United States District Court, S.D. Texas, Houston Division
MEMORANDUM OPINION AND ORDER
H. Miller United States District Judge
before the court is plaintiffs Roydrick and Tamettica
Smith's motion to remand. Dkt. 9. Having considered the
motion, response, reply, complaint, and the applicable law,
the court is of the opinion that the motion should be
GRANTED, and the case should be REMANDED to the 189th
Judicial District Court of Harris County, Texas.
about January 2, 2017, The Smiths' home (“the
Property”) sustained damage from a hail storm. Dkt 1,
Ex. C at ¶ 11. The storm allegedly caused damage to the
roof, vents, flashings, windows, window screens, fascia,
gutters, downspouts, HVAC system, shed, and fencing, and it
compromised the integrity of the roof. Id. at ¶
13. The Smiths contend that due to the compromised roof,
water entered and caused damage to the dining room, game
room, and bedroom. Id. The Smiths own a
homeowner's insurance policy issued by defendant
Travelers Home and Marine Insurance Company
(“Travelers”). Id. at ¶ 9. The
Smiths submitted a claim to Travelers, which then assigned
defendant Greg Paul to adjust the claim. Id. at
¶14. Paul adjusted the claim on or around January 16,
2017, and found no damage from a covered peril to the roof of
the property. Id. at ¶18.
claim that Paul's assessment undervalued the actual
damage to the Property, which an independent adjuster hired
to inspect the Property valued at $14, 434.48. Id.
at ¶ 21.
30, 2017, the Smiths filed suit against Travelers in state
court. Dkt. 9 . They asserted causes of action against both
defendants under the Texas Insurance Code and the Texas
Deceptive Trade Practices Act (“DTPA”), and they
asserted separate claims against Paul for fraud, negligence,
and gross negligence. Dkt 1, Ex. C. On June 30, 2017,
Travelers removed the case to this court based on diversity
jurisdiction. Dkt. 9. For purposes of diversity jurisdiction,
the Smiths are citizens of Texas, and Travelers is a
Connecticut corporation. Dkt. 1.
undisputed that diversity jurisdiction exists between the
Smiths and Travelers. However, Paul is a citizen of Texas,
like Plaintiffs, thereby destroying complete diversity. Dkt.
1. Travelers argues that Paul is an improperly joined party
and that Paul's citizenship thus should be disregarded in
determining this court's jurisdiction. Dkt. 1.
Smiths respond that Paul is properly joined in this case and
the motion for remand should be granted. Dkt. 9.
defendant may remove an action to federal court in instances
where the court would have original jurisdiction over the
case. 28 U.S.C. § 1441. Subject matter jurisdiction
based on diversity jurisdiction requires that (1) complete
diversity exists among the parties, and (2) the amount in
controversy exceeds $75, 000. Id. § 1332. The
presence of a non-diverse defendant does not prevent removal
of a case if the non-diverse defendant was improperly joined.
Hornbuckle v. State Farm Lloyd's, 385
F.3d 538, 542 (5th Cir. 2004). In instances where a
non-diverse defendant has been improperly joined,
i.e., without a legal basis to do so, a case may be
removed despite the presence of a non-diverse defendant.
Id. As the removing party, the defendant bears the
“heavy burden” of demonstrating improper joinder.
Travis v. Irby, 326 F.3d 644, 649 (5th Cir. 2003).
are two ways to establish improper joinder, “(1) actual
fraud in the pleading of jurisdictional facts, or (2)
inability of the plaintiff to establish a cause of action
against the non-diverse party in state court.”
Smallwood v. Ill. Cent. R.R. Co., 385 F.3d 568, 573
(quoting Irby, 326 F.3d at 646-47) (5th Cir. 2004)
(en banc). The court may conduct a Rule 12(b)(6)-
type analysis to determine whether the complaint states a
claim under state law against the in-state defendant or
“pierce the pleadings” and conduct a summary
judgement inquiry. Id. It is left to the court's
discretion to decide the procedure necessary in each case,
but a summary judgement inquiry is only appropriate to
identify the presence of discrete and undisputed facts that
would preclude plaintiff's recovery. Id.
Rule 12(b)(6)-type analysis, the court applies the federal
pleading standard. Int'l Energy Ventures Mgmt.,
L.L.C. v. United Energy Grp., Ltd., 818 F.3d 193, 202
(5th Cir. 2013). To avoid dismissal, the plaintiff must plead
“‘enough facts to state a claim to relief that is
plausible on its face.'” Int'l Energy
Ventures Mgmt., 818 F.3d at 208 (quoting Bell
Atlantic Corp. v. Twombly, 550 U.S. 554, 570, 127 S.Ct.
1955 (2007)). A claim is deemed facially plausible
“when the plaintiff pleads factual content that allows
the court to draw the reasonable conclusion that the
defendant is liable for the misconduct alleged.”
Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937
(2009). A plaintiff must plead more than labels and
conclusions or a formulaic recitation of the elements of a
cause of action in order to establish entitlement to relief.
Twombly, 550 U.S. at 555. When a court determines
that a nondiverse party has been improperly joined, that
party must be dismissed without prejudice. Int'l
Energy Ventures Mgmt., 818 F.3d at 209.
court must first determine the method to establish improper
joinder. Travelers makes no claim that fraud was committed;
instead, Travelers argues that the Smiths cannot establish a
cause of action against Paul. Dkt. 11. Therefore, the
appropriate test to determine if joinder is improper is to
establish whether it has been demonstrated “‘that
there is no possibility of recovery by the plaintiff against
an in-state defendant.'” Robinson v. Allstate
Tex. Lloyds, No. H-16-1569, 2016 WL 3745962, at *2 (S.D.
Tex. July 13, 2016) (Atlas, J.) (quoting Smallwood,
385 F.3d at 573). Travelers argues that the Smiths'
allegations are non-specific, conclusory, and near verbatim
quotations of the ...