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Ray v. FCA U.S. LLC

United States District Court, S.D. Texas, Corpus Christi Division

July 18, 2017

ELOISA RAY, Plaintiff,
v.
FCA U.S. LLC; dba CHRYSLER, Defendants.

          ORDER

          Hilda Tagle Senior United States District Judge

         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.

         I. Background

         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 U.S. 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 at 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 February 21, 2017. Dkt. No. 1-2, Ex. E. FCA U.S. filed an answer to Ray's complaint on February 24, 2017. No. 1-2, Ex. F. On March 3, 2017, Defendant FCA U.S. 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 U.S. and Love Chrysler consented to removal.[1]Dkt. No. 1 at 6.

         FCA U.S. 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 U.S. 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 U.S. 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, 12-1.

         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 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 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 non-diverse party in state court. Travis v. Irby, 326 F.3d 644, 647 (5th Cir. 2003) (citation omitted). Here, FCA U.S. 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 removed).

         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. Georgia-Pacific, 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.

         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. AfricanMethodist 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 ...


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