Duino v. CEM West Village, Inc.

Background

Tony Duino filed a negligence action in New York state court against CEM West Village, Inc. He alleged that he suffered severe personal injuries after falling down a staircase in an apartment at 149 West 10th Street, New York, New York. CEM owned the property and was the apartment’s landlord. The opinion states that CEM is a Delaware corporation with its principal place of business in California, and that Duino is a New York resident.

CEM removed the case to the U.S. District Court for the Southern District of New York based on diversity jurisdiction, which allows federal courts to hear certain cases between citizens of different states. The opinion states that the parties initially established complete diversity for purposes of the federal case. During discovery, CEM produced a one-year lease identifying Stephan Marsan as the apartment’s tenant or leaseholder. Marsan is a New York resident, like Duino.

Duino amended the complaint to add Marsan as a defendant and then moved under 28 U.S.C. § 1447(e) to remand, or return, the case to New York state court. The addition of Marsan destroyed complete diversity because a plaintiff and a defendant were both New York residents.

Joinder under Rule 20

The court first considered whether Marsan was properly joined under Federal Rule of Civil Procedure 20. Rule 20 permits multiple defendants to be joined when the claims arise from the same transaction or occurrence and involve a common question of law or fact.

The court held that both requirements were satisfied. The claims against CEM, the landlord, and Marsan, the leaseholder, arose from the same alleged fall. The claims would also involve many of the same legal and factual questions. The court therefore found that joining Marsan was permissible under Rule 20.

Fundamental-fairness factors

The court next considered whether allowing Marsan’s joinder was consistent with fundamental fairness. It evaluated four factors: the delay in seeking joinder and the reason for it, prejudice to CEM, the likelihood of multiple lawsuits, and Duino’s motivation for adding Marsan.

The court found that Duino did not delay unreasonably. CEM produced the lease about nine months after the lawsuit began, and Duino moved to add Marsan less than a month later. The court accepted Duino’s explanation that he learned through discovery that Marsan might also be liable.

The court found no sufficient prejudice to CEM. Although CEM had properly removed the case and had an interest in litigating in federal court, CEM did not identify specific prejudice or explain that it would have to change its litigation strategy. The court also concluded that remand would avoid parallel litigation and inconsistent judgments by keeping the claims against the potential tortfeasors together.

Finally, the court rejected CEM’s assertion that Duino sought to add Marsan only to defeat federal jurisdiction. The court concluded that the timing and discovery history supported Duino’s explanation that he wanted to pursue claims against all potentially liable parties in one case.

Disposition

Judge Colleen McMahon granted Duino’s motion to remand the matter to state court. The Clerk of Court was directed to remove the motion from the list of pending motions and close the federal case. The opinion did not decide the merits of Duino’s negligence claims or determine whether either defendant was liable for his injuries.