Hollon v. Oy

898 F. Supp. 433, 1995 U.S. Dist. LEXIS 14600
CourtDistrict Court, E.D. Texas
DecidedSeptember 29, 1995
DocketMDL No. 1038; No. 1:95 CV 5039
StatusPublished
Cited by1 cases

This text of 898 F. Supp. 433 (Hollon v. Oy) is published on Counsel Stack Legal Research, covering District Court, E.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hollon v. Oy, 898 F. Supp. 433, 1995 U.S. Dist. LEXIS 14600 (E.D. Tex. 1995).

Opinion

MEMORANDUM OPINION AND ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFFS’ MOTION FOR LEAVE TO FILE FIRST AMENDED COMPLAINT AND GRANTING PLAINTIFFS’ MOTION TO REMAND

SCHELL, Chief Judge.

Before this court are Plaintiffs’ Motion for Leave to File First Amended Complaint and Plaintiffs’ Motion to Remand, which were filed on July 21, 1995. Defendants timely filed their opposition to these motions on August 4, 1995. Plaintiffs then filed a reply to the Defendants’ opposition on August 21, 1995. Upon consideration of the motions, responses, reply, and memoranda of law, the court is of the opinion that the Motion for Leave to File First Amended Complaint should be GRANTED in part and DENIED in part and that the Motion to Remand should be GRANTED.

BACKGROUND

Defendants manufacture, market, distribute, and sell the Norplant contraceptive device (or component parts thereof) to doctors and hospitals, which in turn implant the device in the bodies of women. Plaintiffs are all Texas residents. Plaintiff Brenda Hollon is among those women having had Norplant inserted, and now she and her husband are suing the Defendants, individually and as next' friends of her two children, alleging that Norplant caused in her various unexpected side' effects, which in turn adversely impacted upon' her husband and her children as well. Plaintiffs filed suit on September 14, 1994 in Texas state court. Subsequently, Defendants removed the case to federal court on October 12, 1994, basing the removal on complete diversity of citizenship. Then, on July 21, 1995, Plaintiffs filed a motion for leave to amend their complaint, seeking to add four additional defendants. The proposed additional defendants are (1) Dr. L.B. Goss, M.D. (“Dr. Goss”), the doctor who inserted the Norplant capsules into Plaintiff Brenda Hollon, who is, not coincidentally, a resident of Texas, (2) Bob Boyce (“Boyce”), the product distributor of Plaintiff Brenda Hollon’s Norplant, also a Texas resident, and (3) and (4) two manufacturers of component parts of Norplant. Defendants have responded that Plaintiffs should not now be allowed to add nondiverse defendants to the proceeding, claiming that the Plaintiffs’ sole purpose in doing so is to defeat this court’s subject matter jurisdiction over the case.

DISCUSSION

Rule 15 of the Federal Rules of Civil Procedure states that although leave of court is required for a party to amend its pleadings after a responsive pleading has been served, “leave shall be freely given when justice so requires.” Fed.R.Cxv.P. 15(a). However, this rule must be read in conjunction with 28 U.S.C. § 1447(e), which provides, “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 [435]*435action to the state court.” 28 U.S.C. § 1447(e).

The Fifth Circuit has addressed the situation in which the plaintiff, after a case has been removed on diversity grounds, seeks to add a nondiverse defendant and thereby destroy diversity. See Hensgens v. Deere & Co., 883 F.2d 1179 (5th Cir.1987), appeal after remand, 869 F.2d 879, reh’g denied, 875 F.2d 858, cert. denied, 493 U.S. 851, 110 S.Ct. 150, 107 L.Ed.2d 108 (1989).1 In Hensgens, the court discussed the competing interests that are affected when a plaintiff seeks to add a nondiverse defendant to an already-removed case. The court stated that “the district court, when confronted with an amendment to add a nondiverse nonindis-pensable party, should use its discretion in deciding whether to allow that party to be added.” Id. at 1182. The court went on to mandate that a district court, when faced with this situation, must consider the original defendant’s interest in the choice of forum and should scrutinize an amendment to include a nondiverse defendant more closely than an ordinary amendment. Id. Finally, the court outlined several factors for a district court to consider in using its discretion. These factors include: (1) the extent to which the purpose of the amendment is to defeat federal jurisdiction; (2) whether plaintiff has been dilatory in asking for amendment; (3) whether plaintiff will be significantly injured if amendment is not allowed; and (4) any other factors bearing on the equities. Id.

These factors have been considered in situations similar to the case at bar by other district courts in the Fifth Circuit. See, e.g., Horton v. Scripto-Tokai Corp., 878 F.Supp. 902, 908-909 (S.D.Miss.1995); O’Connor v. Automobile Ins. Co. of Hartford, Conn., 846 F.Supp. 39, 41 (E.D.Tex.1994); Smith v. Arkansas Louisiana Gas Co., 157 F.R.D. 34, 35-36 (E.D.Tex.1994). In cases applying the Hensgens factors, when the plaintiff knew about the nondiverse party’s activities at the time the suit was originally brought in state court but still chose not to include that party as an original defendant, courts have viewed any later attempt to add the nondiverse party as a defendant as nothing more than an attempt to destroy diversity. For example, in O’Connor, the plaintiff sued the defendants for their alleged failure to pay insurance proceeds. O’Connor, 846 F.Supp. at 40. After the defendant insurance companies removed the case to federal court based upon complete diversity between the parties, the plaintiff attempted to add the nondiverse insurance agency from which the plaintiff purchased the policy as a defendant. Id. However, the court refused to allow such an amended complaint, noting that because the agency was mentioned in the original petition filed in state court as the seller of the insurance, policy, plaintiff had apparently chosen to later add the agency as a defendant solely for the purpose of defeating diversity jurisdiction. • Id. at 41.

Alternatively, when a plaintiff discovers the nondiverse party’s activities at some time after the cause of action is removed to federal court, then a district court has held that a later amendment adding that party as a defendant was not done for the express purpose of defeating diversity jurisdiction. See Horton, 878 F.Supp. at 908-909. In Horton, the plaintiff brought a products liability action based upon injuries allegedly caused by a defective lighter. Id. at 904. Soon after Sling its suit in state court, the defendants removed the suit to federal court, alleging diversity of citizenship. Id. However, also at some time immediately after filing its lawsuit, the plaintiff discovered that a nondi-verse party was actually the distributor of the lighter, rather than one of the named defendants. Id. Therefore, the plaintiff attempted to amend her complaint, naming the nondiverse distributor as a defendant. Id. Discussing the Hensgens factors, the court held that the plaintiff did not add the nondi-verse defendant to destroy diversity jurisdiction. Id. at 909.

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Related

In Re Norplant Contraceptive Prod. Liability
898 F. Supp. 433 (E.D. Texas, 1995)

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Bluebook (online)
898 F. Supp. 433, 1995 U.S. Dist. LEXIS 14600, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hollon-v-oy-txed-1995.