Opinion
MDL NO. 1407, No. C04-00013R
March 26, 2004
ORDER GRANTING PLAINTIFFS' MOTION TO REMAND
THIS MATTER comes before the Court on the motion of plaintiffs Royal and Sharlet Lewis ("plaintiffs") to remand the case to state court in Mississippi. Having reviewed the papers filed in support of and in opposition to this motion, the Court rules as follows:
I. BACKGROUND
Royal and Sharlet Lewis filed their complaint in Mississippi state court on November 1, 2001. Plaintiff Royal Lewis alleges that he suffered a stroke after consuming Alka-Seltzer Plus, an over-the-counter cold remedy containing the ingredient phenylpro-panolamine ("PPA"). Mr. Lewis contends that the medication was manufactured by defendant Bayer Corporation and sold to him by defendant Double Quick, Inc. ("Double Quick"), a Mississippi corporation.
Defendants filed their Notice of Removal on May 9, 2003, alleging that federal court jurisdiction existed based on diversity of the parties. Defendants claim that plaintiffs fraudulently joined Double Quick, the only in-state defendant, solely to defeat diversity jurisdiction. Plaintiffs moved to remand to state court. While plaintiffs' motion to remand was pending, the case was transferred to this Court as part of multi-district litigation ("MDL") No. 1407.
II. ANALYSIS
Plaintiffs contend that defendants improperly removed this case, and remand is appropriate, because the Notice of Removal was untimely and because the in-state defendant, Double Quick, was properly joined and defeats diversity. The removing parties have the burden of proving that removal was proper and that this Court has jurisdiction. See, e.g., Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). The Court finds that defendants' Notice of Removal was untimely, and therefore remand is appropriate.
A. Timeliness of Removal
Defendants filed their Notice of Removal approximately 18 months after this action was commenced in state court. Defendants contend that this case was not immediately removable and did not become removable until they learned through discovery facts that cast doubt on whether plaintiffs purchased the Alka-Seltzer product from defendant Double Quick.
The statutory time limits for removing an action which is not immediately removable are set forth in 28 U.S.C. § 1446 (b), which provides:
If the case stated by the initial pleading is not removable, a notice of removal may be filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of the amended pleading, motion, order or other paper from which it may be first ascertained that the case is one which is or has become removable, except that a. case may not be removed on the basis of [diversity jurisdiction] more than 1 year after commencement of the action.28 U.S.C. § 1446 (b) (emphasis added); see also Caterpillar, Inc. v. Lewis, 519 U.S. 61, 69 (1996) ("No case . . . may be removed from state to federal court based on diversity of citizenship more than 1 year after commencement of the action"). Removal statutes are strictly construed against removal. See, e.g., Gould v. Mutual Life Ins. Co. of New York, 790 F.2d 769, 773 (9th Cir. 1986).
It is undisputed that defendants did not file their Notice of Removal within the one-year time limit prescribed by 28 U.S.C. § 1446 (b). Defendants argue, however, that their Notice of Removal should be considered timely because there is an equitable exception to the one-year time limit, and that equitable exception applies here. The Court does not agree.
As an MDL court sitting in the Ninth Circuit, this court applies the Ninth Circuit's standards to the motion to remand. See, e.g., In re Diet Drugs Prods. Liab. Litig. , 220 F. Supp.2d 414, 423 (E.D. Pa. 2002); In re Tobacco/Gov'tal Health Care Costs Litig., 100 F. Supp.2d 31, 34 n. 1 (D. D.C. 2000). The Ninth Circuit has never held that there is an equitable exception to the one-year time limit. Other courts addressing the issue have concluded that the statutory language is clear and includes no exceptions. See, e.g. , Lovern v. GMC , 121 F.3d 160, 163 (4th Cir. 1997) (declining to find that equitable exception exists with respect to one-year time limit to remove diversity cases)
District courts in this Circuit have declined to apply an equitable exception because the statutory language imposing the one-year time limit is plain and includes no exceptions. See, e.g., O'Brien v. Powerforce, Inc., 939 F. Supp. 774, 780 (D. Haw. 1996) (holding that one-year time limit must be strictly construed despite any claim of fraudulent joinder); Horn v. Service Merchandise Co., Inc., 727 F. Supp. 1343, 1345 (N.D. Cal. 1990) (citing Rezendes v. Dow Corning Corp., 717 F. Supp. 1435, 1438 (E.D. Cal. 1989)).
Even if an equitable exception were available, defendants have not shown that the exception applies to the facts of this case. Courts have applied the exception in rare, limited cases in which there was evidence that plaintiffs had engaged in tactical behavior to prevent defendants from removing the case within the statutory time limit. For example, in the case relied on by defendants, Tedford v. Warner-Lambert Co. , 327 F.3d 423, 426 (5th Cir. 2003), plaintiff dismissed her claims against the only in-state defendant immediately after the one-year time limit for removal had expired. Because plaintiff had engaged in "consistent forum manipulation" to prevent a timely removal, the court allowed defendants to remove after one year. Tedford, 327 F.3d at 428. In this case, defendants have not shown that plaintiffs engaged in gamesmanship to preclude a timely removal. Plaintiffs did not amend their pleadings after the one-year removal period expired, rather, they have continuously asserted claims against Double Quick, and they have provided facts to support those claims. Instead of showing that plaintiffs have engaged in forum manipulation, defendants have shown nothing more than a disputed issue of fact regarding whether plaintiffs purchased the PPA-containing product from Double Quick. Even if this factual issue is ultimately resolved in their favor, defendants have not shown that they should be exempted from the statutory one-year time limit. Because the Court finds that defendants' Notice of Removal was untimely, the Court need not address plaintiffs' additional arguments in support of their motion to remand.
See also Morrison v. National Benefit Life Ins. Co., 889 F. Supp. 945, 949 (S.D. Miss. 1995) (applying equitable exception where plaintiff misrepresented amount of damages sought and increased amount to above the jurisdictional limit immediately after one-year period expired).
B. Plaintiffs' Request for Fees and Costs
Plaintiffs request that the Court order defendants to pay the costs and attorneys fees incurred by plaintiffs as a result of the improper removal. See 28 U.S.C. § 1447©). The Court finds that defendants had a colorable argument for removal, and therefore fees and costs are not warranted.
III. CONCLUSION
The Court concludes that defendants' Notice of Removal was not filed within the time limits prescribed by 28 U.S.C. § 1446 (b). Therefore, the Court GRANTS plaintiffs' motion and ORDERS that this case be remanded to the circuit court of Bolivar County, Mississippi, where it was previously assigned Civil Action No. 2:03CV172. Plaintiffs' request for recovery of fees and costs against defendants pursuant to 28 U.S.C. § 1447©) is DENIED.