Hagen v. U-Haul Co. of Tennessee

• Decision Date: 28 January 2009
• Docket Number: No. 08-cv-1197.,08-cv-1197.
• Citation: 613 F.Supp.2d 986
• Parties: Robert HAGEN and wife Dale Hagen, Plaintiffs, v. U-HAUL CO. OF TENNESSEE; Keith O'Brien, individually, and d/b/a West Tennessee Moving Company; Ronald Mathisen, individually and d/b/a Golden Eagle Transportation; U-Haul International, Inc.; U-Haul Co. of Arizona; and General Motors Corporation, Defendants.
• Court: U.S. District Court — Western District of Tennessee

613 F.Supp.2d 986

Robert HAGEN and wife Dale Hagen, Plaintiffs, v. U-HAUL CO. OF TENNESSEE; Keith O'Brien, individually, and d/b/a West Tennessee Moving Company; Ronald Mathisen, individually and d/b/a Golden Eagle Transportation; U-Haul International, Inc.; U-Haul Co. of Arizona; and General Motors Corporation, Defendants.

No. 08-cv-1197.

United States District Court, W.D. Tennessee, Eastern Division.

January 28, 2009.

COPYRIGHT MATERIAL OMITTED

Lisa June Cox, Law Office of Lisa June Cox, Jackson, TN, for Plaintiffs.

John Randolph Bibb, Jr., Waller, Lansden, Dortch & Davis, Nashville, TN, Lezlie Ott Marek, Mary E. Bolkcom, Hanson Marek Bolkcom & Green, Ltd., Minneapolis, MN, Marty R. Phillips, Rainey, Kizer, Reviere & Bell, Jackson, TN, for Defendants.

ORDER DENYING PLAINTIFFS' MOTION TO REMAND AND GRANTING IN PART, DENYING IN PART DEFENDANTS' MOTIONS TO DISMISS

J. DANIEL BREEN, District Judge.

The Plaintiffs, Robert and Dale Hagen, initiated this civil action against the Defendants, U-Haul Co. of Tennessee, Keith O'Brien individually and doing business as West Tennessee Moving Company, Ronald Mathisen individually and doing business as Golden Eagle Transportation, U-Haul International, Inc., U-Haul Co. of Arizona, and General Motors Corporation ("GMC"), in the Circuit Court of Henry County, Tennessee. The Defendants removed the case to federal court pursuant to 28 U.S.C. § 1441 and 28 U.S.C. § 1332 on the basis of diversity of citizenship. In total, the Defendants filed four separate motions to dismiss, while the Plaintiffs sought remand for lack of subject matter jurisdiction. Upon consideration of these motions, the Plaintiffs' motion to remand is DENIED; the Defendants motion to dismiss fraud and conspiracy claims is GRANTED; U-Haul Co. of Tennessee, West Tennessee Moving Company, and O'Brien's motion to dismiss is GRANTED; U-Haul Co. of Arizona, Golden Eagle Transportation, and Ronald Mathisen's motion to dismiss is GRANTED in part, DENIED in part; and U-Haul International's motion to dismiss is GRANTED in part, DENIED in part.¹

FACTUAL BACKGROUND²

Robert Hagen rented a 2006 GMC 26' Super Mover, model C5C042 (the "truck"), which had an Arizona license plate, for use in moving his belongings from Clearbrook, Minnesota to Springville, Tennessee. (Docket Entry ("D.E.") No. 1, Ex. 1 Compl., at ¶ 8.) Presumably, Hagen rented the truck from Ronald Mathisen, who was doing business as Golden Eagle Transportation, in Bemidji, Minnesota. (Id. at ¶ 5.) Following the trip, his wife then returned the truck to Keith O'Brien, who was doing business as West Tennessee Moving Company, in Paris, Tennessee. (Id. at ¶ 4.) Hagen had possession of the truck from June 11 to June 16, 2007. (Id.) At some point while operating the truck, Hagen allegedly inhaled noxious fumes, including carbon monoxide. (Id.) As a result of this exposure, Hagen claimed to have endured permanent bodily injuries, pain and suffering, and other damages. (Id. at ¶ 38.) His wife, Dale Hagen, contends she has suffered damages for loss of consortium and medical expenses. (Id. at ¶ 39.)

Plaintiffs sued under Tennessee law for negligence, breach of express warranty, breach of implied warranty, strict liability, fraud, and conspiracy among the Defendants. (Id. at ¶¶ 23-26, 30-33, 35-36.) When the complaint was originally filed, the Plaintiffs resided in Henry County, Tennessee. (Id. at ¶ 1.) The majority of the Defendants are domiciled outside of Tennessee, except for U-Haul Co. of Tennessee, West Tennessee Moving Company, and O'Brien (referred to as the "Tennessee Defendants"). (Id. at ¶¶ 2-7.)

In their notice of removal, the Defendants alleged that the non-diverse defendants had been fraudulently joined. (D.E. 1, Notice of Removal, at ¶ 14.) This pleading was followed by a series of motions to dismiss. The first argued that the Plaintiffs failed to state claims of fraud and conspiracy against all Defendants, except GMC. (D.E. 5, Mot. to Dismiss, at ¶ 4.) The second motion asserted that the Plaintiffs failed to state a claim against the Tennessee Defendants. (D.E. 6, Mot. to Dismiss, at ¶ 4.) The third alleged that the Hagens failed to state a claim against U-Haul Co. of Arizona, Golden Eagle Transportation, and Mathisen. (D.E. 7, Mot. to Dismiss, at ¶¶ 4-5.) The last motion to dismiss concerned the lack of personal jurisdiction and failure to state a claim as to U-Haul International. (D.E. 8, Mot. to Dismiss, at ¶¶ 3-6.) Although the Plaintiffs have not filed responses to any of these motions, they have moved to remand the case to state court based upon lack of complete diversity among the parties. (D.E. 10, Mot. to Remand, at 1.) In its resolution of these motions, the Court must first determine whether subject matter jurisdiction exists.

JURISDICTION ANALYSIS

A case initially filed in state court may be removed to federal court pursuant to 28 U.S.C. §§ 1441 and 1446: "Any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court." 28 U.S.C. § 1441(a). When federal question jurisdiction is lacking, however, a case may be removed "only if none of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought." 28 U.S.C. § 1441(b). Here, based on the allegations of the complaint, removal would not be permitted because U-Haul Co. of Tennessee, West Tennessee Moving Company, and O'Brien are all located in Tennessee. In this case, defendants who are citizens of, or incorporated in, Tennessee would normally preclude removal under 28 U.S.C. § 1441(b). The Defendants herein, however, contend that the joinder of these non-diverse defendants by the Plaintiffs was undertaken solely for the purpose of avoiding removal under § 1441.

The Sixth Circuit has recognized that "fraudulent joinder of non-diverse defendants will not defeat removal on diversity grounds." Coyne ex rel. Ohio v. Am. Tobacco Co., 183 F.3d 488, 493 (6th Cir.1999) (citation omitted). However, the party removing the case must establish that the joinder was a subterfuge. Alexander v. Elec. Data Sys. Corp., 13 F.3d 940, 949 (6th Cir.1994). To prove fraudulent joinder, "the removing party must present sufficient evidence that a plaintiff could not have established a cause of action against non-diverse defendants under state law." Coyne, 183 F.3d at 493 (citing Alexander, 13 F.3d at 949). "There can be no fraudulent joinder unless it be clear that there can be no recovery under the law of the state on the cause alleged or on the facts in view of the law." Alexander, 13 F.3d at 949 (quoting Bobby Jones Garden Apartments, Inc. v. Suleski, 391 F.2d 172, 176 (5th Cir.1968)). If there is "arguably a reasonable basis for predicting that the state law might impose liability on the facts involved," then remanding the case to state court is appropriate. Id.; see also Coyne, 183 F.3d at 493 (stating that a "colorable basis for predicting that a plaintiff may recover against nondiverse defendants" requires remand); Jerome-Duncan Inc. v. Auto-By-Tel L.L.C., 176 F.3d 904, 907 (6th Cir.1999) (holding that "the inquiry is whether [plaintiff] had at least a colorable cause of action against [the defendant]"). "Any disputed questions [of] fact[] and ambiguities in the controlling state law [should be resolved] . . . in favor of the nonremoving party." Alexander, 13 F.3d at 949 (citing Carriere v. Sears Roebuck & Co., 893 F.2d 98, 100 (5th Cir.1990)). In other words, "[a]ll doubts as to the propriety of removal are resolved in favor of remand." Coyne, 183 F.3d at 493. A plaintiff's motive in joining non-diverse defendants is immaterial to determining whether joinder was fraudulent. Jerome-Duncan, Inc., 176 F.3d at 907 (citation omitted). As the Hagens' claims are based on Tennessee law, the Court looks to the law of that state to determine whether the Tennessee Defendants were fraudulently joined. Id.

Because the jurisdictional question hinges on fraudulent joinder, the Court must analyze whether any of the Plaintiffs' theories of recovery against the Tennessee Defendants provide an "arguably . . . reasonable basis for predicting that the state law might impose liability on the facts involved." Alexander, 13 F.3d at 949. The complaint alleges that the Tennessee Defendants "failed to warn of any defect or dangerous condition when they performed inspection, repair and maintenance work on the truck, before and after the subject rental period," "failed to follow an appropriate and reasonable course of action, although they had the ability to warn, instruct, recall or modify the GMC truck," and "failed to use reasonable, ordinary and due care under the circumstances." (D.E. 1, Ex. 1 Compl., at ¶¶ 23, 33 (emphasis added).) In their memorandum, the Plaintiffs argue that if the Tennessee Defendants had warned Dale Hagen about previous reports of carbon monoxide poisoning at the time she returned the truck, "[Robert] Hagen could have received appropriate medical treatment earlier and lessened his injuries."³ (D.E. 10, Mot. to Remand, at 2.) Thus, the Plaintiffs assert a claim of negligence against the Tennessee Defendants. The Defendants contend that, because the truck was returned after Hagen had been hospitalized for inhaling noxious fumes, the Plaintiffs cannot establish causation between the Tennessee Defendants' alleged negligent acts and Hagen's injuries. Additionally, the Tennessee Defendants claim that they owed no duty to the Plaintiffs under these factual circumstances.

Under Tennessee common law, a claim of negligence is established by proof of the following: "(1) a duty of care owed by the defendant to the plaintiff; (2) conduct by the defendant falling below the standard of care amounting to a breach of that duty; (3) an injury or loss; (4) cause in fact; and (5) proximate or legal cause." West v. E. Tenn....