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Kelly v. Martin & Bayley

January 9, 2006

MICHAEL KELLY, AS ADMINISTRATOR OF THE ESTATE OF EVERETT KELLY, AND PATTI KELLY, PLAINTIFFS,
v.
MARTIN & BAYLEY, INC., D/B/A HUCK'S CONVENIENCE STORE, AND PHILIP MORRIS USA, INC., DEFENDANTS.



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

MEMORANDUM and ORDER

I. Introduction and Background

Now before the Court is Plaintiffs' motion to remand (Docs. 11, 15, & 16). Defendants oppose the motion (Docs. 13, 14 & 17). Based on the pleadings, the applicable law and the following, the Court finds that removal was proper under the federal officer's statute and denies the motion to remand.

On June 3, 2005, Plaintiffs filed a First Amended Complaint in a civil case pending in the Circuit Court of Madison County, Illinois (Doc. 2). Plaintiff Michael Kelly, Administrator of the Estate of Everett Kelly and the son of Everett, is a citizen of Florida and Plaintiff Patti Kelly, the wife of Everett, is a citizen of Illinois. Everett smoked "Marlboro Lights" brand cigarettes for about 30 years, was diagnosed with lung cancer on July 23, 2001 and died as a result of lung cancer on June 4, 2003. Plaintiffs bring this lawsuit against Philip Morris USA, Inc. ("PM"), a citizen of Virginia, who manufactured, marketed, and promoted Marlboro Lights, and Martin & Bayley, Inc., d/b/a Huck's Convenience Store, ("Huck's"), a citizen of Illinois, who "engaged in the business of selling Marlboro Lights" (Doc. 2. p. 2). Plaintiffs' First Amended Complaint contains claims against both Defendants under the Illinois Consumer Fraud statute and the Uniform Commercial Code, plus claims based on negligence, products liability and loss of consortium theories. Among many other things, Plaintiffs allege that Everett was without knowledge that he received higher levels of tar and nicotine than Defendants represented or that the smoke produced by Marlboro Lights is more mutagenic than regular cigarettes (Doc. 2, p. 2, ¶ 3). The First Amended Complaint also alleges that Philip Morris and Huck's expressly warranted that the Marlboro Lights cigarettes were "Lights" cigarettes and contained "lowered tar and nicotine" pursuant to the Uniform Commercial Code § 2-213, 810 ILCS 5/2-313, by placing the words "Marlboro Lights" and/or "lowered tar and nicotine" on each and every package sold to Everett. (Doc. 39, ¶ ¶ 29 & 101).

On June 9, 2005, Defendants jointly removed the action to this Court invoking subject matter jurisdiction under the federal diversity statute, 28 U.S.C. § 1332, and the federal officer statute, 28 U.S.C. § 1442(a)(1). In particular, Defendants' notice of removal states that the Court has diversity jurisdiction exists because Huck's has been fraudulently joined in an attempt to avoid federal jurisdiction and that removal is proper under the "Federal Officer" removal statute, 28 U.S.C. § 1442(a)(1).

II. Analysis

The removal statute, 28 U.S.C. § 1441, is construed narrowly, and doubts concerning removal are resolved in favor of remand. Doe v. Allied-Signal, Inc., 985 F.2d 908, 911 (7th Cir. 1993).Defendants bear the burden to present evidence of federal jurisdiction once the existence of that jurisdiction is fairly cast into doubt. See In re Brand Name Prescription Drugs Antitrust Litig., 123 F.3d 599, 607 (7th Cir. 1997). "A defendant meets this burden by supporting [its] allegations of jurisdiction with 'competent proof,' which in [the Seventh Circuit] requires the defendant to offer evidence which proves 'to a reasonable probability that jurisdiction exists.'" Chase v. Shop 'N Save Warehouse Foods, Inc., 110 F.3d 424, 427 (7th Cir. 1997)(citations omitted).

Here, despite the apparent lack of diversity jurisdiction (both Plaintiff Patti Kelly and Huck's are Illinois citizens), Defendants argue that Huck's was fraudulently joined and that without the presence of Huck's diversity of citizenship exists between the parties. The parties do not dispute that the amount in controversy exceeds $75,000. See 28 U.S.C. § 1332. Thus, the Court must determine if diversity jurisdiction exists which hinges on whether Huck's was fraudulently joined.*fn1

In the context of jurisdiction,"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 no chance of success whatever the plaintiff's motives." Id. (collecting cases). To prove fraudulent joinder the out-of-state 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)). The defendant bears a heavy burden in this regard. Id.

As to the fraudulent joinder of Huck's, the Court finds that Defendants have not sustained this heavy burden. The record before the Court establishes that there exists a reasonably probability that a state court would rule against Huck's. The Court relies on the past decisions of the Circuit Court of Madison County (the state court which this case was removed from) and of this Court finding that tobacco plaintiffs may maintain these type of actions against Huck's and that Huck's was not fraudulently joined. See Krueger v. R.J. Reynolds Tobacco Co., 05-0090-DRH (January 6, 2006 Order, Doc. 48); Mills v. Martin & Bayley, Inc., d/b/a Huck's Convenience Store, No. 04-L-1270 (Ill. Cir. Ct. April 12, 2005)(Kardis, J.); Wilkerson v. Martin & Bayley, Inc., d/b/a Huck's Convenience Store, No. 05-L-125 (Ill. Cir. Ct. June 2, 2005)(Kardis, J.); Lucas v. Martin & Bayley, Inc., d/b/a Huck's Convenience Store, No. 05-L-127 (Ill. Cir. Ct. June 2, 2005)(Kardis, J.); Lucas v. Martin & Bayley, Inc., 05-CV-0410-MJR (August 26, 2005, Doc. 14).

Since the Court finds that Huck's was not fraudulently joined, diversity jurisdiction does not exist, therefore, the Court must determine whether the removal was proper under the "federal officer" removal statute, 28 U.S.C. § 1442(a)(1).

28 U.S.C. § 1442(a)(1) provides in part:

(a) A civil action or criminal prosecution commenced in a State court against any of the following may be removed by them to the district court of the United States for the district and division embracing the place wherein it is pending: (1) ... any officer (or any person acting under that officer) of the United States or of any agency thereof, sued in an official or individual capacity for any act under color of such office or on account of any right, title or authority claimed under any Act of Congress for the apprehension or punishment of criminals or the collection of the revenue.

This provision protects federal officers, federal agencies, and those acting under their direction "against interference in the course of their duties b hostile state court." Willingham v. Morgan, 395 U.S. 402, 405 (1969). The provision carries out its purpose "by allowing those whose federal activity may be inhibited by state court actions to remove to the presumably ...


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