ORDER
This matter is before the Court on the Magistrate Judge’s Report and Recommendation (“R & R”), Dkt. No. 32, recommending that this Court deny Defendants’ Motion to Strike (Dkt. No. 24) and grant Plaintiffs Motion to Remand (Dkt. No. 21). For the reason stated below, the Court ADOPTS the R & R, DENIES the motion to strike and GRANTS the motion to remand.
I. Background
Plaintiff filed this action in state court against his former employers Brothers Property Corporation and Brothers Property Management Corporation (collectively “the Brothers Defendants” or “Defendants”), raising a number of state law causes of action. Brothers Property Management Corporation does business as Charleston Harbor Resort and Marina (“the Resort”) and is a wholly owned subsidiary of Defendant Brothers Property Corporation. {See Dkt. No. 34 at 3). Plaintiff was hired as an Accounting Manager for the Resort in 2009 and later promoted to Controller for the Resort in 2010. (Dkt. No. 14 at ¶¶ 14-15). In June of 2012, Plaintiff was terminated ostensibly for tardiness and absences at work. {Id. at ¶¶ 117-118). Plaintiff claims his termination was for unlawful reasons. {See generally Dkt. No. 14).
The Brothers Defendants properly removed this action to federal court based on diversity jurisdiction. (Dkt. No. 1). After removal, but before the defendants answered, Plaintiff filed a First Amended Complaint as a matter of course under Rule 15(a).
The addition of Defendant Rooskens defeats diversity jurisdiction, and Plaintiff filed a motion to remand on this basis. (Dkt. No. 21). The Brothers Defendants responded with a Motion to Strike the First Amended Complaint (Dkt. No. 24), claiming Plaintiffs addition of Defendant Rooskens is a “procedural trick[ ] to defeat diversity jurisdiction.” (Dkt. No. 34 at 19). The Magistrate Judge recommended denying Defendants’ motion to strike and granting Plaintiffs motion to remand. (Dkt. No. 32). The Brothers Defendants filed timely objections. (Dkt. No. 34).
II. Legal Standard
A. Report and Recommendation
The Magistrate Judge makes only a recommendation to this Court. The recommendation has no presumptive weight, and the responsibility to make a final determination remains with the Court. Mathews v. Weber,
As to portions of the R & R to which no specific objection has been made, this Court “must ‘only satisfy itself that there is no clear error on the face of the record in order to accept the recommendation.’ ” Id. (quoting Fed.R.Civ.P. 72 advisory committee note). Moreover, in the absence of specific objections to the R & R, the Court need not give any explanation for adopting the Magistrate Judge’s analysis and recommendation. See Camby v. Davis,
B. Joinder of a Non-diverse Party after Removal
“If after removal the plaintiff seeks to join additional defendants whose joinder would destroy subject matter jurisdiction, the court may deny joinder, or permit joinder and remand the action to the State court.” ■ 28 U.S.C. § 1447(e). Whether to allow joinder of a non-diverse defendant is “committed to the sound discretion of the district court,” and in exercising this discretion, the district court is “entitled to consider all relevant factors, including: the extent to which the purpose of the amendment is to defeat federal jurisdiction, whether the plaintiff has been dilatory in asking for amendment, whether the plaintiff will be significantly injured if amendment is not allowed, and any other factors bearing on the equities.” Mayes v. Rapoport,
While the fraudulent joinder doctrine does not “directly” apply, “if the defendants can carry the heavy burden of proving fraudulent joinder, that fact should be a factor — -and perhaps the dis-
III. Discussion
A. Legal Standard Applied by Magistrate Judge
In their objections to the R & R, the Brothers’ Defendants first argue that the Magistrate Judge erred by requiring them . to show fraudulent joinder to prevent the addition of Defendant Roosken. Defendants misread the R & R. The Magistrate Judge explicitly stated that “the doctrine of fraudulent joinder only applies to parties joined before removal,” but noted that under Mayes fraudulent joinder, if shown, “should be a factоr — and perhaps the dis-positive factor.” (Dkt. No. 32 at 4 (emphasis added)). Thus, Magistrate Judge “beg[an][her] analysis there.” (Id. at 5). The Magistrate Judge went on to weigh other factors and, “[a]fter considering all relevant factors in the case,” recommended that “the joinder of Defendant Rooskens be allowed because the balance of the equities weighs in the Plaintiffs favor.” (Dkt. No. 32 at 11-12). Therefore, the Magistrate Judge applied the appropriate standard, and this objection is overruled.
B. Whether Defendants Have Shown Fraudulent Joinder
The term “fraudulent joinder” is “a bit misleading” as it does not require a showing of fraud or joinder. Mayes,
The Magistrate Judge found that, after resolving all issues of fact and law in Plaintiffs favor, it was possible that the Plaintiff could establish a claim for wrongful termination in violation of public policy against Defendant Rooskens, and Defendants failed to show fraudulent joinder. (Dkt. No. 32 at 6-11). This Court agrees.
1. Bringing a Claim for Wrongful Termination Against Individual Defendants
Defendants first object to the Magistrate Judge’s finding that it was possible to bring a claim for wrongful termination in violation of public policy against individuals. (Dkt. No. 34 at 11). As Defendants’ note, “[t]here is no South Carolina authority that would allow Plaintiff to bring a claim for wrongful termination in violation of public policy against any individual defendant.” (Id.). There is also no authority holding such claims cannot be brought against individuals. Thus, as Defendants concede, the question is one of first impression in South Carolina. (See id. at 13). There is a split of authority in other jurisdictions. (See Dkt. No. 32 (listing cases)); see also VanBuren v. Grubb,
Contrary to Defendants’ assertions, the Magistrate Judge did not expand the tort of wrongful termination in South Carolina. She held that “there is a possibility that a South Carolina state court would rule the Plaintiffs claim is viable as a tort,” and “[a]ll issues of law must be resolved in favor of the Plaintiff.” (Dkt. No. 32 at 11) (emphasis added). Thus, resolving this issue of law in favor of Plaintiff, the Brothers Defendants have not established that Defendant Rooskens was fraudulently joined.
The Magistrate Judge also did not give “dispositive effect” to the Virginia Supreme Court case VanBuren v. Grubb,
2. Bringing a Claim for Wrongful Termination Against Defеndant Roosk-ens
Next, Defendants argue that even if a claim of wrongful discharge in violation of public policy could lie against individuals, it could not lie against Defendant Roosk-ens who is a “co-wqrker” and not Plaintiffs direct supervisor or an officer of the corporation. (Dkt. No. 34 at 12-14). As South Carolina courts have not addressed whether this tort can be brought against individuals at. all, they have not addressed the type of individual against whom such a tort can be brought.
Other jurisdictions have varied, though they have largely left the question to develop in future cases. In Jasper v. H. Nizam, Inc., the Iowa Supreme Court held that liability can extend to officers of the corporation who “authorized or directed the discharge” but left for another, day “how deep the tort could reach in the corporate chain of management in a particular situation.”
Here, Defendants make much of the fact that Plaintiff alleges that he and Rooskens both reported to corporate-level management and neither was “authorized to terminate the employment of the other at their own discretion.” (Dkt. No. 14 at ¶23). However, documents attached to the Complaint show that Plaintiff reported to both Rooskens and the corporate Chief Financial Officer. (Dkt. No. 1-1 at 58-60). Both supervisors signed the “Final Notice” issued to Plaintiff before termination. (Id. at 60). Plaintiff also alleges that Defendant Rooskens had sole control over setting Plaintiffs salary and determining Plaintiffs annual bonus, disciplined Plaintiff, provided (or failed to provide) equipment for Plaintiff to use in his job, and was responsible for Plaintiffs workplace conditions. (See, e.g., Dkt. No. 14 at ¶¶ 26, 31, 43, 52, 55, 56, 65, 69, 90). Plaintiff also alleges that his termination was the culmination of disciplinary events that Rooskens took in retaliation for Plaintiffs complaints against him and “his engagement in the various fraudulent and oppressive pay рractices and other improprieties.” (See, e.g., id. at ¶¶ 69, 97, 116). Plaintiff also alleges that while Rooskens lacked the authority to terminate Plaintiff at his own discretion, he “effectuate[ed] the termination of Plaintiffs employment” and received authorization to terminate Plaintiff “by making false and pretextual accusations” about Plaintiff “in bad faith.” (Id. at ¶¶ 110-113). Under these facts, it is possible that South Carolina courts would hold that Defendant Rooskens was in a “position of power” and/or “participated in the wrongful discharge” such as to be held liable under the tort. South Carolina courts may also hold to the contrary, but the possibility is sufficient to overcome a claim of fraudulent joinder.
S. Whether Plaintiff Can State a Claim for Wrongful Termination in Violation of Public Policy
Plaintiff alleges, among a number of other things, that he was terminated in retaliation for complaining “about the employer’s pay practices, including the employer’s failure to pay wages due, and for complaints about the employer’s alleged violations of the S.C.Code Ann. § 41-10-10 et seq.,” known as the Payment of Wages Act. (Dkt. No. 14 at ¶ 253). The Magistrate Judge, relying on Barron v. Labor Finders of S. Carolina,
Defendants do not appear to dispute this particular finding, and they could not. The Court in Barron stated that:
We do not foreclose the possibility that a claim for wrongful termination in violation of public policy may exist when an employee is terminated in retaliation for instituting a claim under the Act. We simply decline to address the issue at this time because there is no evidence petitioner was terminated in retaliatioii for filing or threatening to file such a claim.
Additionally, the South Carolina Supreme Court has held that the public policy exception “clearly applies” where “the employer requires the employee to violate the law.” E.g., Barron,
The South Carolina Court of Common Pleas may very well dismiss Plaintiffs claims against Defendant Rooskens, but the Court cannot say that “there is no possibility that the plaintiff would be able to establish a cause of action against the in-state defendant in state court.” Johnson,
C. Balancing of the Equities
Whether Defendants can show fraudulent joinder is only one factor for the Court to consider. See Mayes,
The substance of Plaintiffs Complaint and First Amended Complaint and the addition of Defendants Fuller and Reina, who do are diverse defendant's, support Plaintiffs claims that his amendment was not simply to avoid federal jurisdiction. Rooskens is mentioned 369 times in Plaintiffs original Comрlaint. (Dkt. No. 1-1). The thrust of Plaintiffs allegations is that Rooskens effected his termination in retaliation for various actions by Plaintiff. (See generally, Dkt. No. 14). Clearly, plaintiff is not attempting to “squeeze” Rooskens into the lawsuit. See McCaulley v. Purdue Pharma, L.P.,
The Court also finds that Plaintiff was not dilatory. He amended his complaint during the time allowed tо amend as a matter of course under Fed.R.Civ.P. 15(a). Defendants argue that the fact that Plaintiffs amendment was timely “has no bearing on the Court’s analysis under Section 1447(e).” (Dkt. No. 34 at 11 n. 7). This statement is contrary to Mayes’ holding that a district court can consider “whether the plaintiff has been dilatory in asking for amendment.”
Another factor for the Court’s consideration is “danger of parallel lawsuits in federal and state court, which may spawn inconsistent results and inefficient use of judicial resources.” Mayes,
The Court also considers the fact that the clаim against Rooskens raises issues of first impression under state law. Especially given the split of authority on whether claims for wrongful discharge in violation of public policy can be brought against
In sum, the Court agrees with the Magistrate Judge that the balance of the equities weighs in favor of allowing the amendment. Therefore, the Court allows the amendment and remands the action to state court in accordance with Section 1447(e).
TV. Conclusion
For the reason stated above, the Court ADOPTS the R & R (Dkt. No. 32) as an Order of this Court. Accordingly, the Brothers Defendants’ Motion to Strike the First Amended Complaint (Dkt. No. 24) is DENIED, and Plaintiff’s Motion to Remand (Dkt. No. 21) is GRANTED.
AND IT IS SO ORDERED.
REPORT & RECOMMENDATION OF MAGISTRATE JUDGE
This is a civil action filed by a pro se litigant. Under Local Civil Rule 73.02(B)(2) of the United States District Court for the District of South Carolina, pretriаl proceedings in this action have been referred to the assigned United States Magistrate Judge.
The Plaintiff filed this Complaint on July 18, 2014, in state court. (Dkt. No. 1.) The original Defendants removed this case from the Circuit Court of South Carolina on October 3, 2014, on the basis of diversity between the parties. (Id.) On October 28, 2014, the Plaintiff filed a First Amended Complaint in federal court. (Dkt. No. 14.) The First Amended Complaint was filed before any responsive pleading had been filed by the Defendants. Victor Fuller, Ana Reina, and Oliver Rooskens were joined as .defendants in the First Amended Complaint and have not yet been served. (Id.) On November 4, 2014, the Plaintiff filed Plaintiffs Motion for Remand. (Dkt. No. 21.) Defendants Brothers Property Corporation and Brothers Property Management Corporation (collectively “Brothers”) responded on Novembеr 17, 2014, by filing Brothers’ Motion to Strike Plaintiff’s First Amended Complaint (Dkt. No. 24) and Brothers’ Motion to Dismiss Plaintiffs First Amended Complaint (Dkt. No. 25). On November 21, 2014, Brothers filed Defendants’ Response in Opposition to Plaintiffs Motion to Remand. (Dkt. No. 28.) Plaintiff replied to Brother’s response on December 5, 2014. (Dkt. No. 29.)
Factual Overview
Defendant Property Brothers Management Corporation dba Charleston Harbor Resort and Marina (“CHRM”) hired the Plaintiff on November 30, 2009 as an Accounting Manager. (Dkt. No. 14 ¶ 14.) On or around February 19, 2010, the Plaintiff began serving as Controller for CHRM and reported directly to Defendant Ana Reina until his employment was terminated on June 18, 2012. (Id. at ¶ 15.) Defendant Oliver Rooskens was the General Manager of CHRM throughout the Plaintiffs employment. (Id. at ¶ 13.) Neither the Plaintiff nor Defendant Rooskens controlled the other’s performance or continued employment at CHRM. (Id. at ¶ 23.) Defendant Rooskens is the only defendant alleged to be a South Carolina resident:
Brothers’ Motion to Strike Plaintiffs First Amended Complaint (Dkt., No. 2V)
Rule 15(a)of the Federal Rules of Civil Procedure states, in part,
(1) Amending as a Matter of Course. A party may amend its pleading once as a matter of course within:
(A) 21 days after serving it, or
(B) if the pleading is one to which a responsive pleading is required, 21 days after service of a responsive pleading or 21 days after service of a motion under Rule 12(b), (e), or (f), whichever is earlier.
(2) Other Amendments. In all other cases, a party may amend its pleading only with the opposing party’s written consent or the court’s leave. The court should freely give leave when justice so requires.
Fed.R.Civ.P. 15. “A plaintiff may amend his complaint one time as a matter of course befоre the defendant files a responsive pleading.” Hall v. Burney,
Plaintiffs Motion for Remand (Dkt. No. 21.)
This court has subject matter jurisdiction in this case because of diversity between the parties. The Plaintiffs First Amended Complaint seeks to join Defendant Rooskens, a South Carolina resident. “If after removal the plaintiff seeks to join additional defendants whose joinder would destroy subject matter jurisdiction, the court may deny joinder, or permit joinder and remand the action to the State court.” 28 U.S.C. § 1447.
The Fourth Circuit addressed the issue of joinder of a non-diverse party after removal in Mayes v. Rapoport,
In order to establish that a nondiverse defendant has been fraudulently joined, the removing party must establish either: [tjhat there is no possibility that the plaintiff would be able to establish a cause of action against the in-state defendant in state court; or [t]hat there has been outright fraud in the plaintiffs pleading of jurisdictional facts.
As fraudulent joinder is “perhaps the dispositive factor” in determining whether to allow the Plaintiff to join Defendant Rooskens, the court begins its analysis there. Mayes,
The First Amended Complaint contains nineteen causes of action. (Dkt. No. 14.) Defendant Rooskens’ name is contained in allegations throughout the Complaint. The causes of action all relate to the Plaintiffs former employment at the Charleston Harbor Resort and Marina. The First Amended Complaint contains causes of аction ranging from negligence and breach of contract to fraudulent concealment and defamation.
To show fraudulent joinder, Brothers must establish that none of these nineteen causes of action can possibly be established against Defendant Rooskens. The Plaintiffs seventeenth cause of action alleges “Wrongful Discharge for Violation of Public Policy.” (Dkt. No. 14 at ¶252.) The Plaintiff alleges Defendant Rooskens and “Defendant CHRM” retaliated against and eventually terminated the Plaintiff for his complaints regarding “pay practices, including ... failure to pay wages due, and for complaints about the employer’s alleged violations of S.C.Code Ann § 41-10-10 etseq.” (Dkt. No. 14 ¶253.) S.C.Code Ann § 41-10-10 et seq. is known as the Payment of Wages Act (“the Act”). Additionally, the Plaintiff alleges that a unilateral employment contract issuеd to him violated the form requirements of the Act found in S.C.Code Ann. § 41-1-110 by not containing a disclaimer in underlined capital letters on the first page. (Dkt. No. 14 ¶ 256.) The Plaintiff alleges that between June 13-17, 2012, Defendant Rooskens “procured the authorization to terminate Plaintiffs employment ... in retaliation for Plaintiffs continued complaints of ... fraudulent and oppressive pay practices.” (Dkt. No. 14 ¶ 257.) The Defendants terminated the Plaintiffs employment on June 18, 2012. (Dkt. No. 14 ¶ 258.)
In Defendants’ Response in Opposition to Plaintiffs Motion to Remand, Brothers argue that the Plaintiff alleges that at all times he was an employee of Charleston Harbor Resort and Marina and never was an employee of Defendant Rooskens. (Dkt. no. 28.) Brothers note that the Plaintiff alleges Defendant Rooskens was an agent of his employer and had no power to fire the Plaintiff. (Id.) Brothers argue there is no precedent that allows a wrongful discharge claim against an employer’s agents such as coworkers or supervisors and cite several cases holding-the same. (Id.)
Absent a. specific contract, employment in South Carolina is at-will. Mathis v. Brown & Brown of S. Carolina, Inc.,
In Barron v. Labor Finders of South Carolina,
In the case at bar, the court must resolve “all issues of fact and law in the plaintiffs favor.” Mayes at 464. The Plaintiff does not address in his complaint whether or not he filed or threatened to file a complaint under the Act. The Plaintiff does, however, cite the Act as the basis for his public policy claim and repeatedly' alleges he made complaints regarding pay and compensation. (Dkt. No. 14 ¶ 253.) His First Amended Complaint does not state whether or not his complaints were
The court now turns‘to whether there is a possibility that the Plaintiff may establish this cause of action against Defendant Rooskens. Whether or not such a claim may be brought against only the employer or against a co-employee as well is a matter of first impression in South Carolina. Other states that have addressed whether or not a co-employee who plаyed a role in the termination can be held liable in a wrongful discharge for violations of public policy are split. VanBuren v. Grubb,
States that allow individual co-employees to be liable view wrongful discharge for violation of public policy as any other tort that imposes liability on the individual that committed the tortious conduct. VanBuren,
for the discharge, not the discharge itself.” VanBuren,
In VanBuren the Fourth Circuit questioned the district court’s dismissal of a claim for wrongful discharge for violations of public policy against an individual defendant who “played a role in wrongfully terminating the employee.” VanBuren,
The court must determine whether Brothers has met its heavy burden of showing there is no pоssibility the Plaintiff may establish a claim of wrongful discharge in violation of public policy against Defendant Rooskens. In Savino Del Bene, U.S.A., Inc. v. Hartford Fin. Servs.
The issues in Savino mirror the issues in the ease at bar. The viability of the Plaintiffs claim and who he may assert it against are matters of first impression in South Carolina. Other jurisdictions are split as to who may be liable under the Plaintiffs claim. Brothers has not met their burden because there is a possibility that a South Carolina state court would rule the Plaintiffs claim is viable as a tort and may be asserted against Defendant Rooskens. All issues of law must be resolved in favor of the Plaintiff. Brothers cannot overcome that both the Plaintiffs claim and raising it against a co-employee are matters of first impression in South Carolina. Brothers cannot establish Defendant Rooskens was fraudulently joined.
In weighing whether to allow a plaintiff to join a non-diverse defendant after a case has been removed, the court must consider several other factors as part of balancing the equities. Mayes,
After considering all relevant factors in this case, this court recommends that the joinder of Defendant Rooskens be allowed because the balance of the equities weighs in the Plaintiffs favor. Brothers have not met their burden of showing the Plaintiff cannot possibly establish a claim against Defendant Rooskens to demonstrate fraudulent joinder. Defendant Rooskens’ joinder as part of the Plaintiffs First Amended Complaint was timely under Fed.R.Civ.P. 15. The Plaintiff would be significantly injured if possibly valid claims are not allowed by the court in order to preserve its own jurisdiction because Brothers removed this case. The recommended joinder of Defendant Rooskens destroys diversity in this case. This court
Conclusion
Wherefore, it is RECOMMENDED that Brothers’ Motion to Strike Plaintiffs First Amended Complaint (Dkt. No. 24) be DENIED. It is RECOMMENDED that Plaintiffs Motion For Remand (Dkt. No. 21) be GRANTED.
IT IS SO RECOMMENDED.
April 6, 2015.
Notes
. Facts are taken from the First Amended Complaint, and the Court assumes these facts are true for the purposes of the motions at issue.
. The Brothers Defendants do no object to the Magistrate Judge’s finding that Plaintiff’s First Amended Complaint was timely under Rule 15. (Dkt. No. 34 at 11 n. 7). The Court agrees with the Magistrate Judge and adopts this portiоn of the R & R.
. The standard for summary judgement is less stringent than the standard in the case at bar. Additionally, summary judgment is ruled on after discovery. The standard in the case at bar requires Brothers to show that there is no possibility the Plaintiff would be able to establish a claim.
. See VanBuren v. Grubb,
. The court does not address the Plaintiffs other causes of action as it has found this cause of action to be viable.
. There are two additional pending motions in this case, the'Plaintiff's Application To Proceed Without Prepayment Of Fees And Affidavit (Dkt. No. 17) and Brothers' Motion To Dismiss Plaintiff's First Amended Complaint (Dkt. No. 25).