Collins v. Marten Transp., Ltd.

• Decision Date: 12 March 2014
• Docket Number: Case No.: 4:14-CV-0257-VEH
• Parties: PHILLIP COLLINS, as Co-Personal Representative of the Estate of Harvey Russell Collins, Jr., et al., Plaintiffs, v. MARTEN TRANSPORT, LTD., et al., Defendants.
• Court: U.S. District Court — Northern District of Alabama

PHILLIP COLLINS, as Co-Personal Representative of theEstate of Harvey Russell Collins, Jr., et al., Plaintiffs, v. MARTEN TRANSPORT, LTD., et al., Defendants.

Case No.: 4:14-CV-0257-VEH

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ALABAMA MIDDLE DIVISION

FILED: March 12, 2014

MEMORANDUM OPINION

I. INTRODUCTION

Plaintiffs Phillips Collins and Lisa Collins Cross (the "Plaintiffs"), as co-personal representatives of the estate of Harvey Russell Collins, Jr. (the "Decedent"), originally filed this wrongful death action¹ in the Circuit Court of St. Clair County,Alabama, on February 13, 2013. (Doc.1 ¶ 1; see also Doc. 1-5 at Ex. 5 at 3).² The case stems from a motor vehicle collision that occurred on December 3, 2012, on Interstate 59 near Springville, Alabama. (Doc.1-5 at Ex. 5 at 7 ¶ 7).

Defendants Dale Edward Monson ("Mr. Monson") and Marten Transport, Ltd. ("Marten") (collectively, the "Removing Defendants") removed Plaintiffs' lawsuit to this court on February 12, 2014, asserting diversity under 28 U.S.C. § 1332 as the basis for federal jurisdiction. (Doc. 1 ¶ 8). In relying upon the existence of diversity jurisdiction, the Removing Defendants contend that the court should disregard the instate citizenship of their co-defendant, Richard Hull ("Mr. Hull"), on the basis that Plaintiffs have fraudulently joined him. (Id. ¶ 5).³

The court has before it Plaintiffs' Motion to Remand (Doc. 8) ("Remand Motion"),⁴ their Unopposed Motion for Expedited Consideration (Doc. 9) ("Expedited Ruling Motion"), and their Motion for Sanctions (Doc. 10) ("Sanctions Ala. Code § 6-5-410(a).Motion"), all of which were filed on February 18, 2014. The Removing Defendants filed their opposition (Doc. 12)⁵ to the Remand Motion and response (Doc. 13) to the Sanctions Motion on March 3, 2014. Plaintiffs followed with their respective reply briefs on March 10, 2014. (Docs. 14, 15). Plaintiffs additionally filed a Motion To Strike (Doc. 16) ("Strike Motion") on March 10, 2014.

Because the court concludes that it lacks subject matter jurisdiction, Plaintiffs' Remand Motion is due to be granted. Further, the Expedited Ruling Motion is due to be granted, and the Strike Motion is due to be termed as moot. Finally, the court does not reach the merits of either the Sanctions Motion or of the Motion for Summary Judgment filed by Mr. Hull, and instead leaves the disposition of both of those motions to the sound discretion of the state court.

II. LEGAL STANDARDS

A. General Jurisdictional Principles

"It is by now axiomatic that the inferior courts are courts of limited jurisdiction. They are 'empowered to hear only those cases within the judicial power of the United States as defined by Article III of the Constitution,' and which have been entrusted to them by a jurisdictional grant authorized by Congress." Univ. of S. Ala. v. Am.Tobacco Co., 168 F.3d 405, 409 (11th Cir. 1999) (quoting Taylor v. Appleton, 30 F.3d 1365, 1367 (11th Cir. 1994)). "Accordingly, '[w]hen a federal court acts outside its statutory subject-matter jurisdiction, it violates the fundamental constitutional precept of limited federal power.'" Univ. of S. Ala., 168 F.3d at 409 (quoting Victory Carriers, Inc. v. Law, 404 U.S. 202, 212, 92 S. Ct. 418, 425, 30 L. Ed. 2d 383 (1971)). "Simply put, once a federal court determines that it is without subject matter jurisdiction, the court is powerless to continue." Univ. of S. Ala., 168 F.3d at 410.

"A necessary corollary to the concept that a federal court is powerless to act without jurisdiction is the equally unremarkable principle that a court should inquire into whether it has subject matter jurisdiction at the earliest possible stage in the proceedings." Univ. of S. Ala., 168 F.3d at 410. "Indeed, it is well settled that a federal court is obligated to inquire into subject matter jurisdiction sua sponte whenever it may be lacking." Id. (citing Fitzgerald v. Seaboard Sys. R.R., 760 F.2d 1249, 1251 (11th Cir. 1985) (per curiam)).

Moreover, "[t]he jurisdiction of a court over the subject matter of a claim involves the court's competency to consider a given type of case, and cannot be waived or otherwise conferred upon the court by the parties. Otherwise, a party could 'work a wrongful extension of federal jurisdiction and give district courts power the Congress denied them.'" Jackson v. Seaboard Coast Line R.R., 678 F.2d 992, 1000-01 (11th Cir. 1982) (quoting American Fire & Cas. Co. v. Finn, 341 U.S. 6, 18, 71 S. Ct. 534, 542, 95 L. Ed. 702 (1951)) (footnote and citation omitted). Furthermore, "[b]ecause removal jurisdiction raises significant federalism concerns, federal courts are directed to construe removal statutes strictly." Univ. of S. Ala., 168 F.3d at 411 (citing Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108-09, 61 S. Ct. 868, 872, 85 L. Ed. 1214 (1941)).

Lastly, Congress has decreed and the Supreme Court has confirmed that—with the express exception of civil rights cases that have been removed— orders of remand by district courts based upon certain grounds, including in particular those premised upon lack of subject matter jurisdiction, are entirely insulated from review. More specifically, § 1447(d) provides:

An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1443 of this title shall be reviewable by appeal or otherwise.

28 U.S.C. § 1447(d) (emphasis added); see also Kirchner v. Putnam Funds Trust, 547 U.S. 633, 642 , 126 S. Ct. 2145, 2154, 165 L. Ed. 2d 92,(2006) (recognizing that "'[w]here the [remand] order is based on one of the grounds enumerated in 28 U.S.C. § 1447(c), review is unavailable no matter how plain the legal error in ordering the remand'" (quoting Briscoe v. Bell, 432 U.S. 404, 413 n.13, 97 S. Ct. 2428, 2434 n.13,53 L. Ed. 2d 439 (1977))); Milton I. Shadur, Traps for the Unwary in Removal and Remand, 33 no. 3 Litigation 43 (2007); Powerex Corp. v. Reliant Energy Servs., Inc., 127 S. Ct. 2411, 2418 (2007) (holding that when "the District Court relied upon a ground that is colorably characterized as subject-matter jurisdiction, appellate review is barred by § 1447(d)").

B. Diversity Jurisdiction

The Removing Defendants premise their removal upon this court's diversity jurisdiction. "Diversity jurisdiction exists where the suit is between citizens of different states and the amount in controversy exceeds the statutorily prescribed amount, in this case $75,000." Williams v. Best Buy Co., 269 F.3d 1316, 1319 (11th Cir. 2001) (citing 28 U.S.C. § 1332(a)). Therefore, removal jurisdiction based upon diversity requires: (1) a complete diversity of citizenship between the plaintiff(s) and the defendant(s); and (2) satisfaction of the amount in controversy requirement.

1. Citizenship Requirement

Diversity jurisdiction "requires complete diversity—every plaintiff must be diverse from every defendant." Palmer v. Hosp. Auth., 22 F.3d 1559,1564 (11th Cir. 1994). "Citizenship, not residence, is the key fact that must be alleged in the complaint to establish diversity for a natural person." Taylor v. Appleton, 30 F.3d 1365, 1367 (11th Cir. 1994).

2. Fraudulent Joinder Principles

The dispute over satisfaction of the citizenship requirement in this case has to do with whether Plaintiffs have fraudulently joined the non-diverse co-defendant, Mr. Hull. "[W]hen there is no possibility that the plaintiff can prove a cause of action against the resident (non-diverse) defendant[,]" fraudulent joinder is established. Triggs v. John Crump Toyota, Inc., 154 F.3d 1284, 1287 (11th Cir. 1998). Relatedly, if fraudulent joinder is established, then the resident defendant is subject to dismissal as a party and its citizenship is disregarded for diversity requirement purposes. See id.

The Eleventh Circuit extensively addressed the issue of removal based on diversity jurisdiction when it is alleged that a non-diverse defendant has been fraudulently joined in Crowe v. Coleman, 113 F.3d 1536 (11th Cir. 1997). There the court stated:

In a removal case alleging fraudulent joinder, the removing party has the burden of proving that either: (1) there is no possibility the plaintiff can establish a cause of action against the resident defendant; or (2) the plaintiff has fraudulently pled jurisdictional facts to bring the resident defendant into state court. Cabalceta v. Standard Fruit Co., 883 F.2d 1553, 1561 (11th Cir. 1989). The burden of the removing party is a 'heavy one.' B. Inc. v. Miller Brewing Co., 663 F.2d 545, 549 (5th Cir. Unit A 1981).

Crowe, 113 F.3d at 1538.⁶

The standard is onerous because, absent fraudulent joinder, a plaintiff has the absolute right to choose his forum. That is, courts must keep in mind that the plaintiff is the master of his complaint and has the right to determine how and where he will fight his battle. As Crowe further recognized:

This consequence makes sense given the law that "absent fraudulent joinder, plaintiff has the right to select the forum, to elect whether to sue joint tortfeasors and to prosecute his own suit in his own way to a final determination." Parks v. The New York Times Co., 308 F.2d 474, 478 (5th Cir. 1962).[⁷] The strict construction of removal statutes also prevents "exposing the plaintiff to the possibility that he will win a final judgment in federal court, only to have it determined that the court lacked jurisdiction on removal," see Cowart Iron Works, Inc. v. Phillips Constr. Co., Inc., 507 F. Supp. 740, 744 (S.D. Ga. 1981) (quoting 14A C. Wright, A. Miller & E. Cooper, Federal Practice and Procedures § 3721), a result that is costly not only for the plaintiff, but for all the parties and for society when the case must be re-litigated.

Crowe, 113 F.3d at 1538.

To establish fraudulent joinder of a resident defendant, the burden of proof on the removing party is a "heavy one[,]" see Crowe, 113 F.3d at 1538 (intern...