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E-Alert Case UpdatesEgregiousness Is Not Required in a Fraudulent Misjoinder AnalysisStephens v. Kaiser Foundation Health Plan of the Mid-Atlantic States This case arose when Stephens filed suit against various healthcare providers and manufacturers of products, alleging medical malpractice and products liability claims, in a suit to recover damages for injuries he sustained after a total hip replacement. Two of the products manufacturers removed the case to the federal district court, pursuant to 28 U.S.C. § 1332. This action was in spite of the fact that complete diversity did not exist, insofar as three of the defendants were Maryland citizens. The removing Defendants—those involved in the products liability claim—argued that diversity jurisdiction existed because Stephens’ fraudulently misjoined two of the healthcare provider Defendants. The Court concluded that it need not consider whether the misjoinder was egregious in its fraudulent misjoinder analysis, which comported with the majority of other district courts considering the issue. Therefore, the inquiry focused on whether the Plaintiff satisfied the requirements of FEDERAL RULE OF CIVIL PROCEDURE 20(a), which governs the permissive joinder of claims. Rule 20(a), joinder, requires that: 1) the claim must arise out of the same transaction or occurrence, and 2) there must be a common question of law or fact to all parties. As to the same transaction or occurrence test, the Court rejected the removing defendants’ argument that Mr. Stephen’s medical malpractice and products liability claims were legally and factually distinct. Rather, it concluded that the medical malpractice and products liability claims were completely intertwined. In addition, the Court concluded that there was at least one common question of law or fact; and moreover, if the Court were to sever the causes of action against the medical malpractice Defendants and the removing Defendants, each could utilize the “empty chair” defense. The Court concluded that there was no fraudulent misjoinder, and that complete diversity did not exist, in that three of the Defendants were citizens of Maryland. Therefore, the Court did not have jurisdiction over the case, and it granted Plaintiff’s Motion to Remand, and remanded the case to Baltimore City Circuit Court. | |||
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