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Williams v. 3M Co.

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

June 22, 2018

3M COMPANY, et al., Defendants.


         This matter is before the Court on Plaintiff Fred Williams's Motion to Remand. (DE 7.) The Court previously entered an Order granting Williams's motion and remanding this case to Pike Circuit Court. The Court's reasons for remanding this case are explained below.

         I. Background

         Plaintiff Fred Williams alleges that he contracted coal workers' pneumoconiosis and/or silicosis (and other injuries) due to his use of allegedly defective respiratory protective equipment manufactured by Defendant 3M, a citizen of Delaware and Minnesota.[1] When he originally commenced this suit, Williams also alleged that Mine Service Company ("MSC") and Kentucky Mine Supply Company ("KMSC") were liable because they knew or should have known that the 3M respirators they sold were defective or unreasonably dangerous when used in a coal mine. Both MSC and KMSC, collectively the Supplier Defendants, are Kentucky citizens. Williams also named as Defendants Judith Erickson, Director of the Division of Workers' Compensation Funds ("the Division"), and the Kentucky Coal Workers' Pneumoconiosis Fund ("the Coal Fund").[2] The Coal Fund is seeking repayment of $256, 420.20 in benefits that it has or will pay to Williams.

         This action was commenced on November 2, 2016 in Pike Circuit Court. It is one of a number of lawsuits, of which at least fifty are currently pending in state courts in Kentucky and West Virginia. While these suits are brought against both respirator manufacturers and distributors, Williams concedes that the target of these suits are manufacturers such as 3M. Several of those cases have already come to a close, including three where the plaintiffs dismissed or abandoned their claims against the supplier defendants prior to trial, but later than one-year after the action was commenced. See Hill v. 3M Co., No. 05-CI-00589 (Perry Cir. Ct); Couch v. Mine Safety Appliances Co., No. 10-CI-00155 (Knott Cir. Ct.); Collins v. 3MCo., No. 10-CI-00176 (Knott Cir. Ct.). In one case, Overbee v. 3MCo., No. 16-CI-313 (Knott Cir. Ct.), trial was scheduled within one-year of commencement. At trial, however, the plaintiff argued that MSC was, at most, one percent at fault for his injuries and the jury ultimately assigned them zero liability.

         Invoking its status as a foreign defendant, 3M has repeatedly attempted to remove these actions to federal court. Most recently, 3M removed two respirator cases to this Court, arguing that the Supplier Defendants were fraudulently joined. See Hoskins v. 3M Co., No. 6:17-CV-304-KKC; Hall v. 3M Co., No. 7:18-CV-09-KKC. In a joint Memorandum Opinion and Order, the Court remanded those cases, finding that the plaintiffs had stated colorable claims against the Supplier Defendants. Hoskins v. 3M Co., No. 6:17-CV-304-KKC & No. 7:18-CV-09-KKC, 2018 WL 1040091 (E.D. Ky. Feb. 23, 2018).[3] Additionally, over a decade ago, a number of similar cases involving respirator manufacturers and the supplier defendants were removed to the Western and Eastern Districts of Kentucky, and almost all were remanded.[4]

         The events giving rise to removal of this action began in February 2018. First, on February 12, the Pike Circuit Court entered an order substituting the Coal Fund as a Defendant in place of Old Republic Insurance. On March 1, Williams filed a notice of settlement advising that a confidential settlement was reached with MSC. Williams did not disclose the date of the settlement in the notice, but, in an affidavit filed with this Court, his attorney states the claim was settled in principle on February 23 and became official on February 28. That same affidavit attests that, on March 22, KMSC informed Williams that it would file a motion for summary judgment if it was not dismissed from the case. Williams decided that he would dismiss the claims and, on May 4, the Supplier Defendants tendered a proposed agreed order dismissing the claims against them with prejudice. 3M removed this case on May 29, 2018, contending that dismissal of the Supplier Defendants created complete diversity of citizenship.

         II. Standard

         Generally, a defendant may remove a civil action brought in state court to a federal district court if the district court has original jurisdiction over the case. 28 U.S.C. § 1441(a). If a case does not involve a federal question, district courts have original jurisdiction only if the amount in controversy exceeds $75, 000 and there is complete diversity of citizenship- that is, no plaintiff and defendant are citizens of the same state. 28 U.S.C. § 1332(a); 28 U.S.C. § 1441(b)(2); see Jerome-Duncan, Inc. v. Auto-By-Tel, L.L.L., 176 F.3d 904, 907 (6th Cir. 1999). "Diversity of citizenship must exist as to a party both at the time the state action is commenced and at the time the defendant files for removal." Easley v. Pettibone Mich. Corp., 990 F.2d 905, 908 (6th Cir. 1993). Removal on the basis of diversity jurisdiction also requires consent of all defendants. 28 U.S.C. § 1446(b)(2)(A).

         Removal of diversity cases is subject to two statutory deadlines. First, if a case is not initially removable, the defendant must file a notice of removal "within 30 days after receipt" of the paper "from which it may be first ascertained that the case . . . has become removable." 28 U.S.C. § 1446(b)(2)(3). Second, removal is subject to an overall deadline of "1 year after commencement of the action, unless the district court finds that the plaintiff has acted in bad faith in order to prevent a defendant from removing the action." Id. at § 1446(c)(1).

         The burden of establishing jurisdiction falls on the removing party. Eastman v. Marine Mech. Corp., 438 F.3d 544, 549 (6th Cir. 2000). And, due to 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) (alteration in original) (quoting Alexander v. Elec. Data Sys. Corp., 13 F.3d 940, 949 (6th Cir. 1994)).

         III. Analysis

         Williams seeks remand on four bases. First, he argues that 3M failed to remove this case within one-year of commencement of the action and that 3M cannot establish that he acted in bad faith to prevent removal. Second, he claims 3M did not remove the case within the thirty-days from the time that it was first apparent the case was removable. Third, he claims that the Division and the Coal Fund are Kentucky citizens and therefore the case lacks complete diversity. And, fourth, he claims that the Division and the Coal Fund did not consent to removal. On an expedited schedule, 3M has filed a response and Williams has replied. The Court heard oral arguments from the parties on June 15, 2018, during which the parties focused on the issue of bad faith. The Court determines that, based on the evidence currently before the Court, 3M has not met its burden to show bad faith and therefore remand is required pursuant to 28 U.S.C. § 1446(c)(1).

         A. 3M does not seek removal based on fraudulent joinder

         Williams first asserts that this case is controlled by the Court's decision in Hoskins, which found that the Supplier Defendants were not fraudulently joined because the plaintiffs stated colorable claims against them. 2018 WL 1040091, at *3. Hoskins is not controlling over this case because 3M does not argue that the Supplier Defendants were fraudulently joined.[5]Fraudulent joinder occurs "[w]hen a non-diverse party has been joined as a defendant." Jerome-Duncan, 176 F.3d at 907. Because the Supplier Defendants are no longer joined, fraudulent joinder is inapplicable. 3M's basis for removal is that-because the Supplier Defendants have been dismissed, the Coal Fund realigned as a plaintiff, and the Division deemed a nominal party-there is complete diversity.

         B. Bad faith analysis is broader than fraudulent ...

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