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Kasal v. Stryker Corp.

United States District Court, E.D. Wisconsin

September 19, 2017




         1. INTRODUCTION

         On July 19, 2017, Defendant Stryker Corporation (“Stryker”) removed this matter to this Court from Milwaukee County Circuit Court. (Docket #1). In its notice of removal, Stryker invoked the Court's diversity jurisdiction. Id. at 1. Though the parties appear non-diverse on the face of the complaint, Stryker maintains that certain parties were fraudulently joined to defeat diversity, and others should be realigned as plaintiffs. Id. at 2-8. On July 26, 2017, Defendant Miles W. Green (“Green”), a former Stryker employee who is represented by the same counsel, filed a motion to dismiss himself from this action for Plaintiffs' failure to state any viable claims against him. (Docket #6). Stryker further requests that Defendant Sentry Insurance, A Mutual Company (“Sentry”) be realigned as a plaintiff in this matter. (Docket #25 at 7-10).[1]

         On August 10, 2017, Plaintiffs timely filed a motion to remand this action to state court. (Docket #17); 28 U.S.C. § 1447(c). Stryker responded to that motion, and replied in support of the motion to dismiss, on August 31, 2017. (Docket #25). On September 14, 2017, Plaintiffs submitted a reply in favor of their motion to remand. (Docket #29). Though the issues raised by both motions are intertwined, because the remand question goes to the Court's jurisdiction, Plaintiffs' motion must be addressed first.[2]

         2. RELEVANT FACTS

         The material facts are undisputed. They are drawn from Plaintiffs' complaint, (Docket #1-1), and Green's affidavit, (Docket #1-3). Plaintiffs, Green, Sentry, and Defendant Aurora Health Care Metro, Inc. (“Aurora”) are all citizens of Wisconsin, while Stryker is a citizen of Michigan. On May 11, 2016, Plaintiff Mary Kasal (“Mary”) was employed by Aurora. While working at Aurora-owned St. Luke's Hospital, Mary was injured when a piece of equipment called a “Navigator” tipped over onto her. Plaintiffs allege that the tipping was caused by the failure of one or more of the casters on which the Navigator sat. They further allege that the Navigator was manufactured and owned by Stryker and leased to Aurora at the time of Mary's injury. The incident caused damages to Mary in the form of personal injuries and lost wages, and to Plaintiff George Kasal in the form of loss of Mary's society and companionship.

         Plaintiffs assert three causes of action. The first is for negligence against Stryker and Green. Plaintiffs include Green in this claim based on their allegation that he “performed and oversaw service and maintenance of Stryker machinery at Aurora, ” presumably to include the Navigator. (Docket #1-1 at 5). In his affidavit, Green maintains that he was merely a sales representative for Stryker, “interfac[ing] with hospital and medical personnel to sell and lease Stryker equipment [and] support[ing] surgeons and their staff in using Stryker equipment during a case.” (Docket #1-3 at 2). Green avers that he was not responsible for maintenance of any Stryker equipment, including the Navigator; that duty was laid on a different department within Stryker.

         Plaintiffs' second cause of action is against Stryker alone for products liability, namely producing the Navigator with defective casters. Plaintiffs' final claim is stated against Sentry and Aurora for failing to cooperate in the prosecution of her tort claims herein, thus extinguishing their right to subrogation (both parties had provided worker's compensation benefits to Mary).

         3. ANALYSIS

         As noted above, Plaintiffs have asked the Court to remand this action to state court because the parties are non-diverse. (Docket #18 at 1). This is apparent on the face of their complaint; Plaintiffs, Green, and Sentry are all citizens of Wisconsin, while Stryker is from Michigan. In an attempt to remain in federal court, Stryker argues that neither Green's nor Sentry's presence actually undermines diversity in this case, raising separate arguments as to each. The Court begins with Green.

         Stryker asserts that Green has been fraudulently joined in this action to defeat diversity jurisdiction. The fraudulent joinder doctrine is an exception to the requirement of complete diversity. Morris v. Nuzzo, 718 F.3d 660, 666 (7th Cir. 2013). The doctrine provides that “an out-of-state defendant's right of removal premised on diversity cannot be defeated by joinder of a nondiverse defendant against whom the plaintiff's claim has no chance of success.” Id. (quotation omitted). The Seventh Circuit instructs that

[t]o establish fraudulent joinder, a removing defendant must show that, after resolving all issues of fact and law in favor of the plaintiff, the plaintiff cannot establish a cause of action against the in-state defendant. If the removing defendant can meet this heavy burden, . . . the federal district court considering removal may disregard, for jurisdictional purposes, the citizenship of certain nondiverse defendants, assume jurisdiction over a case, dismiss the nondiverse defendants, and thereby retain jurisdiction.

Id. (citations and quotations omitted). Put another way, Stryker must show that there is no reasonable possibility that Plaintiffs can state a cause of action against Green in state court. Poulos v. Naas Foods, Inc., 959 F.2d 69, 73 (7th Cir. 1992); Gottlieb v. Westin Hotel Co., 990 F.2d 323, 327 (7th Cir. 1993).

         The standard of review applied to fraudulent joinder is even weaker than that applied to a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). As the Third Circuit explains, “it is possible that a party is not fraudulently joined, but that the claim against that party ultimately is dismissed for failure to state a claim upon which relief may be granted.” Batoff v. State Farm Ins. Co., 977 F.2d 848, 852 (3d Cir. 1992) (finding error when “the district court [converted] its jurisdictional inquiry into a motion to dismiss”). Instead, this Court is bound only to determine whether “the claims against [Green] were not even colorable, i.e., were wholly insubstantial and frivolous.” Id. Although Stryker's burden in asserting fraudulent ...

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