Products Liability Law Reporter

A federal district court held that removal to federal court was improper in a mesothelioma lawsuit where the defendant that removed the case failed to demonstrate that the plaintiff had no possibility of prevailing against a non-diverse defendant.

Janis Friend was an art teacher and jewelry making instructor at Fort Huachuca from 1977 to 1979. Years later, her daughter brought an Arizona state court action against various companies for wrongful death, claiming that Friend had developed mesothelioma from her exposure to asbestos-containing products while working at Fort Huachuca. The lawsuit, naming Grobet File Co. of America, LLC, and Posner’s Art Store, Inc., among others, alleged negligence, strict liability, and intentional failure to warn; and sought punitive damages. Grobet filed a notice of removal to federal court on the basis of diversity jurisdiction, as well as enclave jurisdiction. Grobet claimed that Arizona-based Posner’s should be disregarded for purposes of determining diversity because the defendant was fraudulently joined. The plaintiff moved to remand to state court.

Granting the motion to remand, the court found that a state court action is removable only if none of the defendant-parties in interest is a citizen of the state in which the action is brought. Citing case law, the court added that the burden of establishing federal jurisdiction is on the party seeking removal, and the removal statute is strictly construed against removal. Nevertheless, the court said that the defendant seeking removal is entitled to present facts showing that joinder is fraudulent.

Applying these principles, the court rejected the defense argument that the plaintiff’s lack of specific allegations against Posner’s Art Store warrants a finding of fraudulent joinder. This point is not dispositive, the court said, noting that to determine fraudulent joinder, the standard is whether there is a possibility that a state court would find that a complaint states a cause of action against the non-diverse defendant. Here, the court held that the plaintiff alleges colorable claims against Posner’s for negligence, strict liability, and failure to warn, and, therefore, Grobet has not demonstrated that there is no possibility the plaintiff could prevail against Posner’s, warranting diversity jurisdiction.

Consequently, the court remanded for further proceedings in state court.

Citation: Hatten v. Grobet USA, 2020 WL 4282276 (D. Ariz. July 27, 2020).

Plaintiff counsel: AAJ member Melissa C. Schopfer, AAJ member Jean-Michel LeCointre, and Timothy Stackhouse, all of Alton, Ill.; and AAJ member Suvir Dhar and Peter Limperis, both of Tucson.