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Sonn v. Wal-Mart Stores

September 1, 2006

EVELYN SONN, PLAINTIFF,
v.
WAL-MART STORES, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: James Orenstein, Magistrate Judge

MEMORANDUM AND ORDER

Plaintiff Evelyn Sonn ("Sonn") seeks leave to amend her complaint in this personal injury action against Wal-Mart Stores, Inc. ("Wal-Mart") and a Wal-Mart employee whose identity is the subject of the instant motion. See Docket Entry ("DE") 13.*fn1 Specifically, Sonn seeks to substitute all references in her original complaint to the fictitiously-named defendant Diane "Doe" with references to Fran Mahon ("Mahon"), the Wal-Mart employee whom she now believes to have caused her to suffer the injury at issue in this litigation. Because Sonn and Mahon are both citizens of New York, and because the only jurisdictional basis for Wal-Mart's removal of this case to federal court was diversity, see 28 U.S.C. § 1332, Sonn further asks that, in the event I grant leave to amend, I thereupon remand the case to the state court in which it was originally filed. DE 13. Wal-Mart opposes the proposed amendment on the ground that Sonn's sole motivation is to destroy diversity. DE 14. As discussed below, I find that Sonn has established legitimate grounds for adding Mahon, and I therefore grant her motion in its entirety.

I. Background

This is the second time that Wal-Mart has removed this suit to this court and the second time that I have had occasion to consider this court's jurisdiction over the parties' dispute. Sonn first filed her complaint in the Supreme Court of the State of New York, County of Kings, on March 3, 2006, and Wal-Mart, after later being served that complaint, removed the case to this court by means of a notice dated March 22, 2006. See Sonn I, DE 1. The following day, I summarily remanded the case on the ground that Wal-Mart had not shown that the amount in controversy exceeded $75,000, and had therefore failed to demonstrate this court's jurisdiction. See Sonn I, DE 4, 2006 WL 752929 (E.D.N.Y. Mar. 23, 2006). Wal-Mart subsequently removed the case to this court for a second time after it learned, through the use of discovery procedures available under state law, that Sonn seeks damages in excess of $75,000. See DE 1 at 3.

Between the time that I first remanded the case and the time that Wal-Mart filed its second removal notice -- and thus, while the action was pending before the state court in which Sonn had initially filed suit -- Sonn amended her complaint to join as a defendant the individual Wal-Mart employee who she believed had caused the accident in which she claimed to have been injured. See DE 1 at 18-22 (Amended Verified Complaint) ("AVC"). In amending the complaint in state court, Sonn referred to this individual defendant by the fictitious name "Diane 'Doe'" because she then (incorrectly) believed that the individual's first name was Diane, but did not know her last name. See AVC; DE 10; DE 15.

Shortly after the case was removed for the second time, I directed the parties to appear at a case management and scheduling conference to discuss, in addition to routine issues, the facts and law relevant to the addition of Diane "Doe" to this suit and information that might help to identify her. See DE 4. At the conference, I directed the parties to address two specific issues in follow-up submissions: the identity of Diane "Doe" and Sonn's motivation for adding her as a defendant in the state court action. See DE 7.

The parties' submissions made it clear that there was a factual dispute on the latter point. While Sonn's counsel averred that it had "always" been Sonn's intention to add the Wal-Mart employee as a party defendant, see DE 10, Wal-Mart's counsel claimed that Sonn had added "Doe" for the sole purpose of destroying diversity, see DE 11. As I noted in an order dated June 9, 2006, in which I declined to take action on the parties' submissions, there was at that time no justiciable controversy before me: the removal statute by its plain terms directs me to ignore the citizenship of fictitiously-named defendants when considering the propriety of removal. See DE 12 at 2 (citing 28 U.S.C. § 1447(e)). Anticipating the instant motion, I noted that in the event Sonn moved to amend her complaint to add a real individual with New York citizenship, the issue of her motivation for doing so might become relevant. Sonn has now made such a motion.

II. Discussion

A. Leave To Amend

Pursuant to the removal statute and pertinent case law, in a situation such as this where a plaintiff seeks to join a non-diverse defendant whose addition to the case would "destroy subject matter jurisdiction," the trial court can either allow joinder and remand the action to the state court in which it was filed or deny joinder and retain jurisdiction over the case. See 28 U.S.C. § 1447(e). District courts have broad discretion to decide which course of action to take. See e.g., Briarpatch Ltd., L.P. v. Pate,81 F. Supp.2d 509, 515 (S.D.N.Y. 2000).

In exercising that discretion, district courts in this circuit first consider whether the proposed joinder satisfies the liberal "same transaction or occurrences" test applicable to the joinder of a new party pursuant to Federal Rule of Civil Procedure 20. See Nazario v. Deere & Co., 295 F. Supp.2d 360, 363 (S.D.N.Y. 2003). While neither party has addressed that issue, I have no doubt that the proposed joinder of Mahon is consistent with Rule 20: the parties' submissions plainly show that Sonn's complaints against Wal-Mart and Mahon, respectively, involve common questions of law or fact. See id. (citing United Mine Workers of Am. v. Gibbs, 383 U.S. 715, 724 (1966)).

The second and more complicated issue is whether allowing the diversity-destroying joinder Sonn requests would "comport with principles of fundamental fairness." Soto v. Barnitt, 2000 WL 1206603, *3 (S.D.N.Y. Aug. 23, 2000) (citations and internal quotations omitted). "Towards such a determination, a court generally considers the following four factors: (1) any delay, and the reasons for the delay, in seeking to amend; (2) any resulting prejudice to the defendant; (3) the likelihood of multiple litigation; and (4) the plaintiff's motivation in moving to amend." Id. (citing cases); see also Nazario, 295 F. Supp.2d at 363.

As to the first factor, it appears that Sonn has known the identity of the proposed additional defendant since June 2, 2006, when Wal-Mart, complying with my earlier order, provided her with Mahon's name. See DE 14 at 2. Wal-Mart appears to suggest that Sonn's failure to bring the instant motion for just over two months after it disclosed the information constitutes unreasonable delay. See id. at 3 (noting that Sonn's counsel has offered "no reasonable explanation" for not bringing the instant motion sooner). In response, Sonn's counsel has offered what I find to be a reasonable explanation for the two-month delay: she was waiting to initiate such motion practice until after a mediation hearing that Wal-Mart had scheduled for July 19, 2006. See DE 15 at 2. I find that any delay with respect to bringing the instant motion was both minimal and justified. Cf. Nazario, 295. F. Supp.2d at 363 (noting that plaintiff's unjustified five-month delay weighed in favor of denying joinder).

Wal-Mart has never suggested that it will suffer any prejudice from the addition of Mahon as a party to this litigation, and I can think of no way in which it would. Indeed, the only risk of prejudice to Wal-Mart arising from Sonn's proposed amendment is one that it seems eager to endure. That is, Sonn would presumably be within her rights to commence a separate state court action against Mahon if denied an opportunity to join her to this lawsuit. In such circumstances, however, Wal-Mart would likely bear the burdens of defending both cases, given its acknowledgment (to me, at least) that, if Sonn can prove her allegations, it would bear responsibility for Mahon's actions under a theory of respondeat superior. See DE 14 at 3. Even if a judgment against Sonn in one case might collaterally estop her in the other, it seems likely that Wal-Mart would incur the costs of litigating both actions until it obtained such a judgment, and would thereafter have to litigate the issue of preclusion in the remaining lawsuit. That possibility suggests not only that the factor of potential prejudice is of no help to Wal-Mart, but also that the consideration of avoiding multiple litigation weighs in favor of permitting the proposed joinder. However, I do not give these factors ...


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