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April 24, 2003


The opinion of the court was delivered by: Marilyn Patel, Chief Judge, District


Plaintiff Gary E. Brazina ("Brazina") filed a complaint in California state court against Paul Revere Life Insurance Company ("Revere") and Unumprovident Corporation ("Provident") (collectively "defendants"), alleging that defendants wrongfully withheld payment of total disability benefits due Brazina as an orthopedic surgeon. Brazina also brought claims against the California Department of Insurance ("DOI") for its approval of the policy language at issue, and later amended the caption of the complaint to include DOI. On January 22, 2003, Revere and Provident filed a notice of removal with this court, contending DOI was fraudulently joined. Now before the court is Brazina's Motion to Remand. Having considered the parties' arguments and submissions, and for the reasons set forth below, the court rules as follows.


Revere issued an individual income disability insurance policy to Brazina in 1988. In 1997, Brazina experienced a "herniated nucleus pulposis," or slipped disk, that resulted in alleged permanent numbness and muscle loss in his right arm. Brazina made a claim for total disability benefits under the policy in January 1998. A dispute arose between Provident, which acquired Revere as a wholly owned subsidiary in March 1997, and Brazina as to whether Brazina should receive total disability benefits at the level of an orthopedic surgeon. Brazina received orthopedic surgeon benefits between April 1998 and December 1998, but thereafter, Brazina contends he received only residual benefits. The policy at issue defines "Total Disability" as "because of Injury or Sickness: (a) You are unable to perform the important duties of Your Occupation; and (b) You are under the regular and personal care of a Physician." Notice of Removal, Exh. A. "Your Occupation" is "the occupation in which You are regularly engaged at the time You become Disabled." Id.

On December 11, 2002, Brazina filed a complaint in San Francisco Superior Court, alleging that Provident misrepresented the policy provisions by insisting that Brazina show surgery constituted all of his important duties, not just one of them. Brazina brought claims of breach of contract, misrepresentation, breach of covenant of good faith and fair dealing, and intentional infliction of emotional distress against Revere and Provident. Brazina also brought claims for a writ of mandamus ("claim five") and declaratory relief ("claim six") against DOI, contending that the DOI Commissioner ("Commissioner") should not have approved the relevant policy language because it was ambiguous and misleading. On December 18, 2002, Brazina filed an amended complaint adding DOI to the caption. Defendants removed the action to this court on January 22, 2003 on the basis of diversity of citizenship, alleging that Brazina fraudulently joined DOI to destroy diversity jurisdiction. The parties do not dispute that Brazina is a resident of California, Revere is a Massachusetts corporation and Provident is a Tennessee corporation. Brazina then filed this Motion to Remand on February 5, 2003.


As a general rule, an action is removable to a federal court only if it might have been brought there originally. 28 U.S.C. § 1441(a). The removal statute is strictly construed, and the court must reject federal jurisdiction if there is any doubt as to whether removal was proper. Duncan v. Stuetzle, 76 F.3d 1480, 1485 (9th Cir. 1996). The defendants bear the burden of proving the propriety of removal. Id. If at any time before final judgment the court determines that it is without subject matter jurisdiction, the action shall be remanded to state court. 28 U.S.C. § 1447(c).


Defendants argue that DOI is fraudulently joined because no cause of action is or can be stated against it; thus, its citizenship should be disregarded for diversity jurisdiction purposes. In addition, even if there is a cause of action available, they argue that the claim is time barred and Brazina has not exhausted his administrative remedies. Further, defendants argue that DOI's citizenship should be disregarded for removal jurisdiction purposes because the claims are so misjoined that they amount to fraudulent joinder. The court concludes that (1) a claim for writ of mandamus raises a possible cause of action; (2) the defenses are not sufficient under California law to constitute no possible cause of action; (3) misjoinder of the claims does not rise to the level of fraudulent joinder; and (4) it is unnecessary to reach any other possible causes of action.

I. Threshold Issues

The court begins by addressing the procedural defects alleged by plaintiff and defendants.

Defendants contend that Brazina's failure to name DOI in the caption of his initial complaint and the Commissioner in the caption of any complaint warrant removal. Firstly, defendants offer no reasoning for their contention that omission of a non-diverse party from the caption of the initial complaint is an independent basis for diversity jurisdiction. Thus, this court will not reach the issue.*fn2 Secondly, it is clear from the complaint that the Commissioner is the real party in interest in this action. Even if DOI is an improper defendant, this defect is immaterial. The Ninth Circuit has held that when an improper defendant is indicated, the court may consider a complaint to have named the proper defendant "if the allegations in the body of the complaint make it plain that the party is intended as a defendant." Rice v. Hamilton Air Force Base Commissar 720 F.2d 1082, 1085 (9th Cir. 1983) (citing Hoffman v. Halden, 268 F.2d 280, 303-04 (9th Cir. 1959), overruled on other grounds by Cohen v. Norris, 300 F.2d 24, 29-30 (9th Cir. 1962)).*fn3 The contents of the complaint in this action demonstrate that the Commissioner is the party being sued. Moreover, the Commissioner apparently had notice and thus there was no prejudice, or at least he has not alleged any.

Brazina argues that remand is required because DOI did not sign the Notice of Removal. The "rule of unanimity" requires that all defendants in a state action must join in the removal petition. 28 U.S.C. § 1446(a). However, a judicially created doctrine provides an exception for parties who are fraudulently joined. Emrich v. Touche Ross & Co., 846 F.2d 1190, 1193 n. 1 (9th Cir. 1988). Defendants petitioned for removal on the basis that DOI is fraudulently ...

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