We previously wrote about the Fifth Circuit's panel decision and the defendants' petition for rehearing en banc in this case.
As we reported earlier, the issue is whether a non-diverse defendant is improperly joined by virtue of the plaintiff's failure to exhaust his state-law administrative remedies against that defendant. The US District Court for the Eastern District of Louisiana dismissed the non-diverse defendants as improperly joined because Flagg had not completed an administrative review by a medical board, a prerequisite to filing suit under the Louisiana Medical Malpractice Act ("LMMA"). Flagg later appealed this decision to the Fifth Circuit.
Our first post noted that a divided panel (2-1) reversed the district court, holding that the non-diverse defendants were not improperly joined, and ordered the case remanded to state court. The manufacturing (diverse) defendants petitioned the Fifth Circuit for rehearing en banc, which we addressed in our second post.
The en banc court affirmed the district court's dismissal of the non-diverse defendants (and thus the district court's proper diversity jurisdiction), holding that the failure to exhaust the LMMA pre-suit requirement of completing the medical board review meant that Flagg had "no possibility of recovery against the [non-diverse defendants], and the district court correctly dismissed" those defendants as improperly joined.
The Fifth Circuit defense bar can count the en banc court's decision as a win for improper joinder and diversity jurisdiction. The decision solidifies that failure to exhaust state-law pre-suit requirements renders those respective defendants subject to dismissal as improperly joined. This keeps open the improper joinder removal avenue.
We thank you for continuing to follow this important issue as it made its way through the Fifth Circuit's appeal process.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.