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Jocz v. Eichleay Engineers

December 9, 2008

ROBERT JOCZ, ET AL., PLAINTIFFS,
v.
EICHLEAY ENGINEERS, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Diamond, J.

MEMORANDUM

Plaintiffs Teresa and Robert Jocz move to remand this products liability action to state court, arguing that complete diversity of the Parties is lacking. I grant their Motion.

BACKGROUND

Plaintiffs Teresa and Robert Jocz, both Pennsylvania citizens, began this lawsuit in the Philadelphia Common Pleas Court on April 3, 2007. (Doc. No. 1, at 5.) They alleged that on September 15, 2006, Mr. Jocz was struck by a "Larry Car"--a large rail car used to transport coal--while working at a steel plant in Allegheny County, Pennsylvania. (Doc. No. 8, Ex. H, at 45.) Plaintiffs further alleged that the car had a "blind spot" that prevented its operator from seeing Mr. Jocz, thus causing the accident. (Id.) Mr. Jocz claims that the accident caused severe injuries, resulting in the amputation of his legs. (Id.)

Plaintiffs initially sued two Pennsylvania corporations: Eichleay Engineers, Inc. and Eichleay Engineers & Constructors, Inc., alleging that they "participated in the design, manufacturing, installation, assembly and/or maintenance of [the] Larry Car." (Doc. No. 15, Ex. L.) After Plaintiffs took discovery from the Eichleay Defendants over the next year, on February 29, 2008, the Parties stipulated that Plaintiffs could amend their Complaint to join the following Defendants:

(1) Sumitomo Heavy Industries, Ltd. (SHI), which is incorporated and has its principal place of business in Japan; Sumitomo Heavy Industries USA, which is incorporated and has its principal place of business in Delaware; and Sumitomo Machinery Corporation of America, which is incorporated in New York and has its principal place of business in Virginia;

(2) Cutler-Hammer, a division of Eaton Corporation, a Delaware corporation with a principal place of business in Ohio; and

(3) Diamond Power International, a Delaware corporation with a principal place of business in Ohio. (Doc. No. 15, Ex. K.) In their Amended Complaint, Plaintiffs allege that: (1) the Eichleay and Sumitomo Defendants were responsible for designing, manufacturing, installing, assembling and maintaining the Larry Car; (2) Defendant Diamond Power International sold and designed the closed circuit monitors on the Larry Car; and (3) Defendant Cutler-Hammer sold and designed the electronic control system on the Larry Car. (Doc. No. 8, Ex. H, at 46-68.) Plaintiffs bring negligence claims against each of these Defendants, and products liability claims against the Sumitomo Defendants, Diamond Power International, and Cutler-Hammer. (Id.)

SHI was served with Plaintiffs' Amended Complaint on August 4, 2008, and, invoking diversity jurisdiction, removed to this Court on August 20, 2008. 28 U.S.C. § 1441(a); (Doc. No. 1). In its Notice of Removal, SHI stated that the Eichleay Defendants have been in state court involuntary receivership proceedings since 2002, and were dissolved on May 28, 2008. (Doc. No. 1 at 3.) SHI thus alleged that the Eichleay Defendants are fraudulently named or nominal parties whose Pennsylvania citizenship should be disregarded for purposes of diversity jurisdiction. (Doc. No. 1 at 3-4.)

Plaintiffs moved to remand on September 17, 2008, arguing that complete diversity of the Parties is lacking because: (1) the Eichleay Defendants (which Plaintiffs contend are proper Parties here) are Pennsylvania corporations; and (2) Defendant Eaton Electrical's principal place of business is in Pennsylvania. (Doc. No. 8-10, at 6-7, 9-10.) Plaintiffs also argue that SHI's failure to attach to its Notice of Removal written consents from all Defendants is a procedural defect requiring remand. (Doc. No. 8-11, at 7.) Finally, Plaintiffs argue that SHI's removal was untimely because: (1) SHI failed to remove within thirty days of the date on which Sumitomo Machinery was served; and (2) the removal occurred more than one year after the commencement of this action. (Doc. No. 8-11, at 8.)

I agree that the Eichleay Defendants are proper parties. Accordingly, because complete diversity is lacking, I am obligated to remand.

LEGAL STANDARDS

A defendant may remove "any civil action brought in a State court of which the district courts of the United States have original jurisdiction." 28 U.S.C. § 1441(a). Federal courts have original jurisdiction over cases between citizens of different states where the amount in controversy exceeds $75,000. 28 U.S.C. § 1332(a). Diversity jurisdiction is lacking--and removal is thus improper--if any plaintiff and any defendant are citizens of the same state. Lincoln Property Co. v. Roche, 546 U.S. 81, 84 (2005) ("Defendants may remove an action on the basis of diversity of citizenship if there is complete diversity between all named plaintiffs and all named defendants."). The citizenship of fraudulently named or nominal parties must be disregarded for purposes of diversity jurisdiction. Bumberger v. Ins. Co. of N. Am., 952 F.2d 764, 767 (3d Cir. 1991); Steel Valley Auth. v. Union Switch & Signal Div., 809 F.2d 1006, 1010 (3d Cir. 1987). The Third Circuit has cautioned, however, that the removal statutes "are to be strictly construed against removal and all doubts should be resolved in favor of remand." Boyer v. Snap-on Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990).

DISCUSSION

SHI argues that because the Eichleay Defendants are now dissolved and without assets, they are fraudulently named or nominal parties that I must disregard for diversity ...


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