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Altman v. HO Sports Co.

August 20, 2009

JEFFREY ALTMAN, PLAINTIFF,
v.
HO SPORTS COMPANY, INC., DBA BEN SIMS, AND DOES 1 TO 100, DEFENDANTS.



The opinion of the court was delivered by: Anthony W. Ishii Chief United States District Judge

ORDER VACATING THE SEPTEMBER 14, 2009, HEARING ON PLAINTIFF'S MOTION TO REMAND, AND HYPERLITE, ORDER ON PLAINTIFF'S MOTION TO REMAND

(Doc. No. 7)

This is a state law products liability case that was originally brought in the Kern County Superior Court against Defendant HO Sports Company, Inc. ("HOS"). Plaintiff Jeffrey Altman ("Altman") now moves to remand the case and requests that reasonable attorney's fees be awarded. Hearing on the motion to remand, as well as Defendant's motion to dismiss, is currently set for September 14, 2009. The motion, opposition, and reply with respect to the motion to remand have been submitted to the Court. After reviewing these papers, the Court believes that the matter is suitable for decision without the need for oral argument. See Local Rule 78-230. The Court will vacate the motion to remand hearing and instead issue the following order.

BACKGROUND

From the representations of the parties, this case stems from the sale to Altman of wakeboard boots manufactured by HOS. The complaint in this case is on a pre-printed state form that consists mostly of a series of boxes that are checked. The compliant names only HOS and Doe defendants, and alleges two state law causes of action -- products liability and fraud. On May 8, 2009, in state court, Altman filed an amendment that identified Doe 51 as Ben Sims ("Sims"). The complaint associates Doe 51 with a strict products liability cause of action. The complaint contains no allegations that tie Doe 51 to the fraud cause of action, rather the fraud cause of action is alleged only against HOS. See Complaint at pp. 8-9.

On June 8, 2009, HOS removed the case to this Court on the basis of diversity jurisdiction. HOS is a Washington company and Sims and Altman are California citizens.

On July 7, 2009, Altman moved to remand the case to state court. HOS filed its opposition and included a declaration by Sims.

Plaintiff's Argument

Altman argues that there is no diversity jurisdiction in this case because Sims destroys diversity. Further, although HOS has indicated that Sims is a "sham" defendant, they refused to acknowledge that Sims was acting in the course and scope of his employment. Altman also argues that the removal was procedurally defective since Sims did not consent to or join in the removal. In light of the procedural failure and the lack of complete diversity, remand is appropriate as are reasonable attorney's fees.

Additionally, in reply, Altman points out that Sims filed an answer to the complaint and did not file a motion to dismiss or a motion to strike. This indicates that Sims has conceded that sufficient facts were pled against him. Also, while the fraud claim may not have been alleged against Sims, it was Altman's intention to so allege. The omission can be cured by an amended complaint that will allege fraud directly against Sims.

Defendant's Opposition

HOS argues that removal was appropriate and not procedurally defective because Sims is a "fraudulently joined" party. As Sims's declaration shows, he is the employee of HOS who sold Altman the wakeboard boots. When Sims sold Altman the boots, Sims was acting in the course and scope of his employment with HOS. Sims is not a manufacturer, distributor, designer or seller of wakeboard boots. Under California law, it is clear that a mere employee of a manufacturer cannot be liable for a manufacturing defect under strict products liability. Because it is clear that an employee of a manufacturer cannot be liable for strict products liability, no such claim can be stated against Sims and he is a "sham defendant." Further, "sham defendants" need not join a removal petition. Remand should therefore be denied.

Legal Standard 28 U.S.C. § 1441(a) reads in relevant part:

[A]ny civil action brought in a State court of which the district courts have original jurisdiction, may be removed by the defendant or defendants, to the district court of the United States for the district and division embracing the place where such action is pending. For purposes of removal under this chapter, the citizenship of defendants sued under fictitious names shall be disregard. "The burden of establishing federal jurisdiction is on the party seeking removal, and the removal statute is strictly construed against removal jurisdiction." Prize Frize Inc. v. Matrix Inc., 167 F.3d 1261, 1265 (9th Cir. 1999); Emrich v. Touche Ross & Co., 846 F.2d 1190, 1195 (9th Cir. 1988). If there is any doubt as to the right of ...


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