Opinion ID: 815692
Heading Depth: 3
Heading Rank: 2

Heading: Fraudulent joinder standard

Text: A civil case is properly removed under §1441(b) where there is complete diversity of the parties at the time of removal, meaning that “all parties on one side of the litigation are of a different citizenship from all parties on the other side of the litigation.” Coyne v. Am. Tobacco Co., 183 F.3d 488, 492 (6th Cir. 1999) (quoting SHR Ltd. P’ship v. Braun, 888 F.2d 455, 456 (6th Cir.1989)). “When a non-diverse party has been joined as a defendant, then in the absence of a substantial federal question the removing defendant may avoid remand only by demonstrating that the non-diverse party was fraudulently joined.” Casias v. Wal-Mart Stores, Inc., 695 F.3d 428, 432 (6th Cir. 2012) (quoting Jerome–Duncan, Inc. v. Auto–By–Tel, L.L.C., 176 F.3d 904, 907 (6th Cir. 1999)). 6 “To prove fraudulent joinder, the removing party must present sufficient evidence that a plaintiff could not have established a cause of action against non-diverse defendants under state law.” Coyne, 183 F.3d at 492–93 (citing Alexander v. Elec. Data Sys. Corp., 13 F.3d 940, 949 (6th Cir. 1994)). Coyne provides the relevant standard: [I]f there is a colorable basis for predicting that a plaintiff may recover against non-diverse defendants, this Court must remand the action to state court. The district court must resolve all disputed questions of fact and ambiguities in the controlling state law in favor of the non removing party. All doubts as to the propriety of removal are resolved in favor of remand. 183 F.3d at 493 (6th Cir. 1999) (internal quotation marks and citation omitted). The Eighth Circuit, which also considers whether a state-law claim is “colorable” for the purpose of fraudulent joinder, has concluded that a claim is colorable “if the state law might impose liability on the resident defendant under the facts alleged.” Filla v. Norfolk S. Ry. Co., 336 F.3d 806, 810 (8th Cir. 2003). The combination of the “colorable” standard with the requirement that all ambiguities of state law are to be resolved in favor of the non-removing party presents a significant hurdle. A defendant attempting to prove fraudulent joinder thus faces a particularly heavy burden. See Casias, 695 F.3d at 433 (applying a test that is “similar to, but more lenient than, the analysis applicable to a Rule 12(b)(6) motion to dismiss”); see also Schur v. L.A. Weight Loss Ctrs., Inc., 577 F.3d 752, 764 (7th Cir.2009) (“A defendant faces a ‘heavy burden’ to demonstrate that the joinder is fraudulent, and some courts . . . have suggested that the burden is even more favorable to the plaintiff than the standard that applies to a motion to dismiss under [Fed. R. Civ. P.] 12(b)(6).”); Smallwood v. Illinois Cent. R. Co., 385 F.3d 568, 574 (5th Cir. 2004) (“The party seeking removal bears a heavy burden of proving that the joinder of the in-state party was improper.”); Hartley v. CSX Transp., 187 F.3d 422, 424 (4th Cir. 1999) (“The party alleging fraudulent joinder bears a heavy burden—it must show 7 that the plaintiff cannot establish a claim even after resolving all issues of law and fact in the plaintiff’s favor.”).