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POLSON v. COTTRELL

May 17, 2005.

ROBERT POLSON and MARY POLSON, Plaintiffs,
v.
COTTRELL, INC., JACK COOPER TRANSPORT COMPANY, and GENERAL MOTORS CORPORATION, Defendants.



The opinion of the court was delivered by: DAVID HERNDON, District Judge

MEMORANDUM and ORDER

I. Introduction and Background

Pending before the Court is Defendant Jack Cooper Transport Company's motion to dismiss for lack of subject matter jurisdiction (Doc. 31). Jack Cooper Transport Company argues that the Court lacks subject matter jurisdiction over Plaintiffs' claims against it as Plaintiffs' exclusive remedy is pursuant to the Illinois Workers' Compensation Act. Plaintiffs oppose the motion. Based on the following, the Court grants the motion to dismiss.

  On October 10, 2004, Plaintiffs Robert and Mary Polson filed a sevencount complaint in the Madison County, Illinois Circuit Court against Cottrell, Inc. ("Cottrell"), Jack Cooper Transport Company ("Jack Cooper") and General Motors Corporation ("General Motors") (Doc. 2). The Polsons' claims arise from a February 19, 2003 incident wherein Robert was injured while operating the chain and ratchet tie down system of a rig designed and distributed by Cottrell as part of his duties as car hauler for Jack Cooper. Count I is against Cottrell for strict liability; Count II is against Cottrell for negligence; Count III is against Cottrell for breach of implied warranty; Count IV is against General Motors for negligence; Count V is against all Defendants based on a conscious disregard theory; Count VI is brought by Mary against all Defendants for loss of consortium and Count VII is against Jack Cooper for an intentional tort.

  On December 1, 2004, Cottrell removed the case to this Court based on the federal diversity statute, 28 U.S.C. § 1332 (Doc. 1). That same day, both Jack Cooper and General Motors filed consents to the removal (Docs. 3 & 4).

  II. Analysis

  Cottrell removed the case to this Court based on the federal diversity statute, 28 U.S.C. § 1332. Under 28 U.S.C. § 1441, removal is proper over any action that could have been filed originally in federal court. However, if the district court lacks subject matter jurisdiction, the matter must be remanded to state court pursuant to 28 U.S.C. § 1447(c), Courts presume a plaintiff's choice of forum is proper and valid and resolve all doubts regarding jurisdiction in favor of remand. See Doe v. Allied-Signal, Inc., 985 F.2d 908, 911 (7th Cir. 1993). The diversity statute requires complete diversity between the parties plus an amount in controversy which exceeds $75,000, exclusive of interest and cost. Complete diversity of citizenship means that "none of the parties on either side of the litigation may be a citizen of a state of which a party on the other side is a citizen." Howell v. Tribune Entertainment Co., 106 F.3d 215, 217 (7th Cir. 1997) (citations omitted). Here, it is undisputed that the amount in controversy is met. The problem is that both the Polsons and Jack Cooper are citizens of Missouri.*fn1 Therefore, unless Jack Cooper's citizenship is disregarded, there is no federal jurisdiction over the Polsons' claims.

  The question of whether the Court has jurisdiction over the Polsons' claims turns on whether Jack Cooper was fraudulently joined as a defendant. In the context of fraudulent joinder, "fraudulent" is a term of art. See Poulos v. Naas Foods, Inc., 959 F.2d 69, 73 (7th Cir. 1992). "Although false allegations of jurisdictional fact may make joinder fraudulent, . . . in most cases fraudulent joinder involves a claim against an in-state defendant that simply has not chance of success, whatever, the plaintiff's motives. Id. (collecting cases). It is true that, as a general rule, the right of removal cannot be defeated "by a fraudulent joinder of a resident defendant having no real connection with the controversy." Wilson v. Republic Iron & Steel Co., 257 U.S. 92, 97 (1921). To prove fraudulent joinder the defendant must "show there exists no `reasonable possibility that a state court would rule against the [in-state] defendant,'" Schwartz v. State Farm Mutual Auto. Ins. Co., 174 F.3d 875, 878 (7th Cir. 1999) (citing Poulos, 959 F.2d at 73), or "if a state court has come to judgment, there [is not] any reasonable possibility that the judgment will be reversed on appeal." Poulos, 959 F.2d at 73. The defendant bears of heavy burden in this regard. Id. Thus, even if a state court might ultimately find that Plaintiffs failed to state a claim against Jack Cooper joinder of Jack Cooper was not "`fraudulent' for purposes of this court's jurisdiction so long as the issue of state law is subject to reasonable argument on both sides." See Batoff v. State Farm Insurance Co., 977 F.2d 848, 853 (3rd Cir. 1992) (if "intricate analysis of state law" is needed to dismiss claim, the claim may not be disregarded for purposes of diversity jurisdiction).

  The Court must turn to the Polsons' allegations against Jack Cooper to determine whether after resolving all issues of fact and law in favor of the Polsons, they can establish a cause of action against Jack Cooper. Because the parties have raised a choice of law issue, the Court must first decide which states law applies in this case, Missouri or Illinois. Federal courts sitting in diversity apply the choice-oflaw rules of the forum state to determine the applicable substantive law. Hinc v. Lime-O-Sol, 382 F.3d 716, 719 (7th Cir. 2004) (citations omitted). For tort claims, Illinois follows the most significant relationship test of the Restatement (Second) of Conflicts of Law. Ingersoll v. Klein, 262 N.E.2d 593 (Ill. 1970). "Under this test, the law of the place of injury controls unless Illinois has a more significant relationship with the occurrence and with the parties." Id. at 595. When applying this test the court considers: (1) where the injury occurred; (2) where the injury causing conduct occurred; (3) the domicile of the party; and (4) where the relationship of the parties is centered. Id. at 47, 262 N.E.2d 593. The Illinois courts also consider "the interests and public policies of potentially concerned states . . . as they relate to the transaction in issue." Jones v. State Farm Mut. Auto. Ins. Co., 682 N.E.2d 238, 249 (Ill.App. 1997).

  On balance, the Court finds that Illinois has the most significant contacts and a more significant interest in resolving this litigation, as the injury occurred in McClean, Illinois. Further, the totality of factors weighs in favor of applying Illinois law as Polson filed an Application for Adjustment of Claim with the Illinois Industrial Commission, received workers' compensation benefits under the Illinois Workers' Compensation Act and filed his personal injury lawsuit in an Illinois State Circuit Court.

  Applying Illinois law, the Court must now determine whether the Polsons can maintain a cause of action against Jack Copper despite the Illinois Workers' Compensation Act's exclusivity remedy doctrine, 820 ILCS 305/1 et seq.

  "On February 19, 2003, Robert Polson, was performing his normal work duties as a car hauler for his employer in Illinois." (Doc. 2, p. 2, ¶ 4). "[P]laintiff, while attempting to perform his normal work activities in an intended and/or foreseeable fashion while using a ratchet, idler, hook and chain during normal procedures by which he was trained, sustained severe and permanent injuries to his neck, spine and related areas while exerting required and/or foreseeable force and pressure." (Doc. 2, p. 3, ¶ 9). That same day, Polson reported that he had been injured to his employer Jack Cooper. On March 6, 2003, Polson began receiving workers' compensation benefits as a result of the February 19, 2003 accident, including payment of medical expenses and temporary total disability benefits ("TTD") pursuant to the Missouri Workers' Compensation Act.*fn2 Thereafter, Polson filed an Application for Adjustment of Claim with the Illinois Industrial Commission on March 27, 2003. On June 19, 2003, Jack Cooper began paying Polson TTD at the higher Illinois rate and has continued paying Polson TTD at the Illinois rate to the present. (Doc. 44, Exhibit A). Also on June 19, 2003, Jack Cooper issued a check to Polson representing the difference between what had been paid to Polson under the Missouri TTD rate and what he would have received under the higher Illinois rate. (Doc. 44, Exhibit A).

  Jack Cooper maintains that the exclusivity remedy doctrine of the Illinois Workers' Compensation Act bars Polsons' claims. On the other hand, the Polsons argue that they have a viable cause of action against Jack Cooper because the mere filing of a worker's compensation pleadings/claim does not constitute a bar to the simultaneous pursuit of a lawsuit sounding in fraud or other intentional torts. Based on the following, the Court finds that the Polsons' claims against Jack Cooper are barred by the exclusivity remedy doctrine.

  "The Workers' Compensation Act is designed to provide financial protection to workers for accidental injuries arising out of and in the course of employment." Meerbrey v. Marshall Field and Co., Inc., 564 N.E.2d 1222, 1225 (Ill. 1990). "Accordingly, the Act imposes liability without fault upon the employer and, in return, prohibits common law suits by employees against the employer." Id. "The exclusive remedy provision `is part of the quid pro quo in which the sacrifices and gains of employees and employers are to some extent put in balance, for, while the employer assumes a new liability without fault, he is relieved of the prospect of large damage verdicts.'" Id. (quoting 2A A. Larson, Law of Workmen's Compensation § 65.11 (1988)). Thus, injured employees are not permitted to seek and recover ...


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