Junk v. Terminix Intern. Co.

• Decision Date: 13 January 2011
• Docket Number: No. 08-3811,08-3811
• Citation: 628 F.3d 439
• Parties: Rene JUNK, as parent of a minor, Next Friend T.J., Plaintiff-Appellant, v. TERMINIX INTERNATIONAL COMPANY, Limited Partnership; Dow Chemical Company; Dow AgroSciences LLC, Defendants-Appellees, Harold Obrecht; Jim Breneman; Sureco, Inc., Defendants.
• Court: U.S. Court of Appeals — Eighth Circuit

628 F.3d 439

Rene JUNK, as parent of a minor, Next Friend T.J., Plaintiff-Appellant,

v. TERMINIX INTERNATIONAL COMPANY, Limited Partnership; Dow Chemical Company; Dow AgroSciences LLC, Defendants-Appellees,Harold Obrecht; Jim Breneman; Sureco, Inc., Defendants.

No. 08-3811.

United States Court of Appeals, Eighth Circuit.

Submitted: Oct. 19, 2010.

Filed: Dec. 9, 2010.

Rehearing Denied Jan. 13, 2011.

Tracy N. Tool, argued (C.M. Bye, on the brief), River Falls, WI, for appellant.

Dean Taylor Barnhard, argued (Joseph G. Eaton and Kara M. Moorcroft, on the brief), Indianapolis, IN, for appellees Dow Chemical and Dow Agro.

Stephen Swofford, argued (Timothy G. Shelton, on the brief; David Creagh and David Richards, of counsel), Chicago, IL, for appellee Terminix International.

Before MURPHY, BEAM, and BENTON, Circuit Judges.

MURPHY, Circuit Judge.

Rene Junk brought this action in state court on behalf of her son, Tyler (T.J.) Junk, against Terminix International Company (Terminix), Dow Chemical Company and Dow AgroSciences LLC (collectively Dow), and Terminix employee Jim Breneman. Junk alleged that T.J.'s multiple medical conditions were caused by exposure to Dursban, an insecticide manufactured by Dow, distributed by Terminix, and applied to the Junk household by Breneman and other Terminix employees.After Dow removed the case to federal district court, Junk moved to remand for lack of diversity since Junk and defendant Breneman were both citizens of Iowa. The district court denied the motion after concluding that Breneman had been fraudulently joined to evade diversity. Junk's claims against Breneman were subsequently dismissed, and summary judgment was entered for Dow and Terminix. Junk appeals. We affirm the judgment in favor of Dow and Terminix but reverse in respect to the claim against Breneman.

I.

T.J. Junk was born two months premature with an enlarged heart and liver and tachycardia. It was also determined early in his life that T.J. had developmental delay and cerebral palsy. The Junks' home had been infested with spiders during Rene Junk's pregnancy, and she contacted Terminix about the problem. Terminix then sent out its employee Jim Breneman to consult with the family.

Five months before T.J.'s birth, Breneman enrolled the Junks in a Residential Pest Control Service Agreement. Breneman thereafter sprayed the pesticide Dursban inside and outside the Junks' home. Junk alleges that she and her husband had informed Breneman that she was pregnant and had asked him about the safety of Dursban. Dursban contains the synthetic chemical chlorpyrifos. Breneman assured them that Dursban was a "naturally occurring organic material which would have no impact on human beings." The Junks also allege that Breneman and other Terminix employees made similar representations before and after T.J.'s birth. Breneman and other Terminix employees made a total of twenty Dursban applications to the Junk household, the last occurring two years after T.J.'s birth.

On T.J.'s behalf Junk sued Terminix, Dow, and Breneman in Iowa state court. ¹ Junk alleged that her exposure to Dursban during her pregnancy and T.J.'s exposure to the pesticide after his birth had caused T.J.'s severe neurological problems. Junk claimed breach of express and implied warranties, fraud, negligent misrepresentation, products liability, and negligence. The defendants filed a timely notice of removal to federal district court under 28 U.S.C. §§ 1441, 1446, claiming diversity jurisdiction under 28 U.S.C. § 1332(a).

Junk moved to remand the case to state court under 28 U.S.C. § 1447, arguing that the district court lacked diversity jurisdiction because defendant Breneman and T.J., the party in interest, were both citizens of Iowa. The defendants did not dispute Breneman's Iowa citizenship, but argued that he had been fraudulently joined to defeat diversity jurisdiction. The district court denied Junk's motion to remand the case to state court and her subsequent motions to reconsider. While Junk argued that T.J. had a colorable negligence claim against Breneman due to his false statements and other conduct, the court reasoned that Junk "could not maintain a cause of action ... under Iowa common law" because she had failed to allege explicitly that Breneman had deviated from Terminix's instructions. The court later dismissed Junk's claims against Breneman for failure to state a claim for the same reason.

Discovery continued after Breneman's dismissal, and the district court made three subsequent pretrial evidentiary rulings which Junk contests on appeal. The court first excluded the testimony of Dr.Richard Fenske, one of Junk's expert witnesses. Dr. Fenske is a professor at the University of Washington and an expert on human toxic exposure. The Junks retained him to determine whether T.J. had been exposed to an unsafe level of chlorpyrifos during his mother's pregnancy and after his birth. Dr. Fenske testified that when making toxic exposure and dosage estimates in his research, he usually relies on a "deterministic modeling" method in which he creates an exposure model that accounts for numerous variables. In this case, however, he did not have sufficient data to perform such an analysis. Instead, he compared what he knew about the circumstances of T.J.'s exposure with those in published studies. This comparative analysis led him to conclude that T.J. had been exposed to an unsafe level of chlorpyrifos. Observing that Dr. Fenske had not followed his own usual methodology and concluding that he had relied on a number of ungrounded assumptions in his comparative approach, the district court excluded his opinion on the ground that his methodology was not sufficiently reliable. See Fed.R.Evid. 702; Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993).

Dr. Cynthia Bearer's testimony was also excluded. She is a neonatologist and board certified pediatrician whom Junk retained to give her opinion on general and specific causation. She was asked whether chlorpyrifos could have caused the type of injuries that afflict T.J. and whether it did in fact cause them. See Ranes v. Adams Labs., Inc., 778 N.W.2d 677, 688 (Iowa 2010). The district court initially regarded Dr. Bearer's opinions on both general and specific causation to be reliable and admissible, but it indicated that it would revisit the issue after it had examined Dr. Fenske's testimony. That was because Dr. Bearer's opinion on specific causation relied on Dr. Fenske's conclusions. After the court excluded Dr. Fenske's testimony, it found Dr. Bearer's opinion on specific causation to lack a scientific factual basis and declined to admit it.

The district court also granted the defendants' motion in limine to exclude an Environmental Protection Agency (EPA) report that summarized research on the effect of chlorpyrifos exposure on pregnant women, fetuses, and children. After examining a disclaimer on the report that appeared to cast doubt on its trustworthiness, the court expressed concern that the report carried a risk of unfair prejudice and concluded that it was not admissible under Fed.R.Evid. 803(8)(C), 703, or 803(18).

Subsequent to those evidentiary rulings, the district court concluded that Junk could not raise a genuine issue of material fact on the issue of specific causation without Dr. Bearer's opinion. On that basis the court granted summary judgment in favor of Dow and Terminix on all causes of action against them. Junk appeals, challenging the district court's denial of her motion for remand and the subsequent dismissal of the claims against Breneman, the summary judgment for Dow and Terminix, and the orders excluding Junk's experts and the EPA report.

II.

We review the court's denial of remand de novo. In re Prempro Prods. Liab. Litig., 591 F.3d 613, 619 (8th Cir.2010). A defendant's removal of a case to federal court is appropriate "only if the action originally could have been filed there." Id.; 28 U.S.C. § 1441(a)-(b). A plaintiff may move to remand the case if the district court lacks subject matter jurisdiction. 28 U.S.C. § 1447(c). If the district court concludes that it does not have subject matter jurisdiction, it mustremand the case. Id.; see Prempro, 591 F.3d at 620.

Subject matter jurisdiction asserted under 28 U.S.C. § 1332 may be maintained only where there is complete diversity, that is "where no defendant holds citizenship in the same state where any plaintiff holds citizenship." Prempro, 591 F.3d at 620. In an exception to this rule, a district court may retain jurisdiction where the nondiverse defendant has been fraudulently joined. Id. Joinder is fraudulent "when a plaintiff files a frivolous or illegitimate claim against a non-diverse defendant solely to prevent removal." Id.

The parties dispute whether we should review the district court's denial of Junk's remand motion and subsequent dismissal of Breneman under the fraudulent joinder standard outlined in Filla v. Norfolk Southern Railway Co., 336 F.3d 806, 809-11 (8th Cir.2003), or under the standard in Fed.R.Civ.P. 12(b)(6). This question is significant because the two standards differ, with Rule 12(b)(6) being more demanding. Under the Filla standard "the district court's task is limited to determining whether there is arguably a reasonable basis for predicting that the state law might impose liability based upon the facts involved." Filla, 336 F.3d at 811. In contrast, "[t]o survive a [Rule 12(b)(6) ] motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.' " Ashcroft v. Iqbal, --- U.S. ----, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) ( quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)).

Junk argues that the Filla standard is the proper test to decide whether a remand to state court was appropriate and whether the court's subsequent dismissal of Breneman...