Page:Pelman v. McDonald's Corporation (S.D.N.Y. 2003).pdf/10

 Discussion


 * I. Diversity Jurisdiction Exists, and the Plaintiffs’ Motion to Remand Is Denied

In order to rule on this motion, this Court must have jurisdiction. Defendants removed to federal court alleging that diversity jurisdiction exists pursuant to 28 U.S.C. § 1332.

Section 1332 states, in pertinent part, that: "(a) The district court shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between—
 * (1) Citizens of different States…."

28 U.S.C. § 1332. Section 1332 requires complete diversity of citizenship; therefore no defendant may share citizenship with a plaintiff. ''Owen Equip. & Erection Co. v. Kroger'', 437 U.S. 365, 373–34, 98 S.Ct. 2396, 2403, 57 L.Ed.2d 274 (1978). There is no dispute that all of the plaintiffs are New York residents and that three of the defendants—McDonalds of New York, the Bruckner Boulevard outlet, and the Jerome Avenue outlet—are New York residents. Therefore, unless the three non-diverse defendants were “fraudulently joined” to defeat jurisdiction, complete diversity does not exist, and this Court lacks subject matter jurisdiction over the controversy.

As an initial matter, although this concept is described as “fraudulent joinder,” suggesting that the determinative issue is one of motive, motive in fact has nothing to do with it. ''In re Rezulin Prods. Liability Litig.'', 133 F.Supp.2d 272, 279 (S.D.N.Y.2001) (“The only issue is whether the plaintiff has a legitimate claim against the non-diverse or in-state defendant—whether, in other words, the plaintiff has a real or direct interest in the controversy vis-a-vis the non-diverse or in-state defendant ….”). The standard for determining whether a plaintiff’s claim against a defendant is sufficiently substantial to defeat removal jurisdiction is governed by Pampillonia v. RJR Nabisco, Inc., 138 F.3d 459, 461 (2d Cir.1998).

In order to show that a non-diverse defendant was fraudulently joined to defeat diversity jurisdiction, the defendant must demonstrate, by clear and convincing evidence, either that there has been outright fraud committed in the plaintiffs’ pleadings, or that there is no reasonable basis, based on the pleadings, for liability against the non-diverse defendants in light of the claims alleged. Whitaker v. American Telecasting, Inc., 261 F.3d 196, 207 (2d Cir.2001) (quoting Pampillonia, 138 F.3d at 461). The burden on a removing defendant to meet this standard is a heavy one, and all reasonable doubts of fact and law are resolved in favor of the plaintiff. Id. “Nevertheless, the burden is not impossible of satisfaction.” In re Rezulin, 133 F.Supp.2d at 280.

In order to interpret the legal standards stated above, it is necessary to look to the “realities of the record.” Rose v. Giamatti, 721 F.Supp. 906, 915 (S.D.Ohio 1989). The discussion of whether the plaintiffs have stated a claim against the outlets and McDonalds of New York necessarily augurs the discussion, infra, of whether the Complaint should be dismissed. For ease of reading, this section summarizes the later analysis.


 * A. The Outlets

Plaintiffs have chosen to join as defendants two of McDonalds’ myriad outlets in New York State—both of which happen to be located in the Bronx, New York. As an initial matter, it is worth noting that this action is labeled a statewide class action, and any putative class members will