The Voice

Determine if there is a fraudulent joinder

As a reminder, federal courts have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between citizens of different states. 28 U.S.C. § 1332(a)(1). One narrow exception to this rule is found in the “fraudulent joinder” doctrine (sometimes called “improper joinder”). Under this rule, “a plaintiff may not defeat a federal court’s diversity jurisdiction and a defendant’s right to removal by merely joining as defendants parties with no real connection with the controversy.” Romano v. Am. St. Ins. Co., 259 F. Supp. 3d 307, 312 (W.D.N.Y. 2017). A joinder is improper or fraudulent if there is no reasonable basis for predicating liability on the claims alleged. Waste Mgmt. Inc. v. AIG Specialty Ins., 974 F.3d 582, 533 (5th Cir. 2020).

A keen litigator should immediately assess the non-diverse defendants named in a lawsuit and determine whether there is a viable cause of action against them. For example, in product liability cases, if an in-state seller is named in as a defendant and state law shields an innocent seller from liability, removal may still be appropriate. See e.g., Block v. Toyota Motor Corp., 655 F.3d 944 (8th Cir. 2011). Also, a plaintiff may wish to name a manager or employee to defeat complete diversity with a non-resident business. See e.g., Henson v. Union Pacific Railroad Co., 3 F.4th 1075 (8th Cir. 2021). When this happens, we must carefully ascertain whether the named party can bear any liability in the case or whether they are just included due to their employment. If we can show the federal court that there can be no reasonable recovery against the non-diverse defendant, the federal court may and should exercise jurisdiction over the case.

Even if the amount of damages is vague, removal may be proper

Sometimes it may be unclear based on the complaint if the amount-in-controversy requirement is satisfied if the plaintiff fails to allege a specific amount of damages in the complaint. However, this should not deter us from pressing forward with a removal if it is evident on the face of the complaint that the amount-in-controversy exceeds $75,000, exclusive of interests and costs.

To remove a case, the defendant only must prove by a preponderance of the evidence that the jurisdictional minimum is met. Robertson v. Exxon Mobil Corp., 814 F.3d 236, 240 (5th Cir. 2015). This burden can be met by demonstrating that the amount-in-controversy is “facially apparent” on the face of the complaint alone. Id. The court may make “common-sense” inferences about the amount put at stake by the injuries alleged by the plaintiff. Id. Start by looking at the plaintiff’s alleged damages. Is it a serious injury that required surgery and still requires future treatment? See Gebbia v. Wal-Mart Stores, Inc., 233 F.3d 880, 833 (5th Cir. 2000) (holding it was “facially apparent” that damages exceeded $75,000 when plaintiff alleged damages for medical expenses, loss of enjoyment of life, pain and suffering, loss of wages and earning capacity, and permanent disability and disfigurement). Or is it a complex products liability case or wrongful death case? Are there punitive damages? It may be helpful to create a list in the notice of removal of each and every damage that the plaintiff has alleged in his complaint to show the court that there can be little doubt that the complaint satisfies the jurisdictional amount.

However, the damages alleged in the complaint still may not be clear enough to us as to reliably determine whether the amount-in-controversy requirement is met within the 30-day removal time frame. Fortunately, the removal statute accounts for this in 28 U.S.C. § 1441(c)(3) which permits “information relating to the amount in controversy in the record of the State proceeding, or in responses to discovery,” to be treated as an “other paper” in determining removal. Given this statute, it may be wise to serve the plaintiff with some initial discovery, including requests for admissions, to better ascertain damages before filing your notice of removal.

Conclusion

While it is true that the plaintiff is the master of the complaint, this should not deter us as defense attorneys from removing a case from state to federal court. It is important for us to test every allegation in the plaintiff’s complaint and ensure that there is no viable option for removal before simply throwing in the towel. With a clear understanding of the statutory law and case law, it is possible to save a removal even where the plaintiff has attempted to eliminate diversity jurisdiction.  

Briana A. O’Neil is an associate with Watkins & Eager PLLC in Jackson, Mississippi. Her practice focuses primarily on the areas of product liability, premises liability, health care, and general tort litigation. She earned her Juris Doctorate from Wake Forest University School of Law. Briana can be reached at Watkins & Eager PLLC, P.O. Box 650, Jackson, Mississippi 39205, ph. 601-965-1868.

The issues of low-dose toxicology are extended to asbestos exposure and cigarette smoking, whose combined lung cancer risk was characterized as synergistic (i.e., more than additive) in the mid-twentieth century. Since then, cigarette smoking has emerged as the primary cause of lung cancer; cigarette smoking quantitation parameters have evolved for risk assessments; cigarette smoke has been identified as a more potent lung carcinogen than asbestos; and exposures to asbestos and cigarette smoke have declined dramatically. The changing exposure paradigms and evolution of science warrant reassessment of the relationship between asbestos, cigarette smoking, and lung cancer.  

Original cohorts used to evaluate the asbestos-smoking interaction originated prior to 1922 through approximately 1965; these generally represent exposures of 150-600 f-y and have smoking histories that exceed 40 pack-years. A greater-than-additive rate of lung cancer is clear in the many of these studies although the exact magnitude of the synergy varies by study, likely due to a lack of quantitative measures of either asbestos or smoking. Today, new lung cancer cases (or corresponding cohorts) are no longer consistent with those previously studied because their occupational lifetimes occurred after 1972, during periods of declining asbestos use, increasing asbestos exposure regulations, and declining smoking rates. For example, construction workers with a 15-year history of asbestos-containing materials (1976-1991) have exposures of approximately 11 f-yr. Data regarding more contemporary cohorts—with quantitative or semi-quantitative measures of asbestos and smoking exposure risk attributable to asbestos in smokers—is not substantial until cumulative asbestos and cigarette smoke exposures are high. The implication of these data is that lesser asbestos exposures (post-1972) are not associated with an increased risk in lung cancer among smokers.

Dr. Nadia Moore is Vice President and Principal Toxicologist at J.S. Held, which is proud to be a Premier Sponsor of DRI’s Asbestos Medicine seminar, taking November 4–5, 2021 in New Orleans, Louisiana.

Wheeler Trigg O’Donnell Founding Partner and Chair Michael O’Donnell was inducted as the 72nd President of the American College of Trial Lawyers (ACTL) at a ceremony in Chicago. He is the first president in the organization’s history to hail from Colorado. Mr. O’Donnell has been a member of DRI since 1996.

APCO Worldwide recently announced that Benjamin F. Wilson has joined its Board of Directors. Mr. Wilson is an environmental justice advocate and chairman of Beveridge & Diamond—the largest and first national environmental law firm in the United States. He has been lead counsel in numerous complex environmental litigation and regulatory matters involving major corporations, municipalities, and developers. He recently completed work as Deputy Monitor – Emissions & Environmental in the Volkswagen “Dieselgate” proceeding. He also serves as an adjunct professor of environmental law at the Howard University School of Law and co-founded the Howard Energy and Environmental Law Society. He has been a member of DRI since 2015 and currently service on DRI’s Diversity and Inclusion Committee.

If you have a recent achievement or recognition you would like featured, email your news to membership@dri.org. Please note that DRI reserves the right to review all accomplishments to ensure they are adequate for publishing. All submissions will be reviewed for relevance and compliance with DRI’s mission.  Submissions may be edited to conform with our standard and space limitations.

In 2012, Beretta and a Baltimore-based firearm manufacturer, Adcor Industries, Inc. (“Adcor”), began exploring the possibility of working together to manufacture and market a semi-automatic rifle. Both parties signed Non-Disclosure Agreements (“NDAs”) and exchanged design information for evaluation and testing. No agreement was ever made to produce a firearm together or for Beretta to purchase Adcor’s intellectual property. Ultimately, Adcor’s prices to supply component parts were too high, and Beretta ended the relationship.

Adcor threatened litigation and demanded that its information be returned pursuant to the terms of the NDA. Beretta returned Adcor’s information but advised that a copy of all documents would be kept in order to defend against the threatened litigation.

Making good on its threat, in 2015 Adcor filed a 17-count complaint against Beretta in the Circuit Court for Baltimore County, alleging breach of contract, misappropriation of trade secrets, fraud, unjust enrichment, and breach of the NDA, among other causes of action. Adcor’s complaint sought hundreds of millions of dollars in damages, including punitive damages and a constructive trust.

Beretta’s motion for summary judgment was granted in part, which disposed of half of the case in October 2018. The case went to trial in December 2018. At the close of Adcor’s case-in-chief at trial, the court granted Beretta’s motion for judgment on every remaining count except breach of the NDA. The jury found that Beretta breached the NDA and returned a verdict of $20 million in favor of Adcor.

Beretta filed a post-trial motion for judgment notwithstanding the verdict (“JNOV”). In February 2019, the trial court held that Adcor had failed to produce any evidence of actual damages caused by breach of the NDA, and vacated the $20 million verdict, ordering entry of a new judgment for nominal damages in the amount of $1.

In a unanimous, reported opinion issued in April 2021, Maryland’s Court of Special Appeals credited every fact in favor of Adcor, and then squarely rejected each of the arguments, affirming the judgment of the trial court in every respect. Adcor petitioned the Maryland Court of Appeals for review, and the Court rejected the petition on August 2, 2021.

Will Kronenberg

September 30, 2021, a Los Angeles County jury returned a defense verdict in a catastrophic injury trial in Department S29 in Long Beach. DRI member Will Kronenberg represented Defendant Pipeline Plumbing Inc. in the case, which involved a collision between a pedestrian and a Ford F 250 truck on August 29, 2017. The plaintiff, Prince Charles Smyth, sustained serious internal injuries including a ruptured diaphragm, bilateral rib fractures, fractures of the transverse processes at L3, L4 and L5, fractured pelvis and left humerus, as well as a traumatic brain injury. He went into ventricular fibrillation, then asystole, and ultimately code blue during laparoscopic surgery resulting in a prolonged period of intubation with permanent damage to his vocal cords.

Will Kronenberg was retained to try the case and brought a motion to bifurcate liability from damages, which was granted. The jury returned a defense verdict on the liability phase resulting in judgment for the defendants. The plaintiff’s settlement demand prior to trial was $6 million and the offer was $2 million. The demand was reduced during trial to $3.95 million.