Sallee v. Medtronic Inc.

• Decision Date: 23 November 2022
• Docket Number: CV-22-00270-TUC-JCH (DTF)
• Parties: David Sallee, Plaintiff, v. Medtronic Incorporated, et al., Defendants.
• Court: U.S. District Court — District of Arizona

David Sallee, Plaintiff,
v.
Medtronic Incorporated, et al., Defendants.

No. CV-22-00270-TUC-JCH (DTF)

United States District Court, D. Arizona

November 23, 2022

ORDER

John C. Hinderaker United States District Judge.

Before the Court is Plaintiff's Motion to Remand to State Court ("Motion I") (Doc. 13), and Defendants' Motion to Dismiss for Failure to State a Claim ("Motion II") (Doc. 14) and Motion for Summary Disposition of Motion II ("Motion III") (Doc. 19). For the reasons below, the Court grants Motion I. The Court therefore cannot, and does not, reach Motions II and III.

I. Background

The issue here involves the action's procedural history.^[1] In 2021, Plaintiff filed case number C20211049 ("Case 1") in Arizona state court against the Arizona Board of Regents and the State of Arizona. On March 10, 2022, Plaintiff filed case number C20220934 ("Case 2") in state court against Defendants. The next day, Plaintiff filed case number C20220957 ("Case 3") in state court against Dr. Bull and Geena Wu, M.D. Cases 1 and 3 are between Arizona citizens. Case 2 is between an Arizona citizen and citizens of other

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states.^[2] In April, Plaintiff moved for the state court to consolidate the three cases. In May, the state court ordered the three actions "consolidated into case number C20211049 [Case 1] for all further proceedings." The state court further ordered "all pleadings from [Case 2] and [Case 3] be transferred to [Case 1]."

On June 9, Defendants filed a Notice of Removal from state court under case number C20220934 (Case 2). (Doc. 1 (the "Notice").) The Notice asserts Case 2 remains distinct for removal purposes despite the state court's consolidation of Cases 1-3. (Id. at 78.) On June 23, the case was referred to Magistrate Judge Leslie A. Bowman for all pretrial proceedings and a report and recommendation ("R&R"). (Doc. 12.) On June 28, Plaintiff timely sought remand to state court through Motion I. (Doc. 13.) Motion I asserts Case 2 cannot be removed separately from Cases 1 and 3 because the state court consolidated all three. (Id. at 5-6.) In July, the case was reassigned to Magistrate Judge D. Thomas Ferraro. (Doc. 18.) In September, Judge Ferraro issued his R&R recommending that the Court should grant Motion I. (Doc. 23.) The R&R reasoned that remand is required under Arizona law. (Id. at 4.) Defendants filed an Objection to the R&R analysis and conclusion, (Doc. 24), and Plaintiff filed a Reply. (Doc. 25.) II. Standard of Review

The Court reviews de novo any portion of a Magistrate Judge's R&R to which objection is made. 28 U.S.C. § 636(b)(1); see also Fed.R.Civ.P. 72(b); United States v. Remsing, 874 F.2d 614, 617 (9th Cir. 1989).

III. Analysis

Defendants object to the R&R's conclusion and analysis of Motion I. (See Doc. 24 at 2.) The Court must therefore, in essence, review Motion I de novo. The Court concludes that remand is required because Defendants cannot carry their burden of establishing federal jurisdiction. Arizona law does not settle the issue, and the Court declines to predict

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Arizona's approach because removal statutes are construed strictly against removal.

A. Remand is required given "any doubt" of federal jurisdiction.

A state-court defendant may remove the action to federal court if the federal court has "original jurisdiction" over the action. 28 U.S.C. § 1441(a) (2003). Federal courts have original jurisdiction over certain disputes between citizens of different states. 28

U.S.C. § 1332. Specifically, federal "diversity jurisdiction" requires (1) an amount in controversy over $75,000, and (2) "complete diversity"-each plaintiff must be a citizen of a different state from each defendant. 28 U.S.C. § 1332(a); Lincoln Prop. Co. v. Roche, 546 U.S. 81, 84 (2005).

The removing defendant has the burden to demonstrate federal jurisdiction. Abrego Abrego v. Dow Chemical Co., 443 F.3d 676, 685 (9th Cir. 2006). Put differently, the Court presumes it lacks jurisdiction unless the removing defendant shows otherwise. See id. This requirement is easily justified. A federal proceeding is void if it lacks jurisdiction. See U.S. v. Berke, 170 F.3d 882, 883 (9th Cir. 1999); Fed.R.Civ.P. 12(h)(3), 60(b). Presuming jurisdiction, then, would risk tremendous waste of resources. If jurisdiction later turned out to be lacking, the parties and the Court would have wasted their time seeking a resolution properly left to the state. That is why removal statutes are "strictly construed against removal." Luther v. Country Home Loans Servicing LP, 533 F.3d 1031, 1034 (9th Cir. 2008) (citation omitted). Critically, "any doubt" is resolved against removability. Id.; Abels v. State Farm Fire & Cas. Co., 770 F.2d 26, 29 (3d Cir. 1985).

Here, the Court has diversity jurisdiction over Case 2 only if it is distinct from Cases 1 and 3. All three cases involve an amount in controversy over $75,000. (See Doc. 1 at 9; Doc 15 at 5 n. 6.) If Case 2 is distinct, the Court has diversity jurisdiction because Plaintiff is from Arizona and Defendants Medtronic, Covidien Holding, and Covidien Sales are not. (See Doc. 1 at 3-5.) But if Cases 1-3 are no longer distinct, the Court does not have diversity jurisdiction because Plaintiff and Defendants Dr. Bull, Geena Wu, M.D., the Arizona Board of Regents, and the State of Arizona are all from Arizona. (Doc. 23 at 2.) The issue is whether Cases 1-3 remained distinct for removal purposes after the state court

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consolidated them. Because federal courts examine state law to determine the effect of a state-court consolidation order for removal, Bridewell-Sledge v. Blue Cross of Cal., 798 F.3d 923, 925 (9th Cir. 2015), the Court turns to Arizona's case-consolidation law.

B. Arizona has not decided the effect of a general consolidation of cases.

In actions involving a common question of law or fact, an Arizona court may "(1) join for hearing or trial any or all matters at issue in the actions; (2) consolidate the actions; or (3) issue any other orders to avoid unnecessary cost or delay." Ariz. R. Civ. P. 42(a). Few Arizona cases interpret Rule 42(a), and the two most relevant cases do not apply under the facts of this case. In Yavapai County v. Superior Court, the court held that Rule 42(a) "consolidation of cases 'for trial' . . . does not merge the suits into a single cause, or change the rights of the parties." 13 Ariz.App. 368, 370 (1970). Yavapai in turn cited Torosian v. Paulos, which held that Rule 42(a) "consolidation of actions for limited purposes or for the trial of certain issues only . . . does not thereby effect a merger of the cases consolidated." 82 Ariz. 304, 315 (1957).

But these cases concern only a limited-purpose consolidation of cases "for trial." That is different from the current case, where the consolidation order contained no limiting language. The state court consolidated Cases 2 and 3 "into [Case 1] . . . for all further proceedings," not merely for trial, and further ordered "all pleadings from [Case 2] and [Case 3] be transferred to [Case 1]." (Doc. 1-3 at 58-59.) The distinction between a limited consolidation and a more general consolidation is significant. Although Yavapai and Torosian did not refer to Rule 42(a)'s sub-sections, a limited consolidation presumably takes place under Rule 42(a)(1), which permits an Arizona court to join cases "for hearing or trial." A more general consolidation presumably takes place under Rule 42(a)(2), which permits an Arizona court to "consolidate the actions" differently from Rule 42(a)(1). Defendants identify-and the Court can find-no Arizona cases for the proposition that a general consolidation under Rule 42(a)(2) has the same effect as a limited consolidation

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for trial under 42(a)(1).^[3]

In fact, Defendants cite no Arizona cases at all in...