The opinion
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF LOUISIANA
LAFAYETTE DIVISION
TONYA BRAGG ET AL CASE NO. 6:24-CV-01245
VERSUS JUDGE ROBERT R.
SUMMERHAYS
COSTCO WHOLESALE CORP ET AL MAGISTRATE JUDGE CAROL B.
WHITEHURST
REPORT AND RECOMMENDATION
Before the Court is Plaintiffs’ Motion to Remand. (Rec. Doc. 16). Costco
Wholesale Corp. (“Costco”) opposed the Motion. (Rec. Doc. 19). The Motion was
referred to the undersigned magistrate judge for review, report, and recommendation
in accordance with the provisions of 28 U.S.C. §636 and the standing orders of this
Court. Considering the evidence, the law, and the arguments of the parties, and for
the reasons explained below, the Court recommends that Plaintiffs’ motion be
DENIED.
Factual Background
On June 26, 2024, Plaintiffs, Tonya and William Bragg, filed a Petition for
Damages in state court naming Costco, Ambassador Infrastructure, LLC, ABC
Insurance Company, and John/Jane Doe after Plaintiff Tonya Bragg slipped on an
“unseen liquid substance” in the refrigerated produce section at Costco causing her
to “suddenly and violently fall to the floor” which resulted in “severe and disabling
injuries.” (Rec. Doc. 1-1). On August 26, 2024, Plaintiffs filed a “First
Supplemental and Amending Petition for Damages” replacing Infrastructure, LLC,
with The Industrial Development Board of the Parish of Lafayette, Louisiana Inc.
(“The Board”). (Rec. Doc. 1-3). On October 10, 2024, Plaintiffs filed a Second
Supplemental, Amending, and Restated Complaint wherein they named three
additional Defendants: the manufacturer of the refrigeration unit and/or its
ventilation, the installer of the refrigeration unit and/or its ventilation, and the
company hired to maintain the refrigeration unit and/or its ventilation. (Rec. Doc.
15).
In the Notice of Removal, Costco alleges that this Court has subject-matter
jurisdiction pursuant to 28 U.S.C. § 1332 because the parties are diverse in
citizenship and the amount in controversy exceeds $75,000.00. (Rec. Doc. 1). The
citizenship of the known, named parties is uncontested: Costco is a corporation with
its principal place of business in the State of Washington; the Board is a non-profit
corporation domiciled in Louisiana; and Plaintiffs are Louisiana citizens. (Rec.
Docs. 1, 15, 16-1, & 19). Plaintiffs also maintain that, upon information and belief,
the unnamed parties, John/Jane Doe, the manufacturer of the refrigeration unit
and/or its ventilation, the installer of the refrigeration unit and/or its ventilation, and
the company hired to maintain the refrigeration unit and/or its ventilation are citizens
of Louisiana. (Rec. Doc. 16).
Costco asserts that the citizenship of defendants sued under fictitious named
should be disregarded under 28 U.S. Code § 1441(b)(1) and maintains that the Board
is an improperly joined defendant whose citizenship should also be disregarded for
removal purposes. (Rec. Docs. 1 & 19). Plaintiffs filed the instant Motion to
Remand asserting that they have stated viable claims against the Board, such that the
Board is a proper defendant thereby destroying diversity jurisdiction. (Rec. Doc.
16). The Court agrees with Costco that 28 U.S. Code § 1441(b)(1) instructs the Court
to disregard “the citizenship of defendants sued under fictitious names” “[i]n
determining whether a civil action is removable on the basis of jurisdiction under
section 1332(a).” Accordingly, the key question in this matter is whether Plaintiffs
have viable claims against the Board.
Law and Analysis
I. Law applicable to removal, remand, and improper joinder.
The federal district courts have original jurisdiction over cases in which the
parties are diverse in citizenship and the amount in controversy exceeds $75,000,
pursuant to 28 U.S.C. §1332. 28 U.S.C. §1441 and §1446 provide the procedural
mechanism by which a party may remove a matter from state court to a federal
district court.
Generally, upon the filing of a motion to remand, the removing party bears
the burden to prove that federal jurisdiction exists. De Aguilar v. Boeing Co., 47 F.3d
1404, 1408 (5th Cir. 1995). Thus, Costco, as the party seeking to invoke federal
diversity jurisdiction under §1332, bears the burden of establishing both that the
parties are diverse and that the amount in controversy exceeds $75,000. Garcia v.
Koch Oil Co. of Texas Inc., 351 F.3d 636, 638 (5th Cir. 2003).
In this case, Costco contends that the Board, a non-diverse defendant, was
improperly joined. (Rec. Docs. 1 & 19). “When a defendant removes a case to
federal court on a claim of improper joinder, the district court’s first inquiry is
whether the removing party has carried its heavy burden of proving that the joinder
was improper.” Smallwood v. Illinois Cent. R. Co., 385 F.3d 568, 576 (5th Cir. 2004)
(en banc). “To demonstrate improper joinder of resident defendants, the removing
defendants must demonstrate either: (1) actual fraud in the pleading of jurisdictional
facts, or (2) inability of the plaintiff to establish a cause of action against the non-
diverse party in state court. Gasch v. Hartford Acc. & Indem. Co., 491 F.3d 278, 281
(5th Cir. 2007), quoting Crockett v. R.J. Reynolds Tobacco Co., 436 F.3d 529, 532
(5th Cir.2006).
Costco does not contend actual fraud in the pleadings; rather, Costco relies
upon the second category of improper removals. As such, the threshold question is
whether “there is no reasonable basis for the district court to predict that the plaintiff
might be able to recover against an in-state defendant.” Id. (citing Smallwood,
supra). In deciding whether a party was improperly joined, the Court must resolve
all contested factual issues and ambiguities of state law in favor of the plaintiff. Id.
(citing Guillory v. PPG Indus., Inc., 434 F.3d 303, 308 (5th Cir.2005)).
While the Court has discretion to “pierce the pleadings and consider summary
judgment-type evidence in the record” in determining whether joinder was improper,
it “must also take into account all unchallenged factual allegations, including those
alleged in the complaint, in the light most favorable to the plaintiff.” McKee v. Kan.
City S. Ry. Co., 358 F.3d 329, 334 (5th Cir.2004) (citing Travis, 326 F.3d at 648-49.).
Thus, “although the type of inquiry into the evidence is similar to the summary
judgment inquiry, the district court is not to apply a summary judgment standard but
rather a standard closer to the Rule 12(b)(6) standard.” Id. Any contested issues of
fact and any ambiguities of state law must be resolved in the plaintiff’s favor. Id.
The Court “must also take into account the ‘status of discovery’ and consider what
opportunity the plaintiff has had to develop its claims against the non-diverse
defendant.” Id. at 334-36; see also Travis, 326 F.3d at 650-51 (noting that when
discovery was ongoing “simply pointing to the plaintiff's lack of evidence at stage
of the case is insufficient” to establish improper joinder). At this stage of the
litigation the plaintiff is not expected to produce evidence sufficient to survive a
motion for summary judgment; he must only show a “reasonable basis for the []
court to predict that the plaintiff might be able to recover.” Smallwood, 385 F.3d at
573; see also Guillory v. PPG Indus., Inc., 434 F.3d 303, 308–09 (5th Cir.2005)
(explaining “[w]e do not determine whether the plaintiff will actually or even
probably prevail on the merits of the claim, but look only for a possibility that the
plaintiff might do so”).
II. Whether Plaintiffs have asserted viable claims against the Board.
According to Plaintiffs, the Board “owned the property…; had access to the
premises; and was responsible for the condition of the premises and any defects
thereon…” (Rec. Doc. 15, ¶ 5). Plaintiffs contend that the Board and/or Costco
knew or should have known that the liquid substance on the floor presented an
unreasonable risk of harm to patrons, were on constructive notice of the hazard, and
failed to exercise reasonable care in remedying the hazard. (Id. at ¶¶ 7-9). Plaintiffs
also allege that the Board and/or Costco knew that the refrigeration unit vents in the
produce area “produced condensation, especially during hot summer months, which
condensation dripped onto the floor of the produce area” creating an “unreasonably
hazardous condition.” (Id. at ¶ 12). Accordingly, Plaintiffs maintain that the Board
is liable for damages. (Id. at ¶¶ 10, 19, & 20).
Per Plaintiffs, the Board leases the premises to Costco, and the lease does not
absolve the Board from responsibility. (Rec. Doc. 16-1, p. 5). Plaintiffs point to La.
C.C. art. 2696 which states “[t]he lessor warrants the lessee that the thing is suitable
for the purpose for which it was leased and that it is free of vices or defects that
prevent its use for that purpose,” and La. C.C. art. 2699 which provides waiver of
said warranty only when the lessee assumes “by clear and unambiguous language”
responsibility of the premises pursuant to La. R.S. 9:322. (Id.). Plaintiffs assert that
the lease between the Board and Costco contains no such clear and unambiguous
language stating that Costco assumes the responsibility of the condition of the
premises. (Id. at p. 6). Plaintiffs also point to a provision in the lease which states
that the Board “shall have the right at all reasonable times and upon reasonable
advance notice to enter upon ‘The Premises’ and to examine and inspect ‘The
Premises.’” (Id). Plaintiffs thus conclude that the Board had the right to enter the
store “to detect unreasonable dangerous conditions, and it had a duty to remedy such
unreasonably dangerous conditions.” (Id.).
Per La. R.S. 9:322:
[T]he owner of premises leased under a contract whereby the lessee
assumes responsibility for their condition is not liable for injury caused
by any defect therein to the lessee or anyone on the premises who
derives his right to be thereon from the lessee, unless the owner knew
or should have known of the defect or had received notice thereof and
failed to remedy it within a reasonable time.
Costco maintains that the lease agreement does have unambiguous language
requiring Costco to assume responsibility of the condition of the premises. (Rec.
Doc. 19, p. 3). Specifically, Costco points to the following provisions of the lease
agreement:
• The Lessee [Costco] agrees that during the Lease Term it will, at its
own expense, maintain and keep the [premises] in as reasonably safe
condition as its operations shall permit… (Rec. Doc. 19-1, p. 3).
• Lessee [Costco] will, with reasonable promptness, make all structural
and non-structural, foreseen and unforeseen, and ordinary and
extraordinary repairs of every kind and nature… (Id.).
• Lessor [the Board] shall not be required to maintain, repair, or rebuild
the [premises] or any part thereof in any way, or to make any
alterations, replacements or renewals of any nature or description to the
[premises] or any part thereof, whether ordinary or extraordinary,
structural or non-structural, foreseen or unforeseen… (Id.).
• The Lessor [Board] makes no warranty, either expressed or implied, as
to the condition of the [premises] or that it will be suitable for the
Lessee’s [Costco’s] purposes or needs. (Id. at p. 5).
• The Lessee [Costco] shall indemnify and save harmless the Lessor [the
Board]…from and against all liabilities, obligations, claims, damages,
penalties, fines, losses, costs and expenses…in connection with the
following:
…
o (e) any action, suit, claim proceeding of a judicial nature arising
from or in connection with Lessor’s [the Board’s] ownership of
the [premises] or the operation, occupation or use of the
[premises], including without limitation any action to recover
damages for injury to person or property. (Id.).
The Court finds that the lease agreement language clearly shifts responsibility
for the condition of the premises and liability for any injury at the premises to
Costco. Under La. R.S. 9:3221, to establish liability on the part of a lessor who has
passed on responsibility for the condition of its property to its lessee, “a plaintiff
must establish that (1) he sustained damages; (2) there was a defect in the property;
and (3) the lessor knew or should have known of the defect.” Smith v. French Mkt.
Corp., 886 So. 2d 527, 530 (La. App. 4 Cir. 2004).
Plaintiffs did not allege that a representative of the Board was present at the
time of the incident, or that the Board was put on notice about the condition. Rather,
they vaguely allege that the Board knew or should have known that the liquid
substance on the floor presented an unreasonable risk of harm to patrons, were on
constructive notice of the hazard, and failed to exercise reasonable care in remedying
the hazard, and that the Board knew that the refrigeration unit vents in the produce
area “produced condensation, especially during hot summer months, which
condensation dripped onto the floor of the produce area” creating an “unreasonably
hazardous condition.” (Rec. Docs. 16, ¶¶ 7-9 & ¶ 12). Further, while Plaintiffs
conclude that the Board had the right to enter the store “to detect unreasonable
dangerous conditions, and it had a duty to remedy such unreasonably dangerous
conditions,” (Rec. Doc. 16-1, p. 6), there are no pleaded facts to support a finding
that the Board ever inspected the premises, had knowledge of, or received notice of
the alleged defect, and conclusory allegations are not accepted as true. Kaiser
Aluminum & Chemical Sales v. Avondale Shipyards, 677 F.2d 1045, 1050 (5th Cir.
1982).
Accordingly, Plaintiffs’ general allegations that the Board had actual or
constructive knowledge of and knew and should have known of the defective
condition are conclusory allegations that fail to state a claim against the Board. See
Jacko v. DG Louisiana LLC, No. 20-CV-00162, 2020 WL 3022924, at *1 (W.D. La.
May 15, 2020), report and recommendation adopted, No. 6:20-CV-00162, 2020 WL
3023055 (W.D. La. June 4, 2020); see also Giles v. Wal-mart Louisiana LLC, No.
CV 16-2413, 2016 WL 2825778, at *1 (E.D. La. May 13, 2016). Therefore, the
Board has been improperly joined. As such, the Court may ignore the Board’s
citizenship for the purpose of determining the existence of subject matter
jurisdiction. The parties have asserted no other impediment to the Court’s exercise
of diversity jurisdiction, and the pleadings and notice of removal establish that
diversity jurisdiction exists in this case. It is therefore recommended that Plaintiffs’
Motion to Remand be DENIED. Should Plaintiffs discover additional information
regarding the unnamed Defendants’ citizenship, the Court will entertain a request
for leave to amend and subsequent Motion to Remand at the appropriate time.
Conclusion
For the reasons discussed herein, the Court recommends that Plaintiffs’
Motion to Remand (Rec. Doc. 16) be DENIED.
Under the provisions of 28 U.S.C. § 636(b)(1)(C) and Fed. R. Civ. P. 72(b),
parties aggrieved by this recommendation have fourteen days from service of this
report and recommendation to file specific, written objections with the Clerk of
Court. A party may respond to another party’s objections within fourteen days after
being served with of a copy of any objections or responses to the district judge at the
time of filing.
Failure to file written objections to the proposed factual findings and/or the
proposed legal conclusions reflected in the report and recommendation within
fourteen days following the date of its service, or within the time frame authorized
by Fed. R. Civ. P. 6(b), shall bar an aggrieved party from attacking either the factual
findings or the legal conclusions accepted by the district court, except upon grounds
of plain error. See Douglass v. United Services Automobile Association, 79 F.3d
1415 (5 Cir. 1996) (en banc), superseded by statute on other grounds, 28 U.S.C.
§$636(b)(1).
THUS DONE in Chambers, Lafayette, Louisiana on this 21 day of
November, 2024.
UNITED STATES MAGISTRATE JUDGE
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