George Donner v. Alcoa, Inc. ( 2013 )

United States Court of Appeals
For the Eighth Circuit
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No. 12-1415
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George A. Donner; Christine L. Donner
lllllllllllllllllllll Plaintiffs - Appellees
v.
Alcoa, Inc.
lllllllllllllllllllll Defendant - Appellant
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Appeal from United States District Court
for the Western District of Missouri - Kansas City
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Submitted: September 20, 2012
Filed: March 6, 2013
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Before BYE, GRUENDER, and SHEPHERD, Circuit Judges.
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BYE, Circuit Judge.
George Donner sued Alcoa, Inc., in Missouri state court. Donner alleged he
contracted pulmonary fibrosis after working with aluminum for many years and that
Alcoa failed to warn him of the dangers associated with the use of its aluminum
products. After Alcoa removed the case to federal court, Donner moved to voluntarily
dismiss his action. He stated an intention to add his Missouri employer to a new suit
in state court, thereby destroying diversity jurisdiction. The district court granted the
motion. Alcoa appeals contending the joinder of Donner's employer would be
"fraudulent" in the procedural sense. We agree and therefore reverse and remand for
further proceedings.
I
Donner worked with aluminum products for twenty-seven years. He was
employed by Western Forms, a company in Kansas City, Missouri, that manufactures
aluminum forms and related accessories for the pouring of concrete walls and other
concrete structures. Employees of Western Forms cut, saw, grind, weld and otherwise
process and manipulate aluminum sheet stock. Donner started his career as a grinder,
a person who grinds the weld spots off of aluminum products. He worked his way up
through the company, advancing to a machine operator, welder, supervisor, manager,
and eventually vice president and general manager, all the while being exposed to raw
aluminum. Donner then retired from Western Forms to start his own construction
business. Two years later, he sought medical treatment after suffering from a sudden,
violent coughing attack. A biopsy revealed small aluminum particles embedded in
Donner's lungs. He was diagnosed with pulmonary fibrosis resulting from exposure
to aluminum. He had a double lung transplant at the age of forty-nine.
In July 2010, Donner brought suit against aluminum manufacturer Alcoa stating
claims for (a) strict liability–design defect; (b) strict liability–failure to warn; (c)
negligent design and failure to warn; and (d) a loss of consortium claim on behalf of
his wife. The suit was brought in Missouri state court. In September 2010, Alcoa
removed the action to federal district court based on diversity jurisdiction: the
Donners are Missouri residents and Alcoa is a Pennsylvania corporation with its
principal place of business in New York.
While Donner's case was pending in federal court, the Missouri Court of
Appeals decided KCP&L Greater Missouri Operations Co. v. Cook, 353 S.W.3d 14
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(Mo. Ct. App. 2011), which addressed whether the exclusive remedy provisions of
workers' compensation laws applied to an employee's contraction of mesothelioma
due to asbestos exposure in the workplace. The court held contracting the
occupational disease of mesothelioma did not constitute an injury "by accident" under
workers' compensation laws and thus did not preclude an employee's common law
claims for premises liability and negligence against his own employer. Id. at 19-20.
Relying upon Cook, Donner filed a motion to voluntarily dismiss his federal
action pursuant to Rule 41(a)(2) of the Federal Rules of Civil Procedure. Donner
stated his intention to add Western Forms as a defendant. Because the addition of
Western Forms would destroy diversity jurisdiction, Donner sought voluntary
dismissal of his federal action so he could refile his claim in state court.
Alcoa opposed the motion. Noting Donner had failed to present any expert
medical evidence to connect his lung condition to products made or sold by Alcoa (the
deadline for disclosing experts expired on the same day Donner brought his motion
for voluntary dismissal),1 Alcoa argued Donner was simply attempting to avoid a
dismissal on the merits. Alcoa further argued Donner was forum shopping by seeking
to take advantage of more relaxed expert evidence standards in state court. Finally,
Alcoa contended Donner's stated intention for seeking a dismissal of the federal action
– to add Western Forms as a defendant – was improper because Donner had already
received workers' compensation benefits for his injuries and therefore Missouri's
election of remedies doctrine would bar a tort suit against Western Forms.
1
Although Alcoa had agreed to allow Donner to seek an extension of the
deadline for disclosing experts, Alcoa's consent was conditioned on the case
remaining in federal court. Donner's motion for voluntary dismissal, if successful,
would mean the case would not remain in federal court.
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Without considering whether Donner's purported claims against Western Forms
were legally viable, the district court granted Donner's motion for voluntary dismissal
and entered a final order dismissing the action. Alcoa filed a timely appeal.
II
We review a district court's decision to allow a plaintiff to voluntarily dismiss
an action for an abuse of discretion. Thatcher v. Hanover Ins. Grp., Inc., 659 F.3d
1212, 1213 (8th Cir. 2011). The factors a district court should consider when deciding
whether to allow a voluntary dismissal include
whether the party has presented a proper explanation for its desire to
dismiss; whether a dismissal would result in a waste of judicial time and
effort; and whether a dismissal will prejudice the defendants. Likewise,
a party is not permitted to dismiss merely to escape an adverse decision
nor to seek a more favorable forum.
Id. at 1213-14 (quoting Hamm v. Rhone–Poulenc Rorer Pharm., Inc., 187 F.3d 941,
950 (8th Cir. 1999)).
On appeal, Alcoa contends the district court abused its discretion in granting the
voluntary dismissal without addressing whether Donner's purported basis for adding
Western Forms as a defendant had a reasonable basis in fact and law. Cf. Knudson
v. Sys. Painters, Inc., 634 F.3d 968, 977-980 (8th Cir. 2011) (discussing the standard
we apply when deciding if a plaintiff is improperly attempting to join a diversity-
destroying defendant). We agree. The viability of Donner's claims against Western
Forms is relevant to determining whether Donner's purpose in seeking a voluntary
dismissal was proper or improper, and thus the district court should have considered
the issue. In Thatcher, we determined the district court abused its discretion by
declining to address a jurisdictional issue which "was at the crux of the issue of
whether the motion to dismiss was being used for the improper purpose of seeking a
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more favorable forum." 659 F.3d at 1215. Similarly, in this case, the district court
abused its discretion when it failed to consider whether Donner's purported claims
against Western Forms had a reasonable basis in fact and law, because "under the
fraudulent-joinder exception, a plaintiff cannot defeat a defendant's right of removal
by 'fraudulently joining a defendant who has no real connection with the
controversy.'" Id. at 1214 (quoting Knudson, 634 F.3d at 976). If a plaintiff has no
legally viable claim against a putative defendant, that party has no real connection
with the controversy.
Our own consideration of Donner's stated basis for the voluntary dismissal leads
us to conclude the claim against Western Forms has no reasonable basis in law. Cook
does not help Donner because he has already elected to pursue and receive workers'
compensation benefits for his injuries.2 Under Missouri's election of remedies
doctrine, "[a]n injured employee who has accepted benefits paid by his employer in
compliance with the [workers'] compensation action cannot maintain a tort action
against his employer." Ballinger v. Gascosage Elec. Corp., 788 S.W.2d 506, 516 (Mo.
1990), overruled on other grounds by Zueck v. Oppenheimer Gateway Props., 809
S.W.2d 384 (Mo. 1991); see also Neff v. Baiotto Coal Co., 234 S.W.2d 578, 580 (Mo.
2
Donner concedes he has received workers' compensation benefits. He
subsequently filed his proposed suit against both Alcoa and Western Forms in state
court, a suit Alcoa then removed to federal court. In his motion to remand this related
case to state court, Donner admitted he "has received workers' compensation benefits
under a 'Temporary Order' but no final order has been entered." See Donner v. Alcoa,
Inc., et al., No. 4:12-cv-00431-GAF, Docket #14 at 2 (W.D. Mo. May 7, 2012). The
temporary order indicates Western Forms "is liable to claimant for temporary total
disability compensation at $675.90 per week beginning on November 8, 2007 and
continuing until claimant is found to be at maximum medical improvement." Id. at
Docket #1, Exhibit B. We may take judicial notice of the matters filed in this related
case. See United States v. Evans, 690 F.3d 940, 943 (8th Cir. 2012) ("[F]ederal courts
may sua sponte take judicial notice of proceedings in other courts if they relate
directly to the matters at issue." (quoting Conforti v. United States, 74 F.3d 838, 840
(8th Cir. 1996))).
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1950) (indicating a plaintiff's election to receive monthly workers' compensation
benefits as well as hospital and medical benefits precluded the maintenance of a tort
action against his employer for personal injuries suffered on the job).
Donner argues the district court was not obligated to consider whether the
election of remedies doctrine barred his claims against Western Forms because there
has been no full and final settlement in his workers' compensation proceeding. We
disagree. The lack of a full and final settlement is immaterial to whether Donner
elected his remedy. In Neff, it was the receipt of workers' compensation benefits, not
the presence of a final award or judgment, that triggered application of the election of
remedies doctrine. 234 S.W.2d at 580. "Plaintiff's retention of the compensation
benefits constitutes an election precluding the maintenance of the 'inconsistent' tort
action." Ballinger, 788 S.W.2d at 515; see also Alexander v. Link's Landing, Inc., 814
S.W.2d 614, 620 (Mo. Ct. App. 1991) ("Where a party has a right to pursue one of
two inconsistent remedies, makes his election [and] receives something of value on
the claim, he cannot thereafter pursue another and inconsistent remedy."); Grote Meat
Co. v. Goldenberg, 735 S.W.2d 379, 386 (Mo. Ct. App. 1987) (indicating the election
of remedies doctrine is binding when "there has been a gain by the plaintiff and a loss
by the defendant").
Donner further argues the district court was not obligated to consider the
potential merits of his claims against Western Forms because election of remedies is
an affirmative defense, see Berger v. Mercantile Trust Co., 353 S.W.2d 644, 647 (Mo.
1961), and Western Forms may or may not raise the defense in state court. Donner
argues the district court was not obligated to "speculate" about the outcome of an
affirmative defense before granting a voluntary dismissal under Rule 41(a)(2). For
this proposition, Donner cites our decision in Calahan v. Rohan, 423 F.3d 815 (8th
Cir. 2005). We do not find Calahan helpful in guiding our analysis here.
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Calahan involved two New Jersey coworkers, Calahan and Rohan, who suffered
a car accident during a work-related trip to Minnesota. The district court determined
Calahan's claim against Rohan (the driver of the car) was barred by New Jersey's
Workers' Compensation Act. But instead of dismissing the claim with prejudice
following summary judgment, the district court sua sponte dismissed the claim
without prejudice, apparently to allow Calahan to pursue his claim under the theory
that the Minnesota Workers' Compensation Act should apply to his injuries rather than
New Jersey law. Id. at 818. The fighting issue in Rohan's cross appeal was whether
the district court erred when it granted a dismissal without prejudice, instead of
dismissing the claim with prejudice. See id. at 816.
In Donner's case, we are not reviewing a district court's sua sponte decision to
dismiss a claim without prejudice following summary judgment. We are reviewing
the grant of a voluntary dismissal under Rule 41(a)(2). Although Calahan analogized
to Rule 41(a)(2) precedent to address whether the district court's sua sponte dismissal
without prejudice was proper, see id. at 818 (citing Bodecker v. Local Union No. P-
46, 640 F.2d 182, 185 n.5 (8th Cir. 1981) and Hamm, 187 F.3d at 950), we believe the
analogies were made primarily for the purpose of determining what standard of review
to apply to the district court's sua sponte decision. As a result, the unique
circumstances involved in Calahan indicate we should not give its holding a broad
application. More significantly, although the district court chose not to address the
merits of Calahan's claims before granting the dismissal without prejudice, its decision
did not turn on whether Calahan's receipt of benefits under New Jersey law would
constitute an affirmative defense to his alternate claim under Minnesota law. Thus,
even if we were to give Calahan a broader reading than its unique facts justify, we do
not see how it supports Donner's claim that the district court here had no obligation
to address the application of Missouri's election of remedies doctrine on the grounds
that the doctrine is an affirmative defense.
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Instead, we read our Rule 41(a)(2) precedent as requiring a district court to
make an inquiry into whether a "party has presented a proper explanation for its desire
to dismiss." Thatcher, 659 F.3d at 1213 (quoting Hamm, 187 F.3d at 950).
Sometimes, such an inquiry will necessarily require the district court to examine the
merits of a plaintiff's proposed claims against a diversity-destroying defendant,
because an attempt to advance a nonviable claim strongly suggests a party's motive
in requesting a voluntary dismissal is merely to seek a more favorable forum.
The overall circumstances here strongly suggest Donner was merely seeking a
more favorable forum, and thus the district court should have considered whether
Donner's proposed claims against Western Forms had any merit. By the time Donner
filed his motion for voluntary dismissal, the district court had already granted
judgment on the pleadings with respect to some of Donner's claims, leaving only the
failure-to-warn claims pending.3 Moreover, the deadline for disclosing medical
experts expired on the same day Donner filed his motion for a voluntary dismissal,
and he had failed to disclose any medical experts to support his claim. Finally, Alcoa
brought the election of remedies doctrine to the district court's attention, and it is clear
to us the doctrine applies. As a result, in the context of inquiring into Donner's motive
and purpose for filing the motion for a voluntary dismissal, we believe the district
court had an obligation to address whether the doctrine would bar Donner's proposed
claims against Western Forms, and abused its discretion when it failed to do so.
3
Alcoa also appealed the district court's denial of Alcoa's motion for judgment
on the pleadings with respect to Donner's failure-to-warn claims. Vacating the
dismissal order leaves this case pending in federal court and renders the partial denial
of Alcoa's motion interlocutory in nature. We therefore decline to address Alcoa's
appeal of the partial denial of its motion.
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III
We reverse the order granting Donner's motion for voluntary dismissal and
remand this case to the district court for further proceedings.
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