BENIHANA OF TOKYO LLC v. ANGELO GORDON CO (2018)

SUMMARY ORDER

The district court found that Appellee Angelo, Gordon & Co., L.P. (“AGC”) had been fraudulently joined as a defendant in the action to defeat diversity jurisdiction, denied Appellant’s motion to remand this case to New York state court, and dismissed the case in its entirety. Appellant argues the case should have been remanded. We assume the parties’ familiarity with the underlying facts, procedural history, and issues on appeal, which we recite here only to the extent necessary to explain our reasoning.

We examine a district court’s decision on a motion to remand de novo. Bounds v. Pine Belt Mental Health Care Res., 593 F.3d 209, 214 (2d Cir. 2010).

Federal district courts have original jurisdiction over civil actions between “citizens of different States” where the amount in controversy exceeds $75,000. 28 U.S.C. § 1332(a). “[E]ach plaintiff’s citizenship must be different from the citizenship of each defendant” for the district court to have diversity jurisdiction. Briarpatch Ltd., L.P v. Phoenix Pictures, Inc., 373 F.3d 296, 302 (2d Cir. 2004).

It is well established in this Circuit that “a plaintiff may not defeat a federal court’s diversity jurisdiction and a defendant’s right of removal by merely joining as [a] defendant[ ] [a] part[y] with no real connection with the controversy.” Pampillonia v. RJR Nabisco, Inc., 138 F.3d 459, 460–61 (2d Cir. 1998). Under the doctrine of fraudulent joinder, courts overlook the presence of a non-diverse defendant if “there is no possibility, based on the pleadings, that [the] plaintiff can state a cause of action against the non-diverse defendant in state court.” Id. at 461. “The defendant seeking removal bears a heavy burden of proving fraudulent joinder” by clear and convincing evidence. Id.

Here, Appellant claims tortious interference with contract against AGC. Appellant’s complaint itself, however, pleads the elements of the affirmative defense of economic interest under New York law. See White Plains Coat & Apron Co. v. Cintas Corp., 8 N.Y.3d 422, 835 N.Y.S.2d 530, 867 N.E.2d 381, 383–84 (2007); Foster v. Churchill, 87 N.Y.2d 744, 642 N.Y.S.2d 583, 665 N.E.2d 153, 154 (1996). It is thus legally impossible for Appellant to assert its claim against AGC in state court.

We have considered all of Appellant’s arguments and conclude that they are without merit. Accordingly, we AFFIRM the judgment of the district court.