Gunkel v. Crysler

Decision Date18 February 2020
Docket NumberCAUSE NO.: 1:19-CV-499-HAB-SLC
PartiesJENNY GUNKEL and JAMES GUNKEL, Individually and as Wife and Husband, Plaintiffs, v. MELANIE CRYSLER and COSTCO WHOLESALE CORPORATION, Defendant.
CourtU.S. District Court — Northern District of Indiana

Defendants, after being sued by Plaintiffs in Allen County Superior Court for negligence, removed the matter to this Court. Plaintiffs request a remand to state court [Motion to Remand, ECF No. 12], arguing that remand is necessary because there is no basis for federal subject matter jurisdiction. Defendants, citing the doctrine of fraudulent joinder, disagree.


On October 21, 2019, Plaintiffs Jenny Gunkel and James Gunkel filed a Complaint in Allen Superior Court naming as Defendants Melanie Crysler (Melanie)1 and Costco Wholesale Corp. (Costco). They filed an Amended Complaint on October 24, 2019. Plaintiffs allege that Jenny Gunkel was on the premises of the Costco store located in Fort Wayne, Indiana, on May 6, 2018, when she slipped and fell on syrup that had spilled onthe floor, causing serious physical injuries. Plaintiffs allege that the slip and fall incident was the result of the negligence of Costco employees, specifically, that they failed to "properly inspect and maintain its property in a safe condition for its customers," failed to "warn customers of a latent, dangerous condition" and failed to "remove a latent, dangerous condition from the premises." In Count I, Plaintiffs demand judgment against Costco in an amount that will reasonably compensate them for the injuries and damages sustained.

In Count II of the Amended Complaint, Plaintiffs allege that Melanie, a resident of Indiana, was the manager of the Fort Wayne Costco on May 6, 2018. According to the First Amended Complaint allegations, Plaintiffs' damages were the result of the negligence of Melanie in "negligently hiring, failing to properly train, and supervise Costco agents and/or employees and/or inspect, warn, and maintain the premises in a safe condition."

Count III is a loss of consortium claim against both Melanie and Costco.

On November 25, 2019, Defendants filed their Petition for Removal of Action to federal court, invoking diversity jurisdiction. The Petition noted that Costco is incorporated under the laws of the State of Washington and has its principal place of business in Washington. Defendant Melanie is a citizen of Indiana, as are both Plaintiffs. Normally, this would defeat diversity, but Defendants maintained that Melanie's nondiverse residency status was not an impediment to removal to federal court under the doctrine of fraudulent joinder. Defendants note that Melanie was not even working on the date of the subject incident. They submit that Plaintiffs' inclusion of an employeethat was neither in the store at the time of the incident, nor whose actions or inactions created the alleged defect, is an attempt to destroy diversity of citizenship and prevent removal under 28 U.S.C. § 1332. Plaintiffs' negligence claim, they insist, has no legal merit, as employees are not liable for the torts of a corporation solely because of their position; there must be some additional connection with the tort.

On December 23, 2019, Plaintiffs filed their Motion to Remand. They argue that the naming of a store manager in negligence cases does not constitute fraudulent joinder. Rather, because Melanie's liability under Indiana law is unsettled, and uncertainties regarding controlling substantive law must be resolved in favor of a plaintiff, the matter should be remanded to state court.

On January 20, 2020, Defendants filed their Response to Plaintiffs' Motion to Remand. Attached to the Response is the Affidavit of Melanie Petty. Plaintiffs did not file a reply.


A. Removal Jurisdiction and Fraudulent Joinder

A defendant may remove any civil action filed in state court over which federal district courts have original jurisdiction. 28 U.S.C. § 1441. The federal district courts are courts of limited jurisdiction. Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 552 (2005). "[The] district courts may not exercise jurisdiction absent a statutory basis," id., and the removing party "bears the burden of establishing federal jurisdiction," Tylka v. Gerber Prods. Co., 211 F.3d 445, 448 (7th Cir. 2000). Here, Defendants allege that jurisdiction is appropriate pursuant to 28 U.S.C. § 1332 which, in relevant part, providesthat "district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $ 75,000, exclusive of interest and costs, and is between . . . citizens of different States." 28 U.S.C. § 1332(a).

Defendants admit that complete diversity is lacking but nonetheless removed the matter under the fraudulent joinder doctrine, which "permits a district court considering removal 'to disregard, for jurisdictional purposes, the citizenship of certain nondiverse defendants, assume jurisdiction over a case, dismiss the nondiverse defendants, and thereby retain jurisdiction.'" Schur v. L.A. Weight Loss Ctrs., Inc., 577 F.3d 752, 763 (7th Cir. 2009) (first quoting Mayes v. Rapoport, 198 F.3d 457, 461 (4th Cir. 1999), then citing Cobb v. Delta Exports, Inc., 186 F.3d 675, 677-78 (5th Cir. 1999)). The fraudulent joinder doctrine imposes a burden far more stringent than that ordinarily imposed on a removing defendant. See Schur, 577 F.3d at 764 (7th Cir. 2009).

"Fraudulent," in this context, is a term of art. Poulos v. Naas Foods, Inc., 959 F.2d 69, 73 (7th Cir. 1992). A defendant invoking the doctrine must demonstrate that, "after resolving all issues of fact and law in favor of the plaintiff, the plaintiff cannot establish a cause of action against the in-state defendant." Schur, 577 F.3d at 764. (emphasis and internal quotation omitted). The Court must look at both the facts alleged and the law governing the complaint to determine whether plaintiffs have "some chance of success" on their claims under state law. Thornton v. M7 Aerospace LP, 796 F.3d 757, 765 (7th Cir. 2015); Morris v. Nuzzo, 718 F.3d 660, 666 (7th Cir. 2013) ("Under the fraudulent joinder doctrine . . . , an out-of-state defendant's right of removal premised on diversity cannot be defeated by joinder of a nondiverse defendant against whom the plaintiff's claim has'no chance of success.'"). A plaintiff's motive in naming a non-diverse defendant is not relevant. Poulos, 959 F.2d at 73.

A removing defendant may present uncontested evidence to show that the facts of the case preclude a plaintiff's claim against a nondiverse defendant. For example, where a removing defendant provides an uncontroverted affidavit demonstrating that a nondiverse defendant had "absolutely nothing to do with" the claims raised by the plaintiff, the lack of diversity does not prevent removal. Faucett v. Ingersoll-Rand Mining & Mach. Co., 960 F.2d 653, 655 (7th Cir. 1992). In such circumstances, the plaintiff's claim against the nondiverse defendant fails because the undisputed evidence demonstrates that the plaintiff could not factually establish an essential element of the claim. See id.

Fraudulent joinder may also apply where a plaintiff's claim against the nondiverse litigant has no reasonable legal merit, such as where a plaintiff sues an entity who cannot be held liable under established state law. See Poulos, 959 F.2d at 73-74 (applying fraudulent joinder to disregard parent company's citizenship where plaintiff sued parent company for injury allegedly caused by subsidiary). "At the point of decision, the federal court must engage in an act of prediction: is there any reasonable possibility that a state court would rule against the non-diverse defendant?" Id., 959 F.2d at 73.

B. Claims Against Melanie

Plaintiffs allege that Melanie is liable to Plaintiffs for "negligently hiring, failing to properly train and supervise Costco" employees or because she did not "inspect, warn, and maintain the premises in a safe condition." (Am. Compl., Count II.)

As set forth above, Defendants must show that there is no reasonable possibility that an Indiana court would rule against Melanie on Plaintiffs' negligence claim. Although Defendants' burden in asserting fraudulent joinder is heavy, the Seventh Circuit has held that "it need not negate any possible theory that [Plaintiffs] might allege in the future: only [their] present allegations count." Poulos, 959 F.2d at 74. Defendants do not dispute that "Indiana law is wholly unsettled regarding the extent that a plaintiff may bring a claim in negligence against a store manager, based on a delegation of the premise owner's duties toward invitees." (Defs.' Resp. 5, ECF No. 19 (citing Antonio v. Wal-Mart, No. 1:07CV006 JDTTAB, 2007 WL 2884371, at *7 (S.D. Ind. Sept. 27, 2007).) However, that is not the end of the inquiry, they assert, because "the issue is otherwise addressed in Indiana law that a corporate officer, stockholder, director, agent, or employee is not personally liable for the alleged torts of the corporation merely because of her office - the law requires some additional connection with the tort." (Id. (citing Greg Allen Constr. Co. v. Estelle, 798 N.E.2d 171, 173 (Ind. 2003); State Civil Rights Com'n v. Cty. Line Park, Inc., 738 N.E.2d 1044, 1050 (Ind. 2000); Hanson v. St. Luke's United Methodist Church, 682 N.E.2d 1314 (Ind. Ct. App. 1997); Bowling v. Holdeman, 413 N.E.2d 1010 (Ind. Ct. App. 1980).) Defendants assert that the additional connection to the alleged tort is lacking in this case.

Defendants first point to the fact that Melanie was not in or at the Costco Store on the date of the incident alleged in the First Amended Complaint. (Aff. of Melanie Petty, ¶ 3.) Accordingly, she was not the "manager on duty" and could not have been negligent in failing to properly inspect and clean floors on that date, nor negligent in failing to warnof the danger of an unclean floor. (Id., ¶¶ 3-6....

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT