Dagon v. BNSF Ry. Co.
| Decision Date | 21 July 2020 |
| Docket Number | Case No. 19-CV-00417-JPG |
| Court | U.S. District Court — Southern District of Illinois |
| Parties | TYLER DAGON, Administrator of the Estate of Timothy Dagon, Deceased, Plaintiff, v. BNSF RAILWAY COMPANY and UNITED STATES STEEL CORPORATION, Defendants. |
This is a personal-injury case arising from the death of Timothy Dagon ("decedent"). Plaintiff Tyler Dagon ("Estate") moved to remand. Defendants BNSF Railway Company ("BNSF") and United States Steel Corporation ("U.S. Steel") responded. For the reasons below, the Court:
• GRANTS the Estate's Motion to Strike;
• DENIES the Estate's Motion to Remand;
• DISMISSES Counts One and Four of the Complaint;
• FINDS AS MOOT BNSF's Motion for Summary Judgment on Count One.
U.S. Steel is a steel producer with a facility in Granite City, Illinois. (Compl. 3, ECF No. 1-2). The facility contains internal rail lines; and U.S. Steel operates its own locomotives to load railcars with coke, weigh them, and prepare them to be hauled to other facilities. (Gum Dep. 8:10-22, 13:5-13, ECF No. 67-1). It is not, however, "a regulated railroad" and therefore cannot conduct railroad operations. (Bojalad Dep. 26:11-16, ECF No. 49-7). Instead, U.S. Steel hires regulated railroads to haul its freight between facilities. (Id. at 12:15-13:9).
Which railroad U.S. Steel hires "depends on where they need the products shipped and who is the most competitive shipper at the time." (Id. at 29:10-12). BNSF, the Canadian National Railway, Union Pacific Railroad, CSX Transportation, Kansas City Southern Railway—U.S. Steel "use[s] all of them to a pretty big extent." (Id. at 28:22-29:7). Rates may vary depending on whether the railroad can provide its own railcars or must lease them for the job. (Id. at 15:24-16:5).
Because the railroads do not service the Granite City facility directly, U.S. Steel contracted with the Terminal Railroad Association of St. Louis ("Terminal Railroad") to provide a "switching service" that connects larger carriers with smaller ones. (Id. at 11:4-8, 22:8-23:2). For example, U.S. Steel wanted to haul coke from Granite City to its facility in Gary, Indiana. (Id. at 28:1-3). So it solicited rates and ultimately hired BNSF for the job. (Id. at 28:16). U.S. Steel prepared the BNSF-owned railcars and transferred them to Terminal Railroad; Terminal Railroad transferred them to BNSF; and BNSF transferred them to the Gary facility. (See id. at 28:13-16, 29:16-30:3).
TranStar has been a wholly owned subsidiary of U.S. Steel for nearly one hundred years. (Id. at 7:1-6). It manages U.S. Steel's "five common carrier railroads, two switching companies, and also handles certain functions of their movement services role for logistics and raw materials." (Id.).
The decedent was a switchman for U.S. Steel at its Granite City facility.1 (Compl. 3). One day, he worked with a locomotive operator to weigh a BNSF-owned railcar and move it around the railyard. (Id.). But after moving the locomotive forward, the operator "heard an inaudible transmission on his two way radio." (Id.). When he heard a second transmission that sounded like a cry for help, the operator "stopped the locomotive, exited the train, and observed Dagon laying on the ground with an obvious left leg injury." (Id. at 4). A video supplied by U.S. Steel to the Granite City Police Department depicted the decedent "riding on the side of the train who appeared to fall or jump down from the train and go underneath the railcar." (Id.). The BNSF-owned railcar severed his leg; and he died four hours later at St. Louis University Medical Center. (Id. at 4-5).
The Estate—the decedent's only child—sued U.S. Steel and BNSF in Illinois' Third Judicial Circuit Court. (Id. at 1-2). Along with common-law negligence claims against BNSF (Counts Two and Three), the Estate alleges that U.S. Steel and BNSF are liable for the decedent's death under the Federal Employers' Liability Act ("FELA") (Counts One and Four). (Id. at 1-8, 10-17).
U.S. Steel and BNSF removed the case to this Court based on diversity of citizenship: The Estate is an Illinois citizen; U.S. Steel is a Pennsylvania citizen; and BNSF is a Texas citizen. (Notice of Removal 2, ECF No. 1). And although cases arising under FELA are generally not removable, see 28 U.S.C. § 1445(a), U.S. Steel and BNSF contend that the Estate fraudulently joined the FELA claims to defeat federal jurisdiction, (Notice of Removal 4-9). In short, U.S. Steel argues that it is not a common-carrier railroad; and BNSF argues that it was not the decedent'semployer. (Id.). Because FELA only holds liable employers that are common-carrier railroads, U.S. Steel and BNSF ask the Court to dismiss the Estate's FELA claims as frivolous and allow the case to proceed based on diversity jurisdiction. (Id.). On the other hand, the Estate argues that U.S. Steel and BNSF failed to meet their "heavy burden" of proving fraudulent joinder. (Estate's Mot. to Remand 3, ECF No. 23).
The Court's subject-matter jurisdiction turns on the authenticity of the Estate's FELA claims, so it permitted the parties to conduct limited discovery and submit supplemental briefing. (Mem. & Order 5-6, ECF No. 64). That decision partly relied on a finding that the affidavits attached to the Notice of Removal were inadmissible hearsay. (Id.).
U.S. Steel and BNSF then submitted supplemental briefs supported by the deposition testimony of Wayne Gum, who worked at U.S. Steel's Granite City railyard in different capacities over 44 years. (U.S. Steel's Supp. Brief 2, ECF No. 67). BNSF's Supplemental Brief also partly relied on an affidavit by Tom Ondiezek, BNSF's Superintendent of Operations for the St. Louis area. (BNSF's Supp. Brief. 2, ECF No. 65). The Estate moved to strike Ondiezek's affidavit because it was not made subject to cross-examination and was submitted on the eve of the filing deadline. (Estate's Mot. to Strike 5, ECF No. 70).
Finally, the Estate submitted its own Supplemental Brief, arguing that (1) U.S. Steel is a common-carrier railroad because it owns TranStar, a common carrier; and (2) BNSF was the decedent's employer because it had the right to control U.S. Steel's activities. (Estate's Supp. Brief 1, ECF No. 68). The Estate also contends that a procedural defect in the Notice of Removal independently requires remand. (Id. at 8-10).
Even disregarding Ondiezek's testimony and resolving all issues of fact and law in the Estate's favor, the Estate cannot establish a cause of action under FELA against U.S. Steel or BNSF. U.S. Steel is not a common carrier just because it owns TranStar—an entity with no real connection to this dispute. BNSF was also not the decedent's employer: Other than requiring U.S. Steel to follow its loading requirements, BNSF could not direct, control, or supervise any U.S. Steel employees. By extension, holding BNSF liable under FELA here could undermine basic assumptions in the contractual relationship and dissuade other railroads from hauling U.S. Steel's goods. Remand is therefore inappropriate.
"Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court which the district court of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending." 28 U.S.C. § 1441(a). But "[d]ue regard for their rightful independence of state governments . . . requires that [federal courts] scrupulously confine their own jurisdiction to the precise limits which the statute has defined." Healy v. Ratta, 292 U.S. 263, 270 (1934). Thus, "the statutory procedures for removal are to be strictly construed," Syngenta Crop Prot., Inc. v. Henson, 537 U.S. 28, 32 (2002), and any doubts should be resolved "in favor of the plaintiff's choice of forum in state court," Schur v. L.A. Weight Loss Ctr., 577 F.3d 752, 758 (7th Cir. 2009).
Allegations of fraudulent joinder commonly appear in the context of diversity jurisdiction, when each defendant must be a citizen of a different state than the plaintiff. See 28 U.S.C. § 1332. If the plaintiff joins a nondiverse defendant to suit, then federal jurisdiction is destroyed. But if theclaim against that nondiverse defendant is frivolous, then a diverse defendant can assert fraudulent joinder of parties and ask the district court to throw out the nondiverse defendant and proceed under diversity jurisdiction.
Fraudulent joinder rarely arises in the context of federal-question jurisdiction. Federal courts have original jurisdiction over all cases and controversies arising under federal law. Id. § 1331. That is, unless Congress makes an exception. See U.S. Const. art. 3, § 2; Sheldon v. Sill, 49 U.S. 441, 446 (1850). This is one of those rare cases: Because Congress prohibited the removal of FELA claims, see 28 U.S.C. § 1445(a), U.S. Steel and BNSF contend that the Estate fraudulently joined those claims solely to frustrate federal jurisdiction, (Notice of Removal 4-9).
But the legal standard in the Seventh Circuit is unsettled: How should district courts assess fraudulent joinder of claims, and what evidence can they consider? This Court concludes that the standard applied to fraudulent joinder of claims is the same as fraudulent joinder of parties.
"[I]n most cases fraudulent joinder involves a claim against an in-state defendant that simply has no chance of success, whatever the plaintiff's motives." Poulos v. Naas Foods, Inc., 959 F.2d 69, 73 (7th Cir. 1992). In other words, the "right of removal cannot be defeated by a fraudulent joinder of a resident defendant having no real connection with the controversy." Wilson v. Republic Iron & Steel Co...
To continue reading
Request your trial