Ticer v. Imperium

Summary

**Topics:** Improper joinder (fraudulent joinder); diversity jurisdiction; insurance coverage; duty to defend; eight-corners rule; policy exclusion; summary inquiry; dismissal without prejudice. **Holding:** The Fifth Circuit affirmed the district court's finding that a non-diverse insurance defendant was improperly joined because the policy's unambiguous incident exclusion and prior-notice provision barred coverage, leaving no reasonable possibility of recovery in state court. The court held that the district court properly conducted a summary inquiry to review the insurance policy. However, the dismissal of the improperly joined defendant should have been without prejudice, not with prejudice, because improper joinder goes to jurisdiction, not the merits.

Holdings

1. Imperium was improperly joined because there is no reasonable possibility of recovery against it due to the unambiguous policy exclusion.
2. When a nondiverse party is improperly joined, dismissal must be without prejudice.

Questions Presented

1. Whether Imperium was improperly joined to defeat diversity jurisdiction.
2. Whether the district court abused its discretion by conducting a summary inquiry and considering the insurance policy.
3. Whether the district court erred in dismissing Ticer's claims against Imperium with prejudice.

Disposition

other