Furfaro v. Alfonso Aguilera & 21ST Century Centennial Ins. Co.

FRANK FURFARO, Plaintiff, v. ALFONSO AGUILERA and21ST CENTURY CENTENNIAL INSURANCE COMPANY, Defendants.

Case No: 5:15-cv-615-Oc-30PRL

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA OCALA DIVISION

February 16, 2016

ORDER

THIS CAUSE comes before the Court upon Plaintiff's Motion for Remand (Doc. 5), Defendant 21st Century Centennial Insurance Company's ("21st Century") response in opposition (Doc. 9), and Plaintiff's reply (Doc. 13). The Court, having reviewed the motion, response, and reply, and being otherwise fully advised in the premises, concludes that the motion should be denied.

BACKGROUND

On May 21, 2014, Plaintiff was involved in an automobile accident with Alphonso Aguilera in which he sustained physical injuries. Mr. Aguilera did not have bodily injury liability insurance coverage. Consequently, Plaintiff initiated this action in the Fifth Judicial Circuit in and for Lake County, Florida, against his insurer 21st Century alleging claims under Florida law for (1) uninsured/underinsured motorist ("UM") benefits, (2) bad faith, and (3) declaratory relief. (Doc. 1). 21st Century was served with the complaint on November 9, 2015. (Doc. 1).

On December 8, 2015, 21st Century removed the case to this Court on the basis of diversity jurisdiction and filed a motion to dismiss Plaintiff's claims for bad faith and declaratory judgment. (Docs. 1, 2). Plaintiff filed an amended complaint the next day, removing his claims for bad faith and declaratory judgment but asserting a claim against Mr. Aguilera for negligence. Plaintiff also filed the present motion to remand, arguing that because Mr. Aguilera was added as a defendant and is a resident of Florida, complete diversity no longer exists between the parties. (Doc. 5).

DISCUSSION

1. The Applicable Law

21st Century removed this case on the basis of diversity of citizenship. In order to establish diversity jurisdiction at the time of removal, 21st Century must demonstrate (1) complete diversity of citizenship, and (2) an amount in controversy greater than $75,000 See 28 U.S.C. § 1332(a). Complete diversity does not exist if a single plaintiff is a citizen of the same state as a single defendant. See Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 553 (2005). At issue in the present case is whether Plaintiff should be permitted to amend his complaint post-removal to assert a negligence claim against Mr. Aguilera which would defeat diversity jurisdiction.

Amendment of a complaint post-removal is analyzed under 28 U.S.C. § 1447(e).¹ See Ingram v. CSX Transp., Inc., 146 F.3d 858, 862 (11th Cir. 1998). Under § 1447(e): "If after removal the plaintiff seeks to join additional defendants whose joinder would destroysubject matter jurisdiction, the court may deny joinder, or permit joinder and remand the action to the State court." The Eleventh Circuit has held that a district court has only two options: (1) deny the requested joinder, or (2) allow the joinder and remand the case to state court. See Ingram, 146 F.3d at 862. Thus, the issue of whether to allow the joinder of a non-diverse party defendant post-removal "is left to the discretion of the district court." Dean v. Barber, 951 F.2d 1210, 1215 (11th Cir. 1992).

"In exercising discretion to deny joinder, or to permit joinder and remand the case to state court, § 1447(e) requires an evaluation of the prejudice to the parties." Mehta v. N.Y. Life Ins. Co., No. 8:09-cv-59-T-33TGW, 2009 WL 2252270, at *3 (M.D. Fla. July 28, 2009). To evaluate the prejudice to the parties, the district court should consider the following factors: "(1) the extent to which the purpose of the amendment is to defeat federal jurisdiction; (2) whether the plaintiff has been dilatory in asking for the amendment; (3) whether the plaintiff will be significantly injured if the amendment is not allowed; and (4) any other factors bearing on the equities." Id. (citing Hensgens v. Deere & Co., 833 F.3d 1179, 1182 (5th Cir. 1987)).

The district court should also analyze whether the joinder of the non-diverse party is fraudulent. See Bechtelheimer v. Cont'l Airlines, Inc., 776 F. Supp. 2d 1319, 1321 (M.D. Fla. 2011) (citing Triggs v. John Crump Toyota, Inc., 154 F.3d 1284, 1287 (11th Cir. 1998) ("Fraudulent joinder is a judicially created doctrine that provides an exception to the requirement of complete diversity.")). Among other reasons, joinder may be deemed fraudulent "when there is no possibility the plaintiff can prove a cause of action against thenon-diverse defendant." In re Accutane Prods. Liability, No. 8:04-MD-2523-T-30TBM, 2012 WL 3194951, at *2 (M.D. Fla. July 31, 2012) (citing Triggs, 154 F.3d at 1287).

In evaluating whether the plaintiff can prove the cause of action against the non-diverse defendant, "[i]f there is even a possibility that a state court would find that the complaint states a cause of action against any one of the [non-diverse] defendants, the federal court must find that the joinder was proper and remand the case to the state court." Coker v. Amoco Oil Co., 709 F.2d 1433, 1440-41 (11th Cir. 1983), superseded by statute on other grounds as recognized in Wilson v. Gen. Motors Corp., 888 F.2d 779 (11th Cir. 1989). "The plaintiff need not have a winning case against the allegedly fraudulent defendant; he need only have a possibility of stating a valid cause of action in order for the joinder to be legitimate." Triggs, 154 F.3d at 1287.

2. Analysis

21st Century asserts that Mr. Aguilera was fraudulently joined because it is dubious whether Plaintiff will collect against him because he did not have bodily injury liability insurance coverage at the time of the accident. According to 21st Century, because Plaintiff will not likely be able to recover damages against Mr. Aguilera, Plaintiff cannot prove its negligence claim against Mr. Aguilera. However, to succeed on a claim for negligence, Plaintiff need not demonstrate that he will ultimately recover from Mr. Aguilera. Plaintiff is entitled to assert a claim of negligence against Mr. Aguilera. More important, a possibility exists that Plaintiff can prove a claim of negligence against Mr. Aguilera. Therefore, 21st Century's contention that Mr. Aguilera was fraudulently joined is without merit.

Because Mr. Aguilera was added after the case was removed, however, the Court also considers whether joinder of Mr. Aguilera was appropriate under § 1447(e) by examining "(1) the extent to which the purpose of the amendment is to defeat federal jurisdiction; (2) whether the plaintiff has been dilatory in asking for the amendment; (3) whether the plaintiff will be significantly injured if the amendment is not allowed; and (4) any other factors bearing on the equities." Mehta, 2009 WL 2252270, at *3.

First, in considering whether the purpose of the amendment is to defeat jurisdiction, the Court notes the timing of Plaintiff's amendment. 21st Century was served with the original complaint on November 9, 2015, and did not remove until December 8, 2015. During that month-long period, Plaintiff did not seek to add a claim against Mr. Aguilera despite being aware of the facts giving rise to the negligence claim against him from the inception of this case. It was not until the case was removed that Plaintiff decided to amend his complaint to assert this claim against Mr. Aguilera. This factor weighs against permitting the joinder of Mr. Aguilera. See Small v. Ford Motor Co., 923 F. Supp. 2d 1354, 1357 (S.D. Fla. 2013) (noting that the "joining of "non-diverse defendant immediately after removal but before discovery . . . suggests that the amendment is done with specific purpose of destroying diversity jurisdiction" (internal quotation marks omitted).

Second, as to whether Plaintiff has been dilatory in seeking amendment, Plaintiff was aware of this claim against Mr. Aguilera since the accident occurred and prior to the filing of his complaint. Plaintiff asserts that although he was aware of his potential negligence claim against Mr. Aguilera when this action was commenced, he did notoriginally add the claim against Mr. Aguilera for strategic reasons. But since Plaintiff knew about the potential claim against Mr. Aguilera from the inception of this suit and chose not to assert that claim against him, this factor weighs against permitting the joinder.

Third, if the Court does not permit Plaintiff to join Mr. Aguilera in this action, Plaintiff will have to file a separate state-court action...