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Kinney v. Brink's Inc.

United States District Court, S.D. Texas, Houston Division

July 20, 2017

Rosalind B. Kinney, individually and on Behalf of the Estate of Alvin M. Kinney And Brett K. Kinney, Individually Plaintiffs,
Brink's incorporated, Capital One National Association, and 5718 Westheimer Road Investors, LP, Defendants.



         Before the Court is Plaintiffs' motion to remand. Dkt. 98. After having considered the motions and arguments of counsel at a hearing held July 17, 2017, the motion to remand is denied. In addition, joinder of the non-diverse party, 5718 Westheimer Road Investors, LP (“5718 WRI”), is denied under 28 U.S.C. § 1447(e).


         Plaintiffs, Texas citizens, originally filed this suit on October 26, 2015 in Texas court. The original petition named Brink's Incorporated (“Brink's”), a Delaware corporation, and Capital One National Association (“Capital One”), a Virginia corporation, as the defendants and asserted claims against them for negligence, premises liability, wrongful death and a survivor claim for personal injuries. Dkt. 5-2 ¶¶ 13-29. On December 3, 2015, Brink's and Capital One removed the suit to federal court on the basis of diversity. Dkt. 1.

         On December 23, 2015, Plaintiffs filed an amended complaint adding a new defendant, 5718 WRI, allegedly a Delaware limited partnership. Dkt. 12. Leave of court under Rule 15 was never sought nor granted to join this new defendant, which (as plaintiff recently discovered) is actually a Texas entity and therefore non-diverse. The amended complaint alleges that 5718 WRI knew or should have known that a dangerous condition existed and that it failed to take reasonable precautions to address the dangerous condition. Dkt. 12 ¶ 17. Plaintiffs assert premises liability as to 5718 WRI and Capital One, wrongful death as to Brink's, and gross negligence as to all Defendants. Id. ¶¶ 19-36.

         On March 8, 2017, the Court held a hearing on Brink's motion for summary judgment. Shortly thereafter, Capital One and 5718WRI filed its respective motions for summary judgment. Dkt. Nos. 76; 78. While those motions were pending, Plaintiffs filed this motion to remand, asserting for the first time that 5718 WRI was a resident of Texas, thereby destroying diversity jurisdiction over this case. Defendants concede that 5718 WRI is a limited partnership having Texas citizenship, but oppose the motion to remand.


         Plaintiffs argue that because Texas residents are on both sides of the case, complete diversity is destroyed and the Court must remand the matter to Texas state court. Defendants respond that remand is not proper because (1) 5718 WRI was fraudulently joined and thus the Court continues to have diversity jurisdiction over all defendants; or (2) in the alternative, joinder of 5718 WRI should be denied as improper under 28 U.S.C. § 1447(e), effectively dismissing that party from the lawsuit. Dkt. 100.

         Federal district courts have diversity over “civil actions where the matter in controversy exceeds the sum of $75, 000, exclusive of interest and costs, and is between citizens of different States.” 28 U.S.C. § 1332(a)(1). Diversity jurisdiction requires complete diversity, meaning no plaintiff may be of the same citizenship of any defendant. See Int'l Energy Ventures Mgmt., L.L.C. v. United Energy group, Ltd., 818 F.3d 193, 200 (5th Cir. 2016).

         1. Fraudulent Joinder

         “A defendant is improperly joined if the moving party establishes that (1) the plaintiff has stated a claim against a diverse defendant that he fraudulently alleges is non-diverse, or (2) the plaintiff has not stated a claim against a defendant that he properly alleges is non-diverse.” Int'l Energy Ventures Mgmt., 818 F.3d at 199. The Fifth Circuit has explained that a defendant seeking to defeat a motion to remand on the basis of improper joinder must demonstrate “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 v. Illinois Cent. R. Co., 385 F.3d 568, 573 (5th Cir. 2005).

         To determine whether the non-diverse defendant has been improperly joined, the Court usually “conduct[s] a Rule 12(b)(6)-type analysis, looking initially at the allegations of the complaint to determine whether the complaint states a claim under state law against the in-state defendant.” Id. The Fifth Circuit recently held that the federal courts' determinations should be made on the basis of federal pleading standards set out in Bell Atlantic Corp v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009). Int'l Energy Ventures, 818 F.3d at 202.

         Defendants' contention that the Court's inquiry should be similar to that in ruling on a motion for summary judgment (Dkt. 100 at 3) is incorrect. Courts may look beyond the pleadings, but only to identify “discrete and undisputed facts that would preclude plaintiff's recovery against the in-state defendant.” Smallwood, 385 F.3d at 573. Anything beyond this limited inquiry would move the Court outside of its jurisdictional bounds and result in a ruling on the merits.

         The plaintiff's complaint against 5718 WRI survives the fraudulent joinder test. Based on the allegations, it cannot be said that plaintiff would have no possibility of recovery against 5718 WRI for premises liability under Texas law. This is not to say that the claim would survive a properly-supported summary judgment motion, based upon a fully developed factual record. But, on its ...

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