ST. LOUIS – The U.S. District Court of Eastern District of Missouri recently ordered Wright Construction Services’ negligence suit against Liberty Mutual Insurance Company and St. Charles Insurance Agency (SCIA) be tried in St. Charles County Circuit Court.
In a July 17 ruling, U.S. Judge Henry E. Autrey granted Wright Construction’s motion to remand the case to state court citing the federal court’s lack of “subject matter jurisdiction.”
This court action follows the March 30 notice of removal to federal court by Liberty Mutual which cited the court’s “diversity of citizenship jurisdiction.”.
The notice of removal claimed the SCIA branch of Liberty Mutual, which was accused of negligence, was “not properly joined and therefore should not be considered for the purposes of removal, under the doctrine of fraudulent joinder.”
Autrey stated that the defendant bore the burden of proof in “the plaintiff’s claim against the diversity-destroying defendant,” which had “‘no reasonable basis in fact and law.’”
Further, the court found that the plaintiff had a long-standing relationship with SCIA that included “advising, counseling and assisting Wright Construction in its efforts to grow outside of Missouri.”
Autrey also cited other federal court’s statements that indicated that “‘the better practice is for the federal court not to decide the doubtful question … but simply to remand the case and leave the question for the state courts to decide.’”
This decision is the latest ruling on a petition originally filed in St. Charles County Circuit Court on Feb. 6 in which plaintiff, Wright Construction alleged negligence by SCIA as well as Liberty Mutual, stating its actions were “below the applicable standard of care for a broker.”
Wright Construction alleged SCIA did not communicate the state of North Carolina’s requirement that all general contractors who worked within North Carolina had to be licensed within the state prior to “entering into NC construction contracts.”
The original petition included eight counts against the SCIA and Liberty Mutual, including negligence and breach of performance bond.
U.S. District Court Eastern District of Missouri, Case Number 4:18CV483 HEA