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Richardson v. Cudd Pressure Control, Inc.

United States District Court, N.D. Oklahoma

August 23, 2017

KESHIA PORTER RICHARDSON, individually, as representative of the Estate of Delandis Richardson, deceased, and as next friend of M.R., MA.R., and MY.R., minor children, JACQUELINE RICHARDSON, and DARYL SLATE, Plaintiffs,
CUDD PRESSURE CONTROL, INC. d/b/a Cudd Energy Services, FORD MOTOR COMPANY, and BALLARD'S OF CLINTON d/b/a McKinsey Motor Company d/ba/ AMC Jeep Renault, McKinsey-Ballard Motors and/or McKinsey Ford, Defendants.



         Now before the Court is Plaintiffs' Motion to Remand to Oklahoma State District Court (Dkt. # 12). Plaintiffs argue that this case was improperly removed to federal court, and they ask the Court to remand the case to Tulsa County District Court. Defendant Ford Motor Company (Ford) responds that plaintiffs are engaging in blatant forum shopping and that plaintiffs have fraudulently joined two non-diverse defendants in an attempt to defeat federal subject matter jurisdiction.


         Delandis Richardson was employed by Cudd Pressure Control, Inc. (Cudd), and Richardson was and his wife is a citizen of Texas for the purpose of diversity jurisdiction. Dkt. # 1-1, at 2, 4. On November 25, 2014, Richardson was a passenger in a company-owned vehicle, which had been purchased from Ballard's of Clinton d/b/a McKinsey Motor Company (McKinsey). Id. at 4. Cudd employee Randy Roddy was driving the vehicle, and plaintiffs claim that the vehicle rolled over and the occupant restraint system failed during the accident. Id. at 4. Richardson was killed as a result of the accident, and plaintiffs claim that Roddy and Richardson were acting within the scope of their employment at the time of the accident. Id. at 4-5. Plaintiffs allege that the accident occurred in Campbell County, Wyoming. Id. at 4.

         Ford has submitted evidence suggesting that Richardson's estate has filed a claim for workers' compensation benefits in North Dakota.[1] Dkt. # 21-1. However, plaintiffs deny that the estate has filed a workers' compensation claim in North Dakota or that the estate has received workers' compensation benefits in any state. Dkt. # 26, at 3. In addition, plaintiffs have filed a lawsuit in Texas state court alleging claims of negligence and gross negligence against Cudd, and claims of manufacturer's products liability, negligence, and gross negligence against Ford. Dkt. # 21-2, at 7-11. The Texas lawsuit was filed in 2015. On November 17, 2016, plaintiffs filed a second lawsuit in Tulsa County District Court alleging claims of negligence and gross negligence against Cudd, claims of manufacturer's products liability, negligence, and gross negligence against Ford, and a manufacturer's products liability claim against McKinsey. The petition does not specify whether Oklahoma law or the law of some other state applies to plaintiffs' claims, and the state court has not made a choice of law determination.

         As to the case filed in Tulsa County District Court, Ford removed the case to this Court on the basis of diversity jurisdiction. Ford is incorporated in the state of Delaware and has its principal place of business in Michigan. Plaintiffs Keshia Porter Richardson, M.R., MA.R., and MY.R. are citizens of Texas, and the decedent, Delandis Richardson, was also a citizen of Texas. Dkt. # 1, at 4-5. Plaintiff Jacqueline Richardson is a citizen of Florida, and plaintiff Daryl Slate is a citizen of Tennessee.[2] Id. at 5. Defendant Cudd is a citizen of Texas, and defendant McKinsey is a citizen of Oklahoma. Ford argues that Cudd and McKinsey have been fraudulently joined as parties, because plaintiffs do not have viable claims against these defendants under Oklahoma law. Id. at 6-12. Even if Oklahoma law does not apply to plaintiffs' claims against Cudd, Ford argues that plaintiffs' tort claims against Cudd are barred by the workers' compensation laws of Texas, Wyoming, or North Dakota. Plaintiffs have filed a motion to remand (Dkt. # 12), arguing that Cudd and McKinsey are properly joined as parties. According to plaintiffs, Texas law provides an exception to the exclusive remedy provision of its workers' compensation laws, and it is possible that plaintiffs can recover against Cudd in tort as a matter of Texas law. Dkt. # 12, at 11-15. Plaintiffs also argue Ford has not conclusively established that McKinsey would be entitled to an innocent seller defense under Okla. Stat. tit. 76, § 57.2, and it is possible that plaintiff could recover against McKinsey.


         Plaintiffs ask the Court to remand this case to Tulsa County District Court, because neither Cudd nor McKinsey has been fraudulently joined and the Court lacks diversity jurisdiction over this case. Ford responds that plaintiffs' tort claims against Cudd are barred by the exclusive remedy provisions of Oklahoma, Wyoming, North Dakota, or Texas law, and plaintiffs have no possibility of recovery against Cudd. Ford also argues that McKinsey is an innocent seller as a matter of Oklahoma law, and plaintiffs' manufacturer's products liability claim against McKinsey is barred by § 57.2.

         The Supreme Court has recognized that a defendant's “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). Ford can prove fraudulent joinder by showing that either: (1) plaintiff's jurisdictional allegations are fraudulent and made in bad faith; or (2) plaintiff has no possibility of recovery against the non-diverse defendant. Slover v. Equitable Variable Life Ins. Co., 443 F.Supp.2d 1272, 1279 (N.D. Okla. 2006). If Ford can show that the non-diverse defendant, Cudd, was fraudulently joined, the parties will be completely diverse and the Court may exercise subject matter jurisdiction over this case.[3] S e e American Nat. Bank & Trust Co. of Sapulpa, v. Bic Corp., 931 F.2d 1411, 1412 (10th Cir. 1991) (“If, as defendant suggests, plaintiffs joined the Oklahoma residents without good faith, defendant may remove on the grounds of fraudulent joinder.”). To prove that a party has been fraudulently joined, the defendant has the burden to “demonstrate that there is no possibility that [plaintiff] would be able to establish a cause of action against [the joined party] in state court.” Hart v. Bayer Corp., 199 F.3d 239, 246 (5th Cir. 2000). When a defendant raises specific allegations of fraudulent joinder, the Court may pierce the pleadings to evaluate the defendant's argument. Smoot v. Chicago, Rock Island & Pac. R.R. Co., 378 F.2d 879, 881-82 (10th Cir. 1967); Dodd v. Fawcett Publications, Inc., 329 F.2d 82, 85 (10th Cir. 1964). “The burden of persuasion placed upon those who cry ‘fraudulent joinder' is indeed a heavy one.” Hart, 199 F.3d at 246 (quoting B., Inc. v. Miller Brewing Co., 663 F.2d 545, 549 (5th Cir. 1981)). Although the Court can pierce the pleadings, “[t]his does not mean that the federal court will pre-try, as a matter of course, doubtful issues of fact to determine removability; the issue must be capable of summary determination and be proven with complete certainty.” Smoot, 378 F.2d at 882.

         The parties' dispute as to the viability of plaintiffs' claims against Cudd depends upon the choice of law determination. Plaintiffs have not alleged an intentional tort against Cudd, and they do not dispute that a negligence claim of any variety would be barred by the exclusive remedy provisions of Oklahoma, Wyoming, and North Dakota workers' compensation law. In order to proceed with a tort claim against Cudd, plaintiffs will have to establish that their claims against Cudd are governed by Texas law. Under Texas law, workers' compensation is the exclusive remedy for an employee alleging that he suffered a work-related injury. Tex. Labor Code Ann. § 408.001. However, § 408.001 “does not prohibit the recovery of exemplary damages by the surviving spouse or heirs of the body of a deceased employee whose death was caused by an intentional act or omission of the employer or by the employer's gross negligence.” Id. Plaintiffs have alleged that Cudd acted with negligence and gross negligence by allowing Roddy to drive a company vehicle. Dkt. # 1-1, at 5-6. Plaintiff's ordinary negligence claim against Cudd is barred by § 408.001 but, if the Court were to find that Texas law applied, it is possible that plaintiff could proceed with a gross negligence claim against Cudd. Plaintiffs' negligence and gross negligence claims are identical in the Texas lawsuit and this case, and this could be viewed as an indication that plaintiffs are seeking to have Texas law applied to their claims against Cudd in this case. However, plaintiffs' intention concerning the choice of law is not a deciding factor in the choice of law analysis.

         In making a choice of law determination in a diversity case, this Court must apply the choice of law rules that would be applicable in the courts of the forum state. Garcia v. Int'l Elevator Co., Inc., 358 F.3d 777, 779 (10th Cir. 2004); New York Life Ins. Co., v. K N Energy, Inc., 80 F.3d 405, 409 (10th Cir. 1996). The Oklahoma Supreme Court has stated that “the rights and liabilities of parties with respect to a particular issue in tort should be determined by the local law of the state which, with respect to that issue, has the most significant relationship to the occurrence and the parties.” Hightower v. Kansas Southern Ry. Co., 70 P.3d 835, 842 (Okla. 2003). In applying the “most significant relationship” test, a court must consider the following four factors:

(1) the place where the injury occurred,
(2) the place where the conduct causing the injury occurred,
(3) the domicile, residence, nationality, place of incorporation and place of business ...

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