United States District Court, M.D. Florida, Tampa Division
VIRGINIA M. HERNANDEZ COVINGTON UNITED STATES DISTRICT JUDGE
matter comes before the Court upon consideration of Plaintiff
Tampa Electric Company's (“TECO”) Motion to
Remand, filed on July 28, 2017 (Doc. # 10), Defendant
Pipeline Distribution, Inc.'s (“PDI”)
response in opposition, filed on August 11, 2017 (Doc. # 24),
and Defendant The Travelers Indemnity Company of America,
Inc.'s (“Travelers”) response in opposition,
also filed on August 11, 2017 (Doc. # 25). For the reasons
that follow, the Motion to Remand is GRANTED.
originally filed this action in state court, seeking
declaratory relief and damages based on PDI's and
Travelers' refusal to defend and indemnify TECO in an
underlying action. (Doc. # 2). Invoking diversity
jurisdiction, Travelers removed the case to this Court. (Doc.
# 1). Although TECO and PDI are both citizens of Florida, and
complete diversity is therefore lacking, Travelers maintains
that PDI is fraudulently joined and that its citizenship can
be disregarded for diversity purposes. A brief review of the
claims against Travelers and PDI arise from a personal-injury
action filed by Mario Santos against TECO, PDI, and two other
defendants, Posen Construction Co. (“Posen”) and
Johnson Engineering, Inc. (Doc. # 2 at ¶¶ 2, 10).
Mr. Santos was employed by Posen, which was the prime
contractor on a road expansion project. (Id. at
¶ 11). While Mr. Santos was operating a mixer, he struck
an underground gas line, which exploded and caused him to
suffer severe burns and permanent injuries. (Id. at
¶¶ 12, 13, 17). Mr. Santos alleged that TECO and
PDI were negligent for failing to properly install,
reposition, maintain, and mark the gas line. (Id. at
the accident, TECO hired PDI to reposition the gas line in
order to allow Posen to perform necessary construction.
(Id. at ¶ 14). TECO and PDI entered into a
General Agreement for Contracted Work (“General
Agreement”). (Id. at ¶ 18). Among other
provisions, the General Agreement required PDI to obtain a
commercial general liability policy and to name TECO as an
additional insured on the policy. (Id. at
¶¶ 18, 20, 69). In addition, the General Agreement
included a hold-harmless provision, which required PDI to
defend and indemnify TECO for certain claims, including
personal-injury claims arising from TECO's sole,
contributory, or concurrent negligence. (Id. at
¶¶ 18-19; Doc. # 2 at 129-129).
obtained a Commercial Insurance Policy from Travelers that
named TECO as an additional insured (“the
Policy”). (Doc. # 2 at ¶ 1). In the Santos action,
Travelers initially defended TECO under the Policy pursuant
to a reservation of rights. (Id. at ¶¶ 22,
25). Travelers also defended PDI. (Id. at ¶
Travelers settled Mr. Santos's claims against PDI.
(Id. at ¶ 24). After the settlement, Mr. Santos
filed a Fifth Amended Complaint, which asserted two
negligence claims against TECO. (Id. at ¶ 31;
Doc. # 1-1 at 173-179). In contrast to his prior complaint,
Mr. Santos did not allege that PDI was TECO's agent.
(Id. at ¶ 32).
on that change, Travelers withdrew its defense of TECO.
(Id. at ¶¶ 33, 40). In particular,
Travelers maintained that TECO was no longer an
“additional insured” because the Policy specified
that a “person or organization does not qualify as an
additional insured with respect to the independent acts or
omissions of such person or organization.”
(Id. at ¶¶ 33, 35; Doc. # 1-1 at 181-82).
Travelers characterized the Fifth Amended Complaint as
alleging claims based on TECO's independent negligence.
(Doc. # 1-1 at 181).
action, TECO asserts six claims. (Doc. # at ¶¶
43-74). With respect to Travelers, TECO alleges that
Travelers breached the Policy by failing to defend and
indemnify TECO in the Santos action (Count I), TECO seeks a
declaratory judgment with respect to Travelers' duty to
defend and indemnify TECO in the Santos action (Count II),
and TECO alleges that Travelers tortiously interfered with
the General Agreement between TECO and PDI by settling
PDI's claims in the Santos action. (Id. at
respect to PDI, TECO alleges that PDI breached the General
Agreement by failing to defend and indemnify TECO in the
Santos action (Count IV), TECO alleges that PDI breached the
General Agreement by failing to procure insurance for TECO
(Count V), and TECO seeks contribution in the Santos action,
pursuant to Fla. Stat. § 768.31 (Count VI). (Doc. # 2 at
the case was still pending in state court, PDI filed a Motion
to Dismiss TECO's Complaint on July 17, 2017. (Doc. # 3).
That same day, Travelers removed the case to this Court, with
PDI's consent. (Doc. # 1). On July 28, 2017, TECO filed
the instant Motion to Remand. (Doc. # 10). On July 31, 2017,
PDI filed a memorandum of law in support of its Motion to
Dismiss. (Doc. # 14). On August 7, 2017, the Court granted
TECO's motion to stay consideration of PDI's Motion
to Dismiss pending a decision on TECO's Motion to Remand.
(Doc. ## 12, 23).
August 11, 2017, PDI and Travelers filed separate responses
in opposition to the Motion to Remand. (Doc. ## 24, 25).
Accordingly, the Motion to Remand is ripe for review.
general rule, a civil action filed in state court may be
removed by a defendant to federal district court if the
federal court possesses original jurisdiction. 28 U.S.C.
§ 1441(a). Travelers removed this action pursuant to 28
U.S.C. § 1332(a), which confers diversity jurisdiction
when an action is between citizens of different states and
the amount in controversy exceeds $75, 000. “Diversity
jurisdiction requires complete diversity; every plaintiff
must be diverse from every defendant.” Triggs v.
John Crump Toyota, Inc., 154 F.3d 1284, 1287 (11th Cir.
parties agree that TECO is a Florida corporation with its
principal place of business in Florida, that Travelers is a
Connecticut corporation with its principal place of business
in Connecticut, and that PDI is a Florida corporation with
its principal place of business in Florida. (Doc. # 2 at
¶¶ 4-6; Doc. # 1 at ¶¶ 1-3). Therefore,
for diversity purposes, TECO is a Florida citizen, Travelers
is a Connecticut citizen, and PDI is a Florida citizen. 28
U.S.C. § 1332(c)(1) (“a corporation shall be
deemed to be a citizen of every State and foreign state by
which it has been incorporated and of the State or foreign
state where it has its principal place of business”).
concedes in the Notice of Removal that complete diversity is
lacking because TECO and PDI are both Florida citizens. (Doc.
# 1 at ¶ 1). In addition, 28 U.S.C. § 1441(b)(2)
prohibits removal when a properly-served defendant is a
citizen of the state in which the action is filed, as PDI is
here. Nonetheless, Travelers maintains that removal was
proper because PDI was fraudulently joined as a
party-defendant. (Doc. # 1 at ¶¶ 1, 6-7).
judicially-created doctrine of fraudulent joinder provides an
exception to the requirement of complete diversity and to the
forum-defendant rule in 28 U.S.C. § 1441(b)(2).
Triggs, 154 F.3d at 1287; Cabalceta v. Standard
Fruit Co., 883 F.2d 1553, 1561 (11th Cir. 1989).
Fraudulent joinder may be found in three situations: (1)
“when there is no possibility that plaintiff can prove
the claims against the resident [or non-diverse] defendant,
” (2) “when there is outright fraud in the
pleading of jurisdictional facts, ” and (3) when
“a diverse defendant is joined with a nondiverse
defendant as to whom there is no joint, several or
alternative liability and where the claim against the diverse
defendant has no real connection to the claim against the
nondiverse defendant.” Triggs, 154 F.3d at
case, Travelers asserts that the first and third theories
apply, which are addressed in turn below. (Doc. # 25 at 2-3).
As the removing party, Travelers bears the
“heavy” burden of establishing fraudulent
joinder. Crowe v. Coleman, 113 F.3d 1536, 1538 (11th
Cir. 1997). The Court “evaluate[s] the factual
allegations in the light most favorable to the ...