258 F. Supp. 3d 1192
D. Or.2017Background
- Ekeya worked at Shriners Hospital for Children, Portland for ~16 years and was promoted to PR Manager in March 2016; she reported that a supervisor (Dietzler‑Marihart) allowed a reporter into non‑public hospital areas and that a photo was published.
- After internal discussions about Ekeya’s unwillingness to accept a new reporting structure, HR (Smith), Dietzler‑Marihart, and Administrator Patchin discussed offering a severance/"buy‑out" in July 2016; Shriners HQ ultimately denied the severance exception and no release was signed.
- Ekeya reported the privacy incident to a privacy officer and to the Board in August 2016; two days later an Employee Counseling Report recommended discharge and Ekeya was terminated effective August 25, 2016.
- Plaintiff sued in Oregon state court asserting retaliation (ORS 659A.030(1)(f) and ORS 659A.199) against Shriners Portland and aiding/abetting retaliation (ORS 659A.030(1)(g)) against Patchin; Defendants removed to federal court asserting diversity jurisdiction.
- Defendants argued Patchin (an Oregon citizen) was fraudulently joined to avoid the forum‑defendant rule; Plaintiff moved to remand; Court considered whether fraudulent‑joinder doctrine applies to forum defendants and whether Patchin was fraudulently joined.
- The Court found factual disputes (e.g., whether the termination decision was conditional pending severance/release and whether Patchin was the primary decisionmaker) and remanded, awarding Plaintiff attorney fees because removal lacked an objectively reasonable basis.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether fraudulent‑joinder doctrine can negate the forum‑defendant rule | Fraudulent joinder should apply so a resident defendant who cannot be plausibly sued may be disregarded | Fraudulent‑joinder doctrine does not apply to in‑state defendants (or Patchin was properly joined) | Court assumed doctrine can apply but did not decide broadly; remand granted because Patchin was not shown fraudulently joined here |
| Whether Patchin can be liable under ORS 659A.030(1)(g) (aiding/abetting) when he was the decisionmaker | Ekeya: statute covers persons (employees/officers) who aid/abet employer conduct; supervisory actors can be liable | Defendants: a person acting as the primary corporate decisionmaker cannot "aid and abet" himself | Court: appellate Oregon law unresolved; district decisions conflict; at pleading stage aiding/abetting claim against Patchin not "obviously" deficient; cannot find fraudulent joinder on that ground |
| Whether the termination decision predated protected activity (defeating retaliation claim) | Ekeya: July 22 discussions were conditional (severance/release); final termination occurred after protected report in August | Defendants: Patchin decided to fire on July 22, before protected activity, so no causal link | Court: material factual dispute exists; record permits possibility termination decision was made after protected activity — cannot resolve in removal inquiry |
| Attorney fees for improper removal | Ekeya: removal lacked objectively reasonable basis and warrants fees under 28 U.S.C. § 1447(c) | Defendants: removal was reasonable given their evidence of Patchin as decisionmaker and authority | Held: Fees awarded because removal was not objectively reasonable given disputed facts and heavy burden to prove fraudulent joinder |
Key Cases Cited
- Owen Equip. & Erection Co. v. Kroger, 437 U.S. 365 (establishes requirement that each defendant be a citizen of a different state for diversity)
- Lincoln Property Co. v. Roche, 546 U.S. 81 (reinforces forum defendant rule: removal not allowed if any defendant is a citizen of the forum state)
- Hunter v. Philip Morris USA, 582 F.3d 1039 (9th Cir.) (discusses heavy presumption against removal and standards for fraudulent joinder)
- Allen v. Boeing Co., 784 F.3d 625 (9th Cir.) (fraudulent joinder requires showing that plaintiff obviously cannot state a claim; limited summary inquiry allowed)
- Morris v. Nuzzo, 718 F.3d 660 (7th Cir.) (examines whether fraudulent joinder creates exception to forum‑defendant rule; declined to decide definitively)
- Schram v. Albertson’s Inc., 934 P.2d 483 (Or. Ct. App.) (statute ORS 659A.030(1)(g) interpreted to reach employees who aid or abet employer conduct)
- Ashcroft v. Iqbal, 556 U.S. 662 (stands for plausibility pleading standard)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (establishes the pleading‑plausibility standard)