Avenatti v. Fox News Network LLC, No. 21-2702 (3d Cir. 2022)
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Attorney Avenatti rose to public prominence in 2018 by representing “Stormy Daniels,” with whom then-President Trump had allegedly had an extra-marital affair. His subsequent arrest received extensive media coverage, including by Fox News and its individual employees. Avenatti sued Fox and several individuals in Delaware Superior Court. His initial complain described allegedly defamatory statements made by Hunt but did not name Hunt as a Defendant.
Days later, Fox removed the case to federal court claiming complete diversity. Avenatti filed an amended complaint in the district court. Because the amended complaint was entered within 21 days, Avenatti did not require leave of court or the opposing parties, Fed. R. Civ. P. 15(a)(1)(A). The amended complaint named Hunt—a California resident, as was Avenatti—as a Defendant and alleged that Hunt had published an article online about Avenatti’s arrest which included the same defamatory accusations previously attributed to the other Defendants. Avenatti moved to remand the case back to state court, citing Hunt’s shared California citizenship as destroying diversity.
The Third Circuit affirmed the district court’s denial of the remand motion, citing the court’s discretionary authority under Rule 21 to drop Hunt from the litigation to restore complete diversity. The court employed “an open-ended balancing test" for considering post-removal amendments that add nondiverse parties and found that Hunt had been joined to defeat diversity and Avenatti would not be prejudiced by Hunt’s excision.
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