Opinion
CIVIL ACTION NO. 7:00-CV-:244-R
March 8, 2001
MEMORANDUM OPINION AND ORDER
Plaintiffs Marshall Williams and Travis Jones ("Mr. Williams") and ("Mr. Jones") assert claims against Defendants Uniroyal Tire Company, Inc. ("UTC"), Michelin North America Inc., ("MNA") and Discount Tire Company of Texas, Inc. ("DTC") for the torts of products liability, negligence and gross negligence. This court currently has diversity jurisdiction over this action pursuant to 28 U.S.C. § 1332(a). Now before this Court is Plaintiffs' Motion to Remand, filed on February 7, 2001, pursuant to 28 U.S.C § 1447(c). For the reasons discussed below, Plaintiffs' motion is GRANTED.
1. BACKGROUND FACTS
On January 29, 1998, Mr. Williams and Mr. Jones, both Texas residents, were seriously injured when the 1987 Chevrolet Silverado pickup truck in which they were riding rolled over and ejected them from the vehicle. The plaintiffs originally filed suit in the 90th Judicial District of Young County, Texas on December 10, 1999. In their complaint, the plaintiff's allege that the right rear tire of the pickup, a Uniroyal Tiger paw Plus, caused the accident when it lost its tread, causing the truck to fish tail, slide across the highway, and flip. They seek damages for their injuries on the theories of products liability, negligence, and gross negligence as defined by Texas stale law against defendants Uniroyal Tire Company ("UTC"), a New Jersey corporation with its principle place of business in New Jersey; its successor corporation, Michelin North America Inc. ("MNA")., a New York corporation with Us principle place of business in New York, and Discount Tire Company, a Texas corporation with its principle place of business in Texas.On December 6, 2000, defendant MNA removed this action to federal court on diversity grounds, pursuant to 28 U.S.C 1332(a), asserting that non-diverse defendant DTC had been fraudulently joined in an effort to defeat diversity jurisdiction. This motion to remand by plaintiffs Williams and Jones followed on January 4, 2001, The crux of the jurisdictional dispute between the parties evolved when MNA discovered substantial evidence that DTC was not the company that sold the Uniroyal tire that lost its tread while on the vehicle in question. Specifically,, MNA asserts that "thorough review of Discount Tire's records reveals that Larry Minor [the original owner of the truck in question] only had two transactions with the Discount Tire store on South Cooper Street in Arlington in 1995, and the four tires purchased by Mr. Minor and referenced in his affidavit were Goodyear Eagle Tires, not the tire in question." MNA further argues that DTC never sold the Uniroyal tires at the time of Mr. Minor's purchase, and thus should not be connected in any way with this case. In response, the plaintiffs submit the affidavit of Larry Minor which states that in 1995, he purchased new tires at DTC for the vehicle in question. In addition, the plaintiffs have alleged that these tires from DTC were the same tires that were on the vehicle the day of the incident.
Defendant's Response to Plaintiffs' Motion to Remand, p. 7.
Id.
II. PROCEDURAL HISTORY Defendants' Removal Notice was Timely.
As a preliminary matter, plaintiffs Williams and Jones argue that Defendant's Removal Notice was not timely filed, and that this case should he remanded on these grounds. However, the procedural history of this action reveals that the plaintiffs' arguments are without merit. 28 U.S.C, § 1446(b) forbids removal of art action to federal court on diversity ground if such notice is given a.) in excess of one year after the date the action was filed, or b.) more than thirty days of ascertaining from some "amended pleading, motion, order, or other paper" that the case is ripe for removal. See 28 U.S.C. § 1446(b). As this action was filed on December 10, 1999, and the defendant's Notice of Removal was filed on December 6, 2000, it is not disputed that defendant's removal notice meets the first timeliness requirement under § 1446(b). As to the thirty-day requirement, this Court finds sufficient evidence in the record that the defendants were not provided the plaintiffs' medical bills prior to November 17, 2000, and were thus unable to earlier determine whether or not this action met the amount-in-controversy requirement for removal of a stale court action on diversity grounds. As these medical bills are "other papers" within the meaning of the statute, the defendant's December 6, 2000 notice of removal was timely.
Plaintiffs argue that they produced the plaintiffs' medical bills on October 10, 2000. However, this posture is inconsistent with the specific language included in the October 10 production, in which the plaintiffs indicated that "the billing records have been requested through deposition on written questions and are currently being gathered." It is impossible for the plaintiffs to have served the defendants with documents that they were "currently gathering" on October 10, 2000. As such, this Court finds viable the November 17, 2000 production date that the Defendants have sworn to as the date they determined this action was removable.
III. LEGAL ANALYSIS
Having addressed the Plaintiffs' procedural argument, this Court will now turn to the merits of the motion to remand. "Title 28 U.S.C. § 1441 (a) permits removal of any civil action brought in a State Court of which the district courts of the United States have original jurisdiction' Removal jurisdiction must be strictly construed, however, because it `implicated important federalism concerns.'" Ray v. State Farms Lloyds, 1999 WL 151667 (N.D. Tex 1999) (citing Frank v. Bear Stearns Co., 128 F.3d 919, 922 (5th Cir. 1997). "Any doubts concerning removal must be resolved against removal in favor of remanding the case back to state court." Cross v. Bankers Multiple Line Insurance Company, 810 F. Supp. 748, 750 (N.D. Tex. 1992). For these reasons, the burden of establishing subject matter jurisdiction in federal court rests on the party seeking removal. See Gailor v. Peninsular Occidental Steamship Co., 287 F.2d 252, 253-54 (5th Cir. 1961.)In order to properly exercise diversity jurisdiction over an action, a Federal court must ensure that none of the plaintiffs share state citizenship with any of the defendants, and that the case in question involves an amount-in-controversy of at least $75,000. See 28 U.S.C. § 1332(a). While the parties agree that the amount-in-controversy requirement is met, they disagree on whether or not complete diversity of citizenship exists between the parties. Specifically, plaintiffs Williams and Jones argue that they share stale citizenship with Defendant DTC, a Texas corporation with its principle place of business in Texas, which forbids this Court from asserting jurisdiction over this action. See 28 U.S.C. § 1332(a). In order for MIlA to succeed on plaintiffs' motion, it must prove that defendant DTC was fraudulently joined by plaintiffs to defeat diversity jurisdiction, mandating that DTC be ignored for the purposes of asserting diversity jurisdiction and removal. As it cannot do so, this action must be remanded.
Fraudulent Joinder
The law on assessing claims of fraudulent joinder of non-diverse parties for the purposes of defeating diversity jurisdiction is exceedingly clear in this Circuit. The burden placed upon a party asserting a fraudulent joinder claim is extremely high, and such claims only succeed when the removing party can show: "1) there has been outright fraud in the plaintiffs recitation of jurisdictional facts, or 2) there is no possibility that the plaintiff would be able to establish a cause of action against the non-diverse defendants in state court."Burden v. General Dynamics Corp. 60 F.3d 213, 217 (5th Cir. 1995). In its evaluation, the district court must resolve all disputed issues of fact in favor of the plaintiff, and must view all pleaded facts in the plaintiffs favor. See B. Inc. v. Miller Brewing Company, 663 F.2d 545, 549 (5th Cir. Unit A. 1981). "If the plaintiff has any possibility of recovery under state law against the party whose joinder is questioned, then the joinder is not fraudulent in fact or Jaw. We do not determine whether the plaintiff will actually or even probably prevail on the merits of the claim, but look only for a possibility that the plaintiff might do so." Burden, 60 F.3d at 216 (citing Dodson v. Spiliada Maritime Corp., 951 F.2d 40, 42-43 (5th Cir. 1992). From the pleadings on this motion, it is not completely clear whether MNA asserts fraudulent joinder as a matter of law or fact, and as such, this Court will evaluate both prongs of the criteria established by Burden and its predecessors in rejecting MNA's claim.
A.) "Outright Fraud" in the Factual Pleadings
First, while MllA has successfully raised a question of fact regarding the origin of the Uniroyal tires, they have produced no evidence that the plaintiffs have committed "outright fraud" in their assertions to the Court. The definition of fraud necessarily mandates MNA to make a showing of intent: "An intentional pervasion of truth for the purpose of inducing another in reliance upon it to part with some valuable thing belonging to him or to surrender a legal right" Blacks Law Dictionary, 6th Ed, p. 660. (c. 1990). The pleadings on this motion, as well as the supporting affidavits, contain no evidence of positive knowledge on the part of any individual that the plaintiffs are lying. Instead, MNA solely asserts that strong evidence exists that Mr. Minor may not have purchased the allegedly detective tire at DTC. Unfortunately for MNA, this Court is not permitted to "conduct a full-scale evidentiary hearing on questions of fact, but rather should make a summary determination by resolving disputed facts in favor of the plaintiff." Id. at 217 (citingGreen v. Amerada Hess Corp., 707 F.2d 201, 205 (5th Cir. 1983). As MNA has not proven deception on the part of the plaintiffs, it cannot assert fraud, leaving this Court obligated to assume that the plaintiffs' assertion that Mr. Minor purchased the Uniroyal tires in question at DTC is true.
B.) Potential to Establish Liability against PTC.
MNA's removal notice may also survive if it can prove that the plaintiffs cannot establish a viable cause of action against the non-diverse defendant. In order to succeed on a products liability claim in Texas, a plaintiff must prove that a manufacturing flaw existed in the product that renders the product unreasonably dangerous, and a causal connection between the product (in the condition it which it left the seller) and the plaintiffs injuries. See Lucas v. Texas Industries, 696 S.W.2d 372 (Tex.Ct.App. 1984). In order to succeed on a negligence action in Texas, a plaintiff must demonstrate 1.) a legal duty owed by one person to another, 2) a breach of that duty, and 3) proximate cause, consisting of both "cause in fact" and "foreseeability." See Rodriguez v. Moerbe, 963 S.W.2d 808 (Tex. Ct App, 1998). Here, MNA's sole argument surrounding the legal viability of the plaintiffs' claims against DTC is that the plaintiff cannot prove a "causal connection" between DTC and the incident because DTC "did not sell the tire in question." Defendant's Reply, p. 6, Yet this is a question of fact, not law; as previously stated, the origin of the tire's purchase is a factual dispute that this Court must resolve in favor of the plaintiff's on a motion to remand. MNA offers no legal argument why the plaintiffs cannot establish liability on the part of DTC if the tire in question can he traced there. As such, their fraudulent joinder claim fails.
In turning to this second prong of the Burden analysis, this Court reiterates its obligation to assume the disputed facts in the plaintiffs' favor.
IV. CONCLUSION
Based on the aforementioned arguments and the evidence before it, this Court finds that Defendant Discount Tire Company was properly joined in this action, and that the requirement of complete diversity of citizenship between the parties is not satisfied. This Court finds that it does not have diversity jurisdiction over this action as defined by 28 U.S.C § 1332(a), and hereby GRANTS the Plaintiffs' Motion to Remand, pursuant to 28 U.S.C. § 1447(c). This Court ORDERS this action remanded to the district court of Young County, Texas, 90th Judicial District,
IT IS SO ORDERED.