On February 10, 2025, the NAM filed an amicus brief urging the U.S. Supreme Court to address an important issue concerning federal court diversity jurisdiction. After the plaintiff brought this product liability suit in Texas state court, Hain removed the case to the Southern District of Texas asserting diversity jurisdiction as the basis for federal court jurisdiction. Hain maintained that its co-defendant (Whole Foods) should be dismissed from the case because the plaintiffs failed to state a claim against Whole Foods and only joined Whole Foods to prevent a federal court from hearing the case. The plaintiffs then amended their complaint against Whole Foods to defeat diversity and moved to remand the case to state court. The district court, however, held that the plaintiffs could not defeat federal diversity jurisdiction by adding new allegations to their complaint following removal, and that their amended claims still did not state a viable claim against Whole Foods. The district court also ruled for Hain on the merits. Following trial and judgment in Hain’s favor, the 5th Circuit reversed the district court’s decision on appeal and held that the case should be remanded to state court because the district court lacked jurisdiction to resolve the plaintiffs’ claims on the merits.
We argue that the 5th Circuit’s decision threatens to force businesses to expend significant resources litigating a case in federal court only to have a federal court of appeals reverse a favorable judgment and return the case to state court for a plaintiff to have a second bite at the apple. Manufacturers have a strong interest in preserving the finality of court judgments.
Happily, on April 28, 2025, the U.S. Supreme Court granted the petition for certiorari.