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7th Circuit orders Indiana case sent back to Ohio

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A federal judge in the Southern District of Indiana erred when she determined that a claims adjuster from Ohio was fraudulently joined to a case that was transferred out of federal court in Ohio to Indiana, the 7th Circuit Court of Appeals ruled. The case also presented two issues of first impression for the Circuit.

In Tommy L. Morris, personal representative of the estate of Thomas Lynn Morris v. Salvatore Nuzzo, 12-3220, the estate of Thomas Lynn Morris filed a lawsuit in Ohio state court against Mid-Century and Salvatore Nuzzo, alleging tortious bad faith failure to pay an insurance claim and breach of contract. Mid-Century was the insurer of the car driven by Daemon Sampson in Brown County, Ind., which was involved in an accident that killed passenger Morris. Nuzzo, a resident of Ohio, was the claims adjustor assigned to handle the estate’s claims. Mid-Century was based out of California.

The lawsuit was removed to federal court in Ohio, which then granted Mid-Century and Nuzzo’s request to transfer the case to federal court in Indiana. There, Judge Sarah Evans Barker ruled that Nuzzo had been fraudulently joined and should be dismissed because under Indiana law, the claims against him were not cognizable and stood no chance of success. Those claims are potentially viable under Ohio law.

“The question before us is whether the district court erred in applying the fraudulent joinder doctrine to Nuzzo, whose presence triggers the forum defendant rule but does not compromise the parties’ complete diversity,” wrote Judge James Zagel, of the U.S. District Court for the Northern District of Illinois, Eastern Division, sitting by designation. “In other words, we are asked to determine whether the fraudulent joinder doctrine creates an exception to the forum defendant rule. It does not appear that any court of appeals has answered this question.”

The 7th Circuit determined that the costs of expanding the doctrine could far outweigh the benefits of policing against what appears to be an exceptionally rare abusive pleading tactic.

“Ultimately, we think it a very close question whether the fraudulent joinder doctrine ought to extend to diverse resident defendants, and we are reluctant to rule definitively on the issue today absent a more thorough and more able presentation of the relevant balance of interests described above. In any event, we are convinced that Nuzzo was not fraudulently joined,” he wrote.

Another issue of first impression arose: whether, or to what extent, a federal court can make choice of law determinations in conducting a fraudulent joinder analysis. The appeals court held that these determinations can be made as part of the fraudulent joinder analysis where the choice of law decision is dispositive to the outcome, and where the removing defendant bears the same “heavy burden” to make the choice of law showing.

“We believe that there was more than a reasonable possibility that the Ohio state court would have decided against Nuzzo and applied Ohio law to the Estate’s bad faith failure to settle claim. Thus, regardless of what law the Ohio state court would have ultimately applied to the breach of contract claim, Nuzzo was not fraudulently joined and his presence prevented removal under 28 U.S.C. § 1441(b)(2). Because the Estate timely objected to this procedural defect in removal, it has a right to remand,” Zagel wrote.
 

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  1. Call it unauthorized law if you must, a regulatory wrong, but it was fraud and theft well beyond that, a seeming crime! "In three specific cases, the hearing officer found that Westerfield did little to no work for her clients but only issued a partial refund or no refund at all." That is theft by deception, folks. "In its decision to suspend Westerfield, the Supreme Court noted that she already had a long disciplinary history dating back to 1996 and had previously been suspended in 2004 and indefinitely suspended in 2005. She was reinstated in 2009 after finally giving the commission a response to the grievance for which she was suspended in 2004." WOW -- was the Indiana Supreme Court complicit in her fraud? Talk about being on notice of a real bad actor .... "Further, the justices noted that during her testimony, Westerfield was “disingenuous and evasive” about her relationship with Tope and attempted to distance herself from him. They also wrote that other aggravating factors existed in Westerfield’s case, such as her lack of remorse." WOW, and yet she only got 18 months on the bench, and if she shows up and cries for them in a year and a half, and pays money to JLAP for group therapy ... back in to ride roughshod over hapless clients (or are they "marks") once again! Aint Hoosier lawyering a great money making adventure!!! Just live for the bucks, even if filthy lucre, and come out a-ok. ME on the other hand??? Lifetime banishment for blowing the whistle on unconstitutional governance. Yes, had I ripped off clients or had ANY disciplinary history for doing that I would have fared better, most likely, as that it would have revealed me motivated by Mammon and not Faith. Check it out if you doubt my reading of this, compare and contrast the above 18 months with my lifetime banishment from court, see appendix for Bar Examiners report which the ISC adopted without substantive review: https://www.scribd.com/doc/299040839/2016Petitionforcert-to-SCOTUS

  2. Wow, over a quarter million dollars? That is a a lot of commissary money! Over what time frame? Years I would guess. Anyone ever try to blow the whistle? Probably not, since most Hoosiers who take notice of such things realize that Hoosier whistleblowers are almost always pilloried. If someone did blow the whistle, they were likely fired. The persecution of whistleblowers is a sure sign of far too much government corruption. Details of my own personal experience at the top of Hoosier governance available upon request ... maybe a "fake news" media outlet will have the courage to tell the stories of Hoosier whistleblowers that the "real" Hoosier media (cough) will not deign to touch. (They are part of the problem.)

  3. So if I am reading it right, only if and when African American college students agree to receive checks labeling them as "Negroes" do they receive aid from the UNCF or the Quaker's Educational Fund? In other words, to borrow from the Indiana Appellate Court, "the [nonprofit] supposed to be [their] advocate, refers to [students] in a racially offensive manner. While there is no evidence that [the nonprofits] intended harm to [African American students], the harm was nonetheless inflicted. [Black students are] presented to [academia and future employers] in a racially offensive manner. For these reasons, [such] performance [is] deficient and also prejudice[ial]." Maybe even DEPLORABLE???

  4. I'm the poor soul who spent over 10 years in prison with many many other prisoners trying to kill me for being charged with a sex offense THAT I DID NOT COMMIT i was in jail for a battery charge for helping a friend leave a boyfriend who beat her I've been saying for over 28 years that i did not and would never hurt a child like that mine or anybody's child but NOBODY wants to believe that i might not be guilty of this horrible crime or think that when i say that ALL the paperwork concerning my conviction has strangely DISAPPEARED or even when the long beach judge re-sentenced me over 14 months on a already filed plea bargain out of another districts court then had it filed under a fake name so i could not find while trying to fight my conviction on appeal in a nut shell people are ALWAYS quick to believe the worst about some one well I DID NOT HURT ANY CHILD EVER IN MY LIFE AND HAVE SAID THIS FOR ALMOST 30 YEARS please if anybody can me get some kind of justice it would be greatly appreciated respectfully written wrongly accused Brian Valenti

  5. A high ranking Indiana supreme Court operative caught red handed leading a group using the uber offensive N word! She must denounce or be denounced! (Or not since she is an insider ... rules do not apply to them). Evidence here: http://m.indianacompanies.us/friends-educational-fund-for-negroes.364110.company.v2#top_info

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