There are more bad fraudulent joinder decisions than good ones out there, and we typically do not like publicizing the other side’s wins. But occasionally an opinion is so weird that it merits a brief comment. Cardoza v. Med. Device Bus. Servs., 2019 U.S. Dist. LEXIS 77506 (W.D.Va. May 8, 2019), is a bit weird. The plaintiff was a Virginia resident who alleged that the liner of her hip implant fractured shortly after being implanted, requiring her to have emergency revision surgery. Because some of the fractured pieces could not be removed, she continues to have shards in her body. She sued in Virginia state court, naming five out-of-state defendants, all of whom have some relationship to the development, manufacture, or distribution of the hip implant and/or the liner, while also naming three Virginia defendants. What’s weird about any of that? It sounds like a run of the mill product liability case, doesn’t it?
Not completely. In addition to the product liability claims, the plaintiff also asserted three additional state-law claims: a “spoliation” claim; a claim for wrongful disclosure of medical information; and conversion. Those claims arose out of her allegation that, despite her surgeon’s pre-surgery assurances that he would give her the parts of the implant that were removed, those pieces were not provided to her, but were instead given to the manufacturing defendants, where they were “examined, inspected, and tested.” Although the parts have since been returned to her, she alleged that their condition and the lack of any information about the chain of custody makes it “virtually impossible for [her] to determine with reasonable certainty the root cause of her injuries and damages.”
The out of state defendants removed the case to federal court on the basis of diversity jurisdiction. The plaintiff moved to remand. Predictably, the plaintiff argued that the existence of the Virginia defendants destroyed diversity jurisdiction and required remand. Equally predictably, the out of state defendants countered that the non-diverse defendants were fraudulently joined because the plaintiff had no possibility of succeeding on the two counts in which they were named: wrongful disclosure of medical information, and conversion.
The plaintiff offered a threshold argument that remand was required because of technical violations of the removal statute, involving failures to attach copies of all process and pleadings in the case, as well as failure to give requisite notice. But no Fourth Circuit decision suggested that any such technical flaws invalidated removal, and the district court concluded that all that was afoot were de minimis violations that can be cured. We hope the defendants savored this victory, because it just gets worse after that.
The court concluded that, at least as to one claim against one of the non-diverse defendants, the conversion claim, the defendants “cannot show that there is no possibility of establishing the cause of action.” Still, the defendants did not go down without a fight. They relied on a consent form signed by the plaintiff prior to her surgery in which she consented in writing to the hospital doing what it pleased with the explanted parts. But the court held that it could not consider documents beyond the pleadings. The plaintiff claimed that she and her surgeon had a mutual intent to modify a term of the written agreement. Based on that, the court refused to say on the current record that defendants showed that the plaintiff had “no possibility” of succeeding on her claim.
The out of state defendants’ alternative argument was that, even if the non-diverse defendants were not fraudulently joined, the claims against them were improperly joined with the claims against the diverse defendants. This is a theory of “fraudulent misjoinder.” The court held that the plaintiff’s ability to prove her claims against the diverse defendants was “intertwined with her allegations regarding the conversion and spoliation of the extracted implants.” Thus, the court did not find that the claims against the non-diverse defendants were fraudulently misjoined. Lastly, as if to put a poisoned cherry on top of this rotten sundae, the court held that even if it had the discretion to sever, it would not do so here.