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Johnson v. Packaging Corp. of America

United States District Court, M.D. Louisiana

June 2, 2019

MICHAEL JOHNSON, ET AL.
v.
PACKAGING CORP. OF AMERICA, ET AL.

          NOTICE

          ERIN WILDER-DOOMES, UNITED STATES MAGISTRATE JUDGE.

         Please take notice that the attached Magistrate Judge's Report has been filed with the Clerk of the U.S. District Court.

         In accordance with 28 U.S.C. § 636(b)(1), you have 14 days after being served with the attached report to file written objections to the proposed findings of fact, conclusions of law, and recommendations set forth therein. Failure to file written objections to the proposed findings, conclusions and recommendations within 14 days after being served will bar you, except upon grounds of plain error, from attacking on appeal the unobjected-to proposed factual findings and legal conclusions accepted by the District Court.

         ABSOLUTELY NO EXTENSION OF TIME SHALL BE GRANTED TO FILE WRITTEN OBJECTIONS TO THE MAGISTRATE JUDGE'S REPORT.

         REPORT AND RECOMMENDATION

         Before the Court is a (1) Motion to Remand[1] filed by plaintiffs, Michael Johnson, Charles Cunningham, Jerry Bailey, Eric Woodward, Michael Darbonne, Michael McCullough, Demon Benjamin, Pamela Green, and Christopher Harrington (collectively, “Plaintiffs”) and (2) Plaintiffs' Motion and Incorporated Memorandum in Support for Leave to File an Amended Petition (the “Motion to Amend”).[2] Defendants, Packaging Corporation of America, Inc. (“PCA”), Boise Packaging & Newsprint (“Boise P&N”), Boise Inc., and Rick Butterfield (“Butterfield”) (collectively, the “Removing Defendants”) have filed Oppositions to both the Motion to Remand[3]and the Motion to Amend, [4] and Plaintiffs have filed an Omnibus Reply Memorandum in Support of Plaintiffs' Motion for Leave to Amend their Petition and Motion to Remand.[5]

         For the reasons set forth herein, the undersigned RECOMMENDS[6] that the Motion to Remand[7] and the Motion to Amend[8] be DENIED.

         In the event this recommendation is adopted, the undersigned further RECOMMENDS that this matter be referred to the undersigned for a scheduling conference.[9]

         I. Background

         This suit arises out of a February 8, 2017 explosion at a paper and containerboard mill located in DeRidder, Louisiana (the “DeRidder Mill” or the “Mill”). Plaintiffs allege that they each “suffered severe and debilitating injuries” while “working at the Deridder [sic] mill performing work during a shutdown when two tanks violently exploded.”[10] Plaintiffs allege that three individuals were killed in the blast, [11] and that Plaintiffs “suffered severe injuries that will affect them every day for the rest of their lives.”[12] Specifically, Plaintiffs contend that they “suffered severe and permanent injuries, including but not limited to burns, orthopedic injuries, posttraumatic stress disorder, and mental distress, which injuries have caused and will likely cause Plaintiffs residual disability, past and future disfigurement, past and future scarring, past and future pain and suffering, past and future mental anguish and distress, past and future loss of enjoyment of life, past and future medical expenses, past lost earnings, future loss of earning capacity, [and] past and future physical impairment.”[13]

         Per their Second Amended Petition for Damages (the “Petition”), Plaintiffs name the Removing Defendants (PCA; Boise P&N; Boise, Inc.; and Butterfield) and Eric Snelgrove (“Snelgrove”) as defendants (collectively, “Defendants”).[14] Plaintiffs allege that the Mill is owned by Boise P&N and operated by PCA, and that on the date of the accident, Snelgrove was the “mill manager” and Butterfield “was responsible for safety at the mill….”[15] Plaintiffs allege that Defendants, collectively, were negligent and grossly negligent in, inter alia, failing to inspect equipment or ensure the equipment was reasonably safe, provide adequate warnings or medical care, eliminate hazards associated with the work, and provide a safe working environment[16] and that “Defendants are vicariously liable for the negligent acts of their employees, agents and/or contractors.”[17] Plaintiffs additionally allege that Defendants are liable for intentional torts because “the Defendants knew the incident sued on herein was substantially certain to occur given the Defendants' prior knowledge of hazards related to flammable and combustible emissions from tanks related to mill operations.”[18] Specifically, Plaintiffs allege that the “Defendants were consciously aware that they were required to clear the area of potential hazards prior to hot work, as a similar incident occurred at another facility owned and operated by Defendants in Tomahawk, Wisconsin in 2008.”[19]

         On June 6, 2018, the Removing Defendants filed a Notice of Removal asserting this Court has federal subject matter jurisdiction pursuant to 28 U.S.C. § 1332. The Removing Defendants allege that the amount in controversy requirement is met based on medical reports for two of the Plaintiffs, Jerry Bailey and Michael McCollough, wherein these two Plaintiffs are diagnosed with PTSD with anticipated treatment spanning ten years. With respect to diversity of the parties, the Removing Defendants allege that Plaintiffs are citizens of either Louisiana or Texas.[20] The Removing Defendants contend that PCA, Boise, Inc. and Boise P&N are citizens of Delaware and Illinois[21] and that Butterfield is a citizen of Washington.[22] With respect to Snelgrove, the Removing Defendants recognize that Snelgrove is a Louisiana citizen and therefore non-diverse; however, Removing Defendants contend that Snelgrove is improperly joined such that his citizenship should be disregarded.[23]

         On June 28, 2018, Plaintiffs filed the Motion to Remand and the Motion to Amend. In their Motion to Remand, Plaintiffs argue that this Court lacks subject matter jurisdiction because Snelgrove is a properly joined non-diverse defendant. Plaintiffs also contend that remand is proper because the Removing Defendants waived their right to remove by filing two exceptions of no cause of action against Snelgrove in the state court proceedings, and that removal was “premature” because the medical reports for Plaintiffs Bailey and McCollough do not make it “unequivocally clear and certain” that the amount in controversy required for federal jurisdiction exists.[24] In their Motion to Amend, Plaintiffs explain that the state court deferred ruling on the exceptions of no cause of action pending the filing of an amending petition on or before June 28, 2018, and that Plaintiffs “seek leave to amend their petition to comply with the pre-removal state-court deadline….”[25] Significant to the question of improper joinder, the proposed Third Amended Petition for Damages includes additional factual allegations against Snelgrove, which are based on Snelgrove's April 23, 2018 deposition testimony.[26]

         II. Law and Analysis

         A. Removal Standard

         A defendant may remove “any civil action brought in a State court of which the district courts of the United States have original jurisdiction.”[27] When original jurisdiction is based on diversity of citizenship, the cause of action must be between “citizens of different States” and the amount in controversy must exceed the “sum or value of $75, 000, exclusive of interest and costs.”[28] Subject matter jurisdiction must exist at the time of removal to federal court, based on the facts and allegations contained in the complaint.[29] In removed actions, diversity of citizenship must exist both at the time of filing in state court and at the time of removal to federal court.[30] The removal statute, 28 U.S.C. § 1441, is strictly construed and any doubt as to the propriety of removal should be resolved in favor of remand.[31] The removing party has the burden of proving federal diversity jurisdiction.[32] Remand is proper if at any time the court lacks subject matter jurisdiction.[33]

         B. The Notice of Removal Is Timely

         The time limits for filing a notice of removal, which are provided in the removal procedure rules of 28 U.S.C. § 1446, are as follows:

The notice of removal of a civil action or proceeding shall be filed within 30 days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based, or within 30 days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant, whichever period is shorter.
if the case stated by the initial pleading is not removable, a notice of removal may be filed within 30 days after receipt by the defendant, through service or otherwise, of a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable.[34]

         With respect to the 30-day period from the defendant's receipt of the initial pleading, the Fifth Circuit has provided a bright line rule that “the thirty-day removal period under the first paragraph is triggered only where the initial pleading ‘affirmatively reveals on its face that the plaintiff is seeking damages in excess of the minimum jurisdictional amount of the federal court.'”[35] If a plaintiff wants the 30-day period to run from the defendant's receipt of the initial pleading, a plaintiff should place in that pleading “a specific allegation that damages are in excess of the federal jurisdictional amount.”[36] The initial pleading in this action does not contain a specific allegation that damages are in excess of the federal jurisdictional amount. Accordingly, the 30-day period for removing the action was not triggered by service of the initial pleading.

         With respect to triggering the 30-day time period from defendant's receipt “of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable, ” as provided in § 1446(b)(3), the Fifth Circuit has held that the 30-day removal period is triggered only where jurisdiction is “unequivocally clear and certain” from the document.[37] This Court has explained that the “standard for triggering removal upon a subsequent ‘amended pleading, motion, order, or other paper,' as provided in § 1446(b)(3), is at least as strict as the standard for triggering the 30 day period for removal based on an initial pleading, as provided in § 1446(b)(1).”[38]

         The Removing Defendants argue that they “removed this action once it became ‘unequivocally clear and certain' that the amount in controversy exceeded $75, 000 as [to] one or more of the individual plaintiffs.”[39] The Removing Defendants explain that they received medical and billing records for Plaintiff McCullough on May 7, 2018 and for Plaintiff Bailey on May 8, 2018[40] and that included within these records were “two psychiatric reports from Patrick Hayes, M.D., diagnosing Plaintiffs Jerry Bailey and Michael McCullough with posttraumatic stress disorder.”[41] The Removing Defendants contend that “[i]t was not until [they] received these reports that the extent of Plaintiffs Bailey's and McCullough's alleged posttraumatic stress diagnoses became clear.”[42] Specifically, the Removing Defendants assert that in each of these reports, Dr. Hayes “indicates that these diagnoses will likely prevent both Bailey and McCullough from working in their trained, preferred occupations due to industrial stimuli”[43] and that Dr. Hayes anticipates the following care for both McCullough and Bailey:

[a]fter one to two years of acute and subacute stabilization, no fewer than quarterly psychiatric visits and no fewer than quarterly psychotherapy visits. I expect this care to last no less than 10 years. I predict symptom exacerbations every 2 to 3 years.[44]

         The Removing Defendants assert that “[i]t was upon receipt of these ‘other papers,' which diagnosed Plaintiffs McCullough and Bailey with PTSD and predicted over a decade of treatment, [that] it became clear to the Removing Defendants that the amount in controversy exceeded the federal jurisdictional threshold. Importantly, it was not the PTSD diagnosis, by itself, that made the amount in controversy unequivocal. Rather, Dr. Hayes' indication that symptom exacerbations would occur every 2-3 years with an additional decade of future treatment is the information that revealed, for the first time, the extent of Plaintiffs McCullough's and Bailey's damages.”[45]

         The undersigned finds that Dr. Hayes' reports are not “unequivocally clear and certain” as to the amount in controversy to trigger the 30-day time limit to remove set out in 28 U.S.C. § 1446(b)(3). This is not a case where a plaintiff “affirmatively stated in an amended pleading or other paper that [his] damages exceeded the jurisdictional requirement, thus triggering the 30-day period for removal pursuant to § 1446(b)(3).”[46] “The 30-day time limit to remove under Section 1446(b)(3) is only triggered when the factual basis for removal can be proven by evidence that is unequivocally clear and certain. Consequently, if a defendant has to analyze and dissect medical treatment records to divine whether the nature and cause of a plaintiff's injuries satisfy the amount in controversy requirement, then those papers do not suffice to trigger the 30 day time period.”[47]“Relatedly, if a defendant has to conduct independent research by consulting ‘quantum books,' then the discovery responses are not sufficiently unequivocally clear and certain to trigger the 30- day removal period.”[48] Here, although the reports issued by Dr. Hayes do indicate an anticipated ten year treatment period for both McCullough and Bailey, there is no explicit statement in either report (or in anything else provided by the Removing Defendants) regarding the cost of such treatment. Moreover, the Removing Defendants' citation to other cases involving damage awards for plaintiffs diagnosed with PTSD in the Notice of Removal[49] lends further support to the conclusion that the 30-day deadline set forth in 28 U.S.C. § 1446(b)(3) was not triggered.[50]

         Plaintiffs argue that “because the defendants have never received information making it unequivocally clear and certain that the case is or has become removable, the removal window in § 1446(b)(3) has never opened. The defendants' removal is thus premature, and remand is required.”[51] The undersigned recognizes that other courts in this Circuit have remanded suits where removal occurred within neither of the two 30-day time periods set forth in § 1446.[52] However, this Court has explained that “timing issues and the standard to determine when the 30-day removal period has begun” are separate from the question of “whether the matter could have been removed based on the allegations in the pleadings or subsequent discovery”[53] and has denied remand where, although the 30-day period for filing a notice of removal pursuant to 28 U.S.C. § 1446(b)(3) was not triggered, the amount in controversy requirement was satisfied.[54]

         As explained by another district court, “[t]he ‘unequivocally clear and certain' standard is applied when a court is determining whether a defendant has timely removed, not whether removal was permissive. Stated differently, the Section 1446(b)(3) 30-day clock acts as a ceiling or limit on removal, not as a jurisdictional floor.”[55] “Section 1446 ‘does not say anything about removals that occur too soon.' If, before the 30-day clock starts, a defendant can demonstrate by a preponderance of the evidence that the jurisdictional threshold is met, he or she may remove without being required to ‘unlock' the 30-day window by presenting ‘unequivocally clear and certain' evidence.”[56] The undersigned finds this approach is in keeping with the distinction between the timing rules set out in § 1446 and the burden of proof which is placed on a removing defendant to establish, by a preponderance, that the amount in controversy likely exceeds the jurisdictional amount.[57] Moreover, although the reports submitted by Dr. Hayes did not make the amount in controversy “unequivocally clear and certain” so as to trigger the 30-day removal period of § 1446(b)(3), the undersigned finds that these reports are sufficient to meet the Removing Defendants' burden of establishing, by a preponderance, that the amount in controversy likely exceeds $75, 000.[58] Accordingly, although neither 30-day period set out in § 1446 was triggered by either the initial Petition or Dr. Hayes' reports, the Notice of Removal was timely.

         C. Removing Defendants Did Not Waive the Right to Remove

         Plaintiffs also argue that Defendants waived their right to remove because “defendants manifested their intent to invoke the jurisdiction of the state court by twice filing exceptions, answering and asserting affirmative defenses, participating in preliminary discovery, and agreeing to allow the plaintiffs additional time to conduct discovery and amend their petition.”[59] Plaintiffs complain that “the defendants waited to remove until after they failed to receive a satisfactory ruling on their state-court exceptions of no cause of action and just a few weeks before the plaintiffs' agreed-to deadline to amend the petition.”[60] In response, Defendants argue that they only removed once it became clear (based on Dr. Hayes' reports) that the amount in controversy requirement was satisfied.

         “A defendant may waive its right to removal ‘by proceeding to defend [an] action in state court or otherwise invoking the processes of that court.'”[61] “Waiver of the right of removal is intended to preclude a defendant from ‘experimenting' with a case in state court prior to removing it to federal court, where the defendant then has a second opportunity at re-litigating any adverse decisions of the state court.”[62] To defeat the right to remove, “the intent to waive must be clear and unequivocal”[63] and generally, “the filing in state court of a pleading which asserts defenses, without further action on the part of the defendant resulting in a decision on the merits of such defenses, does not constitute a waiver of removal.”[64] Here, although Defendants filed exceptions in state court, there was no ruling on the exceptions of no cause of action prior to the filing of the Notice of Removal. Instead, the state court deferred ruling on those exceptions until after a period of discovery and the filing of Plaintiffs' amended petition.[65] Thus, Defendants' removal seems more tied to the fact that the one-year deadline for removal was approaching, rather than an attempt to “test” the state-court waters.[66] Under these circumstances, Defendants did not waive their right to remove this action to federal court.

         D. The Motion to Remand Should be Denied

         If Snelgrove is properly joined, then as a citizen of Louisiana his presence in this action precludes removal and the Motion to Remand should be granted.[67] “The party seeking removal bears a heavy burden of proving that the joinder of the in-state party was improper.”[68] “‘[A]ny contested issues of fact and any ambiguities of state law must be resolved' in favor of remand, ”[69]and “[a]ny doubts regarding whether removal jurisdiction is proper should be resolved against federal jurisdiction.”[70]

         The Fifth Circuit has “recognized two ways to establish improper joinder: ‘(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.'”[71] As to the second method, the test “is whether the defendant has demonstrated that there is no possibility of recovery by the plaintiff against an instate defendant, which stated differently means that there is no reasonable basis for the district court to predict that the plaintiff might be able to recover against an in-state defendant.”[72] The Removing Defendants do not assert that there has been fraud in the pleading of jurisdictional facts related to Snelgrove.[73] Accordingly, the undersigned considers whether Plaintiffs have a reasonable basis of recovery under state law against Snelgrove.

         A court may resolve the issue of whether a plaintiff has a reasonable basis of recovery under state law in one of two ways. “The court may conduct a Rule 12(b)(6) analysis, looking at the allegations of the complaint to determine whether the complaint states a claim under state law against the in-state defendant. Ordinarily, if a plaintiff can survive a Rule 12(b)(6) challenge, there is no improper joinder. That said, there are cases, hopefully few in number, in which a plaintiff has stated a claim, but has misstated or omitted discrete facts that would determine the propriety of joinder. In such cases, the district court may, in its discretion, pierce the pleadings and conduct a summary inquiry.”[74] The Fifth Circuit has cautioned that such summary inquiry “is appropriate only to identify the presence of discrete and undisputed facts that would preclude plaintiff's recovery against the in-state defendant.”[75]

         i. Scope of Allegations to be Considered

         As a threshold matter, the parties disagree as to what allegations this Court should consider when determining whether Plaintiffs have stated a claim against Snelgrove. As explained above, on the same day Plaintiffs filed their Motion to Remand, Plaintiffs also filed the Motion to Amend.[76] Plaintiffs' proposed Third Amended Petition for Damages includes additional factual allegations against Snelgrove.[77] In their Motion to Remand, Plaintiffs cite extensively to the allegations in their proposed Third Amended Complaint, while the Removing Defendants argue that only the operative pleading - the Second Amended Petition for Damages - should be considered.[78]

         “[T]he general rule is that removal jurisdiction should be determined on the basis of the state court complaint at the time of removal, and that a plaintiff cannot defeat removal by amending it.”[79] The Fifth Circuit has explained that removal jurisdiction must be determined “on the basis of claims in the state court complaint as it existed at the time of removal….”[80] However, post removal evidence that “clarify[ies] or amplify[ies]” the claims alleged in the state court petition operative at the time of removal can be considered.[81] Here, Plaintiffs' Second Amended Petition for Damages (the operative Petition now and at the time of removal) asserts claims of negligence, gross negligence, and intentional tort against all defendants.[82] That Petition does not assert any specific factual allegations against Snelgrove other than alleging that Snelgrove “was the mill manager at the time of the incident.”[83] Plaintiffs' proposed Third Amended Petition for Damages[84]does not add an additional claim or cause of action against Snelgrove. Rather, the proposed pleading seeks to insert additional factual allegations, primarily based on Snelgrove's deposition testimony, to support Plaintiffs' “negligence and gross negligence” claims. Under these circumstances, the undersigned finds that the proposed allegations seek to clarify and amplify Plaintiffs' claim against Snelgrove as those claims existed when this suit was removed, and therefore the undersigned has considered those proposed allegations in the analysis of whether Snelgrove has been improperly joined.[85]

         ii. Individual Liability Under Canter

         “When a case is removed to federal court on the basis of diversity jurisdiction, the Erie doctrine requires federal courts to apply substantive state law when adjudicating state law claims.”[86] “Under Louisiana law, a court may hold a corporate officer or employee individually liable for injuries to third persons under certain circumstances.”[87] “This ‘liability may be imposed on such individuals even if the duty breached arises solely from the employment relationship.'”[88]“If the elements for imposing individual liability on the corporate employee are met, it does not matter than the corporation might also be liable.”[89] Conversely, when considering the sufficiency of allegations purporting to state a claim for an individual employee's personal liability, “[t]he Court is only concerned…[with] whether a viable claim may be made against [the defendant employee] personally and not whether [the employer] may be held vicariously liable for the action of its employees.”[90] As explained by the Fifth Circuit, “[v]icarious liability is not a revolving door. In certain situations, an employer may be held liable for the negligent acts of its employees…but Canter does not attach liability to a managerial employee absent breach of a duty personally owed by the employee to third parties.”[91] Thus, the only question is whether Plaintiffs have alleged sufficient facts to establish the personal liability of Snelgrove, regardless of the claims Plaintiffs may have against the corporate defendants.

         “Under Louisiana law, an employee is personally liable if (1) the employer owes a duty of care to a third person; (2) the employer delegated that duty to a defendant-employee; (3) and the defendant-employee breached the duty through his own fault and lack of ordinary care.”[92]“However, a defendant-employee's ‘general administrative responsibility' is insufficient to impose personal liability.”[93] “In order for a corporate officer to be held liable for purported personal fault or negligence which arises out of a breach of duty, that person must have some personal contact with and responsibility towards the injured employee.”[94]

         Plaintiffs argue that “Snelgrove is a non-diverse, Louisiana defendant who was personally involved with the process for the annual shutdown and safety of the mill, making remand appropriate.”[95] In the Second Amended Petition for Damages, Plaintiffs collectively refer to “Defendants” and allege that “Defendants have previously experienced a similar incident involving an explosion of one of its tanks in 2008 at the Defendants' Tomahawk, Wisconsin facility, which also resulted in serious injuries and deaths, ” and that, presumably in light of this past explosion, Defendants “knew of the hazard.”[96] The only allegation specific to Snelgrove is that he “was the mill manager at the time of the incident.”[97] These allegations, directed to all Defendants collectively or solely directed to Snelgrove's position at the Mill, are insufficient to state a claim of Snelgrove's personal liability under Louisiana law.[98]

         Plaintiffs' factual allegations regarding Snelgrove are more detailed in their proposed Third Amended Petition for Damages. In that proposed pleading, Plaintiffs assert that Snelgrove “had responsibilities and duties regarding plant safety in general and with respect to the equipment/operations at issue in this case”[99] and that

Snelgrove was the mill manager at the paper mill. According to his testimony, the “buck stop[ped] with him.” The mill owed safety duties to contractors working onsite, including duties to inform welding contractors of hazards, such as working near tanks containing flammables. Snelgrove has testified that he shared in these duties and responsibilities. These responsibilities manifested themselves in various ways. As mill manager, Snelgrove had a duty to oversee the mill's departmental managers, to ensure that they understood their job duties and were following mill policies and practices. Snelgrove was also personally involved in mill operations from an operational and safety standpoint; those departments reported directly to him. He approved the process for the annual shutdown (which included bringing contractors such as the plaintiffs' employer, Elite Welders, on site) that ultimately resulted in the explosion, a decision that imposed upon him the duty to evaluate safety considerations. Snelgrove also owed safety duties to mill workers and contract employees. He has testified that his duties at the mill were not merely administrative; instead, he personally had responsibilities for the safety of workers at the plant, and he has testified that he would take action to address any instances of someone not following plant safety policies.[100]

         Additionally, Plaintiffs assert in the proposed Third Amended Petition for Damages that

Snelgrove breached his duties at the plant by having knowledge of and failing to remedy the hazardous conditions that caused injury to the plaintiffs. Snelgrove agreed that policies and procedures were one way to prevent danger to workers at the mill, and he had input, along with others, in writing those policies and procedures. And although he could have, Snelgrove did not put in place a policy that would require testing of a foul condensate tank (like the one that exploded) before hot work was performed near the tank. Snelgrove agreed that it would be important, for planning, to know what products are contained in tanks in an area where hot work was being performed. He acknowledged that a foul condensate tank, like the one that exploded here, could contain flammable liquids. But Snelgrove did not confirm the contents of the tank before the incident, he had not seen any paperwork where someone identified and evaluated the hazards associated with the products in the tank that exploded, and he did not order anyone to check the contents of the tank before performing the hot work that resulted in the incident (though he admits this could have been done). Snelgrove did not know whether his managers followed policies and procedures on the day of the incident, despite having a duty to ensure that those policies and procedures were followed. Snelgrove did not ensure that his managers clearly understood and took charge of their respective departments; the Chemical Safety Board thus noted that there was confusion as to which department was in charge of the foul condensate tank that exploded, with the result that flammable materials inside that tank were never identified or removed before the hot work above the tank was performed. Snelgrove testified that he works to help lower the risks so that the mill would not explode, yet despite these supposed efforts, an explosion still occurred. Snelgrove instructed his leadership team to do the “necessary things” to accomplish the goal for the shutdown process and make sure the shutdown was done safely and appropriately. Snelgrove also contributed to and led a team that put together policies and procedures with a safety objective, including to prevent the mill from exploding. But these instructions, policies, and procedures were inadequate.[101]

         Many of Plaintiffs' proposed allegations as set forth in the Third Amended Petition for Damages focus on Snelgrove's general responsibilities as mill manager at the time of the incident and the fact that an accident occurred while he was employed in that position.[102] Such administrative responsibilities are insufficient to state a claim for Snelgrove's personal liability.[103]Although the undersigned finds that many of the proposed allegations reflect Snelgrove's general administrative duties and are an attempt to hold Snelgrove personally liable based merely on his position as mill manager, Plaintiffs do assert that Snelgrove was “personally” responsible for the safety of the workers at the plant, “approved the process for the annual shutdown, ” had “knowledge of and fail[ed] to remedy the hazardous conditions that caused injury to the plaintiffs, ”[104] that there “was confusion as to which department was in charge of the foul condensate tank that exploded, ” and that “Snelgrove did not know whether his managers followed policies and procedures on the day of the incident, despite having a duty to ensure that those policies and procedures were followed.”[105] Such allegations, taken at face value, [106] do appear to at least potentially state a claim against Snelgrove, and the Fifth Circuit has instructed that any doubt should be resolved in favor of a plaintiff maintaining a cause of action against the non-diverse defendant.[107] Accordingly, based solely on the allegations in the proposed Third Amended Petition for Damages, it appears that remand would be appropriate.

         However, the proposed allegations are based on Snelgrove's deposition testimony (which was obtained prior to removal), and Plaintiffs take pains to cite to Snelgrove's testimony to support each of Snelgrove's alleged duties and breaches.[108] While Plaintiffs contend that the allegations set forth in the proposed Third Amended Petition for Damages are “all that the Court need consider to remand this case, ”[109] they also contend that Snelgrove's deposition testimony “has revealed additional facts about Snelgrove's personal involvement in the incident” such that “it would be appropriate for the Court to pierce the pleadings should it choose to do so.”[110] In response, the Removing Defendants contend that Plaintiffs' proposed amended allegations “misrepresent, misstate, and mischaracterize [Snelgrove's] deposition testimony” and that “even if the Court determines that the proposed amendment states a claim upon which relief may be granted, Mr. Snelgrove's deposition testimony clearly demonstrates that he did not breach a personal duty he owed to the plaintiffs.”[111] Because both Plaintiffs and the Removing Defendants rely on Mr. Snelgrove's deposition testimony to support their positions, and because Plaintiffs' proposed allegations as to Snelgrove are based on Snelgrove's deposition testimony, the undersigned finds it appropriate to pierce the pleadings to evaluate Plaintiffs' proposed allegations in light of Snelgrove's deposition testimony to determine whether there is a reasonable possibility that Snelgrove could be held personally liable.[112]

         In his deposition, Snelgrove stated that he was the mill manager at the time of the accident, [113] and that in that position, he “manage[d] the whole mill operation.”[114] He explained that all departments at the mill reported to him, including the safety department.[115] While Snelgrove agreed that he had “some responsibility”[116] for safety at the mill, he also stated that he was not the only one responsible[117] and that he would “delegate responsibilities down through the organization.”[118] Snelgrove testified that he was “not directly responsible for managing safety” and explained that he was “not the safety manager”[119] but that he was the safety manager's boss.[120]Snelgrove also confirmed that “safety of the plant and its workers” would be a factor that he would consider as the mill manager when considering mill production.[121] He agreed that he wanted all mill employees to follow policies and procedures, [122] but explained that he was not intimately involved in every managers' delegated work.[123] He confirmed that the safety department “is responsible for providing professional guidance to management with respect to hot work procedures.”[124]

         While Snelgrove agreed that policies and procedures were important to ensure safety, and that “you could have a policy in place” that would have required testing the concentrations of liquids in the foul condensate tank prior to performing hot work, [125] he also testified that it was not one of his personal duties to “inform contractors of hazards in the plant.”[126] With respect to hot work, Snelgrove testified that he had never written a hot work permit, and that he had “individuals down in the plant that go through the details.”[127] While he explained that the operations and maintenance teams work together to “execute and implement the hot work permit, ” he stated that he did not know the exact details of the process.[128]

         Regarding his involvement in planning an annual shutdown, Snelgrove explained that he would meet with his managers “with the overall objective of budget, length of time, major projects, et cetera” but that he was “not involved with many of the smaller jobs and actually determining what's going on to be worked on”[129] and that “when it gets to the details of each individual job, what we're going to work on from a maintenance perspective, I'm not involved with that.”[130] He testified that while he approved the occurrence of the shutdown, he did not “sign off anything associated with work orders, ”[131] and agreed that he instructed his leadership “to do the necessary things….”[132] As to the particular location of the tank, Snelgrove testified that the tank “was part of the utilities process”[133] and that it was operated by “utilities operators.”[134] Although Plaintiffs' proposed allegations allude to a possible failure by Snelgrove to know who was in charge of the foul condensate tank, Snelgrove testified that the tank “is in the utilities area” and identified the department manager responsible for the tank at the time of the incident.[135] He further testified that he did not know what caused the explosion, [136] did not know the contents of the tank prior to the accident, [137] and that it was “not a standard practice” to “test or see what was in a foul condensate tank during an outage.”[138] Snelgrove also explained that he was not involved in hiring Elite Welders or granting Elite access to the mill, [139] and that he did “not know the details of this job.”[140] Although Plaintiffs allege that Snelgrove had knowledge of the hazardous condition, [141] Plaintiffs did not specifically ask Snelgrove whether he knew of the 2008 explosion at the Tomahawk, Wisconsin facility[142] and Snelgrove affirmatively stated that he was not aware of another “PCA explosion involving a foul condensate tank“ prior to this accident.[143]

         Although Plaintiffs rely on Snelgrove's deposition testimony to support their claim that he may be held individually liable under Louisiana law, the undersigned's review of that testimony does not support Plaintiffs' contention. Snelgrove testified that he had no knowledge of any previous explosion involving a foul condensate tank, and consistently explained that he delegated responsibilities to others at the Mill. While Snelgrove admitted that he approved the overall shutdown process, he testified that he was not involved in determining the particular maintenance work to be done, and that he did not issue the hot work permit or have involvement with Elite Welders. Snelgrove testified that he did not know the contents of the tank prior to the explosion, and there is nothing to indicate that Snelgrove was personally responsible for inspecting the tank, informing anyone of its condition, or performing work on the tank or in the area of the accident. Finally, although Plaintiffs allege that Snelgrove did not know whether his managers followed policies and procedures, Plaintiffs do not provide any factual information regarding a specific policy or procedure that was not followed; rather, the thrust of this allegation appears to be that Snelgrove should be personally liable because there was no policy that required inspection of the foul condensate tank. The overall tenor of Plaintiffs' allegations is that Snelgrove, as the manager of the mill, was responsible for identifying every potential safety hazard and eradicating it. This seems to directly contravene the limitations on personal liability set forth in Canter and its progeny. Under these circumstances, the undersigned finds that there is no reasonable basis to predict that the Plaintiffs may be able to recover against Snelgrove.[144]

         Considering the underlying deposition testimony upon which Plaintiffs' based their proposed allegations against Snelgrove in the Third Amended Petition for Damages, the undersigned finds that there is no reasonable basis to predict that Plaintiff could recover against Snelgrove. Accordingly, the undersigned finds that the non-diverse defendant, Snelgrove, was improperly joined and therefore recommends that Plaintiffs' claims against Snelgrove be dismissed without prejudice.[145] Because the undersigned finds that Snelgrove is an improperly joined defendant, Snelgrove's citizenship is not considered when determining whether the parties to this proceeding are completely diverse. Because the remaining parties are completely diverse (as based on the Second Amended Petition for Damages which is the operative pleading), and because the Removing Defendants have established that the amount in controversy likely exceeds the jurisdictional threshold, the undersigned recommends that the Motion to Remand[146] be denied.

         E. The Motion to Amend Should be Denied

         Rule 15(a) of the Federal Rules of Civil Procedure provides that leave to amend pleadings “shall be freely given when justice so requires.”[147] The Federal Rules permit liberal amendment of pleadings, and Rule 15(a) favors granting leave to amend. However, “leave to amend is by no means automatic” and the “decision lies within the sound discretion of the district court.”[148] A court should consider five factors to determine whether to grant a party leave to amend a complaint: (1) undue delay; (2) bad faith or dilatory motive; (3) repeated failure to cure deficiencies by previous amendments; (4) undue prejudice to the opposing party; and (5) futility of the amendment.[149] Absent any of these factors, the leave sought should be freely given.[150]

         Here, and as set forth above, the undersigned finds that considering the proposed allegations regarding Snelgrove as set forth in the Third Amended Petition for Damages in light of Snelgrove's deposition testimony, there is no reasonable basis to predict that Plaintiffs could recover against Snelgrove. Accordingly, the undersigned further recommends that the Motion to Amend be denied.[151]

         III. Recommendation

         For the reasons set forth herein, RECOMMENDS that the Motion to Remand[152] and the Motion to Amend[153] be DENIED, and that Plaintiffs' claims against Snelgrove be DISMISSED WITHOUT PREJUDICE.

         In the event this recommendation is adopted, the undersigned further RECOMMENDS that this matter be referred to the undersigned for a scheduling conference.

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Notes:

[1] R. Doc. 4.

[2] R. Doc. 3. Because Plaintiffs seek to add, inter alia, additional allegations against the allegedly improperly joined non-diverse defendant, Eric Snelgrove (“Snelgrove”), the undersigned also addresses the Motion ...


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