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Rite Aid Hdqtrs Corp. v. Crayton Landscaping and Building Maintenance, Inc.

United States District Court, Third Circuit

August 5, 2013

RITE AID HDQTRS CORP. d/b/a RITE AID CORPORATION, Plaintiff,
v.
CRAYTON LANDSCAPING AND BUILDING MAINTENANCE, INC. and AUTO-OWNERS INSURANCE COMPANY, Defendants.

MEMORANDUM OPINION

MITCHEL GOLDBERG, District Judge.

Plaintiff, Rite Aid Headquarters Corporation d/b/a Rite Aid Corporation ("Rite Aid") originally brought this suit in the Court of Common Pleas in Philadelphia County against Defendants Crayton Landscaping and Building Maintenance, Inc. ("Crayton") and Auto-Owners Insurance Company ("Auto-Owners"), for their failure to indemnify Rite Aid in a slip-and-fall suit. Rite Aid alleges that Crayton is contractually obligated to indemnify, defend and hold it harmless from and against any claims arising from Crayton's contract to perform snow and ice removal services at various Rite Aid stores in Ohio. Rite Aid further alleges that Auto-Owners is obligated to indemnify Rite Aid under an insurance policy Crayton carried pursuant to its contract with Rite Aid.

The complaint was originally filed in the Philadelphia Court of Common Pleas on September 17, 2012 and subsequently removed to this Court. Thereafter, Defendants filed a motion to dismiss, or, in the alternative, to transfer the suit to the United States District Court for the Northern District of Ohio, Cleveland Division. On October 31, 2012, Rite Aid filed a motion to remand. For the reasons stated below, Rite Aid's motion will be granted, and Defendants' motion to dismiss, or alternatively to transfer venue, will be denied.

I. FACTUAL AND PROCEDURAL HISTORY

The dispute in this case emanates from a slip and fall occurring on a Rite Aid property located in Mayfield Heights, Ohio ("the Property"). Prior to this occurrence, Rite Aid had entered into a Master Service Agreement ("the Agreement") with Crayton. Rite Aid alleges that (1) "at all relevant times, " Crayton was contractually obligated to perform snow and ice removal services at the Property; (2) the Agreement required Crayton to indemnify, defend and hold Rite Aid harmless from any claims or liabilities that might arise from Crayton's Agreement to perform snow and ice removal services at the Property; and (3) Crayton was required to carry insurance coverage for personal injury perils and contractual liability that named Rite Aid as an "additional insured." (Compl., Doc. No. 1, Ex. A, ¶¶ 9, 12-13). Crayton purchased a policy with Auto-Owners as required by the Agreement. (Id. at ¶ 14.)

Under the Agreement, Crayton committed to "provide all snow and ice removal services for parking lots, service areas, and sidewalks and walkways, " at the Property. (Master Service Agreement, Doc No. 6-3, Ex. B.) The Agreement also contained the following choice of law provision and forum selection clause:

This agreement shall be construed and enforced under and in accordance with the laws of the Commonwealth of Pennsylvania. Any and all disputes or claims relative to this Agreement shall be negotiated, tried, determined, or otherwise handled and disposed of only in the appropriate state court of the Commonwealth of Pennsylvania. [Crayton] hereby consents to the personal jurisdiction of such court over it in such matter.

(Id. at § I(6).)

Rite Aid alleges that, on February 10, 2011, Bertha Wulkam, a customer at the Property, slipped and fell on snow and/or ice that remained on the Property from a prior snowstorm, resulting in serious injuries. (Compl. ¶¶ 6-8.) Wulkam initiated litigation to recover for her injuries while the Agreement between Crayton and Rite Aid was in effect. (Id. at ¶¶ 15-16; Ex. A, p. 1.)

Rite Aid brought the lawsuit currently before the court due to Defendants' failure to provide indemnification for the funds expended in defending and resolving Wulkam's claim.[1] (Compl. ¶¶ 17, 19.) Rite Aid alleges that it contacted Crayton requesting indemnification on February 14, 2011; that Crayton informed Auto-Owners of Wulkam's claim; that Rite Aid reached a settlement agreement with Wulkam for $99, 608.27 on October 11, 2011; and that Rite Aid again requested indemnification from Defendants following its settlement agreement. (Id. at 15-16, 18-19.) Rite Aid claims that both Defendants failed, and continue to refuse, to provide indemnification, contrary to the Agreement and the insurance policy. (Id. at 17, 19.)

Defendants removed the case to this Court on October 10, 2012 on the basis of diversity jurisdiction, under 28 U.S.C. 1441, [2] and thereafter filed a motion to dismiss, or, in the alternative, to transfer the suit to the United States District Court for the Northern District of Ohio, Cleveland Division. Rite Aid contests the removal and filed a motion to remand on October 31, 2012. All of these motions are now fully briefed and ready for disposition.

II. MOTION TO REMAND

A. Standard of Review

A motion to remand under 28 U.S.C. § 1447 shall be granted where the standards for removal under 28 U.S.C. §§ 1441 and 1446 have not been met. Hogan v. Raymond Corp. , 777 F.Supp.2d 906, 912 (W.D. Pa. 2011). In such actions, the defendant bears the burden of demonstrating the propriety of removal. Boyer v. Snap-On Tools Corp. , 913 F.2d 108, 111 (3d Cir. 1990). "The removal statutes are to be strictly construed against removal and all doubts should be resolved in favor of remand.'" Id . (quoting Steel Valley Auth. v. Union Switch & Signal Div. , 809 F.2d 1006, 1010 (3d Cir. 1987)). Under 28 U.S.C. § 1447(c), a trial court must "remand a case whenever it appears that the district court lacks subject matter ...


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