1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 JOHN EDWIN RATHBUN, et al., Case No. 21-cv-03228-HSG

8 Plaintiffs, ORDER GRANTING MOTION TO REMAND 9 v. Re: Dkt. No. 26 10 BARRETTS MINERALS, INC., et al., 11 Defendants.

12 13 Pending before the Court is a motion to remand filed by Plaintiff John Edward Rathbun 14 and Plaintiff Gwendolyn Rathbun and opposed by Defendant Chattem, Inc. (“Chattem”) and 15 Defendant Lucky Stores Inc. (“Lucky”) (collectively, “Defendants”). Dkt. Nos. 26 (“Mot”), 46 16 (“Opp.”), 48 (“Reply”).1 Also pending is Lucky’s motion for summary judgment. Dkt. Nos. 23, 17 45, 49. The Court finds this matter appropriate for disposition without oral argument and the 18 matter is deemed submitted. See Civil L.R. 7-1(b). For the reasons discussed below, the Court 19 GRANTS the motion to remand. 20 I. BACKGROUND 21 Plaintiff John Edwin Rathbun, DDS (“Dr. Rathbun”) was diagnosed with terminal 22 mesothelioma on July 8, 2020. Dkt. No. 26-2 Declaration of Sarah E. Gilson (“Gilson Decl.”) ¶ 2. 23 On December 22, 2020, Plaintiffs filed suit in Alameda Superior Court asserting state-law claims 24 for negligence, strict liability, negligent misrepresentation, fraud by nondisclosure, and loss of 25 consortium. Dkt. No. 1-2, Ex. C (“Compl.”). Plaintiffs allege that Dr. Rathbun “was exposed to 26 asbestos fibers by using and handling asbestos fibers and products incorporating asbestos as a 27 1 component, and being in the presence of others using and handling asbestos fibers and products 2 incorporating asbestos as a component.” Id. ¶ 5. They allege that his “cumulative exposure to 3 asbestos, as a result of acts and omissions of defendants, . . . and the defective products of 4 defendants, . . . were a substantial factor in increasing Plaintiff’s risk of mesothelioma and other 5 related injuries, and therefore a legal cause of Plaintiff’s injuries and damages.” Id. ¶ 6. 6 Defendants allegedly “were engaged in the business of placing asbestos-containing products into 7 the stream of commerce, including by . . . distributing, . . . offering for sale, supplying, selling, . . . 8 and/or advertising said products.” Id. ¶ 20. Plaintiffs allege that these “asbestos-containing 9 products were defective and unsafe for their intended purpose, in that they did not perform as 10 safely as expected by an ordinary consumer when used or misused in a reasonably foreseeable or 11 intended manner.” Id. ¶ 43. They further allege that “Defendants, through words and conduct, 12 represented that asbestos generally and asbestos-containing products marketed, sold, supplied, 13 distributed, disturbed, installed removed, and/or placed in the stream of commerce by Defendants 14 were of merchantable quality and safe for their intended and foreseeable use.” Id. ¶ 56. 15 Additionally, Plaintiffs allege that “Defendants’ conduct and Defendants’ placing of defective 16 products into the stream of commerce, as set forth herein, were a direct and proximate cause of 17 Plaintiff’s injuries and damages.” Id. ¶ 32. 18 On April 30, 2021, Chattem removed this action on diversity grounds. Dkt. No. 1. 19 Plaintiffs move to remand this case to state court and request attorney’s fees and costs. 20 II. LEGAL STANDARD 21 “Except as otherwise expressly provided by Act of Congress, any civil action brought in a 22 State court of which the district courts of the United States have original jurisdiction, may be 23 removed” to federal court.

(a). District courts have original jurisdiction over 24 civil actions between citizens of different states in which the amount in controversy exceeds 25 $75,000. See

(a)(1). To properly invoke diversity jurisdiction, the defendant 26 bears the burden of proving that the parties in the action are completely diverse, meaning that 27 “each plaintiff [is] of a different citizenship from each defendant.” Grancare, LLC v. Thrower by 1 If the district court lacks jurisdiction over an action, a plaintiff may seek remand to state 2 court. See

(c). There is a “strong presumption” in favor of remand, and 3 “[f]ederal jurisdiction must be rejected if there is any doubt as to the right of removal in the first 4 instance.” Guas v. Miles, Inc.,

(9th Cir. 1992). Accordingly, “[t]he strong 5 presumption against removal jurisdiction means that the defendant always has the burden of 6 establishing that removal is proper . . . .” Hunter v. Philip Morris USA,

(9th 7 Cir. 2009). Further, “remand must be granted unless the defendant shows that the plaintiff would 8 not be afforded leave to amend his complaint to cure the purported deficiency.” PHL Variable 9 Ins. Co. v. Cont’l Cas. Co., No. 19-CV-06799-CRB,

, at *2 (N.D. Cal. Mar. 18, 10 2020) (alterations and internal quotations omitted); Williams v. Kemper Indep. Ins. Co.,

Supp. 3d 958, 963 (N.D. Cal. 2020) (same). 12 III. DISCUSSION 13 Defendants oppose remand on the basis that non-diverse Defendants Safeway, Inc. and 14 Lucky were fraudulently joined to defeat diversity jurisdiction. Plaintiffs “do not dispute that 15 Safeway and Lucky are the only Defendants named in Plaintiffs’ Complaint who reside, like 16 Plaintiffs, in California.” Gilson Decl. ¶ 4. But Plaintiffs argue that Defendants have not met their 17 burden of showing fraudulent joinder. The Court agrees. 18 The Ninth Circuit has explained that there are two ways to establish fraudulent joinder: 19 (1) actual fraud in the pleading of jurisdictional facts, or (2) inability 20 of the plaintiff to establish a cause of action against the non-diverse party in state court. 21 22 Grancare, 889 F.3d at 548 (quotation omitted). Accordingly, in the absence of actual fraud, a 23 defendant must “show[] that an individual joined in the action cannot be liable on any theory.” Id. 24 “[I]f there is a possibility that a state court would find that the complaint states a cause of action 25 against any of the resident defendants, the federal court must find that the joinder was proper and 26 remand the case to the state court.” Id. (emphasis added). In other words, joinder is only 27 fraudulent if it is “obvious according to the settled rules of the state that [the plaintiff] has failed to 1 “[A]ll doubts concerning the sufficiency of a cause of action because of inartful, ambiguous or 2 technically defective pleading must be resolved in favor of remand, and a lack of clear precedent 3 does not render the joinder fraudulent.” Krivanek v. Huntsworth Grp. LLC, No. 15-CV-02466- 4 HSG,

, at *2 (N.D. Cal. Sept. 9, 2015) (citation omitted); PHL Variable Ins. 5 Co.,

at *2 (same). “When resolving claims of fraudulent joinder, the Court 6 may consider evidence outside of the pleadings.” Krivanek,

at *2. 7 Defendants contend that the case “is squarely between Plaintiffs and Chattem.” Opp. at 1. 8 They argue that Plaintiffs’ complaint cites one talcum powder product, Gold Bond, which is 9 manufactured by Chattem and which Dr. Rathbun said he never purchased from the non-diverse 10 defendants.2 Dr. Rathbun also testified that before using Gold Bond, he used Johnson & Johnson 11 Baby Powder, which he and his wife used for their children. Dkt. No. 46-2 Declaration of 12 William L. Coggshall (“Coggshall Decl.”) ¶ 3, Ex. 1 (“Rathbun Depo.”) at 55:3-14, 107:19-23, 13 108:7-110:21, 118:7-22. His testimony did not describe who purchased the Johnson & Johnson 14 Baby Powder or where it was purchased. Coggshall Decl. ¶ 4. According to Plaintiffs, Ms. 15 Rathbun, whose deposition had not yet occurred at the time of removal, will testify that she 16 purchased the Johnson & Johnson Baby Powder at Safeway and Lucky, where she bought the 17 family’s groceries. Mot. at 2; see also Gilson Decl. ¶ 9, Ex C. Defendants contend that neither 18 Dr. Rathbun’s deposition testimony nor Ms. Rathbun’s declaration “establishes that Dr. Rathbun 19 was exposed to Johnson & Johnson Baby Powder purchased from Lucky or Safeway.” Opp. at 20 11.3 21 As noted, Plaintiffs allege claims for negligence, strict liability, negligent 22 misrepresentation, fraud by nondisclosure, and loss of consortium. Plaintiffs allege that 23 Defendants, including Safeway and Lucky, supplied and distributed “asbestos-containing 24 2 Defendants also argue that the Johnson & Johnson Baby Powder was not mentioned in certain 25 discovery responses. Opp. at 10 (citing Coggshall Decl. ¶ 5, Ex. 3). 3 Chattem filed objections to statements in Plaintiffs’ counsel’s and Ms. Rathbun’s declaration for 26 either lack of foundation, relevance, or hearsay. Dkt. No. 46-1. Chattem contends, for example, that such evidence is not relevant because Plaintiffs purportedly “failed to establish that Dr. 27 Rathbun used Johnson & Johnson Baby Powder purchased from Lucky or Safeway.” It is not 1 products” to which Dr. Rathbun was exposed. See, e.g., Compl. ¶¶ 20, 42. Defendants correctly 2 note that only one product is specifically identified in the complaint, but it appears it is mentioned 3 only twice in an exhibit to the complaint. Specifically, Exhibit A states in its entirety: Plaintiff alleges he was exposed to asbestos from the regular use of 4 Gold Bond cosmetic powder products from approximately 1973 through 2020. Defendants herein supplied talc for Gold Bond powder 5 products, manufactured such products and supplied such products. Investigation is ongoing as to any exposure to asbestos to products 6 Dr. Rathbun used during his professional career as a dentist. 7 Dkt. No. 1-2, Ex. A. Plaintiffs’ complaint otherwise focuses on “asbestos-containing products” 8 from which Dr. Rathbun “was exposed to asbestos fibers by using and handling asbestos fibers 9 and products incorporating asbestos as a component, and being in the presence of others using and 10 handling asbestos fibers and products incorporating asbestos as a component.”

. Plaintiffs’ 11 counsel states that “consistent with” Plaintiffs’ complaint, Plaintiffs “will pursue a claim against 12 Safeway and Lucky for its [sic] supply of any and all asbestos-containing products to which Dr. 13 Rathbun was exposed.” Gilson Decl.

. 14 Defendants’ arguments largely concern the sufficiency of the claims against Safeway and 15 Lucky, contending, for example, that Plaintiffs cannot show causation based on the complaint and 16 Dr. Rathbun’s related deposition testimony to date. They cite his testimony stating that he 17 remembers using “one bottle” and that he “believe[d]” that he used the product on his children, but 18 that his wife “took more care of that area than [he] did.” Opp. at 7-8, 11 (citing Rathbun Depo. at 19 108:23-109:3). Defendants argue that Plaintiffs have not alleged that the product played more 20 than an “infinitesimal” or “theoretical” part so as to be a “substantial factor” for purposes of 21 causation. See

22 Here, the Court must resolve all “doubts concerning the sufficiency of a cause of action 23 because of inartful, ambiguous or technically defective pleading . . . in favor of remand.” 24 Krivanek,

, at *2. In doing so, the Court finds that Defendants have failed to 25 show that Plaintiffs would not be afforded leave to amend his complaint to cure any purported 26 deficiencies, including by adding factual allegations concerning Dr. Rathbun’s exposure to 27 Johnson & Johnson Baby Powder, or any other products containing asbestos. Without deciding 1 Defendants, the Court finds “it is at least possible” that Plaintiffs “may be able to state [] a claim, 2 either based on the complaint as pleaded or if granted leave to amend.” See Garcha v. Quality 3 Quartz Eng’g, Inc., No. 19-CV-01989-YGR,

, at *4 (N.D. Cal. June 13, 2019) 4 (emphasis in original). Given that Defendants have failed to meet their “heavy burden” to show 5 that Plaintiffs “cannot possibly state a claim” against Safeway and Lucky, the Court declines to 6 find that those defendants were fraudulently joined. Gowan v. Stryker Corp., No. 18-CV-07785- 7 BLF,

, at *5 (N.D. Cal. June 7, 2019) (emphasis in original); see Hunter, 582 8 F.3d at 1042 (“The strong presumption against removal jurisdiction means that the defendant 9 always has the burden of establishing that removal is proper . . . .”). Because there is not complete 10 diversity of citizenship, the Court lacks subject-matter jurisdiction and thus GRANTS the motion 11 to remand. 12 “Absent unusual circumstances, a court may award attorney’s fees and costs under § 13 1447(c) only where the removing party lacked an objectively reasonable basis for seeking 14 removal.” Grancare, 889 F.3d at 552. Plaintiffs request an award of costs and attorney’s fees 15 because “Chattem’s decision to remove was objectively unreasonable.” Mot. at 9. Plaintiffs 16 contend that Chattem’s “failure to address” Dr. Rathbun’s testimony concerning Johnson & 17 Johnson Baby Powder was “misleading, as it asks the Court . . . to find that no possibility of a 18 cause of action against Safeway or Lucky is available.” Id. at 10. Although the Court was not 19 persuaded by Defendants’ arguments, “removal is not objectively unreasonable solely because the 20 removing party’s arguments lack merit.” Lussier v. Dollar Tree Stores, Inc.,

, 1065 21 (9th Cir. 2008). Based on the complaint as currently pleaded, the Court does not find Defendants 22 lacked an objectively reasonable basis for seeking removal. The Court thus finds that an award of 23 costs and fees is not warranted. 24 // 25 // 26 // 27 // IV. CONCLUSION The Court GRANTS Plaintiffs’ motion to remand and REMANDS the case to Alameda 2 Superior Court. The clerk is directed to remand the case and close the file. 3 4 IT IS SO ORDERED. 5 Dated: September 3, 2021

7 cavwot DS. GILLIAM, JR. □ g United States District Judge 9 10 1] 12 15

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