United States District Court, W.D. Virginia, Roanoke Division
Hon. Michael F. Urbanski, United States District Judge
Plaintiff Caleb Quesenberry filed this negligence action in Roanoke City Circuit Court, seeking damages for injuries he allegedly sustained when an elevator he was using dropped at a high rate of speed in the Poff Federal Building in Roanoke, Virginia. Quesenberry named three defendants: Southern Elevator Company, Inc., Northern Management Services, Inc., and Southern's employee Louis Cruz With Northern's consent, Southern removed this case to federal court on February 19, 2016, asserting the court has diversity jurisdiction pursuant to 28 U.S.C. § 1332. Southern contends there is complete diversity of citizenship between Quesenberry and the proper defendants to the case-Southern and Northern-and the amount in controversy exceeds the jurisdictional requirement. With respect to defendant Cruz, who destroys diversity, Southern argues he has been fraudulently joined with the express purpose of defeating diversity jurisdiction and that no cognizable legal claim lies against him.
Quesenberry moves to remand, arguing Cruz is a proper party defendant and the court therefore lacks subject matter jurisdiction over this case. Quesenberry asserts that under Virginia law, an employee can be held liable to a third party for misfeasance, an affirmative act performed improperly. Quesenberry contends that his complaint in this case alleges just that-that Cruz negligently cleared the elevator for service in spite of a fault code that could indicate a broken circuit board. Southern and Cruz maintain that the allegations against Cruz are allegations of nonfeasance, a failure to act, not misfeasance, and Quesenberry therefore has not stated a viable claim against Cruz under Virginia law.
For the reasons set forth below, the court agrees with Quesenberry and finds defendants have failed to meet their burden of establishing fraudulent joinder. Because the court lacks diversity jurisdiction over this matter, Quesenberry's motion to remand (ECF No. 17) will be GRANTED and this case DISMISSED.
Quesenberry filed this personal injury case in Roanoke City Circuit Court on January 6, 2016. His claims arise out of an incident on August 11, 2014 in which an elevator abruptly dropped at a high rate of speed in the Poff Federal Building. Quesenberry alleges that at 10:50 a.m. that day, the subject elevator malfunctioned and displayed fault code "QPRAM Comm. Failure/warn." Compl., ECF No. 1-3, at ¶¶ 8-9. Quesenberry claims this code "is indicative of, among other things, a broken circuit board, " id. at ¶ 9, and that Cruz was dispatched on behalf of Southern to service this elevator, id. at. 8. Quesenberry asserts that Cruz knew or should have known that the "QPRAM Comm. Failure/warn" code could indicate a broken circuit board and there was no way to test for a broken circuit board on site; yet, in spite of that knowledge, Cruz placed the elevator back in service after running tests for other failures, all of which were negative. Id. at ¶¶ 10-12. Later that same day, at approximately 1:30 p.m., Quesenberry entered the elevator and, while in transit, the elevator "dropped at a high rate of speed for a considerable distance, actually and proximately causing the plaintiffs physical injuries." Id. at ¶ 13. Quesenberry alleges the defendants Southern, Northern, and Cruz owed a duty of ordinary care in the maintenance and repair of the elevator and that defendants "negligently failed to maintain and repair the elevator after the first malfunction, for the reasons stated herein, incorporated by reference, actually and proximately causing the plaintiffs injuries." Id. at ¶ 19. Quesenberry further alleges that Cruz is liable for punitive damages because he acted willfully and wantonly given the fact "that the troubleshooting guide suggested the replacement and testing of the circuit board as a solution to the fault code displayed prior to the plaintiffs injury." Id. at ¶ 20.
Southern filed a notice of removal on February 19, 2016 with the consent of Northern, asserting this court has diversity jurisdiction over this case pursuant to 28 U.S.C. § 1332. Not. of Removal, ECF No. 1, 1-1. Southern asserts there is complete diversity of citizenship between Quesenberry, a citizen of Virginia, Southern, a citizen of North Carolina, and Northern, a citizen of Idaho. As for Cruz, also a Virginia citizen, Southern argues he "has been fraudulently joined with the express purpose of defeating the Court's jurisdiction and that no legal claim cognizable in the Commonwealth of Virginia lies against Mr. Cruz." Not. of Removal, ECF No. 1, at ¶ 16. Quesenberry moves to remand, arguing his complaint alleges a claim of misfeasance against Cruz that is cognizable under Virginia law, and the court therefore lacks diversity jurisdiction over this matter. Southern and Cruz respond that Quesenberry "solely alleges that Mr. Cruz failed to 'prevent, eliminate and warn of [the danger], '" and thus no cause of action can be maintained against this employee defendant. Resp. to Mot. to Remand, ECF No. 17, at 8.
None of the parties requested oral argument on the pending motion to remand. The issues have been fully briefed and are ripe for adjudication.
Federal courts are courts of limited jurisdiction. "The threshold question in any matter brought before a federal court is whether the court has jurisdiction to resolve the controversy involved." 17th Street Assoc. LLP v. Markel Inf 1 Ins. Co. Ltd., 373 F.Supp.2d 584, 591 (E.D. Va. 2005). Section 1441 (a) of Title 28 of the United States Code permits a defendant to remove an action to a federal district court if the plaintiff could have brought the action in federal court originally. The party seeking removal bears the burden of establishing federal jurisdiction, and because removal jurisdiction raises significant federalism concerns, the removal statute must be strictly construed. Mulcahey v. Columbia Organic Chem. Co., Inc., 29 F.3d 148, 151 (4th Cir. 1994). "If federal jurisdiction is doubtful, a remand is necessary." Id.
In its notice of removal, Southern asserts that this federal court has original jurisdiction over this personal injury case pursuant to 28 U.S.C. § 1332. Section 1332 provides that federal courts have diversity jurisdiction over actions in which the matter in controversy exceeds the sum of $75, 000 and the dispute is between citizens of different states. This statute requires "'complete diversity of citizenship, '" Carden v. Arkoma Assoc. 494 U.S. 185, 187 (1990), between "real and substantial parties to the controversy, " Navarro Sav. Ass'n v. Lee. 446 U.S. 458, 460 (1980). "This 'complete diversity' rule, when coupled with other rules, makes it difficult for a defendant to remove a case if a nondiverse defendant has been party to the suit prior to removal." Mayes v. Rapoport. 198 F.3d 457, 461 (4th Cir. 1999). The doctrine of fraudulent joinder, however, allows a district court to assume jurisdiction over a case in which a nondiverse defendant is named at the time of removal, dismiss the nondiverse defendant, and retain jurisdiction. Id.
"Fraudulent joinder" is a term of art, it does not reflect on the integrity of plaintiff or counsel, but is merely the rubric applied when a court finds either that no cause of action is stated against the nondiverse defendant, or in fact no cause of action exists. In other words, a joinder is fraudulent if "there [is] no real intention to get a joint judgment, and ... there [is] no colorable ground for so claiming."
AIDS Counseling & Testing Centers v. Grp. W Television. Inc.. 903 F.2d 1000, 1003 (4th Cir. 1990) (quoting Lewis v. Time. Inc.. 83 F.R.D. 455, 460 (E.D. Cal. 1979)).
In order to establish that a nondiverse defendant has been fraudulently joined, the removing ...