Darbison v. Swearingen ( 2022 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ----oo0oo---- 11 12 HELEN DARBISON, individually; No. 2:22-cv-00760 WBS AC and ELLIE LONGANECKER, 13 individually, 14 Plaintiffs, ORDER RE: MOTION TO REMAND 15 v. 16 MICHELLE SWEARINGEN; WOODLAKE CARE GROUP LLC dba THE WOODLAKE; 17 LEISURE CARE LLC; and DOES 1 to 100, inclusive, 18 Defendants. 19 20 ----oo0oo---- 21 22 Plaintiffs brought this action in Sacramento County 23 Superior Court based on injuries plaintiff Helen Darbison 24 allegedly suffered as a resident at a residential care facility 25 operated by defendants. (See Compl. (Docket No. 1-3).) 26 Plaintiffs assert claims for elder abuse, multiple forms of 27 fraud, and negligent infliction of emotional distress. (Id.) 28 After defendants removed the case to this court, (see Notice of 1 Removal (“Notice”) (Docket No. 1)), plaintiffs filed the instant 2 motion to remand the case back to state court, (see Mot. (Docket 3 No. 9-1)).1 4 I. Factual and Procedural Background2 5 After receiving a total hip arthroplasty, being injured 6 during a fall, and suffering a stroke, plaintiff Darbison, who is 7 legally blind and auditorily impaired, moved to defendants’ The 8 Woodlake facility in June of 2021. (Compl. at ¶¶ 17-19.) Given 9 her history and conditions, the Woodlake staff, including 10 defendant Swearingen, were aware that Darbison was a high fall 11 risk and therefore required staff supervision and assistance when 12 ambulating and when using the bathroom. (Id. at ¶¶ 19-22.) 13 Nevertheless, because of significant understaffing at The 14 Woodlake, Darbison fell multiple times while residing there, 15 resulting in significant injury, and on one such occasion 16 Woodlake staff failed to send her to the hospital or promptly 17 notify her physician. (Id. at ¶¶ 23-24.) Darbison continues to 18 suffer from medical complications due to her final fall, during 19 which she sustained a significant head injury. (Id. at ¶ 25.) 20 Plaintiffs filed this action in Sacramento County 21 Superior Court on March 15, 2022. (Compl.) Defendants removed 22 to this court on May 5, 2022, based on diversity jurisdiction. 23 (Notice.) 24 1 This motion was determined to be suitable for decision 25 without oral argument pursuant to Local Rule 230(g), and the hearing on the motion, currently scheduled for July 25, 2022, at 26 1:30 p.m., is vacated. 27 2 All facts recited herein are alleged in the complaint 28 except as otherwise noted. 1 II. Discussion 2 “Under 28 U.S.C. § 1441, a defendant may remove an 3 action filed in state court to federal court if the federal court 4 would have original subject matter jurisdiction over the action.” 5 Moore-Thomas v. Alaska Airlines, Inc., 553 F.3d 1241, 1243 (9th 6 Cir. 2009). On a motion to remand, defendants bear the burden of 7 showing that federal jurisdiction is appropriate. Geographic 8 Expeditions, Inc. v. Estate of Lhotka, 599 F.3d 1102, 1107 (9th 9 Cir. 2010) (citation omitted). Where there are any doubts 10 regarding the propriety of removal, the case should be remanded. 11 Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 12 (9th Cir. 2003); see Toumajian v. Frailey, 135 F.3d 648, 653 (9th 13 Cir. 1998) (If removal was improper, “the district court lack[s] 14 subject matter jurisdiction, and the action should [be] remanded 15 to the state court.”) (citing 28 U.S.C. § 1447(c)). 16 A district court will have original jurisdiction based 17 on diversity when the amount in controversy exceeds $75,000 and 18 there is complete diversity between the parties -- i.e., “if 19 there is no plaintiff and no defendant who are citizens of the 20 same State.” 28 U.S.C. § 1332(a)(1); Wis. Dep’t of Corr. v. 21 Schacht, 524 U.S. 381, 388 (1998). In evaluating whether there 22 is complete diversity, however, “district courts may disregard 23 the citizenship of a non-diverse defendant who has been 24 fraudulently joined.” Grancare, LLC v. Thrower ex rel. Mills, 25 889 F.3d 543, 548 (9th Cir. 2018) (citing Chesapeake & Ohio Ry. 26 Co. v. Cockrell, 232 U.S. 146, 152 (1914)). 27 “There are two ways to establish fraudulent joinder: 28 ‘(1) actual fraud in the pleading of jurisdictional facts, or 1 (2) inability of the plaintiff to establish a cause of action 2 against the non-diverse party in state court.’” Id. (quoting 3 Hunter v. Philip Morris USA, 582 F.3d 1039, 1044 (9th Cir. 4 2009)). “Fraudulent joinder is established the second way if a 5 defendant shows that an ‘individual[ ] joined in the action 6 cannot be liable on any theory.’” Id. (quoting Ritchey v. Upjohn 7 Drug Co., 139 F.3d 1313, 1318 (9th Cir. 1998)) (alteration in 8 original). “But ‘if there is a possibility that a state court 9 would find that the complaint states a cause of action against 10 any of the resident defendants, the federal court must find that 11 the joinder was proper and remand the case to the state court.’” 12 Id. (quoting Hunter, 582 F.3d at 1046); see id. (noting the Ninth 13 Circuit has “upheld rulings of fraudulent joinder where a 14 defendant . . . . presents extraordinarily strong evidence or 15 arguments that a plaintiff could not possibly prevail on her 16 claims against the allegedly fraudulently joined defendant”) 17 (citations omitted); Weeping Hollow Ave. Tr. v. Spencer, 831 F.3d 18 1110, 1113 (9th Cir. 2016). “[T]he party invoking federal court 19 jurisdiction on the basis of fraudulent joinder bears a ‘heavy 20 burden’ since there is a ‘general presumption against fraudulent 21 joinder.’” Id. (quoting Hunter, 582 F.3d at 1046). 22 Defendants have not argued either means by which 23 fraudulent joinder may be established in the Ninth Circuit -- 24 (1) actual fraud in the pleadings regarding a party’s citizenship 25 or the amount in controversy or (2) plaintiffs’ inability to 26 establish any claim against Swearingen. Grancare, 889 F.3d at 27 28 1 548; (see Notice; Opp. (Docket No. 10)).3 Rather, defendants ask 2 that the court apply another standard they refer to as the “Boyer 3 intent test,” set out by the Third Circuit in Boyer v. Snap-on 4 Tools Corp., 913 F.2d 108 (3d Cir. 1990), under which fraudulent 5 joinder may be established by showing that the plaintiff has “no 6 real intention in good faith to prosecute the action against the 7 [alleged sham] defendant or seek a joint judgment.” Id. at 111 8 (citation omitted); (see Opp. at 5 (arguing that “[plaintiffs’] 9 lack of good-faith intent is an independent basis for finding 10 fraudulent joinder; no long-winded inquiry into the viability of 11 the claims is necessary”)). Under this proposed test, defendants 12 argue the procedural history of this case provides circumstantial 13 evidence that plaintiffs do not actually intend to prosecute any 14 claims against defendant Swearingen, which defendants argue 15 establishes that Swearingen was fraudulently joined. (See id. at 16 11-16.) 17 The “Boyer intent test,” however, is not the law of 18 this circuit. See Grancare, 889 F.3d at 548. Although 19 defendants acknowledge that this is the case, conceding that “the 20 Ninth Circuit has not yet adopted the Boyer intent test,” they 21 nevertheless argue this court should apply it because the Ninth 22 Circuit “also has not rejected it as a test of fraudulent 23 joinder.” (Opp. at 11 n.2.) This court declines to do so, 24 inasmuch as application of defendants’ proposed standard would 25 entail a wholly speculative evaluation of plaintiffs’ unstated 26 3 Because defendants concede that Swearingen, like 27 Darbison, is a California resident, (see Opp. at 5; Notice at 3), it is clear that fraudulent joinder cannot be established here on 28 the basis of actual fraud in plaintiffs’ pleadings. 1 intentions, (see id. at 5 (requesting that the court analyze 2 “[p]laintiffs’ true intention”)), and could result in a finding 3 of fraudulent removal even if plaintiffs have meritorious claims 4 against Swearingen based on non-fraudulent factual allegations. 5 This analysis would run counter to Ninth Circuit precedent on 6 fraudulent joinder, see Grancare, 889 F.3d at 548, and reaching 7 this speculative conclusion would require the court to disregard 8 the Ninth Circuit’s admonition that any doubts regarding the 9 propriety of removal be resolved in favor of remand, see 10 Matheson, 319 F.3d at 1090. 11 Defendants also cite Wilson v. Republic Iron & Steel 12 Co., 257 U.S. 92 (1921), for the proposition that fraudulent 13 joinder may be established solely on the basis that a plaintiff 14 lacks a good-faith intent to prosecute his or her claims against 15 the alleged sham defendant. (Opp. at 12-13.) However, Wilson 16 expressly defines fraudulent joinder as joinder “without any 17 reasonable basis in fact and without any purpose to prosecute the 18 cause in good faith against the [alleged sham defendant].” 257 19 U.S. at 98 (emphasis added). The Court also described fraudulent 20 joinder as “joinder of a resident defendant having no real 21 connection with the controversy.” Id. at 97. Wilson therefore 22 makes clear that, to the extent fraudulent joinder may still be 23 established based on a plaintiff’s lack of genuine intent to 24 prosecute his or her claims against an alleged sham defendant, 25 defendants must also show that the plaintiff lacks “any 26 reasonable basis in fact” for asserting claims against that 27 defendant and that the defendant has “no real connection” to the 28 case. Id. Because defendants make no such argument here -- even nnn nnn ene ee nn nnn nn nn ne ne oe on nn nO OI 1 in the face of plaintiffs’ extensive arguments that they do 2 possess meritorious claims against Swearingen and that Swearingen 3 is intimately connected to the controversies in this case, (see 4 Mot. at 8-16) -- defendants have failed to meet their burden in 5 establishing fraudulent joinder. See Geographic Expeditions, 599 6] F.3d at 1107. 7 Because the court therefore cannot disregard the lack 8 of complete diversity in this case, the court lacks jurisdiction 9 and the case must be remanded to state court. See Toumajian, 135 10 F.3d at 653; Matheson, 319 F.3d at 1090.4 11 IT IS THEREFORE ORDERED that plaintiffs’ Motion to 12 Remand (Docket No. 9-1) be, and the same hereby is, GRANTED.® 13 This action is hereby REMANDED to the Superior Court of the State 14 of California, in and for the County of Sacramento. 15 | Dated: July 21, 2022 te t¢ . ak. AY / 16 WILLIAM B. SHUBB UNITED STATES DISTRICT JUDGE 18 19 f— ——— 4 Because defendants have failed to show that Swearingen 20 was fraudulently joined, the court does not consider the parties’ arguments regarding whether defendants waived their right to 21 remove the case to this court, as those arguments are now moot. 22 (See Mot. at 16-17; Opp. at 9-10.) 23 ° Defendants’ request for judicial notice (Docket No. 11) is denied as unnecessary to the resolution of the instant motion. 24 Their opposition brief makes clear that they seek notice of the 5 attached documents to show that plaintiffs lack a genuine intent ° to prosecute their claims against Swearingen. (See Opp. at 15- 26 16.) As explained, however, such a showing does not establish fraudulent joinder unless defendants also show there is no 27 “possibility that a state court would find that the complaint states a cause of action against” Swearingen, see Grancare, 889 28 | F.3d at 548, which defendants have not argued is the case.