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Shaffer v. Donoghue

United States District Court, W.D. Kentucky, Louisville Division

January 23, 2019

JOSEPH SHAFFER Plaintiff
v.
ANDREW DONOGHUE, ET AL. Defendants

          MEMORANDUM OPINION AND ORDER

          Rebecca Grady Jennings, District Judge

         This matter comes before the Court on Plaintiff Joseph Shaffer's Motion to Join New Party, [DE 27]. Plaintiff's Motion was filed on July 2, 2018, and timely responses and replies were filed. [DE 29, Resp. in Op. to Mot.; DE 33, Reply to Resp. to Mot.]. On August 23, 2018, Plaintiff filed a Supplement to his Motion to Join New Party [DE 35] and Defendant filed a response to the Supplement on November 11, 2018, [DE 50], and the matter is now ripe for adjudication. For the reasons set forth below, the Court will GRANT Plaintiff's Motion to Join New Party, and REMAND this action to the Jefferson Circuit Court.

         I. FACTUAL AND PROCEDURAL BACKGROUND

         According to his Complaint, on August 17, 2015, Mr. Shaffer was involved in an automobile accident with Andrew Donoghue (“Mr. Donoghue”), who was an agent, servant, or employee of the D L Peterson Trust (“the Peterson Trust”). [DE 1-2 at 6, ¶¶ 6-7]. On October 26, 2015, Mr. Shaffer was involved in a second automobile accident involving Abigail Hurley. [DE 27 at 86]. Mr. Shaffer alleges that he suffered similar injuries as the result of each these accidents. [Id. at 87].

         Mr. Shaffer sued Mr. Donoghue, the Peterson Trust, [1] and Progressive Direct Insurance Company (Progressive) (collectively, “Defendants”) in Kentucky state court, alleging state-law causes of action arising out of the August 17, 2015 accident. [DE 1-2]. On September 18, 2017, Mr. Donoghue and the Peterson Trust filed a notice of removal to the Western District of Kentucky. [DE 1]. On September 28, 2017, Mr. Donoghue and the Peterson Trust filed Answers to the Complaint. [DE 5; DE 6]. Progressive's Answer was filed on February 9, 2018. [DE 16].

         On July 2, 2018, Mr. Shaffer moved to join Ms. Hurley as a new defendant, pursuant to Fed.R.Civ.P. 20(a)(2). [DE 27]. Progressive opposed this motion, which was then fully briefed by the parties. [DE 29; DE 33]. Shaffer then filed a Supplement to his Motion on August 23, 2018. [DE 35]. The supplement contained the results of Mr. Shaffer's August 10, 2018 medical examination in which Mr. Shaffer alleged that the examining doctor “was not able to distinguish the injuries between the two wrecks at issue” in this case.[2] [DE 35 at 110; DE 35-1]. Progressive moved to strike the Supplement as untimely on August 24, 2018. [DE 37 at 120-21]. With leave of the Court, Progressive filed a response to the Supplement on November 19, 2018. [DE 50].

         II. MOTION TO JOIN NEW PARTY

         Mr. Shaffer moves to join Ms. Hurley, a Kentucky resident, as a Defendant under the permissive joinder rule in Fed.R.Civ.P. 20(a)(2). [DE 27 at 86-87]. Mr. Shaffer admits that mandatory joinder under rule 19 is inapplicable because the additional party is a Kentucky resident and would destroy diversity jurisdiction. [Id. at 87]. This motion is opposed by Progressive on grounds that the two automobile accidents are distinct events occurring too far part in time to satisfy the transactional relatedness required under Rule 20(a)(2)(A). [DE 29 at 92-93].

         A. Application of State Verses Federal Law.

         As a threshold matter, this Court must determine whether its analysis of Mr. Shaffer's Motion to Join is governed by federal or state joinder law. See, e.g., Erie R. Co. v. Tompkins, 304 U.S. 64, 78-80 (1938). When sitting in diversity jurisdiction, “federal courts are to apply state substantive law and federal procedural law.” Hanna v. Plumer, 380 U.S. 460, 465 (1965). Because joinder is a procedural matter, federal courts follow federal rules when evaluating a motion to join. See Provident Tradesmens Bank & Tr. Co. v. Patterson, 390 U.S. 102, 125 n.22 (1968) (“[I]t has been clear that in a diversity case the question of joinder is one of federal law . . . [t]o be sure, state-law questions may arise in determining what interest the outsider actually has . . . but the ultimate question whether, given those state defined interests, a federal court may proceed without the outsider is a federal matter.”) (citations omitted); see also, Winner's Circle of Las Vegas, Inc. v. AMI Franchising, Inc., 916 F.Supp. 1024, 1025-28 (D. Nev. 1996) (noting that federal courts follow federal rules when evaluating a motion to join in actions filed in state court and removed to federal court, so long as the joinder occurred post-removal).

         Whether joinder is appropriate in this case is therefore a matter of federal law, including whether the August 17, 2015 and October 26, 2015 accidents were part of the “same . . . series of transactions or occurrences.” But because this suit sounds in Kentucky tort law, whether there is a question of law or fact common to Defendants and Ms. Hurley may require analyzing Kentucky law and the facts relevant to that law.

         B. Standard for Permissive Joinder Where Joinder Destroys Diversity Jurisdiction.

         “If after removal the plaintiff seeks to join additional defendants whose joinder would destroy subject matter jurisdiction, ” 28 U.S.C. § 1447(e) gives the district court the discretion to either “deny joinder, or permit joinder and remand the action to the State court.” See also, Farm Bureau Life Ins. Co of Mich. v. Nat. City Corp., 2006 WL 2728359, at *1 (W.D. Mich. Sept. 22, 2006) (citing Wyant v. Nat'l R.R. Passenger Corp., 881 F.Supp. 919, 922 (S.D.N.Y. 1995)). In such situations, the Court must “first consider whether joinder would be appropriate under Rule 20 and then proceed to weigh the competing interests in efficient adjudication and the need to protect diversity jurisdiction from manipulation.” Wyant, 881 F.Supp. at 922; see also Telecom Decision Makers, Inc. v. Access Integrated Networks, Inc., 654 Fed.Appx. 218, 221 (6th Cir. 2016) (per curiam).

         Federal Rule of Civil Procedure 20(a)(2) states that persons may be joined as defendants in an action if:

(A) any right to relief is asserted against them jointly, severally, or in the alternative with respect to or arising out of the same transaction, occurrence, or series ...

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