Summary
granting remand to state court although plaintiff could have recovered from two corporations without naming a resident corporate officer as a defendant
Summary of this case from BECK v. ALBERTSONS, INC.Opinion
Civil Action No. 03-1102
May 5, 2003
MEMORANDUM
Before the court is the motion of plaintiffs to remand this action to the Court of Common Pleas of Philadelphia County.
See 28 U.S.C. § 1447(c).
Plaintiff Leonard Harris ("Harris"), a citizen of the Commonwealth of Pennsylvania, originally brought this action in the state court for personal injuries allegedly suffered from exposure to emissions from a beryllium plant near Reading, Pennsylvania ("Reading plant" or "plant"). Harris has lived in the vicinity of the plant from 1949 to the present. The defendants are NGK Metals Corporation ("NGK Metals") and Cabot Corporation ("Cabot"), the former owners of the plant, as well as NGK Insulators, Ltd., NGK North America, Spotts, Stevens and McCoy, Inc. ("SSM") and individuals Len Velky ("Velky") and Yasuhito Niwa ("Niwa").
His wife Louise Harris has also asserted a derivative claim for loss of consortium.
There being no federal claims, defendants NGK Metals, Velky and Niwa, with the consent of Cabot, NGK North America, NGK Insulators, Ltd., and SSM timely removed the action to this court on February 26, 2003 on the ground of diversity of citizenship.
See 28 U.S.C. § 1332(a)(1), 1446(b).
I.
In support of their motion to remand, plaintiffs argue that subject matter jurisdiction fails because complete diversity of citizenship is lacking. See State Farm Fire Cas. Co. v. Tashire, 386 U.S. 523, 530-31 (1967); Strawbridge v. Curtiss, 7 U.S. 267 (1806). Plaintiffs and defendants SSM, Velky and Niwa are all Pennsylvania citizens. While conceding the lack of complete diversity, defendants respond that these three parties were fraudulently joined so that their citizenship should be disregarded.
Under Boyer v. Snap-on Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990), joinder is fraudulent "where there is no reasonable basis in fact or colorable ground supporting the claim against the joined defendant, or no real intention in good faith to prosecute the action against the defendant or seek a joint judgment" (citations omitted). The presence of a party fraudulently joined cannot defeat removal. Wilson v. Republic Iron Steel Co., 257 U.S. 92, 97 (1921).
The burden on defendants to establish fraudulent joinder is a heavy one. See Boyer, 913 F.2d at 111. In determining whether defendants have met their burden, we "must resolve all contested issues of substantive fact in favor of the plaintiff[s]." Id. We are also cognizant that the removal statute must be construed narrowly, and "all doubts should be resolved in favor of remand." Steel Valley Auth. v. Union Switch Signal Div., 809 F.2d 1006, 1010 (3d Cir. 1987) (citation omitted). However, we are not required blindly to accept whatever plaintiffs may say no matter how incredible or how contrary to the overwhelming weight of the evidence. The Supreme Court made it clear in Wilson that if the plaintiffs contest a defendant's assertion that joinder of another defendant was a sham to defeat removal, the District Court must determine the facts from the evidence. Wilson, 257 U.S. at 98. We are not to decide automatically in favor of remand simply because some facts may be said to be in dispute.
On matters of substantive law, "[i]f there is even a possibility that a state court would find that the complaint states a cause of action against any one of the resident defendants, the federal court must find that joinder was proper and remand the case to state court." Boyer, 913 F.2d at 111 (citation omitted). We are mindful that our inquiry into defendants' claim of fraudulent joinder is less searching than that permissible when a party seeks to dismiss a claim under Rule 12(b)(6) of the Federal Rules of Civil Procedure. Batoff v. State Farm Ins. Co., 977 F.2d 848, 852 (3d Cir. 1992); see also Gaul v. Neurocare Diagnostic, Inc., No. 02-CV-2135, 2003 WL 230800, at *2 (E.D.Pa. Jan. 1, 2003). In other words, simply because a claim against a party may ultimately be dismissed for failure to state a claim does not necessarily mean that the party was fraudulently joined. The test is whether a claim is colorable, that is, not "wholly insubstantial and frivolous." Batoff, 977 F.2d at 852.
II.
Plaintiff asserts claims of negligence, civil conspiracy and fraudulent concealment or non-disclosure against defendant Niwa, who has served as either Vice President or President of NGK Metals since it began operating the plant in 1986. Pennsylvania law provides that:
an officer of a corporation who takes part in the commission of a tort by the corporation is personally liable therefor; but that an officer of a corporation who takes no part in the commission of the tort committed by the corporation is not personally liable to third persons for such a tort, nor for the acts of other agents, officers or employees of the corporation in committing it, unless he specifically directed the particular act to be done or participated, or cooperated therein.
Wicks v. Milzoco Builders, Inc., 470 A.2d 86, 90 (Pa. 1983) (citations omitted). Accordingly, "a corporate officer can be held liable for `misfeasance,' i.e., the improper performance of an act, but not for `mere nonfeasance,' i.e., the omission of an act which a person ought to do." Bethea v. Bristol Lodge Corp., No. CIV. A. 01-612, 2002 WL 31859434, at *15 (E.D.Pa. Dec. 18, 2002) (quoting Brindley v. Woodland Vill. Rest., 652 A.2d 865, 868 (Pa.Super.Ct. 1995)).
The Pennsylvania courts have defined misfeasance as "the doing of something which ought not be done, something which a reasonable man would not do, or doing it in such a manner as a man of reasonable and ordinary prudence would not do it, in either case leading to mischief or injury." Brindley, 652 A.2d at 869 (quoting Nelson v. Duquesne Light Co., 12 A.2d 299, 303 (Pa. 1940)). "The touchstone for personal liability under Pennsylvania caselaw, therefore, is knowing participation in the tortious conduct." Peerless Heater Co. v. Mestek, Inc., No. CIV. A. 98-CV-6532, 2000 WL 637082, at *11 (E.D.Pa. May 11, 2000).
In the negligence claim in his complaint asserted against Niwa, Harris maintains that "[i]n or about 1997 Niwa specifically wrote to a U.S. regulatory agency that he knew of no scientific evidence or basis to tighten exposure standards for beryllium when he had been personally aware of such evidence for over 20 years from his own company's medical director."
Plaintiff further contends that as a direct result of Niwa's actions, NGK Metals "continued to discharge quantities of beryllium dust and fumes in both the ambient and occupational environment that was known to be unsafe and dangerous and harmful to plaintiff; such acts and omissions caused or contributed to plaintiff's harm."
Plaintiff has sufficiently alleged that defendant Niwa, as an officer of NGK Metals, has engaged in acts of misfeasance on behalf of the corporation which allegedly caused Harris' injury. Since his claim of negligence against this non-diverse defendant is colorable, that is, not "wholly insubstantial and frivolous," we need not address whether the remaining non-diverse defendants were fraudulently joined. Batoff, 977 F.2d at 852.
Accordingly, we will remand this action to the Court of Common Pleas of Philadelphia County.
ORDER
AND NOW, this day of May, 2003, for the reasons set forth in the accompanying Memorandum, it is hereby ORDERED that:
(1) the motion of plaintiffs to remand this action to the Court of Common Pleas of Philadelphia County is GRANTED; and
(2) this action is REMANDED to the Court of Common Pleas of Philadelphia County, Pennsylvania, pursuant to 28 U.S.C. § 1447(c).
BY THE COURT: