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L.L.D., LLC v. ENPRO Industries, Inc.

United States District Court, N.D. Mississippi, Oxford Division

June 27, 2019



         Presently before the Court is the Plaintiffs' motion to remand this matter to state court. Upon due consideration, the Court finds that the motion should be denied.

         I. Factual and Procedural Background

         On January 31, 2019, the Plaintiffs filed a complaint in the Circuit Court of Yalobusha County, Mississippi, alleging that the Defendants polluted the environment in Water Valley, Mississippi, with trichloroethylene ("TCE"), and then have failed to remediate the pollution. The Plaintiffs assert claims for negligence, nuisance, trespass, fraud, and intentional or negligent infliction of emotional distress against the Defendants.

         The Plaintiffs allege that from 1973 through 1987, the Defendants polluted the environment in Water Valley with TCE from an industrial facility, and that the pollution resulted in a TCE-contaminated groundwater plume that impacts over 150 acres of land owned by the Plaintiffs as well as Plaintiff-owned residences and commercial buildings. The Plaintiffs further aver that the Defendants have breached their duty to remediate the contamination.

         On March 1, 2019, the Defendants timely removed this case to this Court on the basis of diversity jurisdiction and filed an answer and affirmative defenses; in addition, Defendant Williamson filed a motion to dismiss, seeking to have the court dismiss the claims pending against him pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. On April 1, 2019, Plaintiffs filed the present motion to remand the case to state court. The matter is now fully-briefed and ripe for review.

         II. Standard of Review

         Federal courts are courts of limited jurisdiction. Epps v. Bexar-Medina-Atascosa Cnties. Water Improvement Dist. No. 1, 665 F.2d 594, 595 (5th Cir. 1982). Federal diversity jurisdiction, which is the basis upon which the Defendants removed the case sub judice, requires complete diversity between all plaintiffs and all defendants and an amount in controversy that exceeds $75, 000. See 28 U.S.C. § 1332(a). The statute that governs removal of actions pending in state court provides in pertinent part that "any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, 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).

         A court will find that a plaintiff has improperly joined an in-state defendant in order to negate or prevent complete diversity when "there is no reasonable basis for the district court to predict that the plaintiff might be able to recover against an in-state defendant." Smallwood v. III. Cent. R.R. Co., 385 F.3d 568, 573 (5th Cir. 2004) (en banc). To determine whether a defendant is improperly joined, the district "court may conduct a Rule 12(b)(6)-type analysis, looking initially at the allegations of the complaint to determine whether the complaint states a claim under state law against the in-state defendant." Id. If "a court determines that a nondiverse party has been improperly joined to defeat diversity, that party must be dismissed without prejudice." Int'l Energy Ventures Mgmt., LLC v. United Energy Grp, Ltd., 818 F.3d 193, 209 (5th Cir. 2016); Probasco v. Wal-Mart Stores Texas, L.L.C., No. 18-50187, 2019 WL 1323986, at *1 (5th Cir. Mar. 22, 2019).

         "Improper joinder can be established in two ways: (1) actual fraud in the pleading of jurisdictional facts, or (2) inability of the plaintiff to establish a cause of action against the non-diverse party in state court." Davidson v. Georgia-Pac, L.L.C., 819 F.3d 758, 765 (5th Cir. 2016) (citing Mumfrey v. CVS Pharmacy, Inc., 719 F.3d 392, 401 (5th Cir. 2013) (internal quotations and alteration omitted)). Only the second situation is an issue in this case. The applicable test "is whether the defendant has demonstrated that there is no possibility of recovery by the plaintiff against an in-state defendant, which stated differently means that there is no reasonable basis for the district court to predict that the plaintiff might be able to recover against an in-state defendant." Davidson, 819 F.3d at 765 (citing Smallwood, 385 F.3d at 573). The burden to show improper joinder rests on the removing party and "[t]he burden of persuasion on those who claim [improper] joinder is a heavy one." Davidson, 819 F.3d at 765 (citing Travis v. Irby, 326 F.3d 644, 649 (5th Cir. 2003)).

         With that in mind, the Court views "all unchallenged factual allegations, including those alleged in the complaint, in the light most favorable to the plaintiff' and resolves "[a]ny contested issues of fact and any ambiguities of state law" in the plaintiffs favor. Davidson, 819 F.3d at 765. It "is insufficient that there be a mere theoretical possibility of recovery; to the contrary, there must at least be arguably a reasonable basis for predicting that state law would allow recovery in order to preclude a finding of fraudulent joinder." Walton v. Tower Loan of Miss., 338 F.Supp.2d 691, 692-93 (N.D. Miss. 2004) (citing Travis, 326 F.3d at 648; Badon v. RJR Nabisco Inc., 224 F.3d 382, 386 (5th Cir. 2000) (internal quotations omitted)).

         III. Analysis and Discussion

         The Plaintiffs contend that removal of this action is not appropriate because there is lack of complete diversity of citizenship between the parties.[1] It is undisputed that complete diversity exists between the Plaintiffs and all Defendants other than Williamson. The Plaintiffs contend that Williamson's presence as a Defendant destroys complete diversity, as both the Plaintiffs and Williamson are citizens of Mississippi. Plaintiffs maintain that Williamson is a proper party to this case against whom they have alleged cognizable causes of action and that removal is thus improper.

         Defendants argue that Williamson was improperly joined in order to destroy diversity jurisdiction and that Williamson's citizenship should be disregarded in the diversity jurisdiction determination. Defendants further argue that the Plaintiffs are attempting to impose liability upon Williamson merely because he was, at one point, the Environmental/Safety Director for the subject facility, and that liability cannot be imposed upon him solely for this reason.[2] Therefore, Defendants argue that removal is proper.

         The Court now turns to the specific allegations in the Plaintiffs' complaint against Williamson. Plaintiffs allege that Williamson, as the Environmental/Safety Director of the Defendants' predecessor corporation(s) between 1995 and 2002, "was responsible for managing, supervising, and overseeing [the company's] environmental performance and compliance" and that he "was vested with the obligation and duty to ensure that [the company], directly or through its retained environmental contractors, exercised diligence and due care with regard to all remedial actions needed or undertaken." Compl. [Doc. No. 2] at ¶ 37. Plaintiffs further aver that Williamson had the "authority and responsibility ... to enforce and ensure the environmental performance and compliance of the [facility], ...

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