KWIT
v.
WALGREEN CO.
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Retailer-defendants are not fraudulently joined when a state court has dismissed claims against them on preemption grounds but the preemption issue remains subject to reasonable legal debate and appellate review.
[1] A claim is not fraudulently joined so long as there is reasonable debate over the legal sufficiency of the claim, and when a state court dismissal on a legal ground remai…
Previewing 1 of 1 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“Removal following an involuntary dismissal may be only temporary: the plaintiff may appeal the dismissal in state court, and success on appeal would lead to the reinstatement of the non-diverse party, destroying federal jurisdiction and compelling remand to the state court.”
Court cited Poulas v. Naas Foods, Inc., 959 F.2d 69, 72 (7th Cir. 1992) to explain that a plaintiff's right to appeal a dismissal in state court means there is no fraudulent joinder.
Plaintiffs filed suit in state court against retailers who sold Zantac (ranitidine). Defendants removed to federal court, arguing the non-diverse reta…
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argue that there was no possibility that the Plaintiffs could prevail on the claims and, as a result, the retailer-defendants were fraudulently joined. A claim is not fraudulently joined so long as there is reasonable debate over the legal sufficiency of the claim. E.g., Garretson v. Dr. Reddy’s Labs., Inc., No. 21-CV-01366, 2021 WL 5321548, at *2 (S.D. Ill. Nov. 16, 2021). As the Defendants recognize, however, this Court has repeatedly held that there is room for debate as to whether claims against retailers in this MDL are pre-empted by federal law. E.g., In re Zantac, 20-MD-2924 (April 1, 2021). In the Plaintiffs’ state court case, the trial judge’s decision on pre-emption may be appealed at the appropriate time. In such a situation, there is no fraudulent joinder of retailer-defendants. As explained by one circuit
court: Removal following an involuntary dismissal may be only temporary: the plaintiff may appeal the dismissal in state court, and success on appeal would lead to the reinstatement of the non-diverse party, destroying federal jurisdiction and compelling remand to the state court.
Poulas v. Naas Foods, Inc., 959 F. 2d 69, 72 (7th Cir. 1992). Because the trial judge’s ruling has not been affirmed on appeal, because the time to appeal has not yet run, and because the law on this issue is not so clear as to remove “from reasonable debate” how the appellate court would rule, the Plaintiffs did not fraudulently join retailerdefendants. Accordingly, it is ORDERED AND ADJUDGED that the Plaintiffs’ Motions to 2 Remand are granted. The Court declines to award attorney’s fees. The Plaintiffs shall submit a proposed order in Microsoft Word format remanding the above-references cases [...] [email protected]. gov. DONE and ORDERED in Chambers, West Palm Beach, Florida, this 13th day of June, 2024.
“ / ( Th A FRAME, ROBIN L. ROSENBERG ~ Cy,
UNITED STATES DISTRICT JUD
Copies furnished to Counsel of Record