Claims denial law firms are usually well versed on the ways to handle cases that end up in Federal Court when that was not the original intention. This is illustrated in a 2020 opinion from the Western District of Texas, Austin Division. The opinion is styled, Jose Rodriguez v. State Farm Mutual Automobile Insurance Company and Rhonda Cox.
Rodriguez filed an original petition on August 20, 2020, in the 98th Judicial District Court in Travis County, Texas. On September 18, 2020, State Farm timely removed the case to this court based on diversity jurisdiction. On September 25, 2020, State Farm filed a Motion to Dismiss and an Answer. Five days later, on September 30, 2020, Rodriguez filed a Second Amended Complaint which added Defendant Rhonda Cox, the individual that State Farm assigned to evaluate Rodriguez’s insurance claim, as a non-diverse defendant. Rodriguez now seeks to remand to state court in motion filed October 5, 2020. State Farm filed a response on October 25, 2020. Having reviewed the pleadings, record, and applicable law, the court will grant the motion to remand.
Joinder of a non-diverse party after removal is scrutinized under the improper-joinder doctrine. To demonstrate improper joinder of resident defendants, the removing defendant must demonstrate either: (1) actual fraud in the pleading of jurisdictional facts, or (2) inability of the plaintiff to establish a cause of action against the non-diverse party in state court.
Pursuant to 28 U.S.C., Section 1332(a), a court has subject-matter jurisdiction over civil actions between citizens of different states that involve an amount in controversy exceeding $75,000, exclusive of interest and costs. Diversity jurisdiction “requires complete diversity if any plaintiff is a citizen of the same State as any defendant, then diversity jurisdiction does not exist,” according to Flagg v. Stryker Corp., a 5th Circuit 2016 opinion. Federal Rule of Civil Procedure 15(a)(1) provides that a party may amend its pleading once as a matter of course within: “(A) 21 days after serving it, or (B) if the pleading is one to which a responsive pleading is required, 21 days after service of a responsive pleading or 21 days after service of a motion under Rule 12(b), (e), or (t), whichever is earlier.”
State Farm relies heavily on the 1987, 5th Circuit opinion styled, Hensgens v. Deere & Co. which articulates factors that courts should consider when determining whether to grant a party leave to amend its pleadings in order to join a non-diverse party. However, the Hensgens analysis is inapplicable to this case because no leave was necessary or required for Rodriguez to amend, which is discussed in the 2018, 5th Circuit opinion styled, Allen v. Walmart Stores, L.L.C. In deciding whether Cox was properly joined, the court resolves all contested factual issues and ambiguities in favor of the plaintiff. Cox was properly joined in this lawsuit as a matter of right under a Federal Rule of Civil Procedure 15(a)(1)(B) amendment that did not require leave of court. Cox, a non-diverse defendant, destroys complete diversity and denies this court jurisdiction. Accordingly, the Court Ordered that Rodriguez’s motion to remand is Granted. The case is Remanded to the 98th Judicial District Court in Travis County, Texas.