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Gayheart v. Wal-Mart, Inc.

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

November 15, 2018

DEBORAH GAYHEART, Plaintiff,
v.
WAL-MART, INC., et al., Defendants.

          MEMORANDUM OPINION & ORDER

          GREGORY F. VAN TATENHOVE UNITED STATES DISTRICT JUDGE.

         When parties in a case are otherwise diverse, a plaintiff may not avoid federal diversity jurisdiction by also suing a non-diverse employee of a defendant corporation. Here, Deborah Gayheart has attempted to keep her tort lawsuit in Kentucky state courts by joining Mickey Gilley, a Wal-Mart employee, as a defendant. Because she has failed to state a claim upon which relief may be granted against Mr. Gilley, Ms. Gayheart's Motion to Remand is DENIED and Mr. Gilley's Motion to Dismiss is GRANTED.

         I

         Plaintiff Deborah Gayheart, a citizen of Kentucky, sued Wal-Mart, Wal-Mart Stores East, WSE Management, and Mickey Gilley after she slipped and fell in the Wal-Mart Super Center in Pikeville, Kentucky. [R. 1-2 at 2-7.] According to Ms. Gayheart, water had puddled on the floor of the shopping facility due to a leaky ceiling. Id. As to Mr. Gilley specifically, Ms. Gayheart claims he had a duty to notify her of the dangerous conditions but failed to take appropriate action. Id. at 4-5.

         Wal-Mart, Inc., is a corporation with citizenship in Delaware and Arkansas. [R. 1 at 2.] WSE Management is a limited liability company, and its sole member is Wal-Mart Stores East. Id. Wal-Mart Stores East is also a limited liability company with only one member, Wal-Mart, Inc. Id. The citizenship of a limited liability company has the citizenship of each of its members. Varsity Brands, Inc. v. Star Athletica, LLC, 799 F.3d 468, 494 (6th Cir. 2015). Thus, both WSE Management and Wal-Mart Stores East are also citizens of both Delaware and Arkansas, leaving Mr. Gilley the only non-diverse defendant.

         Ms. Gayheart filed suit on July 31, 2018, in Pike Circuit Court in Pike County, Kentucky. [R. 1-2 at 1.] On August 20, all defendants filed a joint answer to Ms. Gayheart's complaint, in which their first defense was failure to state a claim upon which relief could be granted. Id. at 12. The answer did not state defenses specific to each defendant, but rather for Wal-Mart generally. Id. at 12-17. Ten days later, the diverse defendants filed a notice of removal and Mr. Gilley filed a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). Id. at 20. On September 5, Mr. Gilley refiled his motion to dismiss before this Court, and on September 29, Ms. Gayheart filed a motion to remand to Pike Circuit Court. [R. 5; R. 7.] The Defendants claim that Mr. Gilley had no legal duty to Ms. Gayheart, and therefore, he must be dismissed.

         II

         A

         Before reaching the merits of both parties' motions, Ms. Gayheart first argues that Mr. Gilley's motion to dismiss is untimely, since he did not file the motion before he filed his answer. [R. 6 at 3.] Ms. Gayheart asserts that Mr. Gilley has waived this motion. Id. However, only defenses pursuant to Federal Rule of Civil Procedure 12(b)(2)-(5) are considered waived by failure to make a motion or include the specific defense in the responsive pleading. Fed. R. Civ. Pro. 12(b)(h)(1). A defense under Rule 12(b)(6) or a motion to state a legal defense may be made in a pleading, in a motion under Rule 12(c), or even at trial. Fed. R. Civ. Pro. 12(h)(2). Simply because Mr. Gilley asserted this defense after answering does not mean he waived it. Because he has submitted an answer to Ms. Gayheart's complaint, the Court will consider his motion to dismiss as a motion for judgment on the pleadings. Scheid v. Fanny Farmer Candy Shops, Inc., 859 F.2d 434, n.1 (6th Cir. 1988).

         B

         This action is in federal court on the basis of removal and diversity jurisdiction. 28 U.S.C. § 1332. Ms. Gayheart contests this removal because Mr. Gilley is a Kentucky citizen, but the Defendants believe Mr. Gilley is improperly joined. The Court must first determine whether it has jurisdiction to hear the matter.

         For issues of state law, a Federal District Court only has jurisdiction if the amount in controversy exceeds $75, 000 and there is complete diversity among parties. 28 U.S.C. § 1332. Under this rule, Ms. Gayheart's case should be remanded because Mr. Gilley, as a citizen of Kentucky, destroys complete diversity. However, if Mr. Gilley was fraudulently joined, the Court could ignore his non-diverse citizenship and consider removal to be proper. Coyne v. American Tobacco Co., 183 F.3d 488, 493 (6th Cir. 1999). In order to demonstrate fraudulent joinder, the Defendants must introduce sufficient evidence that Mr. Gayheart could not establish a cause of action against Mr. Gilley under Kentucky state law. Id. If there is even a “colorable basis” to predict such success, the Court must remand.

         Regardless of whether the case is remanded or remains before this Court on the basis of diversity jurisdiction, Kentucky is the forum state and its substantive law will be followed. Rawe v. Liberty Mut. Fire Ins. Co., 462 F.3d 521, 526 (6th Cir. 2006). So long as the case remains in federal court, federal procedural law will govern as applicable, including in establishing the appropriate standards for fraudulent joinder and dismissal. Weaver v. Caldwell Tanks, Inc., 190 Fed.Appx. 404, 408 (6th Cir. 2006).

         Mr. Gilley is an hourly employee of Wal-Mart in Pikeville. [R. 1-2 at 27.][1] He asserts, and Ms. Gayheart does not contest, that he has never owned or possessed the building, he has never had managerial responsibilities for Wal-Mart, and he has never been responsible for maintenance or upkeep of the building. [R. 12 at 2-3.] Instead, Ms. Gayheart merely asserts that he had control “over the area of the store” involving her injury. [R. 7-1 at 6-7.] In Kentucky, a plaintiff must demonstrate four elements to establish negligence: duty, breach, causation, and damages. Pathways, Inc. v. ...


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