Products Liability Law Daily Wrap Up, JURISDICTION—INDUSTRIAL AND COMMERCIAL EQUIPMENT—E.D. Pa.: Worker death suit against machine suppliers remanded to state court, (Mar 9, 2026)

By Pankhuri Bhatnagar, B.A. LL.B.

A removing manufacturer failed to show that two Pennsylvania companies were fraudulently joined in this action, which defeated diversity jurisdiction and necessitated a remand.

In a suit brought against the suppliers of an industrial shot-blasting machine by the estate of a worker who sustained fatal injuries due to the machine’s alleged defects, a federal district court in Pennsylvania granted the widow’s motion to remand. Although the two in-state entities had not been served at the time of removal, the estate later served and sought entry of default against them, demonstrating an intent to prosecute them. The widow also asserted colorable negligence and product liability claims which destroyed diversity. Her request for attorney fees and costs was denied, however, since the manufacturer had an objectively reasonable basis for attempting removal (Lasso v. Wheelabrator Group, Inc., No. 25-4371 (E.D. Pa. Feb. 24, 2026)).

Background. A man suffered fatal injuries at his workplace from a machine, prompting his wife/estate to bring suit against the entities involved in that machine’s design, manufacture, distribution, and installation. The entities included Wheelabrator Group, Inc. (Wheelabrator), Wheelabrator Group, Wheelabrator Corporation, Norican Group, Norican Global A/S, K.J.S. Industrial Services, Inc. (KJS), and Kasco Sales, Inc. (Kasco). The complaint alleged that the machine contained a dangerous defect that exposed workers to an unguarded pinch point and caused the decedent’s fatal injuries. It asserted claims for strict products liability, negligence, breach of warranty, wrongful death, and survival damages.

Jurisdiction. The widow was a Pennsylvania resident. The complaint alleged that Wheelabrator was a Delaware corporation; that Wheelabrator Group, Wheelabrator Corporation, and Norican Group were Georgia companies with principal places of business in Georgia; that Norican Global A/S was a Danish corporation headquartered in Denmark; and that KJS and Kasco were Pennsylvania corporations with principal places of business in Pennsylvania. The complaint was originally filed in the Philadelphia Court of Common Pleas but was removed to federal court by Wheelabrator on the basis of diversity jurisdiction. The estate moved to remand.

Parties’ contentions. The widow argued that removal was procedurally defective because Wheelabrator failed to obtain written consent from other properly joined and served defendants before removing the action. She further asserted that removal was substantively improper because there was no complete diversity, thus defeating the manufacturer’s attempt to invoke the snap removal doctrine, which allows a forum defendant to remove a case before it is joined and served, if the court would otherwise have original jurisdiction. She also sought attorney fees and costs associated with the remand motion. Wheelabrator responded that the removal notice did not require the consent of three other Wheelabrator entities as they were no longer active legal entities. The manufacturer dropped its snap removal argument but claimed that diversity jurisdiction nevertheless existed because the two Pennsylvania companies were fraudulently joined and it had an objective reason to remove the suit.

Legal standard. Federal courts have diversity jurisdiction over civil actions where the disputed amount exceeds $75,000 and the dispute is between citizens of different states. 28 U.S.C. §1332(a). Where a non-diverse defendant is fraudulently joined, its citizenship may be disregarded to retain jurisdiction. Joinder is fraudulent only if there is no reasonable factual or legal basis for the claim against the non-diverse defendant or no real intention to pursue the claim. In re Briscoe, 448 F.3d 216 (3d Cir. 2006). The claims must be “wholly insubstantial and frivolous.”

Timeliness. The court first noted that Wheelabrator raised fraudulent joinder for the first time in its opposition to remand rather than in its notice of removal. This alone was sufficient to remand the case since failing to assert fraudulent joinder until opposition renders removal procedurally defective. Stanley v. Lowe’s Cos., Inc., 2020 WL 1531387 (D.N.J. Mar. 31, 2020). The manufacturer had the option to amend its notice of removal to properly assert the defense within the 30-day period available for removal, but failed to do so. However, since defendants are sometimes permitted to amend their notice after the deadline has passed, the court proceeded to evaluate the substance of the fraudulent joinder argument.

Intent. The manufacturer suggested that the estate lacked a genuine intention of pursuing claims against KJS and Kasco as those entities had not been served when the opposition brief was filed. While true, the estate later served both suppliers and sought entry of default against them. The court concluded that this conduct demonstrated at least some intent to prosecute the claims, Weaver v. Am. States Ins. Co., 2023 WL 6541037 (W.D. Pa. Oct. 6, 2023), and Wheelabrator failed to show absence of a good-faith intention of pursuing the claims against them.

Colorability. The court next considered whether the estate had asserted colorable claims against the Pennsylvania entities. The complaint alleged that (1) KJS and Kasco designed, assembled, manufactured, sold, supplied, distributed, or installed the machine at issue; (2) they knew or should have known that devastating injuries would result if workers were exposed to the machine’s unguarded pinch point; and (3) the decedent’s fatal injuries were the direct result of their negligence and recklessness. The manufacturer failed to show why these allegations were not sufficient for even one of the five causes of action to survive. Its argument that KJS and Kasco were no longer in operation held no merit since it did not allege that those companies were dissolved before any liability incurred. Jocz v. Eichleay Eng’rs, Inc., No. 08-cv-4063, 2008 WL 5157503, at *3-4 (E.D. Pa. Dec. 9, 2008). Therefore, the Pennsylvania entities were not fraudulently joined, their citizenship destroyed complete diversity, and this court lacked subject matter jurisdiction. Remand was granted without reaching the rule-of-unanimity argument.

Attorney fees. The widow also sought attorney fees under 28 U.S.C. §1447(c), which permits courts to award costs and expenses when a case is improperly removed. Fees may be awarded where the removing party lacked an objectively reasonable basis for seeking removal. Martin v. Franklin Capital Corp., 546 U.S. 132, 141 (2005). Although the removal was unsuccessful, this court held that the manufacturer’s fraudulent-joinder theory provided a sufficiently reasonable basis for attempting removal, and declined the estate’s request. Stanley v. Lowe’s Cos., Inc., 2020 WL 1531387 (D.N.J. Mar. 31, 2020).

The case is No. 25-4371.

Judge: Henry, C.

Attorneys: Robert J. Mongeluzzi (Saltz Mongeluzzi & Bendesky P.C.) for Dolores J. Lasso. J.D. Feenane (Lucas and Cavalier, LLC) for Wheelabrator Group, Inc. and Norican Global A/S.

Companies: Wheelabrator Group, Inc.; Norican Global A/S; Wheelabrator Group; Wheelabrator Corp.; K.J.S. Industrial Services, Inc.; Kasco Sales, Inc.

Cases: CourtDecisions JurisdictionNews IndustrialCommercialEquipNews PennsylvaniaNews