims.

 [*619]  On December 30, 2008, the plaintiffs moved pursuant to Rule 59(e) to alter or amend the December 29 orders of dismissal. The plaintiffs argued that the court improperly dismissed the cases without giving them an opportunity to respond to the motions, and the court abused its discretion by dismissing the cases rather than staying the Minnesota actions pending disposition of the California cases. The district court denied the Rule 59(e) motions on December 30, 2008.

In February 2009, the United States Judicial Panel on MDL transferred the Allen case to the same MDL court for coordinated proceedings with other pending HRT cases. On February 10, 2009, plaintiffs refiled their motions to remand the Allen case to state court. The court denied the motions on that same day, stating that the plaintiffs were improperly joined under Rule 20 and that he could "see no reason for the joinder of the non-diverse plaintiffs other than to defeat diversity jurisdiction." Id. at 383. The court granted three of the Allen plaintiffs' motions to remand because those women had asserted claims against a manufacturer who was from the same state. The court granted the manufacturers'  [**12] motions to dismiss as to the remaining 57 plaintiffs. The court dropped the remaining 57 plaintiffs from the lawsuit and dismissed their claims because of their duplicative cases.

As a result of the district court's orders in Kirkland, Jasperson, and Allen, seven plaintiffs' cases were remanded to state court and the remaining 116 plaintiffs were dropped from the litigation and their cases were dismissed.

The dismissed plaintiffs’2 appeal (1) the district court's December 29, 2008, orders and judgments denying plaintiffs' motions to remand to state court and granting defendants' motions to dismiss duplicative cases; and (2) the district court's December 30, 2008, orders on plaintiffs' Rule 59(e) motions to alter or amend the final orders of dismissal. Plaintiffs argue the district court: (1) erred in denying their motions to remand to state court when it adopted the fraudulent misjoinder doctrine; (2) erred by dismissing the plaintiffs from the cases without giving them a reasonable opportunity to be heard; and (3) abused its discretion by refusing to stay the duplicative Minnesota claims pending final resolution of the California claim. We reverse on the first issue, thus we need not  [**13] address the final two issues.

II. DISCUSSION

On appeal, the plaintiffs argue the district court erred in denying their motions to remand by applying a discredited theory known as "fraudulent misjoinder" 3 when it concluded they were improperly joined to defeat diversity jurisdiction.

"We review the district court's denial of the remand motion de novo." Menz v. New Holland North America, Inc., 440 F.3d 1002, 1004 (8th Cir. 2006); see also Wilkinson v. Shackelford, 478 F.3d 957, 963 (8th Cir. 2007) ("Whether a plaintiff has fraudulently joined a party to defeat diversity jurisdiction is a question of subject matter jurisdiction we review de novo.").

A defendant may remove a state law claim to federal court only if the action originally could have been filed there. Phipps v. FDIC, 417 F.3d 1006, 1010 (8th Cir. 2005). Diversity jurisdiction under 28 U.S.C. § 1332 requires an amount in controversy greater than $ 75,000 and complete diversity of citizenship among the  [*620]  litigants. 28 U.S.C. § 1332(a). "Complete diversity of citizenship  [**14] exists where no defendant holds citizenship in the same state where any plaintiff holds citizenship." OnePoint Solutions, LLC v. Borchert, 486 F.3d 342, 346 (8th Cir. 2007).

After removal, a plaintiff may move to remand the case to state court, and the case should be remanded if it appears that the district court lacks subject matter jurisdiction. 28 U.S.C. § 1447(c). The defendant bears the burden of establishing federal jurisdiction by a preponderance of the evidence. Altimore v. Mount Mercy College, 420 F.3d 763, 768 (8th Cir. 2005). All doubts about federal jurisdiction should be resolved in favor of remand to state court. Wilkinson, 478 F.3d at 963.

Courts have long recognized fraudulent joinder as an exception to the complete diversity rule. See 14B Charles Alan Wright et al., Federal Practice and Procedure § 3723, at 788-789 (4th ed. 2009). Fraudulent joinder occurs when a plaintiff files a frivolous or illegitimate claim against a non-diverse defendant solely to prevent removal. Filla v. Norfolk S. Ry. Co., 336 F.3d 806, 809 (8th Cir. 2003). When determining if a party has been fraudulently joined, a court considers whether there is any reasonable basis in fact or law to support  [**15] a claim against a nondiverse defendant. Wilkinson, 478 F.3d at 964.

A more recent, somewhat different, and novel exception to the complete diversity rule is the fraudulent misjoinder doctrine which one appellate court 4 and several district courts 5 have adopted. Fraudulent misjoinder

occurs when a plaintiff sues a diverse defendant in state court and joins a viable claim involving a nondiverse party, or a resident defendant, even though the plaintiff has no reasonable procedural basis to join them in one action because the claims bear no relation to each other. In such cases, some courts have concluded that diversity is not defeated where the claim that destroys diversity has "no real connection with the controversy" involving the claims that would qualify for diversity jurisdiction.

Ronald A. Parsons, Jr., Should the Eighth Circuit Recognize Procedural Misjoinder?, 53 S.D. L. Rev. 52, 57 (2008).

The Eleventh Circuit first considered and adopted the fraudulent misjoinder doctrine in Tapscott v. MS Dealer Serv. Corp., 77 F.3d 1353, 1360 (11th Cir. 1996).  [**17] Tapscott concerned a putative class action filed  [*621]  in Alabama state court. Id. at 1355. In the initial complaint, one Alabama plaintiff sued four defendants, one of whom was an Alabama resident. Id. The first amended complaint added sixteen named plaintiffs and twenty-two named defendants. Id. The plaintiffs then amended their complaint again, naming four additional plaintiffs, all Alabama residents, and three named defendants. Id. One of those defendants, Lowe's Home Centers, was a North Carolina resident. Id.

The initial complaint and first amended complaint alleged fraud violations arising from the sale of automobile service contracts. Id. The second amended complaint alleged fraud violations arising from the sale of extended service contracts in connection with the sale of retail products. Id. The result of the amended complaints and joinder under Rule 20 was to create two distinct groups of plaintiffs and defendants: the non-diverse "automobile class" and the diverse "merchant class." Id. at 1359-60, n.16.

Lowe's Home Centers removed the case to federal court and moved to sever the claims against it from the claims against the automobile class defendants. Id. at 1355. The plaintiffs  [**18] moved to remand to state court for lack of federal subject matter jurisdiction. Id. The district court granted Lowe's Home Centers' motion to sever and denied the plaintiffs' motion to remand to state court, holding that there was "no allegation of joint liability between Lowe's and any other defendant and no allegation of conspiracy" and "there was an improper and fraudulent joinder, bordering on a sham." Id. at 1360 (internal quotations omitted).

On appeal, the Eleventh Circuit Court of Appeals affirmed the district court's denial of the plaintiffs' motion to remand. Id. The court held there was misjoinder under Rule 20 because there was "no real connection" between the two sets of alleged transactions. Id. The court reasoned that the alleged transactions concerning the automobile class were wholly distinct from the transactions involving the merchant class. Id. The only similarity between the two classes was that both classes violated particular fraud provisions in the Alabama state code. Id. The Eleventh Circuit cautioned that "mere misjoinder" is not fraudulent misjoinder. Id. However, the plaintiffs' joinder of these two groups of unrelated defendants was "so egregious as to constitute  [**19] fraudulent joinder." Id. Therefore, the Eleventh Circuit reasoned that the district court did not err in concluding the plaintiffs attempted to defeat diversity jurisdiction by misjoinder. Id.

Courts' reactions to Tapscott have been mixed. Some district courts have adopted the doctrine as a means of ensuring defendants their statutory right of removal to the federal courts and precluding plaintiffs from preventing removal to federal court. See, e.g., In re Diet Drugs, No. 98-20478, 1999 U.S. Dist. LEXIS 11414, 1999 WL 554584, at *3 (E.D. Pa. July 16, 1999) (unreported) (explaining that plaintiffs' egregious misjoinder "wrongfully deprives Defendants of their right of removal."); Reed v. American Medical Sec. Group, Inc., 324 F. Supp. 2d 798, 805 (S.D. Miss. 2004) (adopting the fraudulent misjoinder doctrine because "diverse defendants ought not be deprived of their right to a federal forum by such a contrivance as this."). See also Laura J. Hines & Steven S. Gensler, Driving Misjoinder: The Improper Party Problem in Removal Jurisdiction, 57 Ala. L. Rev. 779, 825 (2006) (explaining that fraudulent misjoinder protects access to federal courts).

Other courts have criticized Tapscott, arguing that questions of joinder  [**20] under state law do not implicate federal subject matter jurisdiction, federal jurisdiction is  [*622]  to be narrowly construed, and the fraudulent misjoinder doctrine has created an unpredictable and complex jurisdictional rule. See, e.g., Osborn v. Metropolitan Life Ins. Co., 341 F. Supp. 2d 1123, 1127 (E.D. Cal. 2004) (rejecting fraudulent misjoinder because "the last thing the federal courts need is more procedural complexity."); Rutherford v. Merck & Co., 428 F. Supp. 2d 842, 851 (S.D. Ill. 2006) (holding that Tapscott is an improper expansion of federal diversity jurisdiction, and misjoinder should be resolved by a state court); 14B Charles Alan Wright et al., Federal Practice and Procedure § 3723, at 876 (4th ed. 2009) (explaining that fraudulent misjoinder adds "a level of complexity -- and additional litigation -- to a federal court's decision regarding removal.").

The Eighth Circuit Court of Appeals has not yet considered the fraudulent misjoinder doctrine. See Parsons, supra, at 60. We make no judgment on the propriety of the doctrine in this case, and decline to either adopt or reject it at this time. Rather, on the record in this case, we conclude that even if we adopted the doctrine,  [**21] the plaintiffs' alleged misjoinder in this case is not so egregious as to constitute fraudulent misjoinder.

Rule 20(a)(1), Federal Rules of Civil Procedure, allows multiple plaintiffs to join in a single action if (i) they assert claims "with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences;" and (ii) "any question of law or fact common to all plaintiffs will arise in the action." 6  In construing Rule 20, the Eighth Circuit has provided a very broad definition for the term "transaction." As stated in Mosley v. General Motors Corp., 497 F.2d 1330 (8th Cir. 1974):

"Transaction" is a word of flexible meaning. It may comprehend a series of many occurrences, depending not so much upon the immediateness of their connection as upon their logical relationship.

Accordingly, all "logically related" events entitling a person to institute a legal action against another generally are regarded as comprising a transaction or occurrence. The analogous interpretation of the terms as used in Rule 20 would permit all reasonably related claims for relief by or against different parties to be tried in a single proceeding. Absolute identity of all events  [**22] is unnecessary.

Id. at 1333 (citations omitted); see also 7 Charles A. Wright et al., Federal Practice and Procedure, § 1653, at 415 (3d ed. 2001) (explaining that the transaction/ occurrence requirement prescribed by Rule 20(a) is not a rigid test and is meant to be "read as broadly as possible whenever doing so is likely to promote judicial economy.").

 [*623]  After considering the Rule 20 joinder standards, we conclude that the manufacturers have not met their burden of establishing that plaintiffs' claims are egregiously misjoined.7  Plaintiffs' claims arise from a series of transactions between HRT pharmaceutical manufacturers and individuals that have used HRT drugs. Plaintiffs allege the manufacturers conducted a national sales and marketing campaign to falsely promote the safety and benefits of HRT drugs and understated the risks of HRT drugs. Plaintiffs contend their claims are logically related because they each developed breast cancer as a result of the manufacturers' negligence in designing, manufacturing, testing, advertising, warning, marketing, and selling HRT drugs. Some of the plaintiffs allege to have taken several HRT drugs made by different manufacturers.

Furthermore, given the nature of the plaintiffs' claims, this litigation is likely to contain common questions of law and fact. See Hines & Gensler, supra, at 822 ("When plaintiffs join together to sue a defendant based on the purchase of a common product or having engaged in a common transaction, it seems rather clear that their claims will involve some common question of law or fact."). One such common question might be the causal link between HRT drugs and breast cancer. Causation for all of the plaintiffs' claims will likely focus on the 2002 WHI study suggesting a link between HRT drugs and breast cancer and whether the manufacturers knew of the dangers of HRT drugs before the publication of that study.

Based on the plaintiffs' complaints, we cannot say that their claims have "no real connection" to each other such that they are egregiously misjoined. See Tapscott, 77 F.3d at 1360. This is unlike Tapscott where the alleged transactions concerning the automobile class were  [**25] wholly distinct from the transactions involving the merchant class and there was "no real connection" between the two sets of transactions. Id. Here, there may be a palpable connection between the plaintiffs' claims against the manufacturers as they all relate to similar drugs and injuries and the manufacturers' knowledge of the risks of HRT drugs.

Furthermore, the manufacturers have presented no evidence that the plaintiffs joined their claims to avoid diversity jurisdiction. HN7[] "[T]he majority of courts demand more than simply the presence of nondiverse, misjoined parties, but rather a showing that the misjoinder reflects an egregious or bad faith intent on the part of the plaintiffs to thwart removal." Hines & Gensler, supra, at 803. Without any evidence that the plaintiffs acted with bad faith, we decline to conclude they egregiously misjoined their claims.

We clarify that we make no judgment on whether the plaintiffs' claims are properly joined under Rule 20. See Moore v. SmithKline Beecham Corp., 219 F. Supp. 2d 742, 746 (N.D. Miss. 2002) ("Of course, the court is not faced with and expresses no opinion as to the issue of whether joinder is proper in this case; rather, the court's  [**26] task is solely to determine whether the Plaintiffs are so egregiously misjoined that fraudulent joinder has taken place."). It may be that the plaintiffs' claims are not properly joined, and it has been suggested that the proper procedure may be for the manufacturers to argue that to the state  [*624]  court. 8 See Johnson v. Glaxo Smith Kline, 214 F.R.D. 416, 421 (S.D. Miss. Mar. 29, 2002) (holding that even if defendants are correct that plaintiffs' claims are improperly joined, the issue of "mere misjoinder" is more appropriately addressed to the state district court). However, it is not clear that the joinder is so egregious and grossly improper under the broadly-interpreted joinder standards that it warrants an adoption and application of the fraudulent misjoinder doctrine. See Walton v. Tower Loan of Miss., 338 F. Supp. 2d 691, 695 (N.D. Miss. 2004) ("[F]or Tapscott to be applicable, this court would be required to find a level of misjoinder that was not only improper, but grossly improper . . . ."). Therefore, absent evidence that plaintiffs' misjoinder borders on a "sham," see Tapscott, 77 F.3d at 1360, we decline to apply Tapscott to the present case.

III. CONCLUSION

Because the joinder of claims in this case does not constitute egregious misjoinder, complete diversity does not exist and the district court erred in denying plaintiffs' motions to remand to state court. We reverse the district court's orders and judgments granting in part and denying in part plaintiffs' motions to remand to state court and instruct the district court to remand all of the cases to Minnesota state court for lack of diversity jurisdiction. Because the district court lacked jurisdiction to act in this matter, we also vacate the district  [**28] court's orders granting the manufacturers' motions to dismiss the duplicative cases. 9

 


The California lawsuits had also been transferred to an MDL court.

The plaintiffs whose cases were remanded to state court are not parties to these appeals.

Some courts refer to this judicially-created doctrine as "procedural misjoinder."

Although the Eleventh Circuit is the only federal appellate court to adopt fraudulent misjoinder, see Tapscott v. MS Dealer Serv. Corp., 77 F.3d 1353, 1360 (11th Cir. 1996), abrogated on other grounds by, Cohen v. Office Depot, Inc., 204 F.3d 1069 (11th Cir. 2000), the Fifth and Ninth Circuits  [**16] have acknowledged it, although not expressly adopted it. See In re Benjamin Moore & Co., 309 F.3d 296, 298 (5th Cir. 2002) (citing Tapscott, 77 F.3d at 1360) ("[I]t might be concluded that misjoinder of plaintiffs should not be allowed to defeat diversity jurisdiction."); In re Benjamin Moore & Co., 318 F.3d 626, 630-31 (5th Cir. 2002) ("[W]ithout detracting from the force of the Tapscott principle that fraudulent misjoinder of plaintiffs is no more permissible than fraudulent misjoinder of defendants to circumvent diversity jurisdiction, we do not reach its application in this case."); California Dump Truck Owners Ass'n v. Cummins Engine Co., Inc., 24 Fed. Appx. 727, 729 (9th Cir. 2001) ("For purposes of discussion we will assume, without deciding, that this circuit would accept the doctrines of fraudulent and egregious joinder as applied to plaintiffs.").

Whether the federal or state rules on joinder apply has also received conflicting results post-Tapscott. Compare Tapscott, 77 F.3d at 1360 (applying, without analysis, the federal rules of joinder to determine that the plaintiffs egregiously misjoined the defendants), and Brooks v. Paulk & Cope, Inc., 176 F. Supp. 2d 1270, 1274 (M.D. Ala. 2001) (applying the Federal Rules of Civil Procedure), with Osborn, 341 F. Supp. 2d at 1128 ("[M]ost courts looking at this issue have applied the state rule. This seems the better choice since the question is whether the parties were misjoined in state court."), and Asher v. Minnesota Mining and Mfg. Co., No. 04CV522KKC, 2005 U.S. Dist. LEXIS 42266, 2005 WL 1593941, at *6 (E.D. Ky. June 30, 2005) (unreported) (stating that more courts apply state procedural rules). However, we decline to address this choice of law issue because  [**23] the standards for joinder under Fed. R. Civ. P. 20 and Minn. R. Civ. P. 20.01 are identical in all significant respects, and application of the state joinder rules does not affect our analysis. Therefore, for purposes of this case only, we apply the federal rules in addressing the misjoinder allegation.

We observe that the district court determined that removal was proper  [**24] because the plaintiffs failed to meet the requirements of Fed. R. Civ. P. 20(a). But it was the manufacturers' burden as the removing party to prove that federal jurisdiction exists. See Altimore, 420 F.3d at 768.

Considering the uncertainty surrounding  [**27] the propriety of the joinder of plaintiffs' claims, the preferable course of action may have been for defendants to challenge the misjoinder in state court before it sought removal. See 14B Charles A. Wright et al., Federal Practice and Procedure § 3723, at 658 (3d ed. 1998) ("[T]he fraudulent-joinder doctrine and its allied jurisprudence adds a further level of complexity -- and additional litigation -- to a federal court's decision regarding removal jurisdiction . . . . In many situations this confusion easily could be avoided by having the removing party challenge the misjoinder in state court before seeking removal.").

We need not consider plaintiffs' remaining claims because resolution of the fraudulent misjoinder issue renders resolution of any other claims unnecessary.

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