In re Joint Eastern & Southern Districts Asbestos Litigation

124 F.R.D. 538, 1989 WL 11996
CourtDistrict Court, E.D. New York
DecidedFebruary 3, 1989
DocketJohnson (CV-87-0724 (S.D.N.Y.); Higgins (CV-87-0537 (S.D.N.Y.); Nos. CV-87-0724, CV-87-0537
StatusPublished
Cited by17 cases

This text of 124 F.R.D. 538 (In re Joint Eastern & Southern Districts Asbestos Litigation) is published on Counsel Stack Legal Research, covering District Court, E.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Joint Eastern & Southern Districts Asbestos Litigation, 124 F.R.D. 538, 1989 WL 11996 (E.D.N.Y. 1989).

Opinion

[539]*539MEMORANDUM AND ORDER

SIFTON, District Judge.

These two asbestos-related personal injury cases are before the court on seven motions made after the jury’s verdicts. Four of the motions arise because of the extraordinary circumstance that one allegedly non-diverse party proceeded through trial and verdict although never named in the complaint or served with process.

The facts are not disputed except as noted. The Higgins and Johnson cases were consolidated for trial before the undersigned and a jury. All parties assumed that Celotex Corp., Raymark Industries, Inc., and Owens-Illinois, Inc. were named as defendants in both cases. After trial, the jury rendered a verdict for plaintiffs in both cases, holding all three defendants liable as follows:

Higgins:

Compensatory damages: $1,000,000

Percentage of responsibility:

Mr. Higgins 10%

Celotex Raymark Owens-Illinois Ten settling co-defendants Punitive damages:

Celotex

Raymark

Owens-Illinois

10%

6% each

$1,000,000

Johnson:

Compensatory damages: Percentage of responsibility: Celotex Raymark Owens-Illinois

Seven settling co-defendants

Punitive damages:

$ 350,000

12.5%

5.0%

10.0% each

$1,000,000 $1,000,000 $ 800,000

After the verdict but before entry of judgment, it became clear that Celotex had never been named or served as a defendant in Higgins, apparently because both Higgins and Celotex were thought to be Florida citizens.

Celotex is incorporated in Delaware, but a corporation is also a citizen of the state of its principal place of business. 28 U.S.C. § 1332(c). Defendants assert that Celotex’s principal place of business is in Florida, based on a terse affidavit from one D.S. Gibson, Manager of Safety and Property Conservation for Celotex. Plaintiff has not applied for leave to file an amended complaint alleging diversity and has failed to present any evidence concerning Celotex’s principal place of business at the time these actions were commenced. Since the burden of pleading and proof is on plaintiff to establish diversity, I shall proceed on the premise that diversity is lacking between [540]*540Celotex and plaintiff in the Higgins case. Entry of judgment on this decision will, however, be stayed until February 15, 1989, to permit plaintiff to file an amended complaint in the event it can do so in compliance with Rule 11 of the Federal Rules of Civil Procedure.

The motions before the court are as follows: (1) a motion by plaintiffs, in which Owens-Illinois joins, to amend the complaint under F.R.Civ.P. 15(b) to allege causes of action against Celotex; (2) a motion by defendants to dismiss both cases for lack of subject matter jurisdiction; (3) a motion by plaintiff to drop Celotex as a defendant under Rule 21; (4) a motion by Owens-Illinois to dismiss for failure to join an indispensable party under Rule 19(b); (5) a motion by plaintiff to set aside that portion of the Higgins verdict finding Mr. Higgins comparatively negligent; (6) a motion by Owens-Illinois for determination of offsets required by settlements with co-defendants under N.Y.Gen.Oblig.L. § 15—108; and (7) a motion by defendants for a new trial because of improper statements made during plaintiffs closing arguments.

The four motions relating to subject matter jurisdiction are closely interrelated. In summary, their disposition is as follows. The complaint is deemed amended to add Celotex as a party defendant; this leads to a lack of complete diversity between the parties; Celotex is therefore dropped as a defendant under Rule 21 or 15(a) in order to preserve jurisdiction over the other parties, because this does not cause prejudice to the other defendants within the meaning of Rule 19.

MOTION TO AMEND COMPLAINT

Plaintiff, joined by Owens-Illinois, moves for amendment of the Higgins complaint under F.R.Civ.P. 15(b) to add Celotex as a party. Of course, this motion alone cannot affect subject matter jurisdiction one way or the other. Even if Celotex’s having proceeded through the trial is deemed consent to trying the issue of its liability, this consent could not confer subject matter jurisdiction on the court. Nevertheless, it is appropriate to rule upon this Rule 15(b) motion because of the bearing it has on the motion to dismiss for lack of subject matter jurisdiction.

Implied consent to the trial of an issue will be found, in general, when the parties “recognized that an issue not presented by the pleadings entered the case at trial.” 6 C. Wright and A. Miller, Federal Practice and Procedure § 1493, at 462. “In a motion under rule 15(b) ... the most important question is whether the new issues were tried by the parties’ express or implied consent and whether the defendant ‘would be prejudiced by the implied amendment, i.e., whether he had a fair opportunity to defend and whether he could offer any additional evidence if the case were to be retried on a different theory.’ ” Browning Debenture Holders’ Committee v. DASA Corp., 560 F.2d 1078, 1086 (2d Cir.1977) (citations omitted).

This implied consent can be inferred from a party’s failure to. object to the introduction of evidence relating to the issue, see, e.g., Sun-Fun Prods., Inc. v. Suntan Research and Devel. Inc., 656 F.2d 186 (5th Cir.1981), and from the introduction of evidence on that issue by the very party opposing the implied amendment, see, e.g., Bradford Audio Corp. v. Pious, 392 F.2d 67, 73 (2d Cir.1968). Both of these bases of inference are present in the instant case. Nor are any countervailing factors present that would tend to show lack of consent: a party’s not having been represented by an attorney; the evidence supporting consent having all also borne on issues that were expressly included in the pleadings; or “prejudice” to a party, “prejudice in this context meanpng] a lack of opportunity to prepare to meet the unpleaded issue.” 6 C. Wright and A. Miller, supra, § 1493, at 467-68.

Rule 15(b) cannot, itself, expand the court’s jurisdiction. See, e.g., Falls Industries, Inc. v. Consolidated Chemical Industries, Inc., 258 F.2d 277, 285-86 (5th Cir.1958); Bucky v. Sebo, 208 F.2d 304, 307 n. 7 (2d Cir.1953). But there is no persuasive indication that a Rule 15(b) motion should be denied simply because it might lead to a jurisdictional defect, so long as [541]

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124 F.R.D. 538, 1989 WL 11996, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-joint-eastern-southern-districts-asbestos-litigation-nyed-1989.