The underlying dispute involves Genaro Serrato, who alleges he worked for WestRock Services, LLC at its container plant for eighteen years while managing bipolar disorder, type 1 diabetes, and a hand injury. After returning from a medical leave of absence that ran from February 14, 2023 to June 30, 2025, Serrato alleges WestRock scheduled him for twelve-hour shifts he could not work and assessed attendance points against him despite receiving medical documentation excusing his absences. The complaint further alleges that on the same day Serrato filed an EEOC charge — July 10, 2025 — WestRock HR representative Karen Azzara called his physician's office and falsely accused Serrato of manipulating and coercing his medical providers into issuing accommodation notes, alleged that the medical notes were fraudulent, and threatened the medical practice with legal action and licensure investigations. According to the complaint, one of Serrato's treating physicians, Dr. Haroop Sihota, later wrote to Azzara affirming that Azzara had engaged in the exact conduct she denied, noting that Azzara made statements suggesting that the patient was manipulating his provider or that the provider was being misled or coerced, accused Dr. Sihota of being very unprofessional, and stated that Dr. Sihota's accommodation letter was not necessary for the patient. Serrato alleges he was terminated in or around November 2025. He filed suit in Fresno County Superior Court asserting eight California-law claims, including harassment based on disability, defamation, and invasion of privacy against both WestRock and Azzara.
WestRock removed the case to the Eastern District of California on February 13, 2026, invoking diversity jurisdiction under 28 U.S.C. § 1332. The problem: both Serrato and Azzara are California citizens. WestRock argued that Azzara's California citizenship was irrelevant because she had not yet been served at the time of removal — a snap-removal theory — and alternatively that Azzara was a fraudulently joined sham defendant whose citizenship should be disregarded entirely.
The magistrate judge's findings and recommendations rejected both arguments. On snap-removal, the R&R reasons that snap-removal is an exception to the forum-defendant rule under 28 U.S.C. § 1441(b)(2), which itself only applies to cases subject to diversity jurisdiction — cases where the parties are already completely diverse. Snap-removal does not confer jurisdiction where there is not otherwise diversity jurisdiction. The R&R cites Wagner v. SpaceX, Colbert v. Tesla, and Carrick v. Peloton Interactive for the proposition that the service status of a nondiverse defendant is irrelevant to the section 1332(a) analysis. Every case WestRock cited in support of snap-removal, the R&R notes, involved parties who were already completely diverse.
On fraudulent joinder, the R&R concludes that WestRock's arguments — that Azzara's call to the doctor constituted routine personnel management, that the incidents were isolated, that the statements were opinion rather than fact, and that a common-interest privilege applied — amounted to colorable defenses requiring a searching merits inquiry, not the kind of showing needed to demonstrate that a defendant cannot be liable on any theory under Grancare, LLC v. Thrower.
On fees, the R&R recommends awarding $4,855 under 28 U.S.C. § 1447(c), less than half of the $10,147.50 Serrato sought. Applying Eastern District of California market rates from Beard v. County of Stanislaus, the magistrate reduced the hourly rates for attorneys Jacob Sarabian and Nathan J. Martin to $250 each and for Warren R. Paboojian to $400, and reduced the hours claimed for the reply brief from eight to four. The R&R also recommends denying WestRock's pending Rule 12(b)(6) motion to dismiss as moot. The parties have fourteen days to file objections.