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Jackson v. Burlington Coat Factory

United States District Court, E.D. Pennsylvania

August 17, 2017




         Presently before this Court is a motion to remand, [ECF 5], filed by Plaintiff Harold Jackson (“Plaintiff”), which seeks the return of this matter to the Court of Common Pleas of Philadelphia County, where it was originally filed. Plaintiff, who is a citizen of Pennsylvania, contends that this matter was improperly removed on the basis of diversity jurisdiction because one of the named defendants, Defendant Ken Keen (“Defendant Keen”), is also a Pennsylvania citizen. The Burlington Defendants, [1] which removed this action, oppose the motion and argue that Defendant Keen was “fraudulently joined” for the purpose of destroying federal diversity jurisdiction. The issues raised by the parties' respective filings have been fully briefed. Therefore, the motion to remand is ripe for disposition.

         For the reasons stated herein, Plaintiff's motion to remand is denied.


         Plaintiff commenced this personal injury action in state court on April 3, 2017, by filing a complaint premised on negligence. An amended complaint was filed on May 12, 207. (See Notice of Removal at ¶¶2-3). In the amended complaint, Plaintiff alleges that on January 8, 2016, while patronizing the Burlington Coat Factory store located at 1035 Market Street, Philadelphia, Pennsylvania, he attempted to walk up an escalator that was not running when he fell and injured his left knee, neck, and back. Plaintiff asserts that the Burlington Defendants and Defendant Keen, who is alleged to have been the manager of the Burlington Coat Factory store in which Plaintiff was injured, are jointly and severally liable to Plaintiff for the injuries he suffered.

         On May 31, 2017, the Burlington Defendants timely removed Plaintiff's case to federal court pursuant to 28 U.S.C. §1441. In the notice of removal, the Burlington Defendants contend that Plaintiff “fraudulently joined” Defendant Keen solely as a means to defeat federal diversity jurisdiction.[2] (Id. at ¶¶28-29). Specifically, they argue that Plaintiff has failed to allege a colorable and/or legally viable claim against Defendant Keen under applicable Pennsylvania law and, therefore, this Court can disregard Defendant Keen's Pennsylvania citizenship for purposes of exercising diversity jurisdiction.[3] In response, Plaintiff has moved to remand this case to state court and argues that Defendant Keen was not “fraudulently joined.”


         Removal of a civil action from state to federal court is proper only if the action initially could have been brought in federal court. 28 U.S.C. §1441(a). 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). District courts have original jurisdiction over all civil actions involving citizens of different states where “the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs.” 28 U.S.C. §1332(a). To ascertain jurisdiction, individuals are deemed to be citizens of the state wherein they reside, Swiger v. Allegheny Energy, Inc., 540 F.3d 179, 181 (3d Cir. 2008), while a corporation is deemed a citizen of every state in which it has been incorporated and where it has its principal place of business. 28 U.S.C. §1332(c)(1). Under the forum defendant rule, a civil action that is “otherwise removable solely on the basis of [diversity jurisdiction] may not be removed if any of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.” 28 U.S.C. § 1441(b)(2). If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded. 28 U.S.C. §1447(c). As will be discussed more fully below, the citizenship of a defendant that has been “fraudulently joined” should be disregarded for purposes of determining the existence of diversity jurisdiction. In re Briscoe, 448 F.3d 201, 216 (3d Cir. 2006). The party removing the case bears the burden of showing that federal jurisdiction is proper at all stages of the litigation. Samuel-Bassett v. KIA Motors Am., Inc., 357 F.3d 392, 396 (3d Cir. 2004).


         Plaintiff seeks to remand this matter pursuant to the forum defendant rule and because diversity jurisdiction is lacking as both Plaintiff and Defendant Keen are citizens of Pennsylvania. The Burlington Defendants argue, however, that this Court should disregard the citizenship of Defendant Keen for jurisdictional purposes because he has been “fraudulently joined;” meaning that Plaintiff has failed to state a viable and/or colorable claim against Defendant Keen under applicable Pennsylvania law.

         In the diversity jurisdiction context, the doctrine of fraudulent joinder serves as an exception to the requirement that removal be predicated solely upon complete diversity. In re Briscoe, 448 F.3d at 215-16. This doctrine of fraudulent joinder prevents a plaintiff from joining non-diverse defendants with no real connection or interest to the controversy in order to defeat federal removal jurisdiction. Id. A removing party (such as the Burlington Defendants) who asserts that the plaintiff has fraudulently joined a party in order to destroy diversity jurisdiction carries “a heavy burden of persuasion.” Steel Valley Auth. v. Union Switch and Signal Div., 809 F.2d 1006, 1012 n.6 (3d Cir. 1987).

         A district court may base a finding of fraudulent joinder on factual or legal grounds. In re Zoloft Prods. Liab. Litig., 2013 WL 6050627, at *1 (E.D. Pa. Nov. 14, 2013). Such a finding is appropriate “where there is no reasonable basis in fact or colorable ground supporting the claim against the joined defendant, or no real intention in good faith to prosecute the action against the defendant or seek a joint judgment.” Id. (quoting Abels v. State Farm Fire & Cas. Co., 770 F.2d 26, 32 (3d Cir. 1985)). A claim is colorable if it is not “wholly insubstantial and frivolous” in light of the relevant law. Batoff v. State Farm Ins. Co., 977 F.2d 848, 852 (3d Cir. 1992). When evaluating fraudulent joinder, the district court “must resolve all contested issues of substantive fact . . . and . . . any uncertainties as to the current state of controlling substantive law in favor of the plaintiff.” Boyer, 913 F.2d at 111 (citations omitted). “If 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. (citation omitted). A court should not find a joinder fraudulent “[s]imply because [it] come[s] to believe that, at the end of the day, a state court would dismiss the allegations against a defendant for failure to state a cause of action.” Kallman v. Aronchick, 2013 WL 5964444, at *5 (E.D. Pa. Nov. 8, 2013) (quoting Lyall v. Airtran Airlines, Inc., 109 F.Supp.2d 365, 367-68 (E.D. Pa. 2000)). Rather, a finding of fraudulent joinder is usually reserved for situations where recovery from the non-diverse defendant is a clear legal impossibility. West v. Marriott Hotel Servs., Inc., 2010 WL 4343540, *3 (E.D. Pa. Nov. 2, 2010) (quotations omitted). “Fraudulent joinder should not be found simply because plaintiff has a weak case against a non-diverse defendant.” Id.; see Boyer, 913 F.2d at 111.

         Here, the issue is whether Plaintiff has pled a reasonable basis in fact and/or a colorable ground supporting his negligence claim against Defendant Keen or if the claim pled is “wholly insubstantial and frivolous.” If it is determined that the joinder of Defendant Keen was fraudulent, his Pennsylvania citizenship can be disregarded, and this Court can assume and retain jurisdiction over this matter and dismiss Defendant Keen from this action. See In re Briscoe, 448 F.3d at 216. On the other hand, if it is determined that there is no jurisdiction over the action because the joinder of Defendant Keen was not fraudulent, the case must be remanded to state court. Id. (citing 28 U.S.C. §1447(c)). The Burlington Defendants maintain that Plaintiff's negligence claim against Defendant Keen is legally deficient because Plaintiff has not alleged facts sufficient to satisfy the requirements of Pennsylvania's “participation theory, ” the only viable theory under which a corporate manager, such as Defendant Keen, could be personally liable for negligence.[4] This Court agrees.

         In Wicks v. Milzoco Builders, Inc., 470 A.2d 86 (Pa. 1983), the Pennsylvania Supreme Court confirmed that Pennsylvania law recognizes the participation theory as a basis of liability for the manager of a corporation. Id. at 90; see also Moore v. Johnson & Johnson, 907 F.Supp.2d 646, 663 (E.D. Pa. 2012); Sherfey v. Johnson & Johnson, 2014 WL 715518, at *6 (E.D. Pa. Jan. 29, 2014). Under this theory, a corporate officer/manager can be held personally liable for participating in the tortious activity of the company, but only where the manager “specifically direct[s] the particular act to be done or participate[s], or cooperate[s] therein.” Wicks, 470 A.2d. at 90 (quotation marks and citation omitted); see also Shay v. Flight C. Helicopter Servs., Inc., 822 A.2d 1, 17-20 (Pa. Super. Ct. 2003). Under the participation theory, a manager can be personally liable for his own “misfeasance, ” i.e., the “improper performance of an act, ” but not for mere “nonfeasance, ” i.e., “the omission of an act which a person ought to do.” Brindley v. ...

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