United States District Court, E.D. Michigan, Southern Division
ROBERT W. STEELE, Plaintiff,
v.
AMERICAN HONDA MOTOR COMPANY, INC., et al., Defendants.
OPINION AND ORDER DENYING PLAINTIFF'S MOTION FOR
REMAND, GRANTING DEFENDANT ZEIGLER'S MOTION TO DISMISS,
AND GRANTING IN PART DEFENDANT AHM'S MOTION TO
DISMISS
BERNARD A. FRIEDMAN, SENIOR UNITED STATES DISTRICT JUDGE
This
matter is presently before the Court on plaintiff's
motion for remand [docket entry 3], the motion of defendant
American Honda Motor Company, Inc. (âAHMâ) to dismiss [docket
entry 7], and the motion of defendant Zeigler Imports, LLC
(âZeiglerâ) to dismiss [docket entry 11]. Pursuant to E.D.
Mich. LR. 7.1(f)(2), the Court shall decide these motions
without a hearing. For the reasons stated below, the Court
shall deny plaintiff's motion, grant defendant
Zeigler's motion, and grant in part defendant AHM's
motion.
This is
a product liability and handicap discrimination case.
Plaintiff, who is blind, alleges that on March 10, 2016,
while attempting to cross a street in Kalamazoo, Michigan, he
was struck and severely injured by a 2012 Honda electric
vehicle. Am. Compl. ¶ 6. Plaintiff alleges that the
vehicle “was being operated in the silent mode”
and that he was not able to hear it approaching. Id.
¶ 8. Plaintiff filed suit in state court on March 4,
2019, naming AHM and John Doe Honda Dealership. The complaint
identified the latter as “a domestic or foreign
corporation doing business in Wayne County, Michigan, that
sells or leases automobiles manufactured by American Honda
Motor Co., Inc., ” id. ¶ 3, and as
AHM's “designated agent that sold or leased the
2012 Vehicle to the driver, ” id. ¶ 5.
Plaintiff asserts claims against both defendants for product
liability (Count I) and for violation of his rights under
Michigan's Persons With Disabilities Civil Rights Act
(Count II).
On June
14, 2019, AHM, which had been served with process on May 24,
removed the case based on the parties' diversity of
citizenship, as AHM is incorporated in and has its principal
place of business in California, plaintiff is a resident of
Michigan, and more than $75, 000 is in controversy. Notice of
Removal ¶¶ 4-6. The removal notice correctly noted
that under 28 U.S.C. § 1441(b), “[i]n determining
whether a civil action is removable on the basis of the
jurisdiction under section 1332(a) of this title, the
citizenship of defendants sued under fictitious names shall
be disregarded.”
Plaintiff's
Motion for Remand Based on Alleged Procedural
Error
On July
2, plaintiff filed the instant motion for remand, arguing
that the removal was procedurally defective because the John
Doe defendant (whom plaintiff, in an amended complaint also
filed on July 2, has now identified as “Zeigler
Imports, LLC d/b/a Zeigler Honda and d/b/a Zeigler Honda of
Kalamazoo”) was served with process before the case was
removed and therefore the case could not be removed without
its consent. To show that he served Zeigler with process,
plaintiff points to (1) a summons issued on March 4, 2019,
identifying defendant as “JOHN DOE HONDA DEALERSHIP,
” Pl.'s Mot. for Remand, Ex. 2; and (2)
plaintiff's attorney's Affidavit of Service,
accompanied by a hand-written mail receipt that appears to
show that plaintiff served Zeigler Honda at 4211 Stadium Dr.,
Kalamazoo, MI, with “a copy of the summons and
complaint, together with jury demand” on May 22 or 23,
2019, id., Ex. 3. Apparently the summons and
complaint were mailed under a May 20, 2019, cover letter from
plaintiff's attorney stating, “I forward a copy of
a lawsuit filed 3/4/2019 in Wayne County Circuit
Court.” Zeigler's Mot. to Dismiss, Ex. 2.
Plaintiff
correctly notes that under 28 U.S.C. § 1446(b)(2)(A),
“all defendants who have been properly joined and
served must join in or consent to the removal of the
action.” If Zeigler had been “properly joined and
served” at the time AHM filed its removal notice on
June 14, then Zeigler would have had to join in or consent to
the removal. In the present case, however, Zeigler had not
been “properly joined and served” as of June 14.
At that point in time, plaintiff had served Zeigler with a
summons and complaint naming John Doe Honda Dealership. The
complaint did not contain any allegations or information from
which the reader might surmise that the John Doe Honda
Dealership referred to Zeigler in Kalamazoo. Rather, the
complaint alleged that “JOHN DOE HONDA DEALERSHIP is a
domestic or foreign corporation doing business in Wayne
County, Michigan, ” Compl. ¶ 3, several counties
distant, and more than 140 miles away, from Kalamazoo.
Plainly,
Zeigler was not “properly joined and served” as
of June 14. As the Michigan Court of Appeals has stated,
“defendants not specifically named in ‘John
Doe' complaints are not yet parties to the
suit and, if added later, are considered new parties to the
litigation.” Thomas v. Process Equip.
Corp., 154 Mich.App. 78, 85 (1986) (emphasis added).
Zeigler did not become a party to this action until plaintiff
specifically named it in his amended complaint, which was not
filed until after AHM removed the case. Therefore, Zeigler
was not required to join in or consent to the removal.
Plaintiff's procedural objection to the removal is
unfounded.
Plaintiff's
Motion for Remand Based on Alleged Lack of Subject Matter
Jurisdiction; Joinder of Zeigler, a Non-Diverse Defendant;
Zeigler's Motion to Dismiss
Plaintiff
also argues that this matter must be remanded because the
Court “lacks subject matter jurisdiction in that there
is no diversity jurisdiction because at least one Defendant
is a Michigan citizen.” Pl.'s Mot. for Remand
¶ 30(c). Diversity jurisdiction was present at the time
of removal because the only named defendant, AHM, is a
citizen of California, plaintiff is a citizen of Michigan,
and more than $75, 000 is in controversy. Diversity was not
destroyed until plaintiff amended his complaint post-removal
to replace John Doe Honda Dealership with Zeigler, which is
also a citizen of Michigan.
This
circumstance is governed by 28 U.S.C. § 1447(e), which
states: “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.”[1]The Sixth Circuit has stated that
[a] district court may base its discretionary determination
under § 1447(e) on the following factors: (1) the extent
to which the proposed amendment's intent was to destroy
federal jurisdiction, (2) whether the plaintiff was dilatory
in filing the motion to amend, (3) whether the plaintiff
would be significantly injured if the motion to amend were
denied, and (4) any other equitable factors. Bailey v.
Bayer CropScience, L.P., 563 F.3d 302, 309 (8th Cir.
2009); Mayes v. Rapoport, 198 F.3d 457, 462-63 (4th
Cir. 1999).
Telecom Decision Makers, Inc. v. Access Integrated
Networks, Inc., 654 Fed.Appx. 218, 221 (6th Cir. 2016).
Among the “other equitable factors” a court may
consider is whether the non-diverse defendant has been
fraudulently joined. See Mayes, 198 F.3d at 463.
“To prove fraudulent joinder, the removing party must
show that the plaintiff cannot establish a cause of action
against the non-diverse defendant.” Roof v. Bel
Brands USA, Inc., 641 Fed.Appx. 492, 496 (6th Cir. 2016)
(citation omitted). “Further, [a]ny disputed questions
[of] fact and ambiguities in the controlling state law
[should be resolved] . . . in favor of the nonremoving
party.” Id. (alternations in original;
citations and internal quotation marks omitted). That is to
say, “the question is whether there is arguably a
reasonable basis for predicting that the state law might
impose liability on the facts involved.” Alexander
v. Elec. Data Sys. Corp., 13 F.3d 940, 949 (6th Cir.
1994) (quoting Bobby Jones Garden Apartments,
Inc. v. Suleski, 391 F.2d 172, 176 (5th Cir. 1968)).
In the
present case, the first two of the Telecom factors
favor permitting Zeigler's joinder. First, it is not
apparent that plaintiff joined Zeigler in order to destroy
federal jurisdiction. Although plaintiff filed his amended
complaint naming Zeigler (on July 2) after the case was
removed (on June 14), it appears that before removal
plaintiff's attorney believed that Zeigler may be the
John Doe mentioned in the complaint. As noted above,
plaintiff's counsel mailed a copy of the complaint to
Zeigler Honda under a cover letter dated May 20. Naming
Zeigler was clearly not a post-removal afterthought. Second,
plaintiff was not particularly dilatory in seeking to join
Zeigler, as he filed his amended complaint approximately six
weeks after mailing the summons and original complaint to
Zeigler. However, the third and fourth Telecom
factors weigh heavily against permitting Zeigler's
joinder because plaintiff's claims against Zeigler (to
the extent they are cognizable at all) are time-barred. This
establishes both that Zeigler's joinder was fraudulent
and that plaintiff will suffer no prejudice if Zeigler's
joinder is denied.
The
untimeliness of plaintiff's claims against Zeigler is
undebatable. Plaintiff concedes that both of his claims
(product liability and handicap discrimination) are subject
to the three-year limitations period of Mich. Comp. Laws
§ 600.5805(2). See Am. Compl. ¶ 9;
Pl.'s Resp. to Zeigler's Mot. to Dismiss at 6. His
claims accrued on March 10, 2016, the date on which he
alleges he was injured. See Am. Compl. ¶¶
6, 8. Plaintiff ...