Lailhengue v. Mobil Oil Corp., Civ. A. No. 90-4425

• Decision Date: 18 September 1991
• Docket Number: 91-1143 and 91-1837.,Civ. A. No. 90-4425
• Citation: 775 F. Supp. 908
• Parties: June B. LAILHENGUE, et al. v. MOBIL OIL CORPORATION, et al.
• Court: U.S. District Court — Eastern District of Louisiana

775 F. Supp. 908

June B. LAILHENGUE, et al. v. MOBIL OIL CORPORATION, et al.

Civ. A. Nos. 90-4425, 91-1143 and 91-1837.

United States District Court, E.D. Louisiana.

September 18, 1991.

Sidney D. Torres, III, Roberta L. Burns, Law Offices of Sidney D. Torres, III, Chalmette, La., Manuel A. Fernandez and Gilbert V. Andry, III, New Orleans, La., for Lailhengue plaintiffs.

Douglas M. Schmidt, New Orleans, La., for Sherwood plaintiffs.

Allain F. Hardin, Fransen & Hardin, New Orleans, La., for Perkins plaintiffs.

Sam A. LeBlanc, William B. Gaudet, Glen Pilie and Nanette Jolivette, Adams & Reese, New Orleans, La., for defendant Mobil Oil Corp.

ORDER AND REASONS

MENTZ, District Judge.

In this mass tort action, three groups of plaintiffs filed class action suits in state court against Mobil Oil Corporation, R. V. Pisarczyk, and Lawrence Hess, alleging compensatory and exemplary damages arising from an explosion at Mobil's refinery in New Orleans, Louisiana. In each case, Mobil timely filed a notice of removal under 28 U.S.C. § 1441(a)¹, asserting that this Court has subject matter jurisdiction under 28 U.S.C. § 1332(a)² based on diversity jurisdiction. Specifically, Mobil asserted that there is diversity of citizenship between the plaintiffs, who are domiciliaries of Louisiana, and Mobil, a foreign corporation, that the Louisiana defendants, Pisarczyk and Hess, do not destroy diversity because they were fraudulently joined, and that the amount in controversy exceeds $50,000 based on an aggregation of the plaintiffs' punitive damages claims. After removal, the Court consolidated the plaintiffs' three suits and directed the parties to brief the issue of subject matter jurisdiction.

Before the Court are the plaintiffs' motions to remand under 28 U.S.C. § 1447(c)³. The plaintiffs argue that this Court lacks subject matter jurisdiction because 1) Pisarczyk and Hess are properly joined defendants who destroy diversity by virtue of the fact that they and the plaintiffs are domiciliaries of Louisiana and 2) the jurisdictional amount is not met by each plaintiff and the plaintiffs' punitive damages claims cannot be aggregated to meet the jurisdictional amount.⁴ Pisarczyk and Hess, filed a related motion to dismiss on the ground that they were fraudulently joined. For the reasons set forth below, the Court finds that it has subject matter jurisdiction over this action.

DIVERSITY OF CITIZENSHIP

The first issue the Court addresses is whether the Louisiana defendants, Pisarczyk and Hess, were fraudulently joined. If they were fraudulently joined, then their presence may be disregarded and does not destroy diversity of citizenship. Fraudulent joinder exists "if there is no arguably reasonable basis for predicting that state law might impose liability on the resident defendants." Tedder v. F.M.C. Corp., 590 F.2d 115, 117 (5th Cir. 1979). The removing party has the burden to show that actual fraud exists in the plaintiff's pleadings of jurisdictional facts, or that the plaintiff will not be able to establish a cause of action against the non-diverse defendant. Laughlin v. Prudential Ins. Co., 882 F.2d 187, 190 (5th Cir. 1989).

Under Louisiana law, personal liability cannot be imposed on an employee simply because of his general administrative responsibility for the performance of some function of his employment; he must have an independent, personal duty to the plaintiff. Canter v. Koehring Co., 283 So.2d 716, 721 (La.1973). "Agents are not liable to third persons for nonfeasance or mere omissions of duty. They are responsible to such parties only for the actual commission of those positive wrongs for which they would be otherwise accountable in their individual capacity, under the obligations common to all other men." Prince v. Nationwide Ins. Co., Civ. A. No. 88-2858, 1989 WL 10682 *1 (E.D.La. Feb. 9, 1989) (quoting Tyler v. Walt, 184 La. 659, 167 So. 182, 187 (1936)).

The plaintiffs' state court petitions allege that Pisarczyk and Hess are liable as a result of omissions or nonfeasance in their duties as employees at the Mobil refinery. The plaintiffs did not allege that Pisarczyk and Hess owed a personal duty to the plaintiffs. After taking discovery on the issue of personal duty⁵, the plaintiffs presented evidence that Pisarczyk, the plant manager, together with the Technical, Operating, and Maintenance Departments at Mobil, postponed a scheduled shutdown of the hydrocracker, which prevented discovery of a corroded heat exchanger, a suspected cause of the explosion. The plaintiffs argue that Pisarczyk had a personal duty to the plaintiffs by virtue of his role in postponing the shutdown of the hydrocracker. The allegations and evidence against Pisarczyk are insufficient to support the imposition of personal liability against him because the alleged misfeasance is limited to a breach of responsibilities as an employee at Mobil, and there is no evidence that he knew of facts which would create a foreseeable risk of harm to the public.

Hess is the Emergency Preparedness Manager at Mobil. Other than the allegations in their petitions, the plaintiffs failed to submit evidence or argument to show that Hess owed a personal duty to the plaintiffs. The allegations in the plaintiffs' petitions are limited to Hess's nonfeasance of his duties as an employee of Mobil. There is no evidence that Hess had reason to foresee a risk of harm to the public. Indeed, Hess stated in his deposition that he has no jurisdiction over the equipment in question. Under these circumstances, there is no possibility that state law might impose personal liability on Hess.

In short, the defendants carried their burden to show fraudulent joinder — that the plaintiffs have no possible cause of action against Pisarczyk and Hess — and therefore, the presence of Pisarczyk and Hess does not destroy diversity jurisdiction.

JURISDICTIONAL AMOUNT IN CONTROVERSY

Next, the Court addresses the issue of whether the plaintiffs' claims for punitive damages can be aggregated to satisfy the jurisdictional requirement of at least $50,000 in controversy. In deciding whether the jurisdictional amount is satisfied, the Court will treat this matter as a class action, even though no decision on class certification has been made. See Eagle v. American Tel. and Tel. Co., 769 F.2d 541, 545 n. 1 (9th Cir.1985), cert. denied, 475 U.S. 1084, 106 S.Ct. 1465, 89 L.Ed.2d 721 (1986) (citing City of Inglewood v. City of Los Angeles, 451 F.2d 948, 951 (9th Cir. 1971)).

When a plaintiff challenges the jurisdictional amount in a removal petition, the defendant has the burden of showing that the jurisdictional amount is in controversy. Hale v. Billups of Gonzales, Inc., 610 F.Supp. 162, 163-64 (M.D. La.1985) (citations omitted). The court retains jurisdiction unless it appears "to a legal certainty that the claim is really for less than the jurisdictional amount." St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 289, 58 S.Ct. 586, 590, 82 L.Ed. 845 (1938).

The United States Supreme Court explained the rule for when damages may be aggregated to meet the jurisdictional amount in a suit filed by multiple plaintiffs:

When two or more plaintiffs, having separate and distinct demands, unite for convenience and economy in a single suit, it is essential that the demand of each be of the requisite jurisdictional amount; but when several plaintiffs unite to enforce a single title or right, in which they have a common and undivided interest, it is enough if their interests collectively equal the jurisdictional amount.

Troy Bank v. G.A. Whitehead & Co., 222 U.S. 39, 40-41, 32 S.Ct. 9, 56 L.Ed. 81 (1911). This rule applies with equal force to class actions. See Snyder v. Harris, 394 U.S. 332, 89 S.Ct. 1053, 22 L.Ed.2d 319 (1969) (the separate and distinct claims presented by claimants in a class action cannot be aggregated to meet the jurisdictional amount); Zahn v. International Paper Co., 414 U.S. 291, 94 S.Ct. 505, 38 L.Ed.2d 511 (1973) (the separate and distinct claims of every plaintiff in a class action must satisfy the jurisdictional amount).

There appears to be no precise meaning of the term "common and undivided," but several opinions offer guidance. "It is not necessary that the claims of the plaintiffs be joint, in the technical sense of that word, as opposed to several. But it is essential that these claims constitute in their totality an integrated right against the defendant." Berman v. Narragansett Racing Assoc., 414 F.2d 311 (1st Cir.1969), cert. denied, 396 U.S. 1037, 90 S.Ct. 682, 24 L.Ed.2d 681 (1970) (citing A. Dobie, Federal Procedure § 58 at 158 (1928); Manufacturers Cas. Ins. Co. v. Coker, 219 F.2d 631, 633-634 (4th Cir.1955)). That the defendant has no interest in how the claim is distributed among the class members is a factor in whether the class has a common and undivided interest. Berman, at 316. "An identifying characteristic of a common and undivided interest is that if one plaintiff cannot or does not collect his share, the shares of the remaining plaintiffs are increased." Sellers v. O'Connell, 701 F.2d 575, 579 (6th Cir.1983). "If plaintiffs rights are not affected by the rights of the co-plaintiffs, then there can be no aggregation." Eagle Star Ins. Co. v. Maltes, 313 F.2d 778, 781 (5th Cir.1963).

The parties do not dispute that the individual plaintiffs' claims for compensatory and punitive damages, do not exceed $50,000⁶, and that the plaintiffs' compensatory damages, which are separate and distinct as to each plaintiff, cannot be aggregated to meet the jurisdictional amount. See Snyder, 89 S.Ct. at 1057-59; Zahn, 94 S.Ct. at 512. There also is no dispute that the total of the combination of each plaintiff's claim for exemplary damages exceeds the jurisdictional amount. The parties dispute, however, whether the law permits aggregation of claims for punitive damages.

The Court has found no appellate court decision on the issue of whether...