Land v. International Business Machines Corp.

108 F. Supp. 3d 632, 2015 U.S. Dist. LEXIS 67449, 2015 WL 3397089
CourtDistrict Court, S.D. Indiana
DecidedMay 26, 2015
DocketNo. 1:14-cv-01733-RLY-MJD
StatusPublished
Cited by5 cases

This text of 108 F. Supp. 3d 632 (Land v. International Business Machines Corp.) is published on Counsel Stack Legal Research, covering District Court, S.D. Indiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Land v. International Business Machines Corp., 108 F. Supp. 3d 632, 2015 U.S. Dist. LEXIS 67449, 2015 WL 3397089 (S.D. Ind. 2015).

Opinion

ENTRY ADOPTING THE MAGISTRATE JUDGE’S REPORT AND RECOMMENDATION

RICHARD L. YOUNG, Chief Judge.

The Magistrate Judge ' recommended that the court grant the Plaintiffs Motion to Remand. For the reasons set forth below, the court ADOPTS the Report and Recommendation and REMANDS this action to the Marion Superior Court.

I. Factual Background

In 2006, the Indiana Family and Social Services Administration (“FSSA”) and International Business Machines Corporation (“IBM”) entered into a Master Services Agreement, whereby IBM agreed to carry out many of the administrative responsibilities formerly carried out by FSSA and the State of Indiana. The following year, Plaintiffs adult son, Seth Land, was diagnosed with schizophrenia at the age of 20. Land applied for and received Medicaid coverage to help pay for his medications.

In 2009, Land’s Medicaid coverage was terminated. Acting as Land’s legal guardian, Plaintiff attempted to reinstate Plaintiffs Medicaid coverage, but was unsuccessful. Without his Medicaid- coverage, Plaintiff had no means to obtain the medications necessary to treat his illness. On May 15, 2009, Land attacked and seriously injured Plaintiff.

On May-13, 2011, Plaintiff filed a lawsuit under 42 U.S.C. § 1983 against Anne Murphy, individually and in her capacity as Secretary of the FSSA, IBM, and John and Jane Doe, arising out of the personal injuries she sustained from her son. On September 29, 2011, the court dismissed Plaintiffs § 1983 claims, declined to exercise supplemental jurisdiction over Plain[636]*636tiffs state law claims for, inter alia, negligence, and dismissed the state law claims without prejudice. (Filing No. 21-3 at 7). Plaintiff appealed the court’s decision, but the Seventh Circuit affirmed. Land v. Int’l Bus. Machines, Inc., 485 Fed.Appx. 830, 831 (7th Cir.2012).

On September 19, 2014, Plaintiff filed a Complaint in the Marion Superior Court against IBM, the FSSA, and the State of Indiana. Plaintiff explained that in refiling her claims, she “named the state entities responsible for the conduct alleged rather than the individuals who were named in the original federal court complaint, as required by Ind.Code § 34-13-3-5.” The substance of Plaintiffs allegations remained the same, in that Plaintiff asserted that Defendants’ negligence in administering Indiana’s Medicaid program resulted in the attack that caused her injuries.

On October 22, 2014, IBM removed the action to this court. In its Notice of Removal, IBM asserted that the case was properly removable because Plaintiffs claims raise a substantial federal question and because complete diversity exists among all parties who were properly joined. Although neither the FSSA nor the State joined the Notice of Removal, IBM asserted that their joinder in the action was fraudulent, such that their join-der in the Notice was not required.

On November 21, 2014, Plaintiff moved to remand this case to state court. The court referred the motion to the'-Magistrate Judge on February 2, 2015. Soon thereafter, the Magistrate Judge issued his Report and Recommendation finding that FSSA’s joinder was proper, thus destroying diversity jurisdiction. The Magistrate Judge therefore recommended that the court grant Plaintiffs Motion to Remand. IBM timely objected.

II. Standard of Review

Under the doctrine of fraudulent joinder, “an out-of-state defendant’s right of removal premised on diversity jurisdiction cannot be defeated by joinder of a nondiverse defendant against whom the plaintiffs claim has ‘no chance of success.’” Morris v. Nuzzo, 718 F.3d 660, 666 (7th Cir.2013) (quoting Poulos v. Naas Foods, Inc., 959 F.2d 69, 73 (7th Cir.1992)). The doctrine is designed to “protect the defendant’s statutory right to remove,” and therefore does not allow a plaintiff to “join a nondiverse defendant simply to destroy diversity jurisdiction.” Id.

The defendant asserting fraudulent joinder bears “a heavy burden.” Poulos, 959 F.2d at 73. “The defendant must show that, after resolving all issues of fact and law in favor of the plaintiff, the plaintiff cannot establish a cause of action against the in-state defendant.” Id. (emphasis in original). If the removing defendant can meet its burden, the court may “ ‘disregard, for jurisdictional purposes, the citizenship of certain nondiverse defendants, assume jurisdiction over a case, dismiss the nondiverse defendants, and thereby retain jurisdiction.’ ” Morris, 718 F.3d at 666 (quoting Schur v. L.A. Weight Loss Centers, Inc., 577 F.3d 752, 763 (7th Cir.2009)). Fraudulent joinder is therefore “an ‘exception’ to the requirement of complete diversity.” Id. (quoting Walton v. Bayer Corp., 643 F.3d 994, 999 (7th Cir.2011)).

III. Discussion

The Magistrate Judge concluded that the Journey’s Account Statute operated to extend the statute of limitations and preserve Plaintiffs claims against the FSSA, meaning the FSSA was properly joined. Because Plaintiff and the FSSA are citizens of Indiana, the Magistrate Judge concluded that the FSSA’s pres[637]*637ence1 in the action destroyed diversity jurisdiction. The court reviews the Magistrate Judge’s ruling de novo. Johnson v. Globus Med., Inc., 1:14-cv-00730-SEBMJD, 2015 WL 71035, at *2 (S.D.Ind. Jan. 5, 2015).

The JAS provides:

Sec. l.(a) This section applies if a plaintiff commences an action and:
(1) the plaintiff fails in the action from any cause except negligence in the prosecution of the action;
(2) the action abates or is defeated by the death of a party; or
(3) a judgment is arrested or reversed on appeal.
(b) If subsection (a) applies, a new action may be brought not later than the later of:
(1) three (3) years after the date of the determination under subsection (a); or
(2) the last date an action could have been commenced under the statute of limitations governing the original action;
and be considered a continuation of the original action commenced by the plaintiff.

Ind.Code § 34-11-8-1. The timeliness of Plaintiffs federal 2011 Complaint and its failure (i.e., dismissal without prejudice) are not in dispute. The resolution of the parties’ dispute turns on whether the present action is a continuation of the 2011 federal action.

Generally, for an action to be considered a continuation of the former, the parties, the facts, and the causes of action must be the same. Eves v. Ford Motor Co., 152 Ind.App.

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108 F. Supp. 3d 632, 2015 U.S. Dist. LEXIS 67449, 2015 WL 3397089, Counsel Stack Legal Research, https://law.counselstack.com/opinion/land-v-international-business-machines-corp-insd-2015.