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Hoskins v. 3M Company

United States District Court, E.D. Kentucky, Southern Division

February 23, 2018

CLIFFORD HOSKINS, et al., Plaintiffs,
v.
3M COMPANY, et al., Defendants. BURNIS HALL, et al., Plaintiffs,
v.
3M COMPANY, et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          KAREN K. CALDWELL, CHIEF JUDGE UNITED STATES DISTRICT COURT.

         This matter is before the Court on motions to remand and for attorneys' fees and costs filed in the two above-referenced actions. For the reasons discussed below, the Court will grant the motions to remand but deny the motions for attorneys' fees and costs in each action.

         I. Background

         Plaintiffs are former coal workers who claim that they suffer from pneumoconiosis-more commonly known as Black Lung-due to the use of defective dust mask respirators they wore as coal miners to protect themselves from exposure to coal rock and sand dust. The Plaintiffs in both actions named as defendants 3M Company, who they allege manufactured the defective respirators, and Mine Service Company, Inc. (“MSC”), who they alleged redistributed the masks in Kentucky.[1] The citizenship of the parties is not in dispute. The Plaintiffs are all citizens of Kentucky while 3M and the other respiratory manufacturer defendants are citizens of other states. The Supplier Defendants, MSC and KMSC, however, are Kentucky corporations.

         Prior to removal, the Plaintiffs' claims were at various stages in state court litigation. In the Hoskins case, Bud Napier's claim was set for trial beginning January 22, 2018. Napier and the Defendants' had agreed that expert witness disclosure would occur by August 22, 2017 and all pretrial motions and discovery would be completed by October 31, 2017. In accordance with those deadlines, Napier filed expert disclosures on August 22, 2017. However, he did not disclose any experts who would specifically address liability claims against the Supplier Defendants.

         In the Hall case, the claims of Leslie Cox and Michael Cox were set for trial beginning April 2, 2018, in Knott Circuit Court. The Coxes disclosed the identity and opinions of their expert witnesses on November 6, 2017-the Coxes experts were the same as those previously disclosed by Napier in the Hoskins case. No. pretrial deadlines have been set for any other Plaintiffs in either case, and they have not yet been required to disclose experts.

         3M removed the Hoskins action on November 1, 2017, and removed the Hall action on January 26, 2018. In both notices of removal, 3M conceded that the action lacked complete diversity of citizenship because the Plaintiffs and the supplier Defendants, MSC in both cases and KMSC in the Hoskins case, were all Kentucky citizens. 3M claims that the Hoskins case became removable on October 31, 2017, upon close of discovery for Napier's claim. Similarly, 3M argues that the Hall case became removable at the close of discovery, and the grounds for diversity jurisdiction were not apparent until December 29, 2017, and January 19, 2018- the dates that fact and expert discovery closed on the Coxes' claims. 3M argues that, on these dates, it became apparent that MSC, and KMSC as to the Hoskins case, were fraudulently joined to defeat diversity, given the Plaintiffs' failure to pursue claims against these Defendants. 3M further argues that the remaining Plaintiffs in each case lack a nexus to the claims of Napier and the Coxes, respectively, and were fraudulently misjoined.

         II. Analysis

         A. Standard for removal and fraudulent joinder

         Federal courts are courts of limited subject matter jurisdiction. While the federal removal statute, 28 U.S.C. § 1441, generally grants defendants the right to remove cases from state to federal court, removal is proper only if the district court would have had original jurisdiction over the case. Id. 1441(a). In an action that does not involve a federal question, this Court has original jurisdiction based on diversity of citizenship only if there is complete diversity between the parties. 28 U.S.C. § 1332(a). That is, no plaintiff and no defendant may be citizens of the same state. Jerome-Duncan, Inc. v. Auto-By-Tel, L.L.C., 176 F.3d 904, 907 (6th Cir. 1999). In order for a defendant to remove a case based on diversity of citizenship jurisdiction, complete diversity must exist at both the time the case is commenced in state court and the time of removal. Id. The burden of establishing jurisdiction falls on the removing party. Eastman v. Marine Mech. Corp., 438 F.3d 54, 549 (6th Cir. 2000). And, because of the federalism concerns implicated by removal, “all disputed questions of fact or ambiguities in the controlling . . . state law” must be resolved “in favor of the non removing party.” Coyne v. Am. Tobacco Co., 183 F.3d 488, 493 (6th Cir. 1996) (quoting Alexander v. Elec. Data Sys. Corp., 13 F.3d 940, 949 (6th Cir. 1994)) (alteration in original).

         3M concedes that there was not complete diversity of citizenship at the time these suits were commenced. All plaintiffs and the Supplier Defendants are citizens of Kentucky. Consequently, 3M invokes the “judicially created doctrine” of fraudulent joinder, which “provides an exception to the requirement of complete diversity” as the basis that removal is proper. Coyne, 183 F.3d at 493 (quoting Triggs v. John Crump Toyota, Inc., 154 F.3d 1284, 1287 (11th Cir. 1998)). Fraudulent joinder permits removal of a case that lacks complete diversity if the removing party demonstrates that “the non-removing party join[ed] a party against whom there is no colorable cause of action.” Saginaw Hous. Comm'n v. Bannum, Inc., 576 F.3d 620, 624 (6th Cir. 2009) (citing Jerome-Duncan, 176 F.3d at 907). In other words, the test for fraudulent joinder “is whether there is arguably a reasonable basis for predicting that the state law might impose liability on the facts involved.” Alexander, 13 F.3d at 949 (quoting Bobby Jones Garden Apartments, Inc. v. Suleski, 391 F.2d 172, 176 (5th Cir. 1968)). If the answer is yes, the federal courts lack jurisdiction and must remand the action to the state courts.

         B. Plaintiffs' claims against the Supplier Defendants

         Kentucky's so-called “middleman” statute provides additional protection for wholesalers, retailers, and distributors who are alleged to have sold defective products. Ky Rev. Stat. § 411.340. The statute relieves middlemen where:

(1) the manufacturer is “identified and subject to the jurisdiction of the court[;]” (2) the product was sold “in its original manufactured condition . . . or in the same condition such product was in when received . . .” by the middleman; and, (3) the middleman has neither “breached an express warranty . . .” nor “knew or should have known at the time of distribution or sale ...

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