United States District Court, E.D. Pennsylvania
E. K. PRATTER UNITED STATES DISTRICT JUDGE
Liberty Mutual Insurance Company denied her claim for
underinsured motorist coverage, Dominique Ellis sued both the
insurer and the claims adjuster, Clare MacNabb. Against Ms.
MacNabb, whose presence in the case defeats complete
diversity between the parties, Ms. Ellis brought a single
count for violations of Pennsylvania's consumer
protection statute. Liberty Mutual removed the case to this
Court, arguing that Ms. MacNabb was fraudulently joined. Ms.
Ellis has moved to remand.
Court grants the motion to remand for three reasons. First,
Ms. MacNabb is not fraudulently joined solely because of her
role as a claims adjuster. Second, although a colorable claim
under the consumer protection statute requires active
malfeasance, it is too early to tell whether the complaint
alleges only passive nonfeasance by Ms. MacNabb. Third, even
though Ms. Ellis's mother is the "named
insured" in the insurance policy, at this stage, Ms.
Ellis herself could possibly maintain a claim under the
consumer protection statute. Thus, Ms. MacNabb is not
fraudulently joined and the motion to remand is granted.
Ellis was hit by a car while walking down the street. At the
time of the accident, she was insured by Liberty Mutual under
an auto insurance policy that listed her mother as the
"named insured." Because the driver in the accident
was underinsured, Ms. Ellis sought to recover the balance of
her medical expenses from Liberty Mutual.
MacNabb, a Liberty Mutual employee, was the claims adjuster
assigned to Ms. Ellis's case. Ms. Ellis alleges that Ms.
MacNabb dragged her feet during a six-month investigation
into whether Ms. Ellis actually lived at the address listed
in the insurance policy. At the end of that drawn-out
process, Ms. MacNabb concluded that Ms. Ellis was being
truthful about her address. Yet she denied Ms. Ellis's
claim anyway on the ground that her medical expenses were
less than the limit of the policy owned by the underinsured
driver. Ms. Ellis alleges that the investigation into the
address issue was phony and meant to intimidate her. She
posits that Liberty Mutual was always going to deny her claim
no matter what the investigation revealed.
Ellis brought this suit in state court against Liberty Mutual
and Ms. MacNabb. The complaint contains three counts against
Liberty Mutual: (i) an "underinsured motorist
claim," (ii) a claim for bad faith insurance denial, and
(iii) a claim for violations of the Pennsylvania Unfair Trade
Practices and Consumer Protection Law (UTPCPL). Ms. Ellis
brought only the UTPCPL claim against Ms. MacNabb.
Ms. Ellis and Ms. MacNabb are both residents of Pennsylvania,
and Liberty Mutual is a Massachusetts corporation, Ms.
MacNabb's presence in the case defeats complete diversity
of citizenship. Liberty Mutual argues that Ms. MacNabb was
fraudulently joined because Ms. Ellis has no colorable UTPCPL
claim against Ms. MacNabb. Liberty Mutual removed the case to
this Court, and Ms. Ellis has moved to remand.
defendant in a civil case in state court may remove the case
to federal court as long as the federal court would have
original jurisdiction over the case. See 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) (quoting
Steel Valley Auth. v. Union Switch & Signal
Div., 809 F.2d 1006, 1010 (3d Cir. 1987)) (additional
28 U.S.C. § 1332, a federal court has diversity
jurisdiction only if all plaintiffs are diverse from all
defendants. The doctrine of fraudulent joinder, an exception
to this complete diversity requirement, allows a defendant to
remove an action if a non-diverse defendant was fraudulently
joined solely to defeat diversity jurisdiction. Brown v.
Jevic, 575 F.3d 322, 326 (3d Cir. 2009). If the
non-diverse defendant was fraudulently joined, the court may
disregard the citizenship of the non-diverse defendant for
the purpose of determining diversity of citizenship. In
re Briscoe, 448 F.3d 201, 216 (3d Cir. 2006)). If the
court determines that joinder was not fraudulent, it must
is fraudulent "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." Boyer, 913 F.2d at 111 (quotations
omitted). "The presence of a party fraudulently joined
cannot defeat removal." In re Diet Drugs, 220
F.Supp.2d 414, 419 (E.D. Pa. 2002).
Third Circuit Court of Appeals set forth the standards
applicable to ...