Koester v. Dairy Farmers of America, Inc. et al

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
BRIAN KOESTER and
KIMBERLY KOESTER,
Plaintiffs,
v.
DAIRY FARMERS OF AMERICA,
INC., JEFFREY BACON, ERIC
MILLHOLLEN, KAY VANNATTA,
and ANN HOLLERAN,
Defendants.
No. 4:25-CV-01642
(Chief Judge Brann)
MEMORANDUM OPINION
J ANUARY 30, 2026
I. 	BACKGROUND
Brian 	Koester 	(“Mr. 	Koester”) 	and 	his 	wife 	Kimberly 	Koester 	(“Mrs.
Koester”) (collectively, “Plaintiffs”), brought suit in the Court of Common Pleas of
Philadelphia County (“the state court”) against Mr. Koester’s former employer Dairy
Farmers of America, Inc (“DFA”) and a variety of their employees, including Jeffrey
Bacon (“Bacon”), Eric Millhollen (“Millhollen”), Kay Vannatta (“Vannatta”), and
Ann Holleran (“Holleran”) (collectively, “Defendants”).1
1 	See Doc. 1 (Notice of Removal).
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 1 of 11

2
Mr. Koester brought five counts against Defendants: the first, against DFA,
the rest against each of the individual Defendants. 2 Mrs. Koester brought one loss of
consortium claim against all defendants, totaling the counts to six. 3
Defendants removed the case to the Middle District of Pennsylvania. 4
Defendants also moved to dismiss for failure to state a claim. 5 Plaintiffs filed the
instant motion to remand the case back to the state court for lack of subject matter
jurisdiction, namely lack of complete diversity between Defendants.6 Defendants
oppose 	the 	motion 	to 	remand, 	arguing 	that 	no 	claim 	against 	the 	individual
Defendants can be sustained and that, thus, joinder is fraudulent.7 The motion is now
ripe for disposition. For the reasons stated below, it is granted.
II. 	DISCUSSION
A. 	Removal Standard
Title 28 U.S.C. § 1447(c) governs remand, and provides that, “[i]f at any time
before 	final 	judgment 	it 	appears 	that 	the 	district 	court 	lacks 	subject 	matter
jurisdiction, the case shall be remanded.” 8 “The district courts shall have original
jurisdiction of all civil actions where the matter in controversy exceeds the sum or
value of $75,000, exclusive of interest and costs, and is between . . . citizens of
2 	Doc. 1-1 (Exhibit A – Compl.).
3 	Id.
4 	Id.
5 	Doc. 5 (Mot.).
6 	Doc. 8 (Mot.); Doc. 9 (Br. in Supp.) at 4.
7 	Doc. 12 (Br. in Opp.) at 2.
8 	28 U.S.C. § 1447(c).
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 2 of 11

3
different states.”9 “Complete diversity requires that, in cases with multiple plaintiffs
or multiple defendants, no plaintiff be a citizen of the same state as any defendant.”10
“When a non-diverse party has been joined as a defendant, then in the absence of a
substantial federal question, the removing defendant may avoid remand only by
demonstrating that the non-diverse party was fraudulently joined.” 11
“Joinder is fraudulent ‘where there is no reasonable basis in fact or colorable
ground supporting the claim against the joined defendant, or no real intention in good
faith to prosecute the action against the defendants or seek a joint judgment.’”12 “‘[I]f
there is even a possibility that a state court would find that the complaint states a
cause of action against any one of the resident defendants, the federal court must
find that joinder was proper and remand the case to state court.’” 13 In this inquiry,
courts may look to the plaintiff’s subjective intent, indicated through conduct, and
determine whether it is “‘consistent with an intention to actually proceed against’”
the joined defendants. 14 Courts should also look to the “‘objective criteria’” and
9 	28 U.S.C. § 1332(a)(1).
10 	Zambelli Fireworks Mfg. Co. v. Wood, 592 F.3d 412, 419 (3d Cir. 2010).
11 	Batoff v. State Farm Ins. Co., 977 F.2d 848, 851 (3d Cir. 1992).
12 	Batoff, 977 F.2d at 851 (quoting Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir.
1990)). Examples of legal bars rendering a claim too weak to proceed include actions barred
by the statute of limitations, Bazis v. Reworld Projects, LLC, No. 24-3818, 2025 WL 1073763,
at *3 (E.D. Pa. Apr. 9, 2025), or where controlling law precludes liability against an individual
defendant. Batoff, 977 F.2d at 852-53.
13 	Batoff, 977 F.2d at 851 (quoting Boyer, 913 F.2d at 111).
14 	In re Briscoe, 448 F.3d 201, 219 (3d Cir. 2006) (quoting Abels v. State Farm Fire & Cas. Co.,
770 F.2d 26, 29 (3d Cir. 1985)).
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 3 of 11

4
determine “‘that there [is] some reasonable basis in fact and some colorable legal
ground supporting a claim’” against the joined defendants. 15
In deciding whether parties have been fraudulently joined, courts are not to
convert a “jurisdictional inquiry into a motion to dismiss.” 16 “‘[I]t is possible that a
party is not fraudulently joined, but that the claim against that party ultimately is
dismissed for failure to state a claim upon which relief may be granted.’”17 The
analysis “triggered by a motion to dismiss under Rule 12(b)(6) is more searching
than that permissible when a party makes a claim of fraudulent joinder.”18 In this
inquiry, courts “must take care not to engage in ‘merits determination.’” 19
Accordingly, dismissal for fraudulent joinder is proper only where the claims
against the non-diverse defendants are “wholly insubstantial and frivolous,” i.e., a
claim that is not even colorable. 20 The removing party carries a “‘heavy burden of
persuasion’” when alleging fraudulent joinder.21 Removal statutes are to be “‘strictly
construed against removal and all doubts should be resolved in favor of remand.’” 22
15 	Id.
16 	Batoff, 977 F.2d at 852.
17 	In re Briscoe, 448 F.3d 201, 217-18 (3d Cir. 2006).
18 	Batoff, 977 F.2d at 852.
19 	Alexander Nissan, Inc. v. Maritz LLC, No. 4:14-CV-01623, 2015 WL 391575, at *2 (M.D. Pa.
Jan. 28, 2015) (Brann, J.) (quoting Batoff, 977 F.2d at 852).
20 	Batoff, 977 F.2d at 852.
21 	Batoff, 977 F.2d at 851 (quoting Steel Valley Author v. Union Switch & Signal Div., 809 F.2d
1006, 1012 n.6 (3d Cir. 1987) cert. dismissed, 484 U.S. 1021 (1988)).
22 	Id.
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 4 of 11

5
B. 	Application
Relevant to the instant motion, Mr. Koester brings four counts of wrongful
discharge against each of the individual Defendants. 23 Mrs. Koester brings one
derivative loss of consortium claim against all Defendants as well. 24 Plaintiffs aver
that they are citizens of Pennsylvania, as well as Defendants Bacon, Millhollen, and
Holleran. 25 Should any of the claims against these three Pennsylvania individual
Defendants be valid, i.e. not fraudulently joined, there would not be complete
diversity of citizenship and, accordingly, remand would be proper. 26
Pennsylvania’s at-will employment doctrine allows employers to fire workers
without cause, absent a “‘statutory or contractual provision to the contrary.’”27 An
23 	Doc. 1-1 (Compl.); Doc. 9 (Br. in Supp.) at 6. Plaintiffs pled these claims originally as
“Retaliatory Adverse Employment Action Violat[ing] Public Policy,” Doc. 1-1 at 22, 24, 27,
29, but in brief in remand, Plaintiffs refer to the claims against individual Defendants as
wrongful termination claims. See Doc. 9 at 6 (bringing “state law claims against individual
defendants . . . for the wrongful discharge of plaintiff Brian Koester”; alleging that individual
Defendants’ behavior resulted “in the wrongful termination” of Plaintiff; and analyzing the
legal landscape for “state common law wrongful discharge claim[s]”).
Defendants in brief also argue that any retaliation claims would be duplicative of the wrongful
termination claims and, therefore, address only the wrongful termination claims for the
individual Defendants. Doc. 12 (Br. in Opp.) at 7 n.3. Accordingly, parties appear to be in
agreement, both referring to these claims as wrongful termination rather than retaliation, and
the Court will analyze them similarly.
24 	Doc. 1-1.
25 	Doc. 1-1. Defendants assert without opposition from Plaintiffs that Vannatta is a citizen of the
State of New Mexico. Doc. 12 (Br. in Opp.). Accordingly, as only Defendants Bacon,
Millhollen, and Holleran are alleged to be citizens of the Commonwealth of Pennsylvania, only
the claims against them would defeat complete diversity. Therefore, only those claims against
the latter individual Defendants will be analyzed.
26 	Owen Equipment & Erection Co. v. Kroger, 437 U.S. 365, 373-74 (1978).
27 	Srebro v. Dunbar Armored, Inc., No. 3:12-CV-2136, 2013 WL 4016514, at *3 (M.D. Pa. Aug.
6, 2013) (quoting Weaver v. Harpster, 975 A.2d 555, 562 (Pa. 2009)).
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 5 of 11

6
exception to this rule is when an employee is terminated for reasons that violate
public policy, including situations where “an employer requires an employee to
commit a crime.” 28 “When the ‘commit a crime’ public policy exception is invoked,
the plaintiff must point to his employer's course of action that is ‘clearly illegal.’” 29
“[C]laims reliant upon the ‘commit a crime’ public policy exception to the at-will
doctrine have succeeded when the plaintiff specifically identifies the law violated by
the employer’s actions.” 30
The parties dispute whether Plaintiffs’ claims can be applied to the individual
Defendants as opposed to only the employer; Plaintiffs raise the “participation
theory” of liability to confer liability for individuals, and Defendants asserts the
theory 	is 	inapplicable 	to 	non-officers.31 “‘Pennsylvania 	law 	recognizes 	the
participation theory, under which a corporate officer, employee, or other agent “who
takes part in the commission of a tort by the corporation is personally liable
therefor.’”32 Courts in this Circuit have frequently held noted that the participation
theory applies not only to corporate officers but also to other employees.33 Under the
28 	Pyles v. City of Phila, No. 05-1769, 2006 WL 3613797, at *7 (E.D. Pa Dec. 8, 2006); see also
Capriotti v. Rockwell, No. 19-3136, 2020 WL 12630541, at *8 (E.D. Pa. Jan. 7, 2020).
29 	Srebro, 2013 WL 4016514, at *4 (quoting Kelly v. Ret. Pension Plan for Certain Home Office,
73 F. App'x 543, 544-45 (3d Cir. 2003)).
30 	Id. at *4 n.2 (quoting Woodson v. AMF Leisureland Ctrs., Inc., 842 F.2d 699, 702 (3d Cir.
1988)).
31 	Doc. 9 at 6-7; Doc. 12 at 11.
32 	In re Nat’l Medical Imaging, LLC, 570 B.R. 147, 159 (E.D. Pa. 2017).
33 	See, e.g., id.; M.B. v. Schuylkill County, 375 F. Supp. 3d 574, 601 (E.D. Pa. 2019) (“This
participation theory of liability—that employees are liable only for action but not inaction—
applies to the liability of corporate officers as well as other employees.”); Aldorasi v.
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 6 of 11

7
participation theory, employees and other non-officer agents may be held liable for
misfeasance but not “mere nonfeasance.” 34
The theory’s applicability to wrongful termination claims, though, is unclear.
In Pennsylvania, the law is split on whether wrongful termination claims can be
brought against individual defendants rather than against the employer.35 Courts that
have allowed such claims to proceed have done so when it is alleged that the
defendants acted in an individual or personal capacity as opposed to a corporate
capacity. 36 “An individual acts in a personal capacity if the individual has some
personal orchestration of the plaintiff's termination or personally asks the plaintiff to
partake in a crime and then fires the plaintiff upon refusal.” 37
Here, Plaintiffs’ pleadings raise a colorable claim against the individual
Defendants. Plaintiffs plead the specific requirements for reporting pollution event
standards with which Plaintiff Mr. Koester was required to comply.38 Plaintiffs have
identified a statute allegedly violated by Defendants’ discharge of insufficiently
Crossroads Hosp. and Mgmt. Co., 344 F. Supp. 3d 814, 822 (E.D. Pa. 2018) (collecting cases)
(“Although Plaintiff suggests the participation theory does not apply to managers and
supervisors . . . state and federal courts in Pennsylvania courts have routinely applied the theory
to employees and other non-officer agents.”).
34 	Aldorasi, 344 F. Supp. 3d at 822.
35 	Sadati v. PrimeCare Medical, Inc., No. 19-5452, 2020 WL 4805347, at *6 (E.D. Pa Aug. 18,
2020) (collecting cases).
36 	Medley v. SugarHouse HSP Gaming, No. 12-6284, 2013 WL 1157349, at *4 (E.D. Pa. Mar.
21, 2013); Capriotti, 2020 WL 12630541, at *9.
37 	Capriotti, 2020 WL 12630541, at *9.
38 	Doc. 1-1 ¶ 22.
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 7 of 11

8
cleaned wastewater into public waterways, 35 P.S. § 691.3.39 Plaintiffs claim that
Defendants Bacon and Millhollen ordered Mr. Koester to discharge the pollutants
into the water way in disregard of the applicable regulations.40 When Mr. Koester
refused, 	Bacon 	himself 	“discharge[d] 	untreated 	pollutants 	and 	contaminates
produced by Dairy Farmers of America, Inc. (Middlebury Center) plant’s processing
of milk into public waterways and the banks of soil abutting the waterways.”41 Then,
Mr. Koester was fired, which Plaintiffs allege was due to his refusal to violate the
applicable regulations.42
These facts, pled by Plaintiffs, sufficiently raise a colorable claim against
Defendants Bacon and Millhollen.43 In this situation, Plaintiffs have pled that
Defendants Bacon and Millhollen had some “personal orchestration of the plaintiff's
termination” and that they “personally ask[ed] the plaintiff to partake in a crime and
then fire[d] the plaintiff upon refusal.” 44 A court could find that this is sufficient
39 	Doc. 11 (Br. in Opp. re: Mot. to Dismiss) at 13 n.14.
40 	Doc. 1-1 ¶¶ 35, 37, 38, 44, 45, 77, 78, 81.
41 	Id. at ¶ 84.
42 	Id. at ¶¶ 87, 89, 90.
43 	Defendant Holleran’s involvement in this process is less clear. However, as proper joinder of
any one of the three Pennsylvania individual Defendants would destroy complete diversity,
and as I find that joinder is proper against at least Defendants Bacon and Millhollen, Defendant
Holleran’s involvement need not be analyzed.
44 	Capriotti, 2020 WL 12630541, at *9; Doc. 1-1 ¶¶ 82-94, 89-90. While paragraphs 89 and 90
in Plaintiffs’ complaint could be read as too conclusory to make a claim cognizable, it is
possible a state court could find these sufficient to proceed. Accordingly, construing doubts in
favor of remand, the claims raised by Plaintiffs against the non-diverse defendants are
colorable.
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 8 of 11

9
evidence of Defendants Bacon and Millhollen acting in an individual capacity to
allow a wrongful termination claim against them to proceed.
Moreover, the pleadings as a whole indicate Plaintiffs’ subjective intent to
proceed against the individual Defendants. These claims are not afterthoughts, added
on without supportive pleadings; rather, the claims against the individual Defendants
make up four out of five of Mr. Koester’s claims, and a majority of the factual
pleadings relate to Defendants Bacon and Millhollen’s actions.45 At the very least,
these claims do not rise to the level of being “wholly insubstantial and frivolous.” 46
The Court does not “‘purport to express an opinion on the merits of [the]
claims asserted against [Defendants], nor do [I] even suggest that a [Pennsylvania]
court must find as a matter of law that valid claims have been stated.’”47 This holding
only extends to the jurisdictional inquiry; on those grounds, Defendants have not
met the high bar to show that Plaintiffs’ joinder of the individual Defendants was
fraudulent, and, therefore, remand is proper.
C. 	Plaintiffs’ Motion for Payment of Costs
Plaintiffs additionally request the Court to order Defendants pay Plaintiffs the
fees and costs associated with removal.48 Parties agree that “[a]bsent unusual
45 	Doc. 1-1.
46 	Batoff, 977 F.2d at 852.
47 	Id. at 854 (quoting B., Inc. v. Miller Brewing Co., 663 F.2d 545, 555 (5th Cir. 1981).
48 	Doc. 8 at 1.
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 9 of 11

10
circumstances, courts may award attorney's fees under § 1447(c) only where the
removing party lacked an objectively reasonable basis for seeking removal.” 49
Plaintiffs have not demonstrated that Defendants’ basis for removal was
lacking an objectively reasonable basis; the law is not so clear as to render removal
wholly out of the question.50 Indeed, the split nature of Pennsylvania courts on the
applicability 	of 	wrongful 	termination 	claims 	to 	individual 	defendants 	gives
justification for Defendants’ attempted removal. The Court, however, must construe
doubts in favor of remand, and remand is proper where there is “‘even a possibility
that a state court would find that the complaint states a cause of action against any
one of the resident defendants.’” 51 Accordingly, while Plaintiffs’ motion to remand
is granted, Plaintiffs’ motion to compel payment of costs is denied.
III. 	CONCLUSION
Defendants have not shown that Plaintiffs’ joinder of Defendants Bacon and
Millhollen was fraudulent and, therefore, there is not complete diversity of parties.
Accordingly, the Court lacks subject matter jurisdiction to hear this case, and
Plaintiffs’ motion to remand is granted. The Court remands this action to the Court
of Common Pleas of Philadelphia County.
49 	Martin v. Franklin Capital Corp., 546 U.S. 132, 141 (2005); Doc. 9 at 9. Doc. 12 at 16.
50 	See, e.g., Gleeson v. Dyller, 2:07-CV-0247, 2008 WL 11498150, at *3 (M.D. Pa. Mar. 25,
2008) (quoting McClelland v. Longhitano, 140 F. Supp. 2d 201, 203 (N.D. N.Y. 2001)).
51 	Batoff, 977 F.2d at 851 (quoting Boyer, 913 F.2d at 111).
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 10 of 11

11
An appropriate Order follows.
BY THE COURT:
s/ Matthew W. Brann
Matthew W. Brann
Chief United States District Judge
Case 4:25-cv-01642-MWB Document 14 Filed 01/30/26 Page 11 of 11