Opinion ID: 170884
Heading Depth: 2
Heading Rank: 1

Heading: Diversity of John Doe Defendants

Text: Mrs. McPhail first argues that the citizenship of unidentified defendants is a bar to removal. In her original complaint, Mrs. McPhail named three John Doe defendants who have since been identified as in-state distributors. Under 28 U.S.C. § 1332(a) the citizenship of all defendants must be different from the citizenship of all plaintiffs. Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 2 L.Ed. 435 (1806); Salt Lake Tribune Publ'g Co. v. AT & T Corp., 320 F.3d 1081, 1095-96 (10th Cir. 2003). Mrs. McPhail urges, therefore, that the identification of these defendants has destroyed diversity and that the case must be remanded. She also asserts that she has been unable to amend her complaint to substitute these named defendants because necessary information is contained within records controlled by Deere. Under the federal removal statutes the presence of John Doe defendants at the commencement of an action creates no impediment to removal. See 28 U.S.C. § 1441(a) ([T]he citizenship of defendants sued under fictitious names shall be disregarded.); Australian Gold, Inc. v. Hatfield, 436 F.3d 1228, 1234-35 (10th Cir. 2006). Thus, the diversity of citizenship between Deere and McPhail was sufficient to support the statutory diversity requirement at the time of removal. The question, then, is whether subsequent identification of potential defendants destroys complete diversity and requires remand to state court. To be sure, if a non-diverse party is added to the complaint at any time prior to final judgment, the case must be remanded to state court. 28 U.S.C. § 1447(c) provides that [i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded. Further, § 1447(e) states: [i]f after removal the plaintiff seeks to join additional defendants whose joinder would destroy subject matter jurisdiction, the court may deny joinder, or permit joinder and remand the action to the State Court. Although § 1447(e) speaks of joinder, it has been held to apply when the complaint is amended to replace John Doe defendants with defendants identified by name. See Casas Office Mach., Inc. v. Mita Copystar Am., Inc., 42 F.3d 668, 673-75 (1st Cir.1994) (noting legislative history indicating Congressional intent that this section apply to identification of John Doe defendants). As § 1447(e) indicates, however, the plaintiff does not have an absolute right to join such parties. Federal Rule of Civil Procedure 15(a)(2) allows amendments only with leave of the opposing party or the court. [1] Further, under Rule 19 the district court must determine whether the party sought to be joined is indispensable. If so, Rule 19 requires the court either to join the party, in which case remand is necessary under § 1447(e), or to deny joinder, in which case Rule 19(b) also requires that the action be dismissed. [2] If the defendant is not indispensable, Rule 20(a)(2) permits joinder at the discretion of the district court. See State Distrib., Inc. v. Glenmore Distill. Co., 738 F.2d 405, 416-17 (10th Cir.1984). In exercising this discretion, the district court typically considers several factors [including] whether the amendment will result in undue prejudice, whether the request was unduly and inexplicably delayed, [and whether it] was offered in good faith.... Id. at 416. If the district court determines that joinder is appropriate, § 1447(e) requires remand to state court. If the district court decides otherwise, it may deny joinder. 28 U.S.C. § 1447(e). We have no occasion here to apply these principles to the district court's decision, because Mrs. McPhail never attempted to amend her complaint. She informs us in her brief that she did not learn the identities of these potential defendants until shortly before the district court granted summary judgment, and states that her ability to add these individuals to her complaint was dependent on information controlled by Deere. Accordingly, as matters now stand, the complaint names parties who are wholly diverse, and there is no basis for remanding to state court. If Mrs. McPhail attempts to amend her complaint on remand, the district court will determine whether to grant leave to amend, whether any additional named parties are indispensable, and, if not, whether permissive joinder is appropriate. For now, Deere is the only named defendant. Having never been presented with a motion to amend the complaint to substitute non-diverse defendants in place of the unidentified defendants, the district court did not err in determining that it has diversity jurisdiction.