Candelaria v. Servpro Commercial LLC

Background

Noelia Bernardina Candelaria brought a personal-injury negligence action after slipping and falling on a wet, slippery, or defective condition at a Wells Fargo Bank branch where she worked. She initially sued in New York state court. Wells Fargo Bank removed the case to the Southern District of New York based on diversity jurisdiction, which generally requires complete diversity of citizenship between opposing parties and the required amount in controversy.

Candelaria later amended her complaint several times. Her Third Amended Complaint omitted the Wells Fargo defendants and added Servpro Commercial LLC, Antim Restoration Inc., Mitnor Corporation, CBRE Inc., and Melwood Contracting Corp. She later voluntarily dismissed her claims against Mitnor and Antim. The remaining defendants were Servpro, CBRE, and Melwood.

The opinion states that Candelaria is a New York citizen for diversity purposes. Melwood represented that it is a New York corporation with its principal place of business in Connecticut, making it a citizen of both states. The court also noted that Servpro had not disclosed the citizenship of its members, as required for a limited liability company, so the court could not determine from that filing whether Servpro was diverse from Candelaria.

Remand request

Candelaria sought remand under 28 U.S.C. § 1447(c), arguing that adding Melwood destroyed diversity jurisdiction. During a court conference, Melwood and the other two remaining defendants agreed. No party argued that Candelaria had added Melwood fraudulently to defeat federal jurisdiction.

The court considered both § 1447(c) and § 1447(e). Section 1447(c) requires remand when the federal court lacks subject-matter jurisdiction before final judgment. Section 1447(e) allows a court to deny the addition of a nondiverse defendant or permit the addition and remand the case to state court.

Analysis

The court concluded that Melwood was properly joined under Federal Rule of Civil Procedure 20. Candelaria alleged that Melwood, like the other defendants, performed maintenance work at the premises and contributed to the dangerous condition that caused her fall. The claims therefore arose from the same accident and shared common legal or factual questions.

The court then applied four fairness factors used when a post-removal joinder destroys diversity: the delay and its reason, prejudice to the defendants, the risk of multiple lawsuits, and the plaintiff’s motivation. The court found that Candelaria added Melwood within days of learning through discovery that Melwood had performed work in the relevant basement area. It did not view the delay as excessive.

The court found no particular prejudice to Melwood, which had already answered the Third Amended Complaint and had no pending motions. Denying joinder could create a risk of separate litigation because Candelaria could pursue Melwood in state court while continuing against other defendants in federal court. The court also accepted Candelaria’s explanation that she added Melwood because of its alleged maintenance work, not to destroy diversity. All three defendants’ agreement with remand also supported the result.

Disposition

The court held that both § 1447(c) and § 1447(e) supported remand. It GRANTED Candelaria’s remand motion, directed the Clerk of Court to TERMINATE all pending motions, and ordered that the case be REMANDED to the Supreme Court of the State of New York, Bronx County. The opinion did not decide whether any defendant was liable for Candelaria’s injuries.