The opinion of the court was delivered by: ANITA BRODY, District Judge
On April 12, 2004, plaintiffs moved under 28 U.S.C. § 1447(c)
to remand this case back to state court and for reimbursement of
counsel fees. Plaintiffs' motion to remand will be granted and
plaintiffs' request for counsel fees denied.
On January 22, 2004, plaintiffs Donald and Janice Anderson,
husband and wife and Pennsylvania residents, filed suit in the
Philadelphia Court of Common Pleas against defendants
Philadelphia Suburban Development Corporation ["PSDC"], a
Pennsylvania corporation with its principal place of business in
Pennsylvania, and 7-Eleven, Inc. ["7-11"], a Texas corporation
with its principal place of business in Texas. (Notice of Removal ¶¶
The complaint alleges that on February 21, 2003 Mr. Anderson
was walking in a 7-11 store parking lot when he fell on ice,
causing him severe and permanent injuries. (Compl. ¶ 6.)
Plaintiffs allege that, "[a]t all times material hereto
defendants owned, operated, controlled, maintained, managed,
supervised and possessed the premises known as 7-11 Store, 1035
Allentown Road, Lansdale, PA." (Compl. ¶ 5.) The complaint
contains no facts specifying the relationship between defendants
PSDC and 7-11, nor any more specific allegations about the
ownership of the 7-11 store where Mr. Anderson was injured.
However, subsequent pleadings have established that PSDC was the
lessor and 7-11 was the lessee of the premises where plaintiff
was injured. (Mot. Remand Ex. C.) The parties do not dispute this
On March 11, 2004, defendants removed the action to federal
court under 28 U.S.C. § 1441(a) and 1446, claiming that the
citizenship of PSDC should be disregarded for purposes of
determining diversity jurisdiction under 28 U.S.C. § 1551(b).
Defendants claim that PSDC was fraudulently joined, that is
joined solely to defeat diversity jurisdiction. (Notice of
Removal ¶ 9.) In support of their position, defendants claim that
PSDC is a landlord out of possession and not responsible for
injuries to third parties on the leased premises. (Id. at ¶
11.) If PSDC was not a proper defendant, diversity would exist
between plaintiffs and the remaining defendant, 7-11. Because
plaintiffs have also alleged damages in excess of $75,000, if
diversity is established, federal jurisdiction would lie under
28 U.S.C. § 1332.
Arguing for remand, plaintiffs contend that PSDC may be liable
to plaintiffs for failing to maintain the 7-11 parking lot. (Mot.
Remand ¶ 12.) Plaintiffs attached to the remand motion the
original lease between landlord PSDC and tenant 7-11 (then listed
by its former name, "The Southland Corporation"), dated October 20, 1964. (Mot. Remand Ex.
C.) The lease states in pertinent part:
Landlord covenants and agrees . . . [t]o keep the
exterior of the building in good repair, including
repair and maintenance of the roof and the structural
soundness of the foundation, exterior walls, paving
and curbing, but excluding any painting.
(Mot. Remand Ex. C, Lease between PSDC and the Southland
Corporation, Art. 7.)
Plaintiffs state that, subsequent to the filing of the
complaint, defendants supplied plaintiffs with a partially
executed lease agreement amendment dated March 1, 1994. (Mot.
Remand ¶ 14, Ex. D.) This amendment allegedly deletes the portion
of the original lease agreement holding the landlord responsible
for the repair and maintenance of the paving and curbing. (Mot.
Remand Ex. D.) Plaintiffs claim in their remand motion that the
alleged amendment defendants produced to them is unsigned by the
lessee and the amendment plaintiffs attach to their motion to
remand is indeed not signed by the lessee. (Mot. Remand Ex. D.)
Defendants have since provided the court with a fully executed
copy of the March 1, 1994 amendment, which does appear to release
PSDC of responsibility for maintenance of the paving and curbing.
(Def. Reply to Pl. Sur-Reply to Def. Opp. to Pl. Mot. Remand Ex.
On March 12, 2004, prior to defendants' removal of this case to
federal court, counsel for PSDC asked plaintiffs to dismiss PSDC
from the case based on the amendment to the lease contract. (Pl.
Sur-Reply 1.) On March 31, 2004, one of plaintiffs' two
attorneys, Adam Wilf, sent PSDC's attorney a stipulation
dismissing PSDC from the action without prejudice. (Def. Opp. to
Pl. Mot. Remand Ex. A.) Neither of plaintiffs' attorneys signed
the circulated stipulation prior to sending it to defendants'
attorneys. (Id.) Plaintiffs state that they sent the
stipulation "based on [the] addendum [to the original lease agreement]". (Pl.
Sur-Reply 1.) Plaintiffs now claim that, subsequent to the
circulation of the stipulation, plaintiffs discovered evidence
that the parking lot at issue had problems with ice and slippery
conditions dating back as far as 1991, and that PSDC did not do
anything to remedy the problem. (Pl. Sur-Reply 2.) Based on this
evidence and their understanding that the amendment was never
fully executed, plaintiffs ultimately decided not to sign the
proposed stipulation. (Pl. Sur-Reply 2.)
In addition, plaintiffs' attorney Adam Wilf represents that he
spoke with counsel for PSDC subsequent to the circulation of the
proposed stipulation, and advised PSDC counsel that plaintiffs
reserved the "right to add PSDC as a party any time prior to the
statute of limitation expiring on February 20, 2005 if further
investigation and discovery warranted it." (Pl. Sur-Reply 2.)
Plaintiffs seek to remand this case on the ground that there
was no fraudulent joinder. When a party removes a case by
claiming that a non-diverse defendant was fraudulently joined,
the removing party carries a "heavy burden of persuasion" in
showing that the non-diverse party was fraudulently joined.
Batoff v. State Farm, 977 F.2d 848, 851 (3d Cir. 1992). This is
because "removal statutes are to be strictly construed against
removal and all doubts should be resolved in favor of remand"
Id. (quoting Steel Valley Author v. Union Switch & Signal
Div., 809 F.2d 1006, 1010 (3d Cir. 1987).)
The standard for examining the complaint to determine whether
the joinder of the nondiverse defendant was colorable is whether
the joinder was "wholly insubstantial and frivolous." Id. at
852. "[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." Id. at 851 (quoting Boyer v. Snap-On
Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990).) This
jurisdictional inquiry into a plaintiff's allegations is less
searching than the analysis applied under Fed.R.Civ.P. 12(b)(6)
for failure to state a claim. Batoff, 977 F.2d at 852.
The Third Circuit has further instructed that, "where there are
colorable claims or defenses asserted against or by diverse and
non-diverse defendants alike, the court may not find that the
non-diverse parties were fraudulently joined based on its view of
the merits of those claims or defenses." Id. (quoting Boyer,
913 F.2d at 113.) Finally, "[i]n evaluating the alleged fraud,
the district court must focus on the plaintiff's complaint at the
time the petition for removal was filed. In so ruling, ...