United States District Court, E.D. Missouri, Eastern Division
RHONDA ELIZABETH ORRICK, as Next Friend of D.E., a minor, et al., Plaintiffs,
SMITHKLINE BEECHAM CORPORATION, d/b/a GLAXOSMITHKLINE, and GLAXOSMITHKLINE, LLC, Defendants.
MEMORANDUM AND ORDER
STEPHEN N. LIMBAUGH, Jr., District Judge.
This matter is before the Court on plaintiffs' motion to remand based on the presence of a non-diverse plaintiff. The removing defendants oppose remand alleging plaintiffs fraudulently joined and fraudulently misjoined the non-diverse plaintiff for the sole purpose of defeating diversity jurisdiction. Also before this Court is defendants' motion for leave to file an amended notice of removal and motion for jurisdictional discovery. The motions have been fully briefed, and this matter is ripe for disposition. For the following reasons, the Court concludes that federal diversity jurisdiction does not exist, and plaintiffs' motion to remand must be granted.
Plaintiffs originally filed this cause of action in the Circuit Court of the City of St. Louis against defendants for claims involving the prescription drug Paxil® ("Paxil"). Plaintiffs are mothers who filed the action as next friends of their minor children claiming that their minor children suffered congenital birth defects, disorders, and/or related illnesses as a result of their own ingestion during pregnancy of Paxil. Plaintiffs allege that Paxil was researched, developed, tested, manufactured, promoted, marketed, labeled, and distributed by defendants SmithKline Beecham Corporation d/b/a GlaxoSmithKline, and GlaxoSmithKline, LLC ("defendants"). Plaintiffs allege that Paxil's design is unreasonably dangerous and defective; that defendants knew or should have known that Paxil use during pregnancy posed an increased risk of congenital birth defects and other malformations; that defendants failed to adequately warn doctors and the consuming public of such risks; that defendants failed to properly test, study, and report the adverse effects of Paxil use during pregnancy on the developing fetus; that defendants marketed Paxil using false and misleading information with regard to safety and efficacy; and that, in doing all of the foregoing, defendants acted with evil motive or reckless disregard for the rights of the plaintiffs and the public. Plaintiffs' third amended complaint alleges claims of negligence and negligence per se, negligent pharmaco-vigilance, strict liability failure to warn, and fraud and seeks actual and punitive damages.
Plaintiffs are citizens of 32 states including Missouri and Delaware. Defendants are citizens of Delaware. Defendants removed this case to this Court based on diversity jurisdiction under 28 U.S.C. § 1332. In their notice of removal, defendants allege that the one plaintiff who is a citizen of Delaware is fraudulently joined and fraudulently misjoined. Defendants submitted pharmacy records showing the non-diverse plaintiff's Paxil prescription was not filled. More than thirty days after they were served, defendants filed a motion for leave to file an amended notice of removal adding facts and argument in support of their fraudulent joinder argument, alleging that the non-diverse plaintiff's claim is barred by the applicable statute of limitations.
Plaintiffs filed a motion to remand requesting that this Court remand this matter to the Circuit Court of the City of St. Louis pursuant to 28 U.S.C. § 1447(c) because the Court lacks jurisdiction as the non-diverse plaintiff is not fraudulently joined or fraudulently misjoined. Plaintiffs submitted pharmacy records showing that the non-diverse plaintiff's Paxil prescription was filled during her pregnancy. The defendants oppose remand alleging that the non-diverse plaintiff is fraudulently joined as the allegations in the complaint with regard to her claim fail to state a claim and her claim is barred by the applicable statute of limitations. Additionally, defendants allege that the non-diverse plaintiff is fraudulently misjoined because the plaintiffs' varied claims fail to satisfy the basic requirements for permissive joinder in that they do not arise out of the same transaction, occurrence, or series of transactions or occurrences.
II. Legal Standard - Jurisdiction, Removal, and Remand
The Eighth Circuit has admonished district courts to "be attentive to a satisfaction of jurisdictional requirements in all cases." Sanders v. Clemco Industries, 823 F.2d 214, 216 (8th Cir. 1987). "Only state court actions that originally could have been filed in federal court may be removed to federal court by the defendant." Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987). 28 U.S.C. § 1332(a) provides that "district courts shall have original jurisdiction of all civil actions where the matter in controversy... is between citizens of different states." "Complete diversity of citizenship exists where no defendant holds citizenship in the same state where any plaintiff holds citizenship." In re Prempro, 591 F.3d at 620 (quoting OnePoint Solutions, LLC v. Borchert, 486 F.3d 342, 346 (8th Cir.2007)). "[I]n a case where there are plural plaintiffs and plural defendants a federal court does not have diversity jurisdiction unless there is diversity between all plaintiffs and all defendants." Iowa Public Service Co. v. Medicine Bow Coal Co., 556 F.2d 400, 403-04 (8th Cir. 1977).
28 U.S.C. § 1441 and § 1446 govern removal of a state court action to federal court. Pursuant to § 1446(b), "[t]he notice of removal of a civil action or proceeding shall be filed within 30 days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based...." A notice of removal may be amended during the 30 day period during which the removal may be filed. Whitehead v. The Nautilus Group, Inc., 428 F.Supp.2d 923, 928-29 (W.D. Ark. 2006); Lindsey v. Dillard's, Inc., 306 F.3d 596, 600 (8th Cir. 2002). However, the notice can only be amended to add specific facts supporting the originally stated grounds for removal or to clarify the grounds for removal as stated in the original notice. Id. The amendment cannot add new grounds for removal once the 30 day period has expired. Id.
"A motion to remand the case on the basis of any defect other than lack of subject matter jurisdiction must be made within 30 days after the filing of the notice of removal under section 1446(a)." 28 U.S.C. § 1447(c). The party invoking federal jurisdiction bears the burden of showing that all prerequisites to jurisdiction are satisfied. Hatridge v. Aetna Cas. & Sur. Co., 415 F.2d 809, 814 (8th Cir. 1969). "[A]ll doubts about federal jurisdiction [are resolved] in favor of remand." Transit Cas. Co. v. Certain Underwriters at Lloyd's of London, 119 F.3d 619, 625 (8th Cir. 1997).
Plaintiffs move for remand on the grounds that there is not complete diversity between plaintiffs and defendant. Defendants oppose remand arguing that the plaintiffs fraudulently joined and fraudulently misjoined the non-diverse plaintiff for the sole purpose of defeating diversity jurisdiction and her presence should be disregarded in determining jurisdiction.
A. Fraudulent Joinder
"Fraudulent joinder occurs when a plaintiff files a frivolous or illegitimate claim against a non-diverse [party] solely to prevent removal." In re Prempro Products Liability Litigation, 591 F.3d 613, 620 (8th Cir. 2010) (citing Filla v. Norfolk S. Ry. Co., 336 F.3d 806, 809 (8th Cir. 2003)). The removing party alleging fraudulent joinder bears the burden of proving the alleged fraud. Manning v. Wal-Mart Stores East, Inc., 304 F.Supp.2d 1146, 1148 (E.D. Mo. 2004). To prove fraudulent joinder of a diversity-destroying plaintiff, the defendant seeking removal must prove that the diversity-destroying plaintiff's claim has "no reasonable basis in fact and law." Knudson v. Systems Painters, Inc., 634 F.3d 968, 980 (8th Cir. 2011) (quoting Filla, 336 F.3d at 810). This determination must be made in accordance with the standard set forth in Filla v. Norfolk Southern Ry. Co. as opposed to the Rule 12(b)(6) dismissal standard. Knudson, 634 F.3d at 979-80. By requiring proof that the non-diverse party's claim has no reasonable basis in law and fact, the court requires more than mere proof that the claim should be dismissed pursuant to a Rule 12(b)(6) ...