United States District Court, N.D. Illinois, Eastern Division
May 9, 2005.
RAYMOND SMITH SR., administrator of the estate and person of RAYMOND SMITH JR., a disabled person, Plaintiff,
OTR WHEEL ENGINEERING INC., et al., Defendants.
The opinion of the court was delivered by: RONALD GUZMAN, District Judge
MEMORANDUM OPINION AND ORDER
Before the Court is plaintiff's motion to amend his complaint
to add two new, non-diverse defendants. For the reasons provided
in this Memorandum Opinion and Order, the motion is granted and,
after the second amended complaint is filed, this case will be
remanded to state court.
On April 28, 2004, plaintiff, an Illinois citizen, filed a
complaint in state court seeking to recover for injuries that
Raymond Smith, Jr. sustained when the wheel assembly of a side
loader exploded while he was trying to remove it. Plaintiff named
seven defendants, all of which are citizens of foreign states.
Because the parties were of diverse citizenship, on June 1, 2004,
defendants removed the case to this Court.
On September 28, 2004, plaintiff amended his complaint, adding
Armor Tire & Rim and Titan Steel Wheels ("TSW") as defendants.
Both companies are citizens of foreign states. On December 9, 2004, plaintiff filed the instant motion seeking
to file a second amended complaint, adding Titan-Illinois and
Titan-Virginia as defendants. Plaintiff claims that both
corporations have a principal place of business in Illinois and
had a role in manufacturing and selling the wheel assembly for
the side loader. Thus, plaintiff says, both parties are vital,
though joining them will destroy the Court's diversity
TSW says that only Titan-Virginia is arguably necessary and, as
its name implies, it is not a citizen of Illinois. Titan-Illinois
is irrelevant, TSW says, because it played no role in the
manufacture or sale of any component of the subject wheel
assembly. (Def.'s Mem. Opp'n Pl.'s Mot. Leave File Second Am.
Compl. at 3.) Consequently, TSW says, the motion to amend should
be denied as to Titan-Illinois, the non-diverse defendant, and
granted as to Titan-Virginia, the diverse defendant, preserving
the Court's jurisdiction.
The decision of whether to allow joinder in this case is
governed by 28 U.S.C. § 1447, which provides: "If after removal
the plaintiff seeks to join additional defendants whose joinder
would destroy subject matter jurisdiction, the court may deny
joinder, or permit joinder and remand the action to the State
court." 28 U.S.C. § 1447(e). In making the decision, the Court
considers the following factors: "(1) plaintiff's delay in
seeking to amend; (2) plaintiff's motivation in moving to amend;
(3) the possibility of multiple lawsuits; and (4) other equitable
considerations, including prejudice, if any, to defendants."
County of Cook v. Phillip Morris Inc., No. 97 C 3295, 1997 WL
667777, at *2 (N.D. Ill. Oct. 17, 1997) (internal quotation
marks, alteration and citation omitted). The second factor,
plaintiff's motivation in moving to amend, is decisive if
plaintiff seeks to join a non-diverse defendant for the sole
purpose of destroying diversity jurisdiction. Id. at *5. Such fraudulent joinder, as
it is called, is presumed if, "after resolving all issues of fact
and law in favor of the plaintiff, the plaintiff cannot establish
a cause of action against an in-state defendant." Id. (internal
quotation marks and citation omitted).
There is no evidence here that the requested joinder is
fraudulent. Plaintiff seeks to join Titan-Virginia and
Titan-Illinois because TSW's counsel said one of those two
companies produced a portion of the wheel assembly. (See Pl.'s
Resp. Def.'s Mem. Opp'n Pl.'s Mot. Leave File Second Am. Compl.,
Ex. B, Grossman Aff. ¶ 3.) TSW now disputes that Titan-Illinois
was involved but, for the purposes of this motion, we must credit
plaintiff's version of the facts. County of Cook, 1997 WL
667777, at *5. Assuming, as we must, that Titan-Illinois
manufactured part of the wheel assembly, and that it did so
negligently, then plaintiff has a viable cause of action against
that in-state defendant.
The same is true for Titan-Virginia. TSW admits that
Titan-Virginia may have manufactured part of the wheel assembly.
(Def.'s Mem. Opp'n Pl.'s Mot. Leave File Second Am. Compl. at 4.)
Moreover, though Titan-Virginia's business address is in
Saltville, Virginia, plaintiff has submitted evidence that
suggests the company's principal place of business may be in
Illinois. See Metropolitan Life Ins. Co. v. Estate of Cammon,
929 F.2d 1220, 1223 (7th Cir. 1991) (stating that company's
principal place of business is its "nerve center"); (Pl.'s Resp.
Def.'s Mem. Opp'n Pl.'s Mot. Leave File Second Am. Compl., Group
Ex. D, State of Virginia Corporate Records (showing that
Titan-Virginia's executive officers are Ron Schildt, Kent W.
Hackamack and Cheri T. Holley, all of whom have a business
address in Quincy, Illinois).) Thus, plaintiff may also have a
viable cause of action against a second Illinois citizen,
Titan-Virginia. Because plaintiff has demonstrated that he may
have a cause of action against the in-state defendants he seeks to join, fraudulent joinder is not a basis
for denying his motion.
The other factors do not favor denial either. Plaintiff was not
dilatory in seeking this amendment, a point that TSW apparently
concedes. Moreover, if we deny leave to amend, it is virtually
certain that multiple lawsuits will result. Finally, though TSW
will be deprived of a federal forum if the amendment is allowed,
that sole consideration is far outweighed by the parties' and the
courts' interest in a comprehensive, final and efficient
disposition of these disputes.
For the foregoing reasons, plaintiff's motion for leave to file
a second amended complaint [doc. no. 64] is granted. Plaintiff
has five days from the date of this Memorandum Opinion and Order
to file its second amended complaint. After the complaint is
filed, the case will be remanded to state court in accordance
with 28 U.S.C. § 1447.
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