Millman v. Biomet Orthopedics, Inc.

• Decision Date: 10 December 2013
• Docket Number: CAUSE NO. 3:13-CV-77 RLM-CAN
• Parties: ROCHELLE MILLMAN and LEONARD MILLMAN, Plaintiffs v. BIOMET ORTHOPEDICS, INC., et al., Defendants
• Court: U.S. District Court — Northern District of Indiana

ROCHELLE MILLMAN and LEONARD MILLMAN, Plaintiffs v. BIOMET ORTHOPEDICS, INC., et al., Defendants

CAUSE NO. 3:13-CV-77 RLM-CAN

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF INDIANA SOUTH BEND DIVISION

ENTERED: December 10, 2013

This Document Relates to:

Cause No. 3:12-MD-2391 RLM-CAN

OPINION and ORDER

Illinois citizens Rochelle and Leonard Millman brought suit against defendants Biomet Orthopedics, LLC, and Biomet, Inc. (collectively, Biomet)¹ and T.L. Weis & Associates, Inc. and Adam Garcia (Weis defendants)² in the Cook County, Illinois, Circuit Court for strict product liability, negligence, and loss of consortium. Biomet removed the case to the Northern District of Illinois, Eastern Division, pursuant to 28 U.S.C. § 1446, alleging diversity of citizenship. The Judicial Panel on Multidistrict Litigation transferred the case into the Biomet multi-district litigation docket in this court.

The case is before me on the Millmans' remand motion. For diversity purposes, the Millmans are citizens of Illinois; the Biomet defendants are Indiana citizens; T.L. Weis & Associates is an Illinois citizen; and Adam Garcia is a citizen of Illinois. In removing the case to federal court, Biomet claimed that the Weis defendants' citizenship should be disregarded because those defendants were fraudulently joined, i.e., the Millmans have no reasonable probability of establishing or prevailing on any claim against the Weis defendants. The Millmans argue in their remand motion that their complaint contains viable causes of action against the Weis defendants.

Federal jurisdiction based on diversity of citizenship requires that the parties be completely diverse. 28 U.S.C. § 1332(a). A plaintiff can't join a non-diverse defendant for the sole purpose of destroying diversity jurisdiction. Schur v. L.A. Weight Loss Ctrs., Inc., 577 F.3d 752, 763 (7th Cir. 2009). To establish fraudulent joinder, a removing defendant must show 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.' Framed a different way, the . . . court must ask whether there is 'any reasonable possibility' that the plaintiff could prevail against the non-diverse defendant. A defendant bears a 'heavy burden' to demonstrate that the joinder is fraudulent. " Schur v. L.A. Weight Loss Ctrs., 577 F.3d 752, 764 (7th Cir. 2009) (quoting Poulos v. Naas Foods, Inc., 959 F.2d 69, 73 (7th Cir. 1992)). Fraudulent joinder doesn't require a showing of bad faith on the plaintiff's part, but exists if the claims against the non-diverse defendant have nochance of success. Poulos v. Naas Foods, Inc., 959 F.2d 69, 73 (7th Cir. 1992); Scheinman v. BMW of North America, LLC, No. 10 C 4848, 2010 WL 3937489, at *2 (N.D. Ill. Sept. 30, 2010). If the removing defendant can meet this "heavy burden," the court may "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., 577 F.3d 752, 763 (7th Cir. 2009) (internal quotation and citation omitted); see also Morris v. Nuzzo, 718 F.3d 660, 666 (7th Cir. 2013) ("Because the district court may 'disregard' the nondiverse defendant, we have described the fraudulent joinder doctrine as an 'exception' to the requirement of complete diversity.").

To decide whether a defendant has been fraudulently joined, I can pierce the pleadings to consider summary judgment-type evidence, such as affidavits and deposition testimony. See Rutherford v. Merck & Co., Inc., 428 F. Supp. 2d 842, 848 (S.D. Ill. 2006) (fraudulent joinder considerations are limited to "uncontroverted . . . evidence which establishes unmistakably that a diversity-defeating defendant cannot possibly be liable to a plaintiff under applicable state law"). "[A] limited use of affidavits and other evidence is permissible so long as the evidence is not used to 'pre-try' the case." Siegel v. H Group Holding, Inc., No. 07 C 6830, 2008 WL 4547334, at * 3 (N.D. Ill. Apr. 9, 2008). Compare Wecker v. National Enameling & Stamping Co., 204 U.S. 176, 183-185 (1907) (concluding that non-diverse defendant was fraudulently joined where uncontradicted affidavits showed the defendant was merely a draftsmanwith no responsibility for designing the machine at issue), and Faucet v. Ingersoll-Rand Min. & Machinery Co., 960 F.2d 653, 654-655 (7th Cir. 1992) (fraudulent joinder established via uncontroverted affidavit statement of defendant that he "had absolutely nothing to do with" the machine alleged to have caused plaintiff's injury), with Momans v. St. John's Northwestern Military Academy, Inc., No. 99 C 8510, 2000 WL 33976543, at *4 (N.D. Ill. Apr. 20, 2000) (court declined to consider defendants' affidavits on issue of fraudulent joinder where affidavits contained "substantive, rather than jurisdictional facts" addressing "the merits of the case" rather than the propriety of removal).

Strict Liability Claim

Biomet claims the Millmans' complaint doesn't contain allegations sufficient to state a claim under the Illinois Distributor Statute, 735 Ill. Comp. Stat. 5/2-621, which provides that "[i]n any product liability action based in whole or in part on the doctrine of strict liability in tort," a court must dismiss a non-manufacturer defendant once that defendant "files an affidavit certifying the correct identity of the manufacturer of the product allegedly causing injury, death or damage." Whelchel v. Briggs & Stratton Corp., 850 F. Supp. 2d 929, 932 (N.D. Ill. 2012) (quoting Historical and Statutory Notes to 735 ILCS 5/2-621 (providing pre-amendment language of subsections (a) and (b)) and 735 ILCS 5/2-621(b)); South Side Trust and Sav. Bank of Peoria v. Mitsubishi Heavy Indus., Ltd., 927 N.E.2d 179, 186 (Ill. App. Ct. 2010) (same). "A court may not order dismissal, however,where a plaintiff shows that the distributor (1) participated in the design or manufacture of the product, (2) had actual knowledge of the defect in the product, or (3) created the defect in the product." Whelchel v. Briggs & Stratton Corp., 850 F. Supp. 2d 929, 932 (N.D. Ill. 2012) (quoting 735 ILCS 5/2-621(c)).

Biomet relies on the declaration of Timothy Weis, owner of defendant T.L. Weis & Associates, Inc., who states that Biomet Orthopedics, LLC is the manufacturer of the Magnum Device and the components of the device at issue in this case. Weis Decl. (Removal Notice, Exh. D), ¶ 4. Mr. Weis also says Weis & Associates didn't exercise any control over the design or manufacture of the Magnum Device, played no role in the design, testing, or manufacture of the Magnum Device, and delivers the Magnum Devices to hospitals "in sterile packaging that has been labeled, packaged, and sealed by Biomet." Weis Decl., ¶¶ 6, 9, 10. The Millmans haven't challenged any of Mr. Weis's statements nor have they come forward with any contrary evidence.

The complaint against the Weis defendants must be dismissed unless the Millmans can demonstrate a reasonable possibility that the Weis defendants "participated in the design and manufacturer of the allegedly defective product, had actual knowledge of the alleged defect in the product, or created the defect." South Side Trust and Sav. Bank of Peoria v. Mitsubishi Heavy Indus., Ltd., 927 N.E.2d 179, 186 (Ill. App. Ct. 2010). They haven't done so. The Millmans haven't set forth specific facts supporting their conclusion that a reasonable possibility exists that the Weis defendants had actual knowledge of the defect in the product.See Pooh-Bah Enterprises, Inc. v. County of Cook, 905 N.E.2d 781, 789 (Ill. 2009) ("A plaintiff may not rely on mere conclusions of law or fact unsupported by specific factual allegations."); Beahringer v. Page, 789 N.E.2d 1216, 1221 (Ill. 2003) ("A plaintiff must allege facts sufficient to bring his or her claim within the scope of the cause of action asserted."). Nor have they set forth any facts that could reasonably support their conclusion that the Weis defendants created a defective condition by mishandling or altering the Magnum Device. See Weidner v. Midcon Corp., 767 N.E.2d 815, 819 (Ill. App. Ct. 2002) ("[A]n actionable wrong cannot be made out merely by characterizing acts as having been wrongfully done.").

The Millmans claim in their reply that because a defendant dismissed under the distributor statute may be reinstated, a dismissal under that statute is merely conditional, the dismissed defendant remains a party to the action, and no fraudulent joinder can be found. While the distributor statute allows a plaintiff "'at any time' to move to reinstate a dismissed defendant upon a showing that an action against the manufacturer is time-barred, the manufacturer was incorrectly identified, the manufacturer is not subject to the court's jurisdiction, or the manufacturer cannot satisfy a judgment or settlement," Scheinman v. BMW of North America, LLC, No. 10 C 4848, 2010 WL 3937489, at *3 (N.D. Ill. Sept. 30, 2010) (citing 735 ILCS 5/2-621(b)), the Millmans haven't alleged that any of those scenarios apply here. In addition, more recent cases have held to the contrary: "To allow the conditional nature of a § 2-621 dismissal to defeat diversity jurisdictionin all cases where a distributor is nondiverse would change the Poulos 'reasonable possibility' test into an 'any possibility' test. The question, therefore, is whether there is a 'reasonble possibility' that plaintiff can establish one of the § 2-621(c) factors and, if not, whether there is a 'reasonable possibility' that the plaintiff will be unable to recover from the manufacturer for one of the reasons stated in § 2-621(b)." Whelchel v. Briggs & Stratton Corp., 850 F. Supp. 2d 926, 934 (N.D. Ill. 2012); see also Xiaofa Shi v. American Honda Motor Co., Inc., No. 11 C 2682, 2011 WL 5403618, at * 2 (N.D. Ill. Nov. 8, 2011); Steel v. Ford Motor Co., No. 11 C 460...