Courtney v. Benedetto

• Decision Date: 24 January 1986
• Docket Number: Civ. A. No. 85-450-B.
• Parties: J.B. COURTNEY, II, et al. v. William L. BENEDETTO, et al.
• Court: U.S. District Court — Middle District of Louisiana

627 F. Supp. 523

J.B. COURTNEY, II, et al. v. William L. BENEDETTO, et al.

Civ. A. No. 85-450-B.

United States District Court, M.D. Louisiana.

January 24, 1986.

John N. Gallaspy, Gallaspy & Paduda, Bogalusa, La., John W. DeGravelles, Dué Dodson, de Gravelles, Robinson, & Caskey, Baton Rouge, La., for plaintiffs.

F.W. Middleton, Taylor, Porter Brooks & Phillips, Baton Rouge, La., Vickie Crochet, A.R. Christovich, Jr., Christovich & Kearney, New Orleans, La., for defendants.

POLOZOLA, District Judge.

On April 22, 1985, the plaintiffs filed this suit in the Twenty-First Judicial District for the Parish of St. Helena against William L. Benedetto, Clarence Bailey, Ed Cryer, Walter Jones, Richards Company and Gulf States Utilities Company ("GSU") to recover damages allegedly caused to their property by the construction of a high voltage electricity line. GSU, a Texas corporation, was served on April 26, 1985; Benedetto, Bailey and Jones, all Louisiana residents, were served on April 29, 1985; and Edward Cryer, a citizen of Texas, was served pursuant to the Louisiana "Long Arm" Statute, Louisiana Revised Statute 13:3204. The Richards Company was never served. On April 29, 1985, one week after the suit was originally filed, the plaintiffs filed a supplemental and amending petition naming CLECO, a Louisiana corporation, as an additional defendant. CLECO was served with this supplemental and amended petition on May 7, 1985; Benedetto, Bailey and Jones were served with the amended petition on May 8, 1985; and GSU was served with the amended complaint on May 14, 1985. The Richards Company was never served. On May 10, 1985, four days before GSU had been served with the supplemental and amending petition, but eleven days after it had been filed, GSU and Cryer filed a petition for removal, alleging in their petition that the defendants Benedetto, Bailey and Jones were nominal parties joined solely to defeat diversity. As stated previously, the Richards Company was never served with either the original or the supplemental and amending petition and, therefore, did not join the petition for removal. On July 3, 1985, GSU and Cryer filed a supplemental petition for removal alleging that CLECO was a nominal party joined solely to defeat diversity. The supplemental petition for removal also stated that the status of CLECO had not been addressed in the original petition for removal because GSU and Cryer had no notice at the time the original removal had been filed that CLECO had been added as a defendant.

On July 9, 1985, CLECO filed a motion for summary judgment on the ground that it has no connection with the activities of GSU with regard to the transmission lines at issue. On August 22, 1985, Benedetto, Bailey and Jones also moved for summary judgment contending that they are nominal parties who, as a matter of law, have no liability to the plaintiffs. The movers in both motions for summary judgment allege that they were named as defendants in the present suit solely for the purpose of defeating diversity.

Thereafter, the plaintiffs filed a motion to remand contending that this court lacks subject matter jurisdiction because complete diversity between all defendants and plaintiffs was not present. A motion to continue the hearings on defendants' motions for summary judgment until the court decided the motion to remand was also filed by the plaintiffs and denied by the court because the court concluded that it was necessary to consider the merits of these motions in ruling on the motion to remand. In opposition to the motions for summary judgment, the plaintiffs filed the affidavit of John W. Gravelles, attorney for the plaintiffs, stating that: (1) no discovery had been conducted in the case because the plaintiffs did not want to waive the right to file a motion to remand; and, (2) the plaintiffs needed additional time to pursue discovery regarding certain enumerated issues so that they could adequately oppose the motions for summary judgment. Subsequently, the plaintiffs filed a motion for a continuance of all three motions so that discovery could be conducted, which was granted by the court. At the end of the discovery period, the plaintiffs filed a supplemental opposition to the motions for summary judgment stating that they had "reconsidered their position with regard to the taking of additional discovery" and requested that the court decide all three motions based upon the record now before the court.

The plaintiffs' motion to remand is based upon two grounds. First, the plaintiffs contend that complete diversity, as required by Strawbridge v. Curtiss, 3 Cranch 267, 7 U.S. 267, 2 L.Ed. 435 (1806), is lacking. Since diversity jurisdiction is the only basis for subject matter jurisdiction asserted by the defendants, and it is obvious that complete diversity does not exist in this case, the defendants improperly removed this case to the federal court.¹ Defendants contended in their original and supplemental petitions of removal that Benedetto, Bailey, Jones and CLECO were fraudulently joined and, therefore, the citizenship of these parties should not be considered when diversity is determined. However, the plaintiffs contend that: (1) such allegations, with no factual basis set forth in the petition, is insufficient; and, (2) they have demonstrated that a valid cause of action exists against all non-diverse defendants.² The plaintiffs also contend that the procedure employed by GSU and Cryer to remove the present action was defective. More specifically, the plaintiffs allege that: (1) CLECO did not join the original petition for removal; (2) there was no allegation in such petition why CLECO had not joined the petition for removal; and (3) the amended or supplemental petition for removal which asserted that CLECO was a nominal party joined solely to defeat diversity was untimely filed because it was filed more than 30 days after any party had been served with the supplemental and amending state court petition naming CLECO as an additional defendant.³

Courts have consistently construed 28 U.S.C. § 1446(a)⁴ to require that all defendants either join the petition for removal or to consent to such removal. See, e.g., Northern Illinois Gas Co. v. Airco Industrial Gases, 676 F.2d 270, 272 (7th Cir.1982); Tri-Cities Newspapers, Inc. v. Tri-Cities P.P. & A. Local 394, 427 F.2d 325 (5th Cir.1970); Lontheir v. Northwest Insurance Company, 599 F.Supp. 963 (W.D.La.1985); Mason v. International Business Machines & RTKL, 543 F.Supp. 444, 446 (M.D.N.C.1982) and Baldwin v. Perdue, Inc., 451 F.Supp. 373, 376 (E.D.Va. 1973). Furthermore, defendants mandated by 1446(a) to either join the petition for removal or to consent to such removal must do so within thirty (30) days of notice or service of process.⁵Tri-Cities Newspapers, Inc. v. Tri-Cities P.P. & A. Local 394, 427 F.2d 325; Brooks v. Rosiere, 585 F.Supp. 351 (E.D.La.1984); Albonetti v. GAF Corporation—Chemical Group, 520 F.Supp. 825 (S.D.Tex.1981) and Intercoastal Refining Co., Inc. v. Jalil, 487 F.Supp. 606 (S.D.Tex.1980). The exceptions to the general rule that all defendants join or consent to the petition for removal exist when: (1) the non-joining defendant has not been served with service of process at the time the removal petition is filed;⁶ (2) the non-joining defendant is merely a nominal or formal party;⁷ and, (3) the removed claim is a separate and independent claim as defined by 28 U.S.C. § 1441(c).⁸ See Mason v. International Business Machines & RTKL, 543 F.Supp. at 446, n. 1 and Albonetti v. GAF Corporation— Chemical Group, 520 F.Supp. at 827. A necessary corollary to 1446(a) which requires the petition for removal contain "a short and plain statement of the facts which entitle him or them to removal" is that the removal petition must set forth the reason why a defendant named in such action has not joined the petition for removal. Lewis v. Rego Co., 757 F.2d 66 (3rd Cir.1985); P.P. Farmers' Elevator Co. v. Farmers Elevator Mutual Ins. Co. & New Amsterdam Casualty Co., 395 F.2d 546 (7th Cir.1968); Wright v. Missouri Pac. R. Co., 98 F.2d 34 (8th Cir.1938); Hardesty v. General Foods Corp., 608 F.Supp. 992 (N.D.Ill.1985); Lontheir v. Northwest Insurance Company, 599 F.Supp. 963 (W.D. La.1985); Romashko v. Avco Corp., 553 F.Supp. 391 (N.D.Ill.1983); and DiCesare-Engler Productions, Inc. v. Mainman, Ltd., 421 F.Supp. 116 (W.D.Pa.1976). A petition for removal filed by less than all defendants is considered defective if it does not contain an explanation for the non-joinder of those defendants. Id. In Romashko v. Avco Corp., 553 F.Supp. 391, 392 (N.D.Ill.1983), the court stated that "it is the defendant's burden under the removal statute (28 U.S.C. § 1446(a)) to explain affirmatively the absence of co-defendants in the petition for removal, and failure to set out such explanation renders the removal petition defective."

In the present case, the original petition for removal contained explanations as to why the Richards Company, Benedetto, Bailey and Jones had not joined the petition for removal,⁹ although it contained no explanation as to why CLECO had not joined.¹⁰ Four days after the petition for removal was filed in this court, GSU was served with the supplemental and amending petition naming CLECO as an additional defendant in the state court action. The defendants, however, did not amend the original petition for removal to "affirmatively explain the absence" of CLECO until it filed a supplemental petition for removal alleging that CLECO was a nominal party joined solely to defeat diversity on July 3, 1985, some 50 days after GSU had been served with the supplemental and amending state court petition, 54 days after the original petition for removal had been filed, 57 days after CLECO had been served, and 65 days after the supplemental and amending petition had been filed in state court.

Therefore, the question before the court is whether this supplemental...