DAVID ALAN EZRA, Senior District Judge.
Before the Court is a Motion for Joinder and Motion to Remand (Dkt. # 24) filed by Plaintiffs Maria Barragan and Angel Alvarez as next friend to A.A. Jr., A.A., and A.A. (collectively, "Plaintiffs") and Ruby Campas ("Campas") as next friend to N.B. and A.B. Also before the Court is a Motion to Intervene filed by Campas (Dkt. # 14). At the hearing, Robert P. Woodliff, Esq., represented Plaintiffs, Raymond D. McElfish, Esq., represented Campas, David R. Montpas, Esq., represented Defendant General Motors LLC ("GM"), and David A. Rich represented Defendants U-Haul International, Inc. ("U-Haul") and AMERCO. After careful consideration of the supporting and opposing memoranda and the arguments presented at the hearing, the Court
On August 27, 2012, Isabel Barragan Mendoza ("Mendoza") was driving on I-10 with Juan Barragan, her brother, in the passenger's seat. (Ex. A-3, Dkt. # 1-6 at 5.) Mendoza was driving a 2004 GMC Envoy. (Id.) Mendoza lost control of the vehicle, which rolled over, resulting in the deaths of both Mendoza and Juan Barragan. (Id.)
Plaintiff Maria Barragan ("Barragan") is the mother of the decedents.
Defendants jointly removed the action to this Court on December 22, 2014, invoking the Court's diversity jurisdiction. (Dkt. # 1.) On the Plaintiffs' side, Barragan is a California citizen, and Alvarez's children are citizens of South Carolina.
On January 23, 2015, Campas, as next friend to N.B. and A.B., the children of decedent Juan Barragan, filed a Motion to Intervene pursuant to Rule 24 of the Federal Rules of Civil Procedure. (Dkt. # 14.) GM filed a Response in opposition to the Motion (Dkt. # 16), Campas filed a Reply (Dkt. # 19), and GM filed a Sur-reply (Dkt. # 26-1). U-Haul and AMERCO jointly filed a Response opposing the Motion to Intervene. (Dkt. # 27.)
On February 5, 2015, Plaintiffs and Campas jointly filed a Motion for Joinder and Motion to Remand seeking to join Campas under Rule 20 of the Federal Rules of Civil Procedure and remand to state court. (Dkt. # 23.) Campas did not contemporaneously withdraw her Motion to Intervene, which is therefore still before the Court. Defendants jointly filed a Response stating that they do not oppose joining Campas, but oppose the Motion to Remand. (Dkt. # 32.)
Rule 24 of the Federal Rules of Civil Procedure provides for intervention as of right as well as permissive intervention. Under Rule 24(a),
Fed.R.Civ.P. 24(a). To intervene under Rule 24(a)(2),
Ford v. City of Huntsville, 242 F.3d 235, 239 (5th Cir.2001). Each of the four requirements must be satisfied. Id.
Under Rule 24(b), "On timely motion, the court may permit anyone to intervene who: (A) is given a conditional right to intervene by a federal statute; or (B) has a claim or defense that shares with the main action a common question of law or fact." Fed.R.Civ.P. 24(b)(1). "In exercising its discretion, the court must consider whether the intervention will unduly delay
Rule 20 of the Federal Rules of Civil Procedure provides that plaintiffs may be joined in an action if they assert any right to relief jointly, severally, or in the alternative with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences, and any question of law or fact common to all plaintiffs will arise in the action. Fed.R.Civ.P. 20(a)(1). "Courts have described Rule 20 as creating a two-prong test, allowing joinder of plaintiffs when (1) their claims arise out of the `same transaction, occurrence, or series of transactions or occurrences' and when (2) there is at least one common question of law or fact linking all claims." Acevedo v. Allsup's Convenience Stores, Inc., 600 F.3d 516, 521 (5th Cir.2010).
"Generally, a permissive joinder of plaintiffs under Federal Rule of Civil Procedure 20 is at the option of the plaintiffs...." Applewhite v. Reichhold Chemicals, Inc., 67 F.3d 571, 574 (5th Cir.1995). However, "district courts have the discretion to refuse joinder in the interest of avoiding prejudice and delay, ensuring judicial economy, or safeguarding principles of fundamental fairness." Acevedo, 600 F.3d at 521 (citations omitted).
A defendant may remove to federal court any civil action brought in state court over which the district court would have had original jurisdiction. 28 U.S.C. § 1441(a); Mumfrey v. CVS Pharmacy, Inc., 719 F.3d 392, 397 (5th Cir.2013). Original jurisdiction may be based on either diversity of citizenship or the existence of a federal question. Halmekangas v. State Farm Fire & Cas. Co., 603 F.3d 290, 295 (5th Cir.2010). On a motion to remand, the removing party bears the burden of establishing that one of these bases of jurisdiction exists. Shearer v. Sw. Serv. Life Ins. Co., 516 F.3d 276, 278 (5th Cir. 2008). Diversity jurisdiction exists where the amount in controversy exceeds $75,000 and there is complete diversity of citizenship between the parties — in other words, every plaintiff must be diverse from every defendant. 28 U.S.C. § 1332(a); Caterpillar Inc. v. Lewis, 519 U.S. 61, 68, 117 S.Ct. 467, 136 L.Ed.2d 437 (1996); Harvey v. Grey Wolf Drilling Co., 542 F.3d 1077, 1079 (5th Cir.2008).
To determine whether jurisdiction is present, the court considers the claims in the state court petition as they existed at the time of removal. Louisiana v. Am. Nat'l Prop. Cas. Co., 746 F.3d 633, 637 (5th Cir.2014) (citing Cavallini v. State Farm Mut. Auto Ins. Co., 44 F.3d 256, 264 (5th Cir.1995)). Because removal jurisdiction implicates federalism concerns, all ambiguities must be construed in favor of remand. Barker v. Hercules Offshore, Inc., 713 F.3d 208, 212 (5th Cir.2013) (citing Manguno v. Prudential Prop. & Cas. Co., 276 F.3d 720, 723 (5th Cir.2002)).
Campas first sought to join this suit by intervening under Rule 24 of the Federal Rules of Civil Procedure. (Dkt. # 14.) Although Campas has not withdrawn her Motion to Intervene, Campas, with Plaintiffs, filed a joint Motion for
Under § 1367(b), in a civil action in which a district court's original jurisdiction is founded solely on its diversity jurisdiction, a district court does not have supplemental jurisdiction over claims by persons seeking to intervene as plaintiffs under Rule 24 when exercising jurisdiction over such claims would be inconsistent with the jurisdictional requirements of § 1332. § 1367(b). Here, Campas is not diverse from all Defendants — both U-Haul and Campas, through her children, are Arizona citizens. (Dkt. # 24 ¶ 4; Dkt. # 1 at 4.) Her intervention would therefore be inconsistent with 28 U.S.C. § 1332, which requires that all plaintiffs be diverse from all defendants. Lincoln Prop. Co. v. Roche, 546 U.S. 81, 89, 126 S.Ct. 606, 163 L.Ed.2d 415 (2005). Campas's intervention is thus barred by § 1367(b), and the Court therefore
Plaintiffs and Campas have also moved to join Campas as a plaintiff under Rule 20. Because analysis of the Motion to Remand depends on the disposition of the Motion for Joinder, the Court will discuss them together.
Campas is the mother of decedent Juan Barragan's children, and the car accident that forms the basis of Plaintiffs' claims against Defendants is also the basis for Campas's claims.
However, as discussed above, Campas is not diverse from all Defendants — both U-Haul and Campas, through her children, are Arizona citizens. (Dkt. # 24 ¶ 4; Dkt. # 1 at 4.) The Federal Rules of Civil Procedure "do not extend ... the jurisdiction of the district courts." Fed.R.Civ.P. 82. The Supreme Court has consistently interpreted 28 U.S.C. § 1332, the statute governing diversity jurisdiction, to require complete diversity between all plaintiffs and all defendants. Lincoln Prop. Co. v. Roche, 546 U.S. 81, 89, 126 S.Ct. 606, 163 L.Ed.2d 415 (2005) (citing Caterpillar Inc., 519 U.S. at 68, 117 S.Ct. 467); Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 553, 125 S.Ct. 2611, 162 L.Ed.2d 502 (2005) ("In a case with multiple plaintiffs and multiple defendants, the presence in the action of a single plaintiff from the same State as a single defendant deprives the district court of original diversity jurisdiction over the entire action."). The purpose of the diversity requirement is
Allapattah, 545 U.S. at 553-54, 125 S.Ct. 2611.
Defendants, seeking to remain in federal court, contend that the Court can allow Campas to join as a co-plaintiff under Rule 20 and continue to exercise jurisdiction over the case. (Dkt. # 32 at 4.) Defendants argue that the Court can exercise supplemental jurisdiction over Campas's claims because Campas's claims are not specifically excluded from the Court's supplemental jurisdiction under 28 U.S.C. § 1367(b). (Id.) Under § 1367(a), "in any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy." § 1367(a). Such supplemental jurisdiction includes claims that involve the joinder or intervention of additional parties. Id. Under § 1367(b), in a civil action in which a district court's original jurisdiction is founded solely on its diversity jurisdiction, a district court does not have supplemental jurisdiction over (1) claims by plaintiffs against persons made parties under Rules 14, 19, 20, or 24 of the Federal Rules of Civil Procedure, or (2) claims by persons proposed to be joined as plaintiffs under Rule 19 or seeking to intervene as plaintiffs under Rule 24, when exercising jurisdiction over such claims would be inconsistent with the jurisdictional requirements of § 1332. § 1367(b). Because Campas seeks to be joined as a plaintiff under Rule 20, Defendants argue, Campas's claims fall within the broad grant of supplemental jurisdiction governed by § 1367(a): "all other claims" that form part of the same case or controversy.
Defendants' argument, however, is foreclosed by the well-established Supreme Court precedent discussed above: for a district court to have jurisdiction under 28 U.S.C. § 1332, all plaintiffs must be diverse from all defendants. See Lincoln Prop. Co. v. Roche, 546 U.S. 81, 89, 126 S.Ct. 606, 163 L.Ed.2d 415 (2005) (citing Caterpillar Inc., 519 U.S. at 68, 117 S.Ct. 467); Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 267, 2 L.Ed. 435 (1806). "A failure of complete diversity ... contaminates every claim in the action." Allapattah, 545 U.S. at 564, 125 S.Ct. 2611. While jurisdiction is generally determined as of the time the suit is filed, "addition of a nondiverse party will defeat jurisdiction." Hensgens v. Deere & Co., 833 F.2d 1179, 1180-81 (5th Cir.1987).
The Supreme Court has explicitly applied the complete diversity requirement to supplemental jurisdiction: "neither the convenience of litigants nor considerations of judicial economy can suffice to justify extension of the doctrine of ancillary jurisdiction," the predecessor of statutory supplemental jurisdiction, "to a plaintiff's cause of action against a citizen of the same state in a diversity case." Owen Equip. & Erection Co. v. Kroger, 437 U.S. 365, 377, 98 S.Ct. 2396, 57 L.Ed.2d 274 (1978). Defendant's reliance on § 1367 is therefore misplaced. Because Campas shares Arizona citizenship with U-Haul, allowing her to join as a co-plaintiff under Rule 20 would destroy the Court's jurisdiction over this action and require remand. "Incomplete diversity destroys original jurisdiction with respect to all claims, so there is nothing to which supplemental jurisdiction can adhere." Allapattah, 545 U.S. at 554, 125 S.Ct. 2611.
The exceptions set out in § 1367(b) were intended to prevent a plaintiff from circumventing the complete diversity requirement by bringing suit in federal court against diverse defendants and later asserting claims against subsequently joined nondiverse parties. See H.R.Rep. No. 101-734, at 29 n. 16 (1990), 1990 U.S.C.C.A.N. 6860, 6875 (stating that "The net effect of subsection (b) is to implement the principal rationale of Owen Equipment & Erection Co. v. Kroger, 437 U.S. 365, 98 S.Ct. 2396, 57 L.Ed.2d 274 (1978)," which held that a district court did not have ancillary jurisdiction over a state-law claim asserted by the plaintiff against a nondiverse third-party defendant because allowing such jurisdiction would permit "a plaintiff [to] defeat the statutory requirement of complete diversity by the simple expedient of suing only those defendants who were of diverse citizenship and waiting for them to implead nondiverse defendants," 437 U.S. at 376-77, 98 S.Ct. 2396); see also id. at 28 ("In diversity cases, the district courts may exercise supplemental jurisdiction, except when doing so would be inconsistent with the jurisdictional requirements of the diversity statute."). Disallowing claims by parties joined as plaintiffs under Rules 19 and 24 similarly ensures that the complete diversity requirement cannot be avoided by omitting nondiverse plaintiffs from the original suit and later allowing them to intervene or be joined. See Allapattah, 545 U.S. at 565, 125 S.Ct. 2611 (noting that Congress may have been "concerned that extending supplemental jurisdiction to Rule 19 plaintiffs would allow circumvention of the complete diversity rule"). Asserting jurisdiction over Campas's claims here would present the same problem — co-plaintiffs could evade, and indeed eviscerate, the complete diversity requirement by having only the diverse plaintiff bring suit in federal court and later joining the non-diverse plaintiff under Rule 20.
The Court recognizes that Defendants' argument is not without basis. Shortly after enactment of § 1367, three law professors who participated in drafting the provision noted:
Thomas D. Rowe, Jr., Stephen B. Burbank, & Thomas M. Mengler, Compounding or Creating Confusion About Supplemental Jurisdiction? A Reply to Professor
In Allapattah, the Supreme Court held that § 1367 grants supplemental jurisdiction over claims in which some but not all plaintiffs in a diversity action satisfy the amount in controversy requirement of § 1332. 545 U.S. at 566, 125 S.Ct. 2611. While it did not address the precise issue of joinder under Rule 20 in the context of the complete diversity rule, the Court explicitly distinguished between the amount in controversy requirement and the complete diversity requirement: "Though the special nature and purpose of the diversity requirement mean that a single nondiverse party can contaminate every other claim in the lawsuit, the contamination does not occur with respect to jurisdictional defects that go only to the substantive importance of individual claims" — that is, defects involving the amounts in controversy asserted by individual plaintiffs. Id. The Supreme Court held that "the presence of a claim that falls short of a minimum amount in controversy does nothing to reduce the importance of the claims that do meet this requirement," but noted, by contrast, that "the presence of nondiverse parties on both sides of a lawsuit eliminates the justification for providing a federal forum." Id. at 562, 125 S.Ct. 2611.
The Second Circuit, interpreting Allapattah, reached the same conclusion — "Exxon makes clear that its expansive interpretation of § 1367 does not extend to additional parties whose presence defeats diversity." Merrill Lynch & Co. Inc. v. Allegheny Energy, Inc., 500 F.3d 171, 179 (2d Cir.2007). Defendants argue that the Second Circuit's opinion misreads Allapattah by failing to appreciate the distinction between original jurisdiction and supplemental jurisdiction — while complete diversity is required for the former, Defendants argue, it is not required for the latter. (Dkt. # 50-1 at 4.) The Supreme Court's discussion of the complete diversity requirement, however, makes no such distinction. While Allapattah did not directly address the situation here, nothing in its reasoning suggests that a district court in a diversity action may exercise supplemental jurisdiction over the state law claims of a nondiverse plaintiff — over which it certainly would not have had jurisdiction if the nondiverse plaintiff been present at the time of removal — simply because the nondiverse plaintiff was joined later under Rule 20.
A more recent Second Circuit decision, presented with the same procedural posture at issue in this case, confirmed its previous holding — "federal subject matter jurisdiction under Section 1332(a)(3) requires complete diversity of all parties, regardless of how they joined the action." Pa. Pub. Sch. Emps. Ret. Sys. v. Morgan Stanley & Co., Inc., 772 F.3d 111, 119 (2d Cir.2014). In Morgan Stanley, a party permissively added as a plaintiff under Rule 20 after the suit had been commenced was a state entity, and thus was not diverse for the purpose of § 1332. Id. at 118. It argued, as Defendants do here, that it could nevertheless remain in the suit based on the district court's supplemental jurisdiction because § 1367(b) does not exclude plaintiffs joined under Rule 20. Id. Noting that "the discussions of complete diversity in Exxon and Merrill Lynch follow a long line of cases" requiring complete diversity between all plaintiffs and all defendants, the Second Circuit held that the district court did not have subject matter jurisdiction over the nondiverse party's claims. Id. at 119.
The D.C. Circuit has also considered and rejected Defendants' argument. In In re Lorazepam & Clorazepate Antitrust Litigation, defendants objected on appeal that plaintiffs, who were not originally named as plaintiffs but who were in fact the real parties in interest, were not completely diverse from all defendants. 631 F.3d 537, 539-40 (D.C.Cir.2011). The plaintiffs, citing Allapattah, argued that once the district court had jurisdiction over the named plaintiffs, it could exercise supplemental jurisdiction over the additional plaintiffs. Id. at 541. The D.C. Circuit, finding that the Supreme Court in Allapattah made clear that it was not overturning its longstanding requirement of complete diversity, ruled that the presence of a nondiverse party deprived the district court of jurisdiction over any of the claims, leaving nothing to which supplemental jurisdiction could attach. Id. at 541-42.
The Court further notes that several district courts have considered the complete diversity requirement with regard to the joinder of additional parties in light of Allapattah and found that supplemental jurisdiction cannot be used to circumvent the requirement that all plaintiffs be diverse from all defendants. See Abu Dhabi Commercial Bank v. Morgan Stanley & Co. Inc., 921 F.Supp.2d 158, 161-63 (S.D.N.Y.2013), aff'd by Pa. Pub. Sch. Emps. Ret. Sys., 772 F.3d 111, 119 (2d Cir.2014); Tuttobene v. Assurance Grp., Inc., No. 3:10-0978, 2012 WL 2871848, at *3 (M.D.Tenn. July 12, 2012); Jonsson v. Nat'l Feeds, Inc., No. 2:11-CV-00140BSJ, 2012 WL 425274, at *4-6 (D.Utah Feb. 9, 2012). Wright and Miller's treatise on federal jurisdiction reaches the same conclusion. See Charles Alan Wright & Arthur R. Miller, 13E Federal Practice & Procedure Jurisdiction § 3506 (3d ed.) (stating that "Justice Kennedy's opinion for the Court [in Allapattah] drew a sharp distinction between the requirement of complete diversity and that of jurisdictional amount," and that "[b]ecause the Allapattah
The Court notes that the situation presented here is relatively unusual. In cases removed based on diversity of citizenship, it is far more common for a plaintiff to subsequently seek to join additional defendants, who may not be diverse from the plaintiff.
The question before the Court is thus whether to deny joinder or to allow joinder and remand to state court. The addition of nondiverse defendants by a plaintiff is governed by 28 U.S.C. § 1447(e), which provides that where a plaintiff seeks to join, after removal, additional defendants whose joinder would destroy subject matter jurisdiction, the court may either deny joinder or permit joinder and remand the action to the State court. § 1447(e). Here, however, Plaintiffs seek to join a co-plaintiff, and the statute is thus not applicable.
Without analogous statutory guidance with respect to the joinder of co-plaintiffs, and finding no authority for the proposition that the Court may apply to this situation the balancing of interests set out by the Fifth Circuit for joinder of nondiverse defendants, see Hensgens, 833 F.2d at 1181, the Court's decision must be based on the jurisdictional requirements of § 1332 alone. Because Campas is not diverse from all Defendants, the Court cannot assume jurisdiction over Campas's claims. § 1332(a); see also 13E Federal
Absent Campas's claims, all Plaintiffs remain completely diverse from all Defendants, and jurisdiction is therefore proper under § 1332(a). The Court therefore
For the foregoing reasons, the Court
Id. (citation omitted).
Finally, Sunpoint Sec., Inc. v. Porta, 192 F.R.D. 716 (M.D.Fl.2000), is of limited persuasiveness because it was decided before the Supreme Court's discussion of the complete diversity requirement in Allapattah. The court in that case, while recognizing that the Rule 20 joinder of a co-plaintiff "destroys diversity," nevertheless allowed the co-plaintiff to be joined because claims by plaintiffs under Rule 20 were not expressly disallowed by § 1367(b). Id. at 719. As discussed above, however, the fact that the claims of a plaintiff seeking to join under Rule 20 is not excluded from the court's supplemental jurisdiction by § 1367(b) does not mean that a court may exercise supplemental jurisdiction over a nondiverse plaintiff in a diversity action under § 1367(a).