Summary
holding that because the LPLA only provides a source of recovery against manufacturers, the plaintiff had no possibility of recovery against a seller under the Act
Summary of this case from Banks v. Hiab USA, Inc.Opinion
Civil Action No: 04-2005 Section: "J"(1).
September 28, 2004
ORDER AND REASONS
Before the Court are Plaintiff's Motion to Remand (Rec. Doc. 3) and Motion for Leave to File Supplemental and Amending Complaint (Rec. Doc. 5). In response to plaintiff's motions, defendant, Cordis Corporation, filed an Opposition to Plaintiff's Motion to Remand (Rec. Doc. 7) and an Opposition to Plaintiff's Motion for Leave to File Supplemental and Amending Complaint (Rec. Doc. 9). The motions are currently set for hearing for October 13, 2004 and the defendant has requested oral argument.
PROCEDURAL BACKGROUND
On May 24, 2004, plaintiff filed suit individually, as administratrix of the estate of her husband, and as natural tutrix of her minor children against Cordis Corporation ("Cordis"), a Florida corporation, and St. Tammany Parish Hospital ("STPH"), a political subdivision of St. Tammany Parish, in the 22nd Judicial District Court of Louisiana. Service of process was effected on Cordis by certified mail on June 16, 2004 by the Louisiana Long Arm Statute. On July 16, 2004, Cordis removed the case to this Court alleging that STPH was fraudulently joined as a defendant, and asserting that this Court has subject matter jurisdiction based on diversity of citizenship.
DISCUSSION
Under the former fraudulent joinder doctrine, now actually known as "improper joinder," there at least must be a reasonable basis for predicting that state law would allow recovery in order to preclude a finding of improper. In order to prove that a non-diverse defendant was improperly joined in a case to defeat diversity jurisdiction, "the removing party must show either that there is no possibility that the plaintiff would be able to establish a cause of action against the in-state defendant in state court; or that there has been outright fraud in the plaintiff's pleadings of jurisdictional facts." A district court does not inquire whether the plaintiff will actually or even probably prevail on the merits of her claim. "The court determines whether that party has any possibility of recovery against the party whose joinder is questioned. If there is arguably a reasonable basis for predicting that the state law might impose liability on the facts involved, then there is no [improper] joinder. This possibility, however, must be reasonable, not merely theoretical." "If the plaintiff has any possibility of recovery under state law against the party whose joinder is questioned, then the joinder is not [improper] in fact or law." In assessing an improper joinder claim, the Court must evaluate all of the contested factual allegations in the light most favorable to the plaintiff. Moreover, the Court must resolve any uncertainties concerning the current status of controlling state substantive law in favor of the plaintiff.
Travis v. Irby, 326 F.3d 644, 648 (5th Cir. 2003) (quoting Bandon v. RJR Nabisco, Inc., 236 F.3d 282, 286 n. 4 (5th Cir. 2000) (first emphasis in original)); See Smalllwood v. Illinois Cent. R.R. Co., 2004 WL 2047314, *18 n. 1 (5th Cir. 2004) (adopting the term "improper joinder" as being more consistent with the statutory language than the term "fraudulent joinder").
See Tauzier v. Dodge, No. 97-2444, 1998 WL 458184, *3 (E.D. La. 8/4/98) (citing B., Inc. v. Miller Brewing Co., 663 F.2d 545, 549 (1981); Sid Richardson Carbon Gasoline Co. v. Interenergy Resources, Ltd., 99 F.3d 746, 751 (5th Cir. 1996); Cavallini v. State Farm Mut. Auto Ins. Co., 44 F.3d 256, 259 (5th Cir. 1995)).
See Travis, 326 F.3d at 648 (quoting Great Plains Trust Co. v. Morgan Stanley Dean Witter Co., 313 F.3d 305, 312 (5th Cir. 2002) (emphasis added; internal citation and quotations omitted)).
See Tauzier, 1998 WL 458184, *3 (quoting Burden v. General Dynamics Corp., 60 F.3d 213, 216 (5th Cir. 1995)).
See id. (citing Sid Richardson, 99 F.3d at 751; Burden, 60 F.3d at 216; Miller Brewing Co., 663 F.2d at 549).
Plaintiff's petition alleges, inter alia, that "the negligence of St. Tammany Parish Hospital as a 'Seller' of a defective product in violation of the Louisiana Products Liability Act caused or contributed to the death of [plaintiff's husband] and damages sustained by Petitioners." Additionally, the petition states "[a]s a result of the acts of negligence of the defendants jointly and in solido" plaintiff's husband suffered. . . ." The LPLA defines a seller as "a person or entity who is not a manufacturer and who is in the business of conveying title to or possession of a product to another person or entity in exchange for anything of value." As evidenced by the itemized statement attached to the plaintiff's memorandum in support of remand, STPH sold the allegedly defective product/device to the plaintiff and, therefore, is properly classified as a seller under the LPLA. However, the LPLA does not provide a cause of action against "sellers," but only against manufacturers. Thus, because STPH is not a manufacturer as defined by the LPLA, there is no possibility that the plaintiff can recover against STPH based on the LPLA claims asserted.
Petition, p. 3.
Petition, p. 3.
LA.REV.STAT. ANN. § 9:2800.53(2) (West 1997).
LA.REV.STAT. ANN. § 9:2800.52 explains that the LPLA "establishes exclusive theories of liability for manufacturers for damages caused by their products."
Generally, a non-manufacturer seller of a product may be held liable only for its negligent failure to warn consumers of the dangerous propensities of the product it sells. The seller of a defective product may be liable in tort if he knew or should have known that the product was defective, and he failed to declare it. In the plaintiff's memorandum in support of her motion to remand, plaintiff asserts that STPH's knowledge was properly pled because "knowledge" is a component of the claims arising under the LPLA. Although knowledge may be a component of LPLA claims, plaintiff cannot assert that knowledge was properly pled under the LPLA because STPH is not a manufacturer and, therefore, plaintiff does not have a valid LPLA cause of action against STPH. Further, plaintiff's petition does not allege that STPH "knew or should have known" of a defect in the product. Considering the facts alleged in this matter, there is no reasonable basis for predicting that state law might impose liability on STPH based on the LPLA.
Kelly v. Price-Macemon, Inc., 992 F.2d 1408, 1413 (5th Cir. 1993).
Id. at 1414. See Wilson v. State Farm Fire Cas. Ins. Co., 94-1342 (La.App. 3 Cir. 4/5/95), 654 So. 2d 385, 387 ("non-manufacturing seller of a defective product is not responsible for damages in tort absent a showing that he knew or should have known the product was defective and failed to declare it."). Other Louisiana appellate courts agree. See also Nelton v. Astro-Lounger Manufacturing Co., Inc., 542 So. 2d 128, 131 (La.App. 1 Cir. 4/11/89) ("Tort liability for a defective product attaches to a non-manufacturer seller who does not vouch for the product by holding it out as his own or who is not a professional vendor or merchant "only if he knew or should have known that the product sold was defective, and failed to declare it."); Picolo v. Flex-A-Bed, Inc., 466 So. 2d 652 (La.App. 5 Cir.), writ denied, 467 So. 2d 1134 (La. 1985).
Specifically, plaintiff cites Louisiana Revised Statute sections 9:2800.57 (B) (2), 2800.57 (C), and 2800.59.
Despite the allegations in plaintiff's Supplemental and Amending Complaint that STPH "knew or should have known that the [product] was defective and failed to notify [plaintiff] of the defect," the plaintiff has not alleged facts or submitted any evidence supporting this conclusory allegation.
Additionally, Plaintiff filed a motion to amend her complaint to add or clarify her claim based in tort against STPH as a non-manufacturer seller. In Pullman Co. v. Jenkins, the United States Supreme Court stated that "[t]he second amended complaint should not have been considered in determining the right to remove, which in a case like the present one [removal based on diverse defendant's claim that controversy as to it was separable from claims against nondiverse defendants] was to be determined according to the plaintiffs' pleading at the time of the petition for removal." The Fifth Circuit has explained that "[l]imiting removal jurisdiction question to the claims in the state court complaint . . . permits early resolution of which court has jurisdiction, so that the parties and the court can proceed with, and expeditiously conclude, the litigation." In other words, the plaintiff cannot rely on her supplemental complaint to destroy diversity jurisdiction.
Pullman Co. v. Jenkins, 305 U.S. 534 (1939).
Cavallini v. State Farm Mut. Auto Ins. Co., 44 F.3d 256, 264 (5th Cir. 1995).
Specifically, the amended complaint asserts that STPH sold the product to plaintiff's deceased husband, and that STPH knew or should have known that the product was defective. Despite the fact that an amended complaint cannot be used to defeat diversity jurisdiction, plaintiff's conclusory and unsupported assertion that STPH knew or should have known the product was defective fails to rebut the evidence presented by the defendant.
When considering remand motions on improper joinder grounds, the Fifth Circuit has held that conclusory allegations wholly lacking in specific factual support are insufficient to create a cause of action against a non-diverse defendant. See Jernigan v. Ashland Oil, Inc., 989 F.2d 812, 817 (5th Cir. 1993) (explaining that conclusory "allegations, wholly lacking in factual support" are insufficient as a matter of law to create a cause of action against a non-diverse defendant).
Accompanying the defendant's Opposition to the Motion to Remand is the affidavit of Janet Jones, the Director of the Heart Center for St. Tammany Parish Hospital. As stated in the affidavit, Jones' duties as director include supervising the personnel and procedures in the cardiovascular lab in the Heart Center. Jones' affidavit states that the hospital did not have any knowledge of any defective condition of the filters. The filters come packaged and sealed from the manufacturer. The packages are not labeled or otherwise identified as those of the hospital. The packages are only opened when they are placed in the operating room for use. Ms. Jones further avers that the hospital did not receive any indication of any defects or problems with the filters. In the similar case of Jackson v. Pneumatic Production Corp., the plaintiffs failed to proffer any evidence to supplement the contentions that they made in their amended complaint. As a result, the court found that the contentions of the defendants remained undisputed and plaintiffs' motion to remand was denied.
When resolving an improper joinder issue, a district court may "pierce the pleadings" and consider summary judgment-type evidence in the record, including documents and affidavits. Travis, 326 F.3d at 648-49.
Jackson v. Pneumatic Production Corp., 2001 WL 1327656, *3-4 (E.D. La. 10/26/01).
Id.
In this case, the Court finds that the plaintiff cannot use her amended complaint to defeat diversity jurisdiction, however, even if the Court were to entertain the plaintiff's unsupported, conclusory allegations within the amended complaint, defendant's adequately supported contention that STPH did not have any knowledge of any defective condition of the filter remains undisputed.
Accordingly;
IT IS ORDERED that Plaintiff's Motion to Remand (Rec. Doc. 3) should be and is hereby DENIED; IT IS FURTHER ORDERED that Plaintiff's Motion for Leave to File Supplemental and Amending Complaint (Rec. Doc. 5) should be and is hereby DENIED; IT IS FURTHER ORDERED that defendant St. Tammany Parish Hospital should be and is hereby DISMISSED from this action;
IT IS FURTHER ORDERED that the oral argument set for Wednesday, October 13, 2004 is CANCELLED.