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Lipham v. Koch Farms of Ashland, LLC

United States District Court, M.D. Alabama, Eastern Division

December 4, 2018

JANE LIPHAM d/b/a JANE LIPHAM FARM AND LITTLE MAN FARM, Plaintiff,
v.
KOCH FARMS OF ASHLAND, LLC, Defendants.

          MEMORANDUM OPINION AND ORDER

          DAVID A. BAKER, UNITED STATES MAGISTRATE JUDGE.

         Plaintiff Jane Lipham d/b/a Jane Lipham Farm and Little Man Farm, sues Defendant, Koch Farms of Ashland, LLC, ("Koch Farms"), and numerous fictitious Defendants for damages resulting from the infestation of Plaintiff s farm by bed bugs introduced to the farm by Defendants. In a six-count complaint filed in the Circuit Court of Randolph County, Alabama, Plaintiff alleges claims for breach of contract, fraud, and negligence. (Doc. 1-1). Defendant Koch Farms removed the case to this court. (Doc. 1). Pending before the court is Koch Farms' Motion to Dismiss Plaintiffs Complaint (Doc. 4). Also pending are Plaintiffs Motion for Leave to Amend and Clarify Complaint (Doc. 6) and Plaintiffs Motion to Remand (Doc. 7). The parties have had the opportunity to fully brief the motions and the court heard argument on September 25, 2018. For the reasons that follow, Plaintiffs Motion for Leave to Amend and Clarify Complaint (Doc. 6) is granted, Defendant Koch Farm's Motion to Dismiss Plaintiffs Complaint (Doc. 4) is denied withont prejudice, and Plaintiffs Motion to Remand (Doc. 7) is granted.

         I. Jurisdiction

         This matter was removed to this court pursuant to 28 U.S.C. §§ 1332(a), 1441, and 1446. (Doc. 1). The jurisdiction of the court is invoked based upon diversity of citizenship and an amount in controversy in excess of $75, 000. Id. ¶ 7. Plaintiff contests this court's diversity jurisdiction contending diversity does not exist among the parties because the individual Defendants, Kenny Green ("Green"), Michelle Yates Davidson ("Davidson"), Tommy Rushing ("Rushing"), and Pat Fagan ("Fagan"), who were named in the complaint, but inadvertently not included in the case caption, are Alabama citizens and, therefore, nondiverse.

         II. Background and Statement of Facts[1]

         On June 18, 2018, Plaintiff filed a civil complaint in the Circuit Court of Randolph County, Alabama. (Doc. 1-1). The complaint, sounding exclusively in state law, alleges claims for breach of contract, fraud, and negligence against Defendant Koch Farms of Ashland, LLC. Id. at 6-14. Additionally, Plaintiff names fictitious parties A, B, C, D, E, and F, including "the person, firm or corporation who provided chicken catching services at Plaintiff s farm." Id. at 1. On July 12, 2018, Koch Farms removed the case to the United States District Court for the Middle District of Alabama, asserting diversity jurisdiction pursuant to 28 U.S.C. § 1332.[2] (Doc. 1).

         In her complaint, Plaintiff alleges she has a poultry farm located near Randolph County, Alabama, that consists of six breeder hen houses where she has grown breeder hens and produced eggs for Koch Farms. (Doc. 1-1, ¶ 10). In late 2009 or early 2010, Plaintiffs chickens were being picked up and caught by Koch Farms at which time cages brought by Koch Farms that were infested with bed bugs were placed in one of Plaintiffs chicken houses. Id. ¶ 11. Plaintiff observed the cages being placed on the floor and bed bugs spreading from the cage. Id. Prior to the introduction of the bed bugs by Koch Farms, Plaintiff did not have any bed bugs located on her farm. Id. ¶ 12. Plaintiff notified her service representative Fagan, who shortly thereafter was replaced by Davidson. Id. ¶ 13. Davidson took a sample of the bed bugs and represented to Plaintiff that she was taking the bed bugs to Auburn University for analysis so they could be treated and eradicated from Plaintiffs farm. Id. ¶ 14. In November 2014, Plaintiff learned that Davidson never took the bed bugs to Auburn University. Id. ¶ 15.

         The infestation of Plaintiff s farm by the bed bugs continued to spread and grow. Id. ¶ 16. Plaintiff s service representatives gave her chemicals to treat the bed bugs and directed her how to use the chemicals. Id. Since the infestation of bed bugs began on her farm, Plaintiff was told by Koch Farms, Fagan, Davidson, Green, and Rushing that Koch Farms would continue to supply her with breeder hens provided she continued to use the chemicals as directed. Id. ¶ 17.

         Plaintiffs chicken houses have at all times been classified as "Class A" houses, and she invested a significant amount of money to update them to maintain her "Class A" status at the insistence of Koch Farms. Id. ¶¶ 18-19. After Koch Farms completed the catch of Plaintiff s breeder hens in September 2017, Rushing and Green came to Plaintiffs farm to discuss the bed bug problem and advised Plaintiff and her husband that there was nothing further that they could do regarding the infestation. Id. ¶¶ 20-21. Although following the meeting Green told Plaintiff to get ready for their new batch of chickens, Plaintiff received a letter from Koch Farms in October 2017 stating no new chickens will be sent until the bed bug infestation is eradicated at Plaintiffs expense. Id. ¶¶ 22-24. The flock to flock breeder agreement between Plaintiff and Koch Farms provides that Koch Farms will supply "all feed, medication and sanitation products necessary to raise, develop, and maintain the breeder flock." Id. ¶ 27. The last flock to flock breeder contract entered into between the parties was November 22, 2016, with the prior agreements containing similar terms. Id. ¶¶ 26-27'.

         Plaintiff alleges that between 2012 and 2017 her production pay from Koch Farms has decreased significantly due to the bed bug infestation. Id. ¶ 25. Since being dropped by Koch Farm as egg producers in October 2017, Plaintiff has been unable to contract with any other chicken company due to the bed bug infestation. Id. ¶ 28.

         Plaintiff filed suit in the Circuit Court of Randolph County, Alabama, alleging state law claims of breach of contract (Counts I, II), fraud (Counts III, IV, V), and negligence (Count VI) against Defendants. (Doc. 1-1). The complaint caption names as Defendants Koch Farms and various fictitious persons or entities, see Id. at 1, but the prayers for relief in Counts III and IV also seek relief against the individuals Fagan, Green, Davidson, and Rushing, see Id. at 11-12. Plaintiffs Complaint alleges Green, Davidson and Rushing are Alabama resident citizens.[3] Id. ¶¶ 5-7.

         Koch Farms moves to dismiss the Plaintiff s complaint. (Doc. 4). It argues that her breach of contract claims are barred by Alabama's six-year statute of limitations. As for the tort claims, Koch Farms alleges Plaintiff does not plead her fraud claims with specificity to satisfy the particularity requirements of Rule 9(b), and in any event, her tort claims are actually mislabeled contract claims. (Doc. 4).

         Plaintiff filed a motion for leave to amend and clarify her complaint. (Doc. 6). She alleges that the individual Defendants were inadvertently left out of the case caption, but that she clearly intended to sue them as they are specifically referenced in the complaint and included in the prayers for relief in multiple counts. (Doc. 6). When the citizenship of the individual Defendants is considered, diversity does not exist, and therefore Plaintiff also moves to remand. (Doc. 7).

         III. ...


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