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Feldman v. Rite Aid HDQTRS Corporation

United States District Court, S.D. Mississippi, Western Division

April 26, 2017



          David Bramlette UNITED STATES DISTRICT JUDGE

         This cause is before the Court on plaintiffs Arnold E. Feldman, M.D. (“Dr. Feldman”), Southwest Mississippi Anesthesia, P.A., and Southwest Mississippi Anesthesia, P.A., Inc. d/b/a The Feldman Institute (collectively “Plaintiffs”)'s Motion to Remand (docket entry 5). Having considered the motion and responses, applicable statutory and case law, and being otherwise fully informed in the premises, the Court finds as follows:

         I. Facts & Procedural History

         Plaintiff Arnold Feldman, M.D., is a board-certified anesthesiologist with chronic pain management practices located in both Louisiana and Mississippi. Doc. 1-1, ¶ 9. Dr. Feldman's practice groups include The Feldman Institute and First Choice Surgery Center, LLC in Louisiana and Southwest Mississippi Anesthesia Associates located in Natchez, Mississippi. Id. As of October 14, 2016, the Louisiana State Board of Medical Examiners suspended Dr. Feldman's Louisiana medical license for two years. Id. at ¶ 14. Following his suspension, Dr. Feldman “made the decision to continue to expand his practice in Natchez, Mississippi, given that he still maintains a valid Mississippi medical license and a valid DEA prescribing license.” Id.

         On December 9, 2015, the plaintiffs filed a Complaint in the Chancery Court of Adams County, Mississippi, alleging that the defendant pharmacies have refused to honor, and placed undue restrictions on, Dr. Feldman's prescriptions despite the fact that his Mississippi medical license and DEA prescribing license remain effective. See Doc. 1-1. The plaintiffs seek an injunction to prevent the defendant pharmacies from engaging in this practice, and a declaratory judgment granting the plaintiffs “specific performance of their agreements with Defendants” regarding Dr. Feldman's prescriptions. Id.

         On January 19, 2017, defendant Walgreens Co. (“Walgreens”) filed a Notice of Removal on the basis of diversity jurisdiction, claiming that plaintiffs' claims against the defendant pharmacies have been fraudulently misjoined.[1] Shortly thereafter on February 1, 2017, Plaintiffs filed their Motion to Remand for lack of subject matter jurisdiction, citing a lack of diversity between the parties and an amount in controversy below the jurisdictional minimum.

         II. Discussion

         Defendant Walgreens, as the removing party, bears the burden of proving that federal jurisdiction exists and that removal was proper. Barker v. Hercules Offshore, Inc., 713 F.3d 208, 212 (5th Cir. 2013). When considering motions to remand, the removal statutes are to be strictly construed against removal, and all ambiguities or doubts are resolved in favor of remand. Wilkinson v. Jackson, 294 F.Supp.2d 873, 877 (S.D.Miss. 2003) (citing Willy v. Coastal Corp., 855 F.2d 1160 (5th Cir. 1988)).

         The removal of cases from state to federal court is governed by 28 U.S.C. § 1441, which provides that “any civil action brought in a State court of which the district courts of the United States have original jurisdiction may be removed . . . to the district court of the United States for the district and division embracing the place where such action is pending.” 28 U.S.C. § 1441(a). Federal courts have original diversity jurisdiction over civil actions between citizens of different states where the amount in controversy exceeds $75, 000, exclusive interest and costs. 28 U.S.C. § 1332(a). In moving to remand, the plaintiffs contend that neither of the jurisdictional requirements set forth in 28 U.S.C. § 1332(a) has been met.

         A. Diversity of Citizenship

         For the Court to exercise diversity jurisdiction under 28 U.S.C. § 1332(a), complete diversity of citizenship must exist between the parties. Complete diversity “requires that all persons on one side of the controversy be citizens of different states than all persons on the other side.” Vaillancourt v. PNC Bank, Nat. Ass'n, 771 F.3d 843, 847 (5th Cir. 2014). It is undisputed that complete diversity between the parties is lacking, as multiple plaintiffs and defendants are alleged to be citizens of Mississippi.[2] Defendant Walgreens, which is a foreign corporation with its principal place of business in Illinois, urges the Court to exercise diversity jurisdiction over the claims stated against it based on a theory of fraudulent misjoinder. In its Notice of Removal and Response to the plaintiffs' motion, Walgreens asks the Court to sever and remand Plaintiffs' claims against the non-diverse defendants while retaining jurisdiction over Plaintiffs' claims against Walgreens.[3] Should the Court choose to sever the plaintiffs' claims, complete diversity would exist between Walgreens and the plaintiffs.

         The doctrine of fraudulent misjoinder was first adopted by the Eleventh Circuit in Tapscott v. MS Dealer Serv. Corp., 77 F.3d 1353, 1360 (11th Cir. 1996), abrogated on other grounds, Cohen v. Office Depot, Inc., 204 F.3d 1069 (11th Cir. 2000), and later acknowledged by the Fifth Circuit in In re Benjamin Moore & Co., 318 F.3d 626, 630-631 (5th Cir. 2002) (“fraudulent misjoinder of plaintiffs is no more permissible than fraudulent misjoinder of defendants to circumvent diversity jurisdiction”). Apart from mentioning the general principle, the Fifth Circuit has provided scarce guidance as to how the fraudulent misjoinder doctrine should be applied in our courts. Nevertheless, “most district courts within this circuit have taken the position that the Fifth Circuit has adopted, or at least appears to have adopted, Tapscott.” Palermo v. Letourneau Tech., Inc., 542 F.Supp.2d 499, 515 (S.D.Miss. 2008) (collecting cases). When considering the standard by which fraudulent misjoinder should be judged, this Court has

...adopt[ed] the fraudlent joinder-like standard for purposes of deciding the fraudulent misjoinder issue... Removal and severance will be allowed only if claims were improperly joined under state law at the action's inception. The standard also protects both the right of a plaintiff to choose his own forum and the right of a defendant to remove to a federal forum when faced with misjoinder in the state court. As long as there is a reasonable possibility that the state court would find joinder proper, the plaintiff's right to a state forum prevails, but if there is no reasonable possibility that the state court would find joinder proper, the defendant is entitled to removal and severance. Under this standard, the lack of a reasonable possibility that the state court would allow the joinder renders the claims or parties “fraudulently misjoined.”

Id. at 523-24. Applying the “fraudulent joinder-like” approach previously adopted by this Court and others within the Northern and Southern Districts, the Court considers whether, based on the unique circumstances at issue, there is a reasonable possibility that a Mississippi court would find that Plaintiffs' claims against Rite Aid, CVS, and Fred's pharmacies were properly joined with their claims against Walgreens. See Id. at 542 F.Supp.2d at 523-24; Hampton v. Frost, 2015 WL 11233043, *1 (S.D.Miss. Sept. 24, 2015); see also Sweeney v. Sherwin Williams Co.,304 F.Supp.2d 868, 872 (S.D.Miss. 2004) (“mere misjoinder is insufficient to raise to the level of fraudulent misjoinder . . . misjoinder must represent totally unsupported, or ‘egregious' misjoinder”); Walton v. Tower Loan of Miss.,338 F.Supp.2d 691, 697 (N.D. Miss. 2004) (noting that fraudulent misjoinder ...

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