Grogan v. Babson Bros. Co. - 101 F.R.D. 697 (N.D.N.Y. 1984)

Rule:

When there is no showing that the plaintiff seeks to join the additional defendants solely to effectuate a remand, in the exercise of sound discretion the court may permit a new party to be added, although his citizenship destroys diversity and requires a remand.

Facts:

Plaintiff initiated the present action against Babson Brothers Co. of Illinois alleging, inter alia, negligence and breach of warranty. Plaintiff’s claims related to certain livestock milking equipment manufactured by Babson Brothers Co. of Illinois, distributed by Surge Inc. of Babson Brothers Co., and retailed and distributed by Don Carrier Surge Inc. Don Carrier Surge Inc. installed the milking equipment on the plaintiff's premises. Plaintiff alleged that the equipment caused electric current to come into contact with the livestock during the milking operations. Don Carrier undertook to modify and correct the defect but allegedly abandoned its efforts without having corrected the problem. Subsequently, plaintiff sought to amend his complaint joining Surge Inc. of Babson Brothers and Don Carrier Surge Inc. to the present action. Plaintiff had previously commenced a separate action in state court against these two proposed defendants. Defendant contended that the motion should be denied because plaintiff's sole motive in seeking joinder was to destroy diversity of citizenship thereby subverting the defendant's right to defend the litigation in a federal forum. 

Issue:

Should joinder be allowed under the circumstances, notwithstanding the fact that joinder would destroy diversity of citizenship? 

Answer:

Yes.

Conclusion:

Plaintiff’s motion to join the distributor and the retailer as defendants was granted. The court first determined that joinder was proper under Fed. R. Civ. P. 20(a). The suit arose out of defective milking equipment, liability for which might have rested with any party. Common questions of fact and law existed, and joinder would have promoted convenience and avoided multiple litigation. While as a general rule a party could not have used joinder to destroy diversity jurisdiction, when there was no showing that a plaintiff sought to join additional defendants for the sole purpose of causing a remand, a court could have permitted joinder even though diversity was destroyed. In this case, the plaintiff did not seek joinder solely to effectuate remand. He did not know of the true manufacturer until litigation began. The manufacturer was not prejudiced by joinder because both lawsuits were in their infancy.