Allen v. Red Frog Events, LLC, 335 F. Supp. 3d 831 (2018)

Sept. 13, 2018 · United States District Court for the Middle District of Louisiana · CIVIL ACTION NO.: 17-01664-BAJ-EWD
335 F. Supp. 3d 831

Kara Jo ALLEN, et al.
v.
RED FROG EVENTS, LLC, et al.

CIVIL ACTION NO.: 17-01664-BAJ-EWD

United States District Court, M.D. Louisiana.

Signed September 13, 2018

*834Russell W. Beall, William Walter Thies, Jacob Henry Thomas, Beall & Thies, LLC Attorneys at Law, James R. Bullman, The Bullman Law Firm, LLC, Daniel Brian Davis, Baton Rouge, LA, for Kara Jo Allen, et al.

Christopher A. D'Amour, Gerard Joseph Gaudet, William Kirby Wright, IV, Adams and Reese LLP, Max J. Cohen, Melanie Lockett, Abigail Frank Gerrity, Lowe Stein Hoffman Allweiss & Hauver, LLP, Paula M. Wellons, Walter N. Dietzen, Taylor, Wellons, Politz & Duhe, Robert E. Couhig, Jr., Cory Steven Grant, Jonathan Percy Lemann, Couhig Partners, LLC, Howard Carter Marshall, David B. Belk, Kevin Richard Tully, Christovich & Kearney, LLP, New Orleans, LA, Rachel Lauren Kovach, Taylor, Wellons, Politz, and Duhe, APLC, Baton Rouge, LA, Andre' Collins Gaudin, Burglass & Tankersley, L.L.C., Craig Joseph Canizaro, Burglass & Tankerslay, Metairie, LA, for Red Frog Events, LLC, et al.

RULING AND ORDER

JUDGE BRIAN A. JACKSON

Before the Court is the Magistrate Judge's Report and Recommendation (Doc. 93) pursuant to 28 U.S.C. § 636(b)(1). The Magistrate Judge recommends that this case be remanded because complete diversity does not exist between the parties due to Plaintiffs' inclusion of the Parish of West Feliciana, a non-diverse party, as a named Defendant. (Doc. 93 at p. 18).

The Report and Recommendation notified the parties that, pursuant to 28 U.S.C. § 636(b)(1), they had fourteen (14) days from the date they received the Report and Recommendation to file written objections to the proposed findings of fact, conclusions of law, and recommendations therein (Doc. 93 at p. 1). Defendants First Specialty Insurance Corporation and Red Frog Events filed an objections. (Doc. 94; Doc. 95).

Both Defendants vigorously assert that the "playground exception" to the Louisiana Recreational Use Immunity Statute, La. Rev. Stat. ann. § 9:2795(B), clearly does not apply to the obstacles constructed at the event hosted by Red Frog, and *835therefore, joinder of the Parish of West Feliciana is improper. However, the Court agrees with the Magistrate Judge that fact issues preclude a definitive determination that the Parish of West Feliciana is immune under the statute.

Having carefully considered the underlying complaint, the instant motion, and related filings, the Court approves the Magistrate Judge's Report and Recommendation, and hereby adopts its findings of fact, conclusions of law, and recommendation.

Accordingly,

IT IS SO ORDERED that the Magistrate Judge's Report and Recommendation (Doc. 93) is ADOPTED as the Court's opinion herein.

IT IS FURTHER ORDERED that this case is REMANDED to the 20th Judicial District Court for the Parish of West Feliciana, State of Louisiana.

IT IS FURTHER ORDERED that the Motion to Remand (Doc. 12) is DENIED as MOOT.

REPORT AND RECOMMENDATION

ERIN WILDER-DOOMES, UNITED STATES MAGISTRATE JUDGE

NOTICE

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.

Signed in Baton Rouge, Louisiana, on August 14, 2018.

Before the court is a Motion to Remand1 filed by plaintiffs, Kara Jo Allen, Gabiel Allen, and Courtney Stricklin ("Plaintiffs"). The Motion to Remand is opposed2 by defendant, Red Frog Events, LLC ("Red Frog"). For the reasons set forth herein, the undersigned recommends3 that the Motion to Remand4 be granted and that this suit be REMANDED to the 20th Judicial District Court for the Parish of West Feliciana, State of Louisiana

I. Background

This is a civil action involving claims for damages based upon injuries allegedly sustained by Kara Jo Allen and Courtney Stricklin when a "tall, open dome like structure, constructed of wood, and designed to be climbed upon and over"5 (referred to as the "Diesel Dome" or the "Dome") over which Allen and Stricklin were traversing "spontaneously collapsed"

*8366 during a "Warrior Dash" race held in October 2016.7 On or about October 4, 2017, Plaintiffs filed a Petition for Damages in state court against Red Frog, First Specialty Insurance Corporation ("First Specialty"), Peterson Builders Framing Contractors, LLC, ("Peterson"), Auto-Owners Insurance Company ("Auto-Owners"), North South Renovations, Inc. ("North South"), Nationwide Mutual Insurance Company ("Nationwide"), and the Parish of West Feliciana ("West Feliciana" or the "Parish") in the Twentieth Judicial District Court for the Parish of West Feliciana, State of Louisiana.8

The matter was removed to this court by Red Frog on November 15, 2017 on the basis of diversity jurisdiction under 28 U.S.C. § 1332(a).9 Per its Notice of Removal, Red Frog asserts that, with the exception of West Feliciana, the parties to this action are completely diverse.10 With *837respect to West Feliciana, Red Frog asserts that the Parish was improperly joined for the sole purpose of defeating diversity jurisdiction.11 In the Notice of Removal, Red Frog asserts that pursuant to an agreement between West Feliciana and Red Frog (the "Venue Agreement"), Red Frog "received 'exclusive use' of the West Feliciana Parish Sports Park" (the premises wherein the Warrior Dash was hosted) and that West Feliciana "[i]n no manner...[had] anything to do with the construction of the allegedly-defective obstacle or the provision of medical services at the event...."12 Red Frog avers that pursuant to the Venue Agreement "any and all responsibility for the condition, maintenance, use, occupation, operation, or alteration of the West Feliciana Sports Park was passed to Red Frog"13 and that "Louisiana law imposes no legal duty on West Feliciana Parish to, inter alia , (1) monitor/supervise a private event (the Warrior Dash) that occurs on property that it leases to private entities and (2) ensure that temporary structures that may be used during a private event that occurs on its leased premises are safe."14

On November 22, 2017, Plaintiffs filed the instant Motion to Remand.15 Plaintiffs argue that they have stated viable claims against West Feliciana and that the Parish is not entitled to statutory immunity pursuant to Louisiana's Recreational Use Statute for these claims. Plaintiffs further assert that the question of whether they have stated a claim against West Feliciana should be limited to a 12(b)(6)-type analysis, and that piercing the pleadings would be inappropriate. In opposition, Red Frog contends that the Parish was improperly joined because it is entitled to statutory immunity and because it otherwise owed no duty under Louisiana law.

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."16 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."17 Subject matter jurisdiction must exist at the time of removal to federal court, based on the facts and allegations contained in the complaint.18 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.19 The removal statute, *83828 U.S.C. § 1441, is strictly construed and any doubt as to the propriety of removal should be resolved in favor of remand.20 The removing party has the burden of proving federal diversity jurisdiction.21 Remand is proper if at any time the court lacks subject matter jurisdiction.22

B. The Forum Defendant Rule Does Not Require Denial of the Motion to Remand

In opposition to the Motion to Remand, Red Frog includes a discussion of the forum defendant rule and asserts that West Feliciana was not served at the time of removal.23 The forum defendant rule of § 1441(b) provides that when the federal court's original jurisdiction is based on diversity of citizenship, the civil action "may not be removed if any of the parties in interest properly joined and served as defendants is a citizen [of the State] in which such action is brought."24 "The majority of courts that have considered the question, including multiple district courts within this circuit, have ruled that the plain language of § 1441(b)(2) bars removal only where the forum defendant was properly served at the time of removal, and that the presence of a forum defendant will not create a defect if that defendant was not properly served at the time of removal."25

Plaintiffs do not rely on the forum defendant rule in support of their Motion to Remand, and it is unclear why Red Frog includes an analysis of same in its opposition. To the extent Red Frog argues that the citizenship of an unserved, non-diverse defendant should be disregarded for purposes of this court's jurisdictional analysis,26 the Fifth Circuit has held that "non-diverse citizenship cannot be ignored simply because [the defendant is] an unserved defendant."27 "A non-resident defendant cannot remove an action if the citizenship of any co-defendant, joined by the plaintiff in good faith, destroys complete diversity, regardless of service or non-service upon the co-defendant. Whenever federal jurisdiction in a removal case depends upon complete diversity, the existence of diversity is determined from the fact of citizenship of the parties named and not from the fact of service."28 Accordingly, *839the citizenship of West Feliciana cannot be ignored on the basis that it was not served at the time of removal, and the undersigned proceeds with consideration of the propriety of Plaintiffs' joinder of West Feliciana.

C. Improper Joinder Standard

The party seeking removal based on improper joinder of a non-diverse defendant bears a "heavy" burden of proving that the joinder was improper.29 To meet its burden, the removing party must show (1) an actual fraud in the pleading of jurisdictional facts, or (2) an inability of the plaintiff to establish a cause of action against the non-diverse party in state court.30 Red Frog has not alleged actual fraud in the Petition.31 The undersigned will therefore only consider the second approach (i.e. , inability to establish a cause of action) in analyzing the propriety of West Feliciana's joinder.

Under the second approach, "the test for [improper] joinder is whether the defendant has demonstrated that there is no possibility of recovery by the plaintiff against an in-state 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."32 The court must resolve all disputed questions of fact and ambiguities in the controlling state law in favor of the plaintiff.33 If the court concludes that the plaintiff has any "possibility of recovery against the party whose joinder is questioned" then joinder is proper and the case must be remanded for lack of subject matter jurisdiction.34 "The possibility must be reasonable, not merely theoretical."35

The Fifth Circuit has explained that to determine whether a plaintiff has a reasonable basis of recovery under state law, a court can resolve the issue in one of two ways.36 "The court may conduct a Rule 12(b)(6)-type analysis, looking initially 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."37 However, where a plaintiff has omitted or misstated "discrete facts that would determine the propriety of joinder," the district court may "pierce the pleadings and conduct a summary inquiry" to determine whether a non-diverse defendant has been improperly joined.38 The Fifth Circuit has explained *840that, "[a]lthough a court may pierce the pleadings and consider summary-judgment type evidence, the standard for finding improper joinder is not the summary judgment standard in which an absence in the plaintiff's proof alone can be fatal."39 The Fifth Circuit in Davidson explained that:

The examples of improper joinder based on "discrete and undisputed facts" outside the pleadings that Smallwood provides are consistent with this language requiring a defendant to "preclude" the possibility of recovery: evidence showing that "the in-state doctor defendant did not treat the plaintiff," that "the in-state pharmacist defendant did not fill a prescription for the plaintiff patient," that "a party's residence was not as alleged, or any other fact that easily can be disproved if not true."40

Although the district court may consider such discrete and undisputed facts, the Fifth Circuit has "frequently cautioned the district courts against pretrying a case to determine removal jurisdiction...."41

1. Plaintiffs' Allegations Regarding West Feliciana

Plaintiffs allege that "West Feliciana Sports Complex is a municipal park owned and operated by The Parish of West Feliciana, a political subdivision within the State of Louisiana"42 and that West Feliciana "offers the West Feliciana Sports Complex as a venue available to host events."43 Plaintiffs allege that "[o]n Saturday, October 8, 2016, [Red Frog] produced and hosted a 'WARRIOR DASH' race at the West Feliciana Sports Park in St. Francisville, Louisiana" and that "[c]onsistent with the 'WARRIOR DASH' model, twelve (12) man-made obstacles were positioned along the 5 kilometer race path."44 Plaintiffs further contend that Red Frog contracted with North South and/or Peterson to construct the obstacles, including the Diesel Dome,45 and that the Dome "spontaneously collapsed" while Kara Jo Allen and Courtney Stricklin were climbing it.46

Plaintiffs repeatedly assert in their Petition that although commonly referred to as "obstacles," the twelve items used in the Warrior Dash should be categorized as "simply playground equipment."47 Plaintiffs contend that West Feliciana must be aware of defective playground equipment and must inspect, test, and insure that any and all playground equipment constructed upon or within the Sports Complex is safe for its intended use and is in compliance with "any and all applicable codes" and "any known engineering plans."48 Plaintiffs assert their damages were caused by the fault and negligent acts and omissions of West Feliciana including but not limited to:

*841a. Failure to know, or in the exercise of reasonable care, know of defective playground equipment within the West Feliciana Sports Complex;
b. Failure to inspect and insure that all playground equipment within and upon the Sports Complex property is safe for its intended use;
c. Failure to insure that any and all playground equipment constructed upon or within the Sports Complex must comply with any and all applicable codes;
d. Failure to insure that any and all playground equipment constructed upon or within the Sports Complex must be constructed in a manner that it complies with any known engineering plans for safe construction and intended use;
e. Failure to inspect any and all playground equipment constructed upon or within the Sports Complex to insure it is safe for its intended use; and
f. Failure to test any and all playground equipment constructed upon or within the Sports Complex to insure it is safe for its intended use.49

In addition to asserting the general negligence of all defendants, Plaintiffs "invoke CC Art 2317.1 as a basis for liability of defendants...in that the defendants were owners and/or custodians of the subject 'Diesel Dome', of which was burdened by a defect, said defect not being open or obvious, wherein the named defendants knew, or in the exercise of reasonable care, should have known of the defect, and failed to take adequate steps to prevent the harm caused by the defect."50

2. Louisiana Negligence Law

"In general, landowners and land occupiers have a duty to refrain from acting negligently toward those they know or should have known will come onto their property. The duty of a governmental agency or municipality operating a public park is held to keep the premises in a reasonably safe condition for those using the park and to discover any unreasonably dangerous conditions on the premises and to either correct the conditions or warn of the danger."51 "A governmental agency or municipality operating a public park or playground is held to the same degree of care arising from ownership as any other person in possession and control of land; this rule requires that the agency or municipality use reasonable or ordinary care to keep the premises in reasonably safe condition for those using them."52

Louisiana Civil Code article 2317.1, which Plaintiffs explicitly cite in their Petition, imposes a negligence standard and provides that "[t]he owner or custodian of a thing is answerable for damage occasioned by its ruin, vice, or defect, only upon a showing that he knew or, in the exercise of reasonable care, should have known of the ruin, vice, or defect which caused the damage, that the damage could have been prevented by the exercise of reasonable care, and that he failed to exercise such reasonable care." Plaintiffs allege that the Dome should be considered playground equipment and that West Feliciana was negligent, inter alia , in its "[f]ailure to know or in the exercise of reasonable care, know of defective playground equipment...."53 Plaintiffs further allege that *842the Parish "offer[ed] the West Feliciana Sports Complex as a venue to host events" (including the Warrior Dash) and that the Parish "must insure that any and all playground equipment within and upon the Sports Complex property is safe" and "compl[ies] with any and all applicable codes."54 Although such allegations verge dangerously close to conclusory, the undersigned finds that Plaintiffs' allegations that West Feliciana offered its property for use by Red Frog for the Warrior Dash, and that West Feliciana failed to inspect and test one of the pieces of equipment constructed on its property for the Warrior Dash are sufficient to withstand scrutiny under Rule 12(b)(6).55

In opposition to Plaintiff's Motion to Remand, Red Frog asserts that "[t]he Warrior Dash occurred at the West Feliciana Sports Park, but the Parish had nothing to do with the Warrior Dash and the construction of the obstacles."56 Red Frog explains that in preparing for the race, it "entered into a Venue Agreement ('Agreement') with the Parish, wherein Red Frog received exclusive use of (i.e. , leased) the West Feliciana Sports Park, which is owned by the Parish. The Agreement did not allow the Parish to monitor or supervise the event or construct or inspect the obstacles, it also did not grant the Parish ownership, custody, or control of the obstacles."57 In making these factual assertions, Red Frog relies on a Declaration executed by Megan Gaesor,58 a Red Frog employee who states she was "an Event Director" at the Warrior Dash, and the Venue Agreement itself, which is attached to Ms. Gaesor's Declaration.59

La. R.S. § 9:3221, which Red Frog asserts is applicable here, provides that "the owner of premises leased under a contract whereby the lessee assumes responsibility for their condition is not liable for injury caused by any defect therein to the lessee or anyone on the premises who derives his right to be thereon from the lessee, unless the owner knew or should have known of *843the defect or had received notice thereof and failed to remedy it within a reasonable time."

Assuming, arguendo , that the Venue Agreement constitutes a lease (and that Louisiana law applies),60 it is not clear as an initial matter that pursuant to the Venue Agreement "any and all responsibility for the condition, maintenance, use, occupation, operation, or alteration of the West Feliciana Sports Park was passed to Red Frog."61 While the Venue Agreement provides Red Frog "exclusive use" of certain portions of the West Feliciana sports complex "for an obstacle course race, festival area and vehicle parking," it also provides that the West Feliciana Sports Park "shall retain the right to access the Property during the Events."62 The Venue Agreement provides that Red Frog would "[p]rovide all necessary labor and materials to construct Event obstacles,"63 but also requires the Venue to provide specified areas for the construction of certain obstacles.64 Finally, the Venue Agreement requires Red Frog to list the Venue as an additional insured under Red Frog's applicable insurance policies65 and includes the following reciprocal indemnification provision:

RFE [Red Frog] shall indemnify, defend and hold Venue [West Feliciana Sports Park]...harmless from and against all actions, suits, proceedings, judgments, *844demands, claims, liabilities, losses or expenses, including reasonable attorneys' fees, due to RFE's negligence, gross negligence or intentional acts or omissions that give rise to a claim in connection with the Event. Likewise, Venue shall indemnify, defend and hold RFE...harmless from and against all actions, suits, proceedings, judgments, demands, claims, liabilities, losses or expenses, including reasonable attorneys' fees, due to Venue's negligence, gross negligence or intentional acts or omissions that give rise to a claim in connection with the Event.66

In light of these provisions, the undersigned finds that the Venue Agreement does not, at least at this initial stage of these proceedings, provide a basis for finding that there is no possibility of recovery by Plaintiffs against the Parish.67 As explained above, Red Frog's burden to establish the improper joinder of West Feliciana is a heavy one,68 and the Fifth Circuit has "frequently cautioned the district courts against pretrying a case to determine removal jurisdiction...."69 At this stage of these proceedings, the undersigned finds that, based on the allegations of the Petition, Plaintiffs have sufficiently *845stated a claim against West Feliciana.70

3. Louisiana Recreational Use Immunity

La R.S. § 9:2795(B) provides, inter alia , that:

(1) Except for willful or malicious failure to warn against a dangerous condition, use, structure, or activity, an owner of land, except an owner of commercial recreational developments or facilities, who permits with or without charge any person to use his land for recreational purposes as herein defined does not thereby:
(a) Extend any assurance that the premises are safe for any purposes.
(b) Constitute such person the legal status of an invitee or licensee to whom a duty of care is owed.
(c) Incur liability for any injury to person or property caused by any defect in the land regardless of whether naturally occurring or man-made.

The statute defines "land" to include "urban or rural land, roads, water, watercourses, private ways or buildings, structures, and machinery or equipment when attached to the realty"71 and provides that "recreational purposes" "includes but is not limited to any of the following, or any combination thereof: hunting, fishing, trapping, swimming, boating, camping, picnicking, hiking, horseback riding, bicycle riding, motorized, or nonmotorized vehicle operation for recreation purposes, nature study, water skiing, ice skating, roller skating, roller blading, skate boarding, sledding, snowmobiling, snow skiing, summer and winter sports, or viewing or enjoying historical, archaeological, scenic, or scientific sites."72 The statute further provides that "[t]he limitation of liability provided in this Section shall apply to any lands, whether urban or rural, which are owned, leased, or managed as a public park by the state or any of its political subdivisions and which are used for recreational purposes."73 Red Frog argues that " § 9:2795's immunity statute clearly applies here because Plaintiffs fail to plead allegations that the Parish willfully or maliciously failed to warn of the alleged defect in the Diesel Dome...."74

Significant to the instant Motion to Remand, La. R.S. § 9:2795(E)(2)(c) provides that "[f]or purposes of the limitation of liability afforded to parks pursuant to this Section this limitation does not apply to playground equipment or stands which are defective." As set forth above Plaintiffs have specifically alleged that the Dome *846should be considered "playground equipment."75 While Red Frog argues that such characterization is "dubious" and that the policy behind the playground equipment exception "clearly contemplates that playground equipment and bleachers excepted from the immunity is in the control of the public entity and that the public entity is responsible for maintaining these items," Red Frog provides no support for that reading. Further, the undersigned's research indicates that the question of whether a defendant is entitled to immunity pursuant to the statute is one usually analyzed within the context of a motion for summary judgment.76 While "summary judgment-type" evidence may be considered in some instances during an improper joinder analysis, whether the Diesel Dome should be characterized as "playground equipment" for purposes of the statute appears to be a more factually intensive inquiry than that contemplated by Davidson - i.e. , this is not the type of fact that can be "easily disproved if not true."77 The allegations set forth in the Petition are sufficient to survive a Rule 12(b)(6) challenge based on the assertion of statutory immunity and the undersigned finds that an analysis of whether the Diesel Dome should be considered playground equipment for purposes of the statute is not the type of "discrete fact" contemplated by the Fifth Circuit and would instead require this court to improperly "pretry[ ] [this] case to determine removal jurisdiction...."78

III. Conclusion

The Removing Defendants bear the heavy burden of proving improper joinder.79 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.80 Here, based *847on the allegations set forth in Plaintiffs' Petition, the undersigned finds that Red Frog has not met its heavy burden of establishing that there is no reasonable possibility that Plaintiffs may recover against West Feliciana. The undersigned therefore finds that West Feliciana is a properly joined, non-diverse defendant. Accordingly, for the reasons set forth herein, the undersigned recommends that the Motion to Remand81 be GRANTED and that this matter be remanded to the 20th Judicial District Court, Parish of West Feliciana.

Signed in Baton Rouge, Louisiana, on August 14, 2018.