6 F.

3d 229

63 Fair Empl.Prac.Cas. 622,

62 Empl. Prac. Dec. P 42,572
Mildred MARSHALL, Plaintiff-Appellant,
v.
MANVILLE SALES CORPORATION, Defendant-Appellee,
and
Robert L. Mason, Defendant.
No. 92-2211.

United States Court of Appeals,

Fourth Circuit.
Argued May 7, 1993.
Decided Oct. 4, 1993.

Leman Walton Auvil, Pyles & Auvil, Parkersburg, WV, argued for
appellant.
Robert James Kent, Bowles, Rice, McDavid, Graff & Love, Parkersburg,
WV, argued (John R. Teare, Jr., Bowles, Rice, McDavid, Graff & Love,
Charleston, WV, on brief), for defendant-appellee.
Before NIEMEYER and WILLIAMS, Circuit Judges, and BUTZNER,
Senior Circuit Judge.
OPINION
BUTZNER, Senior Circuit Judge:

In this appeal Mildred Marshall assigns error to the district court's judgment
that the statute of limitations bars her claim of employment discrimination
under the West Virginia Human Rights Act, W.Va.Code Sec. 5-11-1 et seq.,
against her former employer, Manville Sales Corporation. She also assigns
error to the district court's denial of her motion to remand to a West Virginia
court her action against Robert L. Mason and Manville.

Concluding that summary judgment was improper, we vacate Manville's

judgment. Having vacated the final judgment and concluding that the dismissal
of Mason and denial of Marshall's motion to remand were improper, we
reinstate Mason, remand this case to the district court, and direct the court to
remand to state court.

* Manville, a Delaware corporation based principally in Colorado, employed

Marshall in a West Virginia plant from May 1, 1964, until her retirement on
October 1, 1990. In January 1988, she notified Robert Mason, the plant
manager, that she felt that her salary was not commensurate with her
responsibilities as materials coordinator or with the pay of males in similar
positions. Neither Mason nor Manville took action to remedy Marshall's
complaints. In January 1989, a younger man was promoted into the position of
buyer, a job for which Marshall maintains she was qualified. Marshall asserts
that Mason was directly involved in the discrimination about which she
complained.

On March 24, 1989, Marshall filed claims alleging sex and age discrimination
with the West Virginia Human Rights Commission. The Commission issued
notices of a right to sue Marshall on September 15, 1989, and March 16, 1990.

On October 12, 1991, Marshall filed suit in the Circuit Court of Wood County,
West Virginia, naming Mason and Manville as defendants. Manville removed
the suit to federal court, stating that Marshall had fraudulently joined Mason, a
West Virginia resident, to avoid federal diversity jurisdiction. On May 29,
1992, the district court dismissed Mason from the action because he was not
Marshall's employer, and it denied Marshall's motion to remand her action to
state court. The district court then granted summary judgment to Manville,
ruling that the statute of limitations barred Marshall's action. We review a
district court's grant of summary judgment de novo. Atlas Machine and Iron
Works, Inc. v. Bethlehem Steel Corp., 986 F.2d 709, 712 (4th Cir.1993).

II
6

The district court held that Marshall had failed to commence her action within
the 90 days allowed after a claimant has received a right-to-sue letter and
within the 2-year statute of limitations. W.Va.Code Secs. 5-11-13(b) and 55-212. For the purpose of applying the two-year statute of limitations, the court
held that Marshall's claims of alleged discrimination occurred on October 6,
1988, and January 4, 1989.

The district court did not address the merits of Marshall's claim of continuing
discrimination. Instead, it held that Marshall failed to adequately plead
continuing discrimination because she did not show a factual basis for the
claim.

Marshall alleged that she had worked for Manville since 1964; she had never
been reprimanded; she had always received excellent performance evaluations.
Nevertheless, she alleged, because of gender and age discrimination she had
been paid less than men performing the same work. She also alleged
discriminatory denial of promotion. In addition, she claimed that because her
pay was lower than it would have been had there been no discrimination, her
pension is reduced.

Manville was well aware that Marshall claimed wrongful discrimination with
respect to compensation disparity based on gender and age. In its notice of
removal it stated that although the complaint does not demand a sum certain,
the amount in controversy exceeds $50,000 exclusive of interest and costs
because Marshall claims a continuing injury. Indeed, if Marshall's pleading
were to be read as not alleging a continuing injury, the court would probably
lack subject matter jurisdiction because of an inadequate amount in
controversy.

10

The parties have not called our attention to any West Virginia case precisely on
point. Nevertheless, dicta in West Virginia Institute of Technology v. Human
Rights Comm'n, 181 W.Va. 525, 383 S.E.2d 490 (1989), persuades us that the
West Virginia Supreme Court would adopt the continuing violation doctrine
when considering whether an action had been brought within the two-year
statute of limitations.

11

The Court defined a continuing violation in the context of a statute of

limitations as follows:

12
"Unlawful
employment discrimination in the form of compensation disparity based
upon a prohibited factor such as race, gender, national origin, etc., is a "continuing
violation," so that there is a present violation of the antidiscrimination statute for as
long as such compensation disparity exists; that is, each paycheck at the
discriminatory rate is a separate link in a chain of violations. Therefore, a disparatetreatment employment discrimination complaint based upon allegedly unlawful
compensation disparity is timely brought if it is filed within the statutory limitation
period after such compensation disparity last occurred.

13

383 S.E.2d at 499. It is readily apparent that Marshall's allegation of an

unlawful continuing injury caused by compensation disparity based on gender
and age satisfies this definition of a continuous violation. The West Virginia
Court cited West Virginia Human Rights Comm'n v. United Transportation
Union, 167 W.Va. 282, 292, 280 S.E.2d 653, 658-59 (1981), which applied the
continuing violation theory in the context of the 90-day limitation contained in
the Human Rights Act. The Court also included among the authorities that it
cited Jenkins v. Home Ins. Co., 635 F.2d 310 (4th Cir.1980), which applied the
continuing violation theory in the context of the statute of limitations.

14

Manville's reliance on Hill v. AT & T Technologies, Inc., 731 F.2d 175 (4th
Cir.1984), is misplaced. The intervenor who alleged a continuous violation in
Hill was complaining about discrimination in hiring practices. Refusal to hire is
not a continuous violation. It is a distinct act, and the statute of limitations runs
from the date of refusal. Refusal to hire, unlike continuous pay disparity, is not
a present violation. Present violation in the context of limitations means a
violation within the time allowed by a statute of limitations. 731 F.2d at 180.

15

Marshall retired October 1, 1990. Her allegedly unlawful compensation

disparity continued until that time. She commenced this action on October 12,
1991, well within the two-year statute of limitations that the district court
identified as applicable. Her suit was timely, and we must vacate the district
court's judgment of dismissal.

III
16

Marshall also assigns error to the district court's denial of her motion to remand
her suit to the state court from which it was in her view wrongfully removed.

17

Ordinarily we would not consider this assignment of error on appeal of the

district court's final judgment. In Able v. Upjohn Co., 829 F.2d 1330 (4th
Cir.1987), we held that we would not disturb a district court's final judgment on
the basis of a defective removal when the plaintiff had failed to seek an
interlocutory appeal of the order denying remand. 829 F.2d at 1333-34;
accordSorosky v. Burroughs Corp., 826 F.2d 794, 798-99 (9th Cir.1987). But
seeCarriere v. Sears, Roebuck & Co., 893 F.2d 98, 100 n. 2 (5th Cir.1990).
Able is based on the well-established principle that jurisdiction to enter final
judgment will be upheld even though there was no right of removal when "the
federal trial court would have had original jurisdiction of the controversy had it
been brought in the federal court in the posture it had at the time of the actual
trial of the cause or of the entry of the judgment." American Fire & Casualty

Co. v. Finn, 341 U.S. 6, 16, 71 S.Ct. 534, 541, 95 L.Ed. 702 (1951). See
alsoGrubbs v. General Electric Credit Corp., 405 U.S. 699, 702, 92 S.Ct. 1344,
1347, 31 L.Ed.2d 612 (1972). Able points out that judicial economy and
interests in finality are served by not disturbing a final judgment when a party
aggrieved by removal could have sought appeal of the issue early in the
proceedings. 829 F.2d at 1333.
18

The merits of the controversy between Marshall and both Mason and Manville
have not been resolved by either summary judgment or trial. The district court
never considered the merits. The case is now virtually where it was at the time
it was removed to federal court. Because the statute of limitations is not a bar to
Marshall's action, the case must now be tried by either the state or federal court.

19

The district court did not direct entry of a final judgment when it dismissed
Mason. As a result of our vacating the summary judgment in favor of Manville
in part II of this opinion, there is now no final judgment adjudicating the
claims, rights, and liabilities of all the parties. Therefore, the decision to dismiss
Mason is subject to revision. Fed.R.Civ.P. 54(b). Under these circumstances,
because the case was wrongfully removed, as explained in part IV, Mason
should be reinstated as a party and the case remanded to state court.

20

Review of the district court's denial of the motion to remand will effectuate
Congress' clear intention to restrict removal and to resolve all doubts about the
propriety of removal in favor of retained state court jurisdiction. SeeAmerican
Fire, 341 U.S. at 10, 71 S.Ct. at 538; Able, 829 F.2d at 1332. Where there has
been a minimum investment of the parties' time and judicial resources, we can
realize this intent without harming the interests of finality or judicial economy.
SeeChivas Products Ltd. v. Owen, 864 F.2d 1280, 1286-87 (6th Cir.1988).

IV
21

Marshall contends that she had a valid cause of action against Mason under
West Virginia law. Manville maintains that Mason was fraudulently joined
because he could not possibly be viewed as an employer under W.Va.Code Sec.
5-11-9(a)(1), which prohibits "any employer" from discriminating against an
individual regarding wages and other conditions of employment.

22

Manville's argument overlooks Marshall's cause of action against Mason as a

person. As the district court noted, Marshall also sought relief under another
section of the Human Rights Act which provides that it is an unlawful
discriminatory practice

23 any person ... to: (A) engage in any form of threats or reprisals, or engage in, or
for
hire, or conspire with others to commit acts or activities of any nature, the purpose of
which is to harass, degrade, embarrass, or cause physical harm or economic loss or
to aid, abet, incite, compel or coerce any person to engage in any of the unlawful
discriminatory practices defined in this section....
24

W.Va.Code Sec. 5-11-9(a)(9) (current version at W.Va.Code Sec. 5-11-9(a)(7)

(1992)). This section does not limit the potential defendants to employers as
defined by the West Virginia Code. Under this section Mason can be held
liable for his discriminatory actions as a person.

25

In order to establish that a nondiverse defendant has been fraudulently joined,

the removing party must establish either:

26
"[T]hat
there is no possibility that the plaintiff would be able to establish a cause of
action against the in-state defendant in state court; or
27

[T]hat there has been outright fraud in the plaintiff's pleading of jurisdictional
facts.

28

B., Inc. v. Miller Brewing Co., 663 F.2d 545, 549 (5th Cir.1981) (emphasis in
original). The burden on the defendant claiming fraudulent joinder is heavy: the
defendant must show that the plaintiff cannot establish a claim against the
nondiverse defendant even after resolving all issues of fact and law in the
plaintiff's favor. Poulos v. Naas Foods, Inc., 959 F.2d 69, 73 (7th Cir.1992). A
claim need not ultimately succeed to defeat removal; only a possibility of a
right to relief need be asserted. 14A Charles A. Wright et al., Federal Practice
& Procedure Sec. 3723, at 353-54 (1985).

29

Manville has not shown outright fraud in Marshall's pleadings; therefore, it had
to show that there is no possibility that Marshall could establish a cause of
action against Mason in the West Virginia courts. As the plain language of
W.Va.Code Sec. 5-11-9(a)(9) supports such a cause of action, Marshall did not
fraudulently join Mason. Marshall's complaint against both Mason and
Manville constitutes a single wrong arising out of the actions taken by Mason.
Consequently, there is no "separate and independent claim or cause of action"
within the meaning of the removal statute, 28 U.S.C. Sec. 1441(c).
SeeAmerican Fire, 341 U.S. at 9-16, 71 S.Ct. at 537-41. The district court
should have granted her motion to remand. SeeYedla v. Electronic Data
Systems, Inc., 764 F.Supp. 90 (E.D.Mi.1991).

30

We vacate the summary judgment of the district court in favor of Manville on

the issue of limitations. We also vacate the orders dismissing Mason and
denying remand to the state court. Mason is reinstated as a party, and we
remand the case to the district court with directions to remand it to the state
court.

31

VACATED AND REMANDED.