Walth v. Staples the Office Superstore LLC, 2:17-cv-00323

Plaintiffs Lee and Janet Walth sued Staples, Spar Marketing Force, Inc. (Spar), and others in Washington state court after Mr. Walth allegedly fell from an assembled display chair at a Spokane Staples store.
Spar removed the action to federal court based on diversity jurisdiction; Plaintiffs initially moved to remand and that motion was denied.
Plaintiffs moved to amend their complaint to add Spar Business Services, Inc., Spar Administrative Services, Inc. (the “Spar Companies”), and Ande Udby (an on‑site merchandiser/independent contractor). Joining Udby would destroy diversity.
Defendants opposed some joinders and argued joinder might be unnecessary because Spar could be vicariously liable for Udby; they also argued plaintiffs sought joinder to defeat federal jurisdiction.
The court analyzed Rule 20 joinder and the § 1447(e) factors for post‑removal joinder of a non‑diverse defendant and considered futility, prejudice, delay, and validity of claims.
The court granted joinder of the two Spar Companies and of Udby, found the § 1447(e) factors weighed in favor of joinder, and remanded the case to Spokane County Superior Court.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Joinder of Spar Business Services, Inc. and Spar Administrative Services, Inc. under Rule 20	Necessary for complete relief; claims arise from same transaction	Contractual ties alone insufficient; joinder would delay case	Granted — Rule 20 satisfied; allegations plausibly state claims against them
Joinder of non‑diverse Ande Udby (post‑removal) under 28 U.S.C. § 1447(e)	Udby is needed for just adjudication, avoids "empty chair," prompt motion given looming SOL	Joinder is to destroy diversity; Spar can be vicariously liable and Udby lacks insurance	Granted — § 1447(e) factors (need, delay, motive, validity, prejudice) overall favor joinder; joinder destroys diversity
Whether amendment is futile or prejudicial under Fed. R. Civ. P. 15	Amendment is timely and necessary based on discovery; not sought in bad faith	Amendment would prejudice defendants and is unnecessary if vicarious liability applies	Granted — leave to amend; court found no futility or undue prejudice at this stage
Effect on federal jurisdiction and remand	If joinder permitted, diversity destroyed → remand appropriate	Opposed (seek to keep case in federal court)	Case remanded to state court after joinder permitted; defendants’ pending dismissal motion denied as moot

AmerisourceBergen Corp. v. Dailysist West, Inc., 465 F.3d 946 (9th Cir. 2006) (factors permitting denial of leave to amend: prejudice, bad faith, undue delay, futility)
Newcombe v. Adolf Coors Co., 157 F.3d 686 (9th Cir. 1998) (district court has discretion under § 1447(e) whether to permit joinder of non‑diverse defendants)
U.S. ex rel. Lee v. SmithKline Beecham, Inc., 245 F.3d 1048 (9th Cir. 2001) (amendment may be denied as futile)
Haley v. TalentWise, Inc., 9 F. Supp. 3d 1188 (W.D. Wash. 2014) (discussing futility as a basis to deny leave to amend)