United States District Court, D. Massachusetts
MEMORANDUM AND ORDER REGARDING PLAINTIFF’S MOTION TO JOIN PARTY DEFENDANTS Dkt. No. 73
MARK G. MASTROIANNI United States District Judge
AIG Property Casualty Company (“AIG”) brought this action against William H. Cosby Jr., Tamara Green, Therese Serignese, and Linda Traitz seeking a declaration that it has no duty to defend or indemnify Cosby under two homeowners insurance policies in relation to a defamation case also pending in this court, Green v. Cosby, Case No. 14-cv-30211-MGM (“Underlying Litigation”). When AIG commenced this action, Green, Serignese, and Traitz were the only plaintiffs in the Underlying Litigation. Since that time, additional plaintiffs joined the Underlying Litigation by way of a third amended complaint: Louisa Moritz, Barbara Bowman, Joan Tarshis, and Angela Leslie. Presently before the court is AIG’s motion to join these additional underlying plaintiffs as defendants in this action. (Dkt. No. 73.)
AIG’s motion has not been opposed on the merits. In the Underlying Litigation, the third amended complaint alleges Tarshis is a citizen of New York. (Green v. Cosby, Case No. 14-cv-30211-MGM, Dkt. No. 109 ¶ 9.) In this action, AIG alleges its principal place of business is in New York. (Dkt. No. 1, Compl. ¶ 1.) The court, therefore, directed the parties to address “whether the addition of Joan Tarshis as a defendant destroys complete diversity of citizenship . . . and to what extent Rule 19(b) of the Federal Rules of Civil Procedure is implicated.” (Dkt. No. 78.) AIG and Cosby each filed supplemental memoranda on this issue, as directed. (Dkt. Nos. 86, 87.) For the following reasons, the court will grant the relief requested in AIG’s original motion because it concludes the joinder of Tarshis will not deprive the court of subject matter jurisdiction. The court will also direct AIG to file an amended complaint reflecting the new defendants and the latest claims in the Underlying Litigation.
II. Procedural History
On December 10, 2014, Green filed a complaint against Cosby for defamation. (Green v. Cosby, Case No. 14-cv-30211-MGM, Dkt. No. 1.) A second amended complaint, which added Serignese and Traitz as plaintiffs along with Green, was filed on April 16, 2015. (Id., Dkt. No. 48.) AIG commenced this declaratory judgment action on June 26, 2015. (Compl.) On November 13, 2015, a third amended complaint was filed in the Underlying Litigation, adding as plaintiffs Moritz, Bowman, Tarshis, and Leslie, and adding claims for invasion of privacy (false light) and intentional infliction of emotional distress on behalf of all the underlying plaintiffs. (Green v. Cosby, Case No. 14-cv-30211-MGM, Dkt. No. 109.)
On December 3, 2015, the court held a hearing in this action on cross motions filed by Cosby and AIG: Cosby’s motion to dismiss or, in the alternative, to stay this declaratory judgment action; and AIG’s motion to stay the Underlying Litigation pending the outcome of this declaratory judgment action. (Dkt. No. 41.) Cosby’s motion did not seek dismissal on the merits but, rather, asked the court to abstain from exercising jurisdiction or to stay this action pending the completion of the Underlying Litigation. (Dkt. No. 17.) AIG’s motion essentially sought the opposite relief, asking the court to stay the Underlying Litigation pending resolution of this action. (Dkt. No. 26.) The court denied both motions and opted to proceed with both action simultaneously. AIG Prop. Cas. Co. v. Green, ___ F.Supp. 3d ___, 2015 WL 8779732 (D. Mass. Dec. 15, 2015). As noted in that decision, “AIG represented at the hearing that it intends to file an amended complaint including the new plaintiffs in the Underling Litigation as defendants here.” Id. at *2 n.2; see also Dkt. No. 47, Tr. of Mot. Hr’g Dec. 3, 2013, at 27 (“Our declaratory judgment complaint only concerns the three but I’ve already initiated a local rule conference about amending the complaint to make sure we get all the interested parties in and those parties are necessary in order for AIG to obtain complete relief.”). Despite this representation, AIG did not file the instant motion until March 2, 2016, the deadline for doing so under the Scheduling Order issued by Magistrate Judge David Hennessy. (Dkt. No. 67.)
AIG argued in its motion to join that Moritz, Bowman, Tarshis, and Leslie should be added as defendants in this action under Rule 19(a) of the Federal Rules of Civil Procedure because, without doing so, the court could not grant complete relief. (Pl’s Mot. to Join Party Defs. at 3 (“[T]he Court should join each of the Green plaintiffs to this case so the adjudication of coverage also takes place in one proceeding and is binding on all interested parties.” (citing Nat’l Union Fire Ins. Co. of Pittsburgh, Pa. v. Massachusetts Mun. Wholesale Elec. Co., 117 F.R.D. 321 (D. Mass. 1987)); id. at 4 (“Joinder will allow the Court to grant complete relief. Although this court could issue a declaratory judgment declaring the insurance policies at issue do not apply to the claims asserted by the Green plaintiffs, that ruling would not be binding on Louisa Moritz, Barbara Bowman, Joan Tarshis, and Angela Leslie if they are not parties to this proceeding.” (citing Eagle-Picher Indus., Inc. v. Liberty Mut. Ins. Co., 682 F.2d 12, 16 n. 1 (1st Cir. 1982), and Lopez v. Arrasas, 606 F.2d 347, 352 (1st Cir. 1979)).) AIG also asserted, without explanation, that “[j]oinder of Louisa Moritz, Barbara Bowman, Joan Tarshis, and Angela Leslie will not deprive the Court of jurisdiction.” (Id. at 3.) In addition, AIG took the position that joining these individuals does not require an amendment to its complaint. (Id. at 3-4.) Counsel for the underlying plaintiffs consented to AIG’s motion. (Id. at 5.) Cosby filed an opposition which merely took issue with AIG’s argument that it need not amend its complaint but otherwise did not oppose joining the additional underlying plaintiffs as defendants. (Dkt. No. 76.)
On March 4, 2016, the court directed the parties to address by March 18, 2016 whether adding her as a defendant would destroy complete diversity of citizenship and the extent to which Rule 19(b) of the Federal Rules of Civil Procedure is implicated. (Dkt. No. 78.) In AIG’s supplemental memorandum, it acknowledged that “joinder of Joan Tarshis does not appear feasible given [her] citizenship and the jurisdictional requirements and limitations set forth in the provisions of 28 U.S.C. § 1332, ” but argued the court may join all the additional underlying plaintiffs except her so as to preserve subject matter jurisdiction. (Dkt. No. 86, at 1, 5.) Notably, AIG explained that it “did not move for joinder on the ground the Court must join all the Green plaintiffs to grant relief, or on the grounds that the Green plaintiffs were necessary or indispensable parties.” (Id. at 2.) In apparent contradiction with its original motion to join and its counsel’s representation at the December 3, 2015 hearing, AIG proceeded to argue that the additional underlying plaintiffs were not “necessary” parties under Rule 19(a). (Id. at 7-12.) It also argued that even if Tarshis is a necessary party under Rule 19(a), she is not an “indispensable” party under Rule 19(b) and, therefore, the action should proceed without her and should not be dismissed. (Id. at 13-19.) In the alternative, AIG asserted the addition of Tarshis would not destroy subject matter jurisdiction because she is a dispensable party and her interest in this action arose after AIG originally filed its complaint. (Id. at 19-20.) In Cosby’s supplemental memorandum, he argued that the addition of Tarshis would destroy subject matter jurisdiction because both AIG and Tarshis are citizens of New York for diversity purposes. (Dkt. No. 87, at 4-5.) He also argued none of the underlying plaintiffs are necessary parties and, if that is the case, “then joinder should be denied and the underlying plaintiffs that AIG previously included should be dismissed.” (Id. at 9.) AIG and Cosby have each demonstrated a lack of consideration and foresight about this issue and now each has reversed themselves without detailed explanation.
III. Standard of Review
Rule 19(a) of the Federal Rules of Civil Procedure provides in relevant part:
A person who is subject to service of process and whose joinder will not deprive the court of subject-matter jurisdiction must be joined as a party if: (A) in that person’s absence, the court cannot accord complete relief among existing parties; or (B) that person claims an interest relating to the subject of the action and is so situated that disposing of the action in the person’s absence may: (i) as a practical matter impair or impede the person’s ability to protect the interest; or (ii) leave an existing party subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations of the interest.
Paragraph (b) of Rule 19 provides:
If a person who is required to be joined if feasible cannot be joined, the court must determine whether, in equity and good conscience, the action should proceed among the existing parties or should be dismissed. The factors for the court to consider include: (1) the extent to which a judgment rendered in the person’s absence might prejudice that person or the existing parties; (2) the extent to which any prejudice could be lessened or avoided by: (A) protective provisions in the judgment; (B) shaping the relief; or (C) other measures; (3) whether a judgment rendered in the ...