Walker v. Philip Morris USA, Inc.

• Decision Date: 31 October 2011
• Docket Number: No. 09-5318,09-5318
• Parties: JOHN WALKER, Individually and as Administrator for estate of Ann-Ashia Maddox; GREG MCKINNEY, Individually and as Administrator for estate of Deashia McKinney; estate of Nakiya McKinney; JANET TONGUE, as Administratrix for estate of Sherry Lynn Maddox; estate of Crystal Maddox; estate of Demita Wise; PATRICK NETHERTON, as Guardian and Next Friend of Y.M. and as Administrator for estate of Heaven Maddox; estate of Earth Maddox; CARLA SPARROW, Individually and as Administrator for estate of Dariyel Maddox; ROGER HARDIN, JR., as Guardian and Next Friend of N.H.; ELIZABETH MADDOX; DARYL MADDOX; MICHAEL TAYLOR, Individually; PATRICK NETHERTON, as Guardian and Next Friend of Y.M. and as Administrator for estate of Heaven Maddox; estate of Earth Maddox, Plaintiffs - Appellants, v. PHILIP MORRIS USA, INC., GAIL BROTHERS; MICKEY BROTHERS; ALTRIA GROUP, INC.; PHILIP MORRIS INTERNATIONAL, INC.; NATHAN JOHNSON; JACKSON FURNITURE INDUSTRIES, INC., Defendants - Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (6th Circuit)

JOHN WALKER, Individually and as Administrator for estate of Ann-Ashia Maddox; GREG MCKINNEY, Individually and as Administrator for estate of Deashia McKinney;

estate of Nakiya McKinney; JANET TONGUE, as Administratrix for estate of Sherry Lynn Maddox; estate of Crystal Maddox; estate of Demita Wise;

PATRICK NETHERTON, as Guardian and Next Friend of Y.M. and as Administrator for estate of Heaven Maddox; estate of Earth Maddox; CARLA SPARROW, Individually and as Administrator for estate of Dariyel Maddox; ROGER HARDIN, JR., as Guardian and Next Friend of N.H.;

ELIZABETH MADDOX; DARYL MADDOX; MICHAEL TAYLOR, Individually; PATRICK NETHERTON, as Guardian and Next Friend of Y.M.

and as Administrator for estate of Heaven Maddox; estate of Earth Maddox, Plaintiffs - Appellants, v. PHILIP MORRIS USA, INC., GAIL BROTHERS; MICKEY BROTHERS; ALTRIA GROUP, INC.; PHILIP MORRIS INTERNATIONAL, INC.;

NATHAN JOHNSON; JACKSON FURNITURE INDUSTRIES, INC., Defendants - Appellees.

No. 09-5318

UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT

Filed: October 31, 2011

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION

File Name: 11a0739n.06

ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF KENTUCKY

OPINION

BEFORE: KETHLEDGE and WHITE, Circuit Judges, and BECKWITH, District Judge.^*

HELENE N. WHITE, Circuit Judge. Plaintiffs, the surviving relatives and administrators of the estates of the victims of a house fire, appeal the district-court orders denying their motion to remand this diversity case to the Kentucky state court and granting Defendants' 12(b)(6) motions to dismiss. Because we conclude the district court erred in denying the motion to remand, we VACATE the district court's orders of dismissal, and remand for entry of an order remanding the case to state court.

I. BACKGROUND

A. Factual Background

On February 6, 2007, at approximately 3:51 a.m., a fire broke out at 235 Guthrie Drive, a residence in Bardstown, Kentucky. Daryl Maddox, who lived at the premises, was the first to notice the fire; although intoxicated, he tried to rouse the other inhabitants, then fled outside to seek help. Maddox alerted the neighbors, who tried unsuccessfully to enter the burning house and rescue those remaining inside. By the time the blaze was brought under control, ten persons - four adults and six children - were dead.

The official report lists the cause of the fire as unknown, but suggests that the most likely source of ignition was "smoking material." Investigators traced the origin of the fire to an area in the living room where Johnny Litsey, a deceased tenant, usually sat in an upholstered chair. Friends and family described Litsey as a moderate to heavy smoker, who spent most of his days (and many nights) sitting in "his" chair. No one who responded to the fire recalled hearing a smoke detector sounding an alarm. An investigative report states that Maddox told investigators that there was a smoke detector in the hallway, but he "tested it and it did not work."

Defendant Nathan Johnson owned the Guthrie Drive property and rented it to Sherry Maddox, a victim of the fire. Johnson hired his cousin Mickey Brothers and Brothers's wife, Gail, to maintain the property and perform all repairs. According to service records, the Brothers tested the smoke and carbon monoxide detector in January 2006, while performing other maintenance work, but it had not been checked since.

Plaintiffs commenced this action in the Circuit Court for Nelson County, Kentucky, alleging negligence on the part of Johnson and the Brothers,¹ and product-liability claims against the cigarette manufacturer, Philip Morris USA, its parent entities, Philip Morris International, Inc., and Altria Group, Inc. (together, "Philip Morris"), and the manufacturer of the chair that initially caught fire, Jackson Furniture Industries, Inc. ("Jackson Furniture").² Plaintiffs claim the fire could have been prevented if the Kentucky Defendants had maintained a working smoke detector in the rental home, and if Philip Morris and Jackson Furniture used safer designs for their products. In particular, Plaintiffs contend that the fire would not have occurred if Johnny Litsey had been smoking "reduced ignition propensity" cigarettes ("RIPC"), which are less likely than regular cigarettes to cause smoking fires,³ and that the existence of a safer alternative cigarette design rendered Philip Morris'sregular cigarettes unreasonably dangerous. Plaintiffs also allege that Jackson Furniture should have used fire-retardant products in manufacturing Litsey's upholstered chair.

B. Procedural History

Philip Morris was served the complaint on February 4, 2008. On March 14 and 24, 2008, Philip Morris received the Brothers' and Johnson's Answers denying Plaintiffs' allegations. On April 9, 2008, Philip Morris received copies of three signed affidavits in which Nathan Johnson, Gail Brothers and Mickey Brothers denied assuming a duty to maintain or inspect the smoke detector. The Brothers' affidavits state that Mickey Brothers checked the smoke detector on one occasion when asked to do so by Sherry Maddox, and that there were no other requests to check or service the smoke detector made by Maddox or any other resident. Mickey Brothers' affidavit adds that on that one occasion, he "told Sherry Maddox to check [the smoke detector] in the future whenever she changed the time on her clocks in the spring and the fall."

On April 11, 2008, with the support of all Defendants, Philip Morris removed the case to the Federal District Court for the Western District of Kentucky pursuant to 28 U.S.C. § 1446(b). Philip Morris argued that the Kentucky Defendants were fraudulently joined, and that, in their absence, the complete-diversity requirement of 28 U.S.C. § 1332(a)(1) was met. On April 17, Philip Morris moved to dismiss Plaintiffs' claims. On May 1, 2008, Plaintiffs filed a motion to remand, arguing that Philip Morris's removal notice was untimely and that the district court lacked subject-matter jurisdiction over the case because the joinder of the non-diverse Defendants was not fraudulent. Plaintiffs supported their motion to remand with Daryl Maddox's affidavit stating that he and his mother "relied on the maintenance people overseeing the property to test and service the smokedetector. We believed the maintenance people tested the smoke detector when they checked the furnace filters and serviced other items in the home."

The district court denied Plaintiffs' motion to remand on August 28, 2008.

II. DISCUSSION

A. Removal/Remand Issue

Plaintiffs contend that the district court erred in denying their motion to remand because: (1) the notice of removal was untimely; and (2) the Kentucky Defendants were properly joined in the lawsuit.

1. Whether Philip Morris's Removal Notice was Timely Filed

Whether there is a defect in the removal procedure is a purely legal question that we review de novo. Loftis v. United Parcel Serv., Inc., 342 F.3d 509, 514 (6th Cir. 2003). Plaintiffs contend that Philip Morris's removal to federal district court was untimely. Philip Morris filed its notice of removal 65 days after being served with Plaintiffs' Complaint, and 28 days after receiving the Brothers' Answer to the Complaint.

In relevant part, the federal removal statute provides that a notice of removal "shall be filed within thirty days after the receipt by the defendant . . . of a copy of the initial pleading . . . ." 28 U.S.C. § 1446(b). If, however, "the case stated by the initial pleading is not removable, a notice of removal may be filed within thirty days after receipt by the defendant . . . of a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable . . . ." Id.

Plaintiffs argue that their Complaint contained unambiguous information concerning the nature of their state-law claims against the Kentucky Defendants, and therefore Philip Morris had no excuse not to remove within 30 days of service. We disagree.

Philip Morris could not divine that the case was removable based only on a complaint that "unambiguously" asserted claims against non-diverse defendants. Section 1446(b) allows the filing of a notice of removal within 30 days after receipt of a document "from which it may first be ascertained" that the case is removable. Id. (emphasis added); see also Holston v. Carolina Freight Carriers Corp., 936 F.2d 573 (6th Cir. 1991) (unpublished table case) ("§ 1446(b) starts the thirty-day period running from the date that a defendant has solid and unambiguous information that the case is removable."). Here, Defendants' basis for asserting fraudulent joinder was not ascertainable until receipt of co-Defendants' answers. Thus, Defendants' removal notice was timely filed.

2. Whether the District Court Erred in Denying Plaintiffs' Motion to Remand

a. The District Court's Decision.

As to the Kentucky Defendants, the issue central to liability is whether they voluntarily assumed a duty of care to maintain and repair a smoke detector that failed to function on the night of the fire. The parties presented the following evidence on this issue:

1. According to the property's service records, the Kentucky Defendants inspected the smoke detector in January 2006, while performing other maintenance work. There is no evidence of any subsequent inspection.

2. By affidavit, the Kentucky Defendants claim that they told Sherry Maddox, the main tenant, to check the smoke detector twice a year. Sherry Maddox died in the fire.

3. According to a report, Daryl Maddox told fire investigators that he tested the smoke detector some time before the fire and that it did not work.

4. By affidavit, Daryl Maddox claims that Plaintiffs relied on the Kentucky Defendants to test and service the smoke detector, and believed that the Kentucky Defendants did so when they checked the furnace filters and serviced other items in the home.

Upon reviewing this...