Opinion
Case No. 2:03 cv 305 PGC
September 16, 2003
ORDER GRANTING MOTION TO REMAND
This wrongful death action is before the court on the plantiff s motion to remand to state court. Plaintiff, the estate of Mr. Geary Taylor ("Taylor's estate"), initially filed this action in state court. Shortly thereafter, defendant Pacificorp, Inc., removed the action to this court on the basis of diversity of citizenship. The Taylors then filed the pending motion to remand to state court, alleging incomplete diversity. The Taylors argue that their complaint properly alleges a cause of action against the other defendant, Thomas Davis, who is a Utah citizen. The court agrees and therefore GRANTS the motion to remand because diversity is not complete.
Statement of Facts
In December 2002, Mr. Geary Taylor, while employed with the Castle Valley Cooperative, delivered fuel to Pacificorp's Huntington Power Plant in Huntington, Utah. (Pacificorp did business there as "Pacificorp Electric Operations.") While delivering fuel to the plant, Taylor tragically fell to his death from a ladder owned and maintained by Pacificorp Electric Operations. Taylor's estate alleges in its complaint that defendant Thomas Davis, Director of Safety for Pacificorp Electric Operations and a resident of Utah, was aware the ladder was defective, unsafe, and presented a danger to Mr. Taylor, but took no corrective action.Taylor's estate filed a cause of action for wrongful death alleging that the ladder in question should have had a cage enclosing it to comply with federal and state safety guidelines. It further claimed that Mr. Davis breached his duty to provide a safe working environment, and that he failed to inspect the premises for unsafe conditions. Specifically, the estate contends that other similar ladders at the Huntington facility had cages. The estate claim that the negligence of both defendants caused Mr. Taylor's death.
Discussion
After Pacificorp removed this case, Taylor's estate filed a motion to remand, alleging incomplete diversity of citizenship on two grounds: first, that it had properly alleged a cause of action against defendant Davis and that, as a resident of Utah, he defeats diversity jurisdiction; and, second, that Pacificorp Electric has sufficient ties with Utah to establish a principal place of business in Utah. The court finds it necessary to address only the first of these two grounds.
Pacificorp claims that Davis is a "sham" party and that this court should therefore disregard his status as a defendant. A non-diverse party named in the state court action may be disregarded if a federal court determines that the party's joinder is a "sham" or "fraudulent" so that no possible cause of action has been stated against that party. The term "fraudulent" is not used in the tort sense; no intent to deceive or bad motive on plaintiff's part need be shown. Nonetheless, the showing that must be made is a difficult one. This court may only retain this case if Taylor's estate can allege "no cause of action whatsoever" under Utah law against Mr. Davis personally. Sham joinder is not shown simply by demonstrating that the plaintiff has a weak case, as any "possibility" of recovery is sufficient. The burden of making these difficult showings falls squarely on Pacificorp.
Schwarzer, Tashima, and Wagstaffe, Federal Civil Procedure before Trial § 2:670 (2003) ( citing Farias v. Bexar County Bd. of Trustees, 925 F.2d 866, 871 (5th Cir. 1991) Triggs v. John Crump Toyota, Inc., 154 F.3d 1284, 1287 (11th Cir. 1998)).
Id. at § 2:671.
Id. at § 2:672.
Dodson v. Spiliada Maritme Corp., 951 F.2d 40, 42 (5th Cir. 1992).
Jernigan v. Ashland Oil, Inc., 989 F.2d 812, 815 (5th Cir. 1993).
Taylor's estate alleges two grounds for personally liability of Mr. Davis under Utah law: first, that as a "managing officer" of a corporation, he owed a duty to third-party business invitees to maintain the ladders in safe condition; and, second, that under Restatement (Second) of Torts § 324A, Mr. Davis can be found personally liable under Utah law. To dispose of this motion, it is necessary to only discuss the first cause of action. Taylor's estate alleges that Mr. Davis can be held personally liable under Utah law from his failure, as the managing officer of a corporation, to ascertain the unsafe condition of the ladder. In support, the estate cites a 1936 case from the Utah Supreme Court — Kaumans v. White Star Gas Oil Co. Though Kaumans relates to a duty owed to an employee, Taylor's estate argues that this duty is also owed to a third-party business invitee. It is unclear to this court whether Taylor's estate's somewhat novel argument will ultimately succeed. It is clear to the court, however, that Pacificorp has failed to carry its burden of demonstrating that the estate has no "possibility" of prevailing on it argument — the standard required at this juncture. Accordingly, Davis has not been fraudulently joined in this case.
63 P.2d 231, 237-38 (Utah 1936).
Because Davis is a proper party to this suit (at this time), diversity is not complete and this court lacks jurisdiction. As a result, the case is remanded to state court.
Conclusion
The court REMANDS this action to state court. The clerk of the court is directed to CLOSE THIS CASE.