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Hayes v. Colgate-Palmolive Co.

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

June 6, 2019



          Joseph H. McKinley Jr., District Judge.

         This matter is before the Court on Plaintiff's Emergency Motion to Remand [DN 10], Plaintiff's Motion for Leave to File Excess Pages [DN 23], and Defendant Johnson & Johnson's Motion for Leave to File Excess Pages [DN 25]. Fully briefed, these matters are ripe for decision. For the following reasons, both Motions for Leave to Files Excess Pages are GRANTED and Plaintiff's Emergency Motion to Remand is GRANTED. Plaintiff's request for attorney's fees and costs is DENIED.

         I. Background

         Donna Ann Hayes (“Decedent”) brought an action in Jefferson Circuit Court on July 25, 2016. [DN 1-2, DN 10 at 1]. Decedent alleged that her malignant mesothelioma was a result of her use of Defendant Johnson & Johnson's (“J&J”) talcum powder products containing asbestos- specifically, J&J's Cashmere Bouquet and Shower to Shower talcum products. [DN 1-2 at 10-11, DN 10 at 1]. Decedent also sued other parties in her state action but the causes of action against J&J are the only ones relevant to the instant Motion. [DN 1-2 at 5-8]. Decedent died of malignant mesothelioma on December 7, 2016. [Id. at 3-4]. Cynthia Hayes (“Plaintiff”), was appointed executrix of the estate of Decedent on January 18, 2017. [Id. at 4]. The state court action was revived, and Plaintiff, as executrix, was substituted as the plaintiff on February 20, 2017. [Id.]. This case has been heavily litigated in state court for almost three years.

         On February 13, 2019, the producer of the talcum powder, Imerys Talc America, Inc. (“Imerys”), filed a Notice of Suggestion of Pendency of Bankruptcy and Automatic Stay of Proceedings, informing the Jefferson Circuit Court of its commencement of bankruptcy proceedings in the United States Bankruptcy Court for the District of Delaware pursuant to Chapter 11 of title 11 of the United States Code. [Id.].

         Two weeks later, J&J participated in oral arguments in the state court action regarding its own motion for summary judgment and other pre-trial motions filed by the parties. [Id.]. On April 12, 2019, the state court issued a ruling denying summary judgment to J&J and ruling on most of the motions in limine. [Id.]. Despite having two months since Imerys filed its Notice in the Jefferson Circuit Court-the event J&J relies on as creating the basis for federal subject matter jurisdiction-J&J gave no indication it was going to remove the action to federal court.

         On April 18, 2019, over two months after Imerys' Notice to the Jefferson Circuit Court, J&J filed in the District Court of Delaware its Motion to Fix Venue for Claims Related to Imerys' Bankruptcy (“Motion to Fix Venue”). [Id. at 5]. J&J then filed its Notice of Removal of the state court talcum powder claims on April 25, 2019. [DN 1]. It appears that J&J only intended to remove to federal court Plaintiff's claims against it. [DN 26 n.32]. Accordingly, Plaintiff's action against Defendant Colgate-Palmolive Company remains in state court. As grounds for removal, J&J maintains that federal subject matter jurisdiction exists because the state court action is related to Imerys' Chapter 11 bankruptcy. See §§ 1334(b), 1452(a). [Id. at 4]. J&J proposes three grounds upon which the Court may find related-to jurisdiction: (1) indemnity agreements; (2) shared insurance policies; and (3) identity of interest. [Id.].

         Plaintiff filed the instant Emergency Motion to Remand on April 29, 2019. [DN 10]. Plaintiff offered several bases upon which the Court could remand the action to state court: (1) J&J's removal to federal court was untimely and, as such, its right of removal is waived [Id. at 5- 7]; (2) even if J&J removed in a timely fashion, J&J continued to litigate the action in state court for two months after it allegedly had the right to remove, thus demonstrating its clear intent to litigate in state court [Id. at 7-8]; (3) if the Court finds that J&J did not waive its right to remove to federal court, the state court action is not sufficiently related to Imerys' pending bankruptcy to supply the Court subject matter jurisdiction [Id. at 9-19]; (4) even if the Court finds there to be subject matter jurisdiction, abstention is mandatory [Id. at 20-23]; and (5) even if mandatory abstention does not apply, the factors relevant to permissive abstention warrant remand [Id. at 23- 28]. In its Response, J&J asks the Court to either deny or defer ruling on Plaintiff's Motion to Remand until the District Court of Delaware rules on its Motion to Fix Venue. [DN 26 at 1, DN 1, DN 1-4]. J&J appears hopeful that the District Court of Delaware will find that the pending state court personal injury and wrongful death actions against it are sufficiently related to Imerys' Chapter 11 bankruptcy pending in its court such that that it will fix venue in Delaware for all such actions. However, the Court is not required to defer its determination as to whether it may exercise jurisdiction over Plaintiff's state court talcum powder claims because of J&J's filing in the District Court of Delaware.

         II. Legal Standard

         It is well established that federal courts are courts of limited jurisdiction, possessing only the authority to hear cases authorized by the Constitution and statute. Hudson v. Coleman, 347 F.3d 138, 141 (6th Cir. 2003). The party who seeks to invoke a federal district court's jurisdiction bears the burden of establishing the court's authority to hear the case. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). The Court is mindful that statutes conferring removal jurisdiction, like the one invoked by J&J, are to be strictly construed. Alexander v. Elec. Data Sys. Corp., 13 F.3d 940, 949 (6th Cir. 1994). All doubts as to the propriety of removal are resolved in favor of remand. Brierly v. Alusuisse Flexible Packaging, Inc., 184 F.3d 527, 534 (6th Cir. 1999).

         28 U.S.C. § 1452 provides for the removal of claims related to bankruptcy cases. Subsection (a) of that statute specifies that “[a] party may remove any claim or cause of action in a civil action . . . to the district court for the district where such action is pending, if such district court has jurisdiction of such claim or cause of action under section 1334 of this title.” § 1452(a). Section 1334(b) grants district courts with “original but not exclusive jurisdiction of all civil proceedings arising under title 11 [of the Bankruptcy Code], or arising in or related to cases under title 11.” 28 U.S.C. § 1334(b). Once a claim is removed to federal district court pursuant to § 1452(a), the court to which the claim has been removed “may remand such claim or cause of action on any equitable ground.” § 1452(b). An order under this subsection “is not reviewable by appeal or otherwise by the court of appeals under section 158(d), 1291, or 1292 [of Title 28] or by the Supreme Court . . . .” Id.

         The “any equitable ground” language of § 1452(b) provides federal courts broad authority and discretion in determining whether remand is proper. Ector Investors, L.P. v. BML, Inc. (In re Warren Producers, Inc.), 358 B.R. 717, 719 (Bankr. W.D. Ky. 2007) (citing Grace Cmty. v. KPMG Peat Marwick, LLP (In re Grace Cmty., Inc.), 262 B.R. 625, 629 (Bankr. E.D. Pa. 2001)). Section 1452(b), and its counterpart 1334(c), governing abstention, evince a strong congressional intent that although certain matters may be heard in federal court, many should remain in state court. This is particularly true where the action removed to federal court does not maintain a strong connection to the bankruptcy case. Specifically, where there is no basis for federal jurisdiction independent of § 1334(b) and the litigation can be timely completed in state court, trial of state law issues should be allowed to proceed in state court. § 1334(c)(2).

         Courts within the Sixth Circuit have established a No. of considerations relevant to determining whether an action should be remanded based on equitable grounds. Those considerations include:

(1) duplicative and uneconomical effort of judicial resources in two forums; (2) prejudice to the involuntarily removed parties; (3) forum non conveniens; (4) the state's ability to handle a suit involving questions of state law; (5) comity considerations; (6) lessened possibility of an inconsistent result; ...

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