Opinion
Civil Action No. 3:04-CV-0535-D.
June 8, 2004
MEMORANDUM OPINION AND ORDER
In this lawsuit that has been removed from state court a second time, the court must decide whether the case became removable anew on the ground that defendants were first able to ascertain from plaintiff's third amended petition that the case was or had become removable. Concluding that it is not removable on this basis, the court grants plaintiff's motion to remand this case to state court.
Defendants responded to plaintiff's motion on April 21, 2004. Plaintiff's reply brief, if any, was due May 6, 2004. No reply brief has been filed, and the motion is now ripe for decision.
I
Defendants Wheaton Interstate Moving and Wheaton World Wide Moving (collectively, "Wheaton") initially removed this case in 2001 under 28 U.S.C. § 1445(b) and 1441, contending that plaintiff Donna M. Ervin's ("Ervin's") claims — all of which were pleaded under state-law theories — were preempted by the Carmack Amendment, 49 U.S.C. § 11706, 14706, and 15906. The court remanded the case based on then-controlling Fifth Circuit precedent, which provided that the Carmack Amendment did not completely preempt state-law claims for the loss of or damage to goods arising from their transport by a common carrier in interstate commerce. See Ervin v. Stagecoach Moving Storage Inc., 2001 WL 1667820, at *1 (N.D. Tex. July 25, 2001) (Fitzwater, J.) (citing Beers v. N. Am. Van Lines, Inc., 836 F.2d 910 (5th Cir. 1988)). Thereafter, the Fifth Circuit held in a separate lawsuit that because the Supreme Court's decision in Beneficial National Bank v. Anderson, 539 U.S. 1 (2003), overruled the court's analysis, Beers was no longer binding circuit precedent. See Hoskins v. Bekins Van Lines, 343 F.3d 769, 775 (5th Cir. 2003). The panel then analyzed whether the Carmack Amendment completely preempted the state claim at issue, ultimately concluding that it provides "the exclusive cause of action for loss or damages to goods arising from the interstate transportation of those goods by a common carrier." Id. at 778 (emphasis omitted).Wheaton removed this case again on March 15, 2004, contending that it could first ascertain from Ervin's third amended petition that the case was one that was or had become removable under § 1446. It maintains that until Ervin served her third amended petition on February 17, 2004, it was unclear whether she was proceeding against Wheaton only upon agency principles and within the confines of the Carmack Amendment. Wheaton contends that when Ervin filed her third amended petition, she changed her theory of recovery to base it only on an agency agreement between defendant Stagecoach Moving and Storage, Inc. ("Stagecoach") and Wheaton. Wheaton posits that, until she filed this amended pleading, Ervin maintained that both Stagecoach and Wheaton were directly liable to her for acts and omissions that allegedly occurred during the transport of her goods. It reasons that, although Ervin vaguely alleged agency, she framed her allegations so generally against "Stagecoach/Wheaton" and asserted her causes of action against "Defendants," and until she served her third amended petition, it appeared that she was seeking recovery against Wheaton under direct liability theories. Wheaton asserts that the latest pleading unequivocally indicates that Ervin's only theory of recovery against it is as the principal of Stagecoach. It maintains that agency relationships relating to household goods motor carriers are governed by the Carmack Amendment and that Ervin's claims clearly arise out of the interstate carriage of her household goods, making removal proper based on this court's federal question jurisdiction.
II A
"Federal courts are courts of limited jurisdiction." Howery v. Allstate Ins. Co., 243 F.3d 912, 916 (5th Cir. 2001) (citing Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994)). A suit is presumed to lie outside this limited jurisdiction, and the party seeking removal bears the burden of establishing the propriety of jurisdiction in a federal court. Id. Ordinarily, the well-pleaded complaint rule governs federal question jurisdiction. Under the rule, "[r]emoval is not possible unless the plaintiff's `well pleaded complaint' raises issues of federal law sufficient to support federal question jurisdiction." Rodriguez v. Pacificare of Tex., Inc., 980 F.2d 1014, 1017 (5th Cir. 1993). Even if federal claims are available, the plaintiff may remain in state court by relying exclusively on state law. See Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987). There are, however, exceptions to the rule's application. One such exception — the complete preemption doctrine — applies to areas "in which Congress has `so completely pre-empt[ed] a particular area that any civil complaint raising this select group of claims is necessarily federal in character.'" Rodriguez, 980 F.2d at 1017 (quoting Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 63-64 (1987)). As indicated, under Hoskins it is now settled that the Carmack Amendment provides "the exclusive cause of action for loss or damages to goods arising from the interstate transportation of those goods by a common carrier." Hoskins, 343 F.3d at 778 (emphasis omitted).
"There is a difference in language in the two paragraphs of 28 U.S.C. § 1446(b) describing the documents which trigger the time limits for notices of removal." Boksy v. Kroger Texas, LP, 288 F.3d 208, 209 (5th Cir. 2002). The second paragraph, at issue in the instant case, governs removal based on "a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable." Id. (emphasis added) (quoting 28 U.S.C. § 1446(b)). Cases removed on this basis "seem to require a greater level of certainty or that the facts supporting removability be stated unequivocally," as opposed to cases removed under the first paragraph, which by using the language "setting forth the claim for relief" "encompasses a broader range of information that can trigger a time limit based on notice than would `ascertained[.]'" Id. at 211.
B
Although the Fifth Circuit's Hoskins decision certainly affects Wheaton's reasoning in support of removal, in that it makes removable under federal preemption a case that alleges only state-law claims, Wheaton does not argue that the issuance of Hoskins itself made the case removable a second time. Instead, Wheaton maintains that this suit did not become removable until Ervin served her third amended petition, alleging for the first time that there was an agency relationship between Stagecoach and Wheaton. It is this agency relationship that Wheaton argues is exclusively controlled by the Carmack Amendment and that makes the case removable now, when it was not before. The court's decision on Ervin's remand motion thus pivots on whether her third amended petition is the first paper from which Wheaton could ascertain that the case is one that was or had become removable. The court holds that it is not.
In fact, such an argument would be unwarranted in the context of this case. The Fifth Circuit has held that a decision in an unrelated case may only count as "an order" to make an action removable if it involves "a defendant in both cases, involving similar factual situations, and the order expressly authorized removal," which is not the case here. See Green v. R.J. Reynolds Tobacco Co., 274 F.3d 263, 267-68 (5th Cir. 2001) (citing Doe v. Am. Red Cross, 14 F.3d 196 (3d Cir. 1993)). The Fifth Circuit noted that a Third Circuit ruling on the same issue expressly avoided deciding whether the unrelated decision constituted an "other paper," and the Fifth Circuit did not rule on that issue as well. See id. The "other paper" provision of § 1446(b) has been applied by many courts only to papers "filed in the case," and not to papers filed apart from the case, including Supreme Court opinions. See, e.g., Phillips v. Allstate Ins. Co., 702 F. Supp. 1466, 1468 (C.D. Ca. 1989) ("It is apparent that this case was not subject to removal when it was originally filed. . . . [V]irtually every court which has considered the question of what suffices as a removal triggering `paper' has concluded that the term does not include intervening statutory or case law changes.").
First, whether Wheaton is directly responsible for Ervin's harm or can be held liable only through an agency relationship with Stagecoach is not dispositive in determining Carmack Amendment preemption. Principals are held liable for the tortious acts and omissions of their agents under the Carmack Amendment, see 49 U.S.C. § 13907(a), but motor carriers who act independently are also held liable for their own acts and omissions, see 49 U.S.C. § 14706(a)(1). It necessarily follows that, under Carmack Amendment preemption as now understood following Hoskins, at least some claims that Ervin asserted against Wheaton — whether directly or through an agent — were completely preempted before she filed her third amended petition.
The fact that Wheaton removed the case in 2001 based on Carmack Amendment preemption shows that — if the case had in fact been removable on that basis (which it was not at that time) — Wheaton knew then that it was.
Second, the agency issue that Wheaton contends initially appeared in the third amended petition had already been injected before that pleading. Ervin's original petition, like the third amended petition, asserted that Stagecoach was at all relevant times an agent of Wheaton and "was acting in the course and scope of that agency." P. Br. Ex. C and Ex. G. It has been ascertainable from the inception of this suit that Ervin seeks to hold Wheaton liable for damages arising from the interstate transport of her household goods — directly, under agency principles, or both — as evidenced by Wheaton's consistent denial of an agency relationship and independent liability. Thus nothing about the third amended petition first made Wheaton aware that the case was removable.
The court cites Ervin's exhibits rather than her appendix because she did not comply with N.D. Tex. Civ. R. 7.1(i)(1) and 7.2(e) in briefing this motion. Rule 7.1(i)(1) provides that "[a] party who relies on documentary (including an affidavit, declaration, deposition, answer to interrogatory, or admission) or non-documentary evidence to support or oppose a motion must include such evidence in an appendix." Rule 7.2(e) states that "[i]f a party's motion or response is accompanied by an appendix, the party's brief must include citations to each page of the appendix that supports each assertion that the party makes concerning any documentary or non-documentary evidence on which the party relies to support or oppose the motion." Because these deficiencies did not interfere with the decisional process of the court, the court has considered the documents and briefing.
Essentially, the change in the law that came about during the pendency of this case occurred too late to assist Wheaton. Wheaton knew from the beginning that this suit was removable if the Carmack Amendment preempted Ervin's state-law claims. But at the time it removed the case initially, Fifth Circuit precedent did not support complete preemption, resulting in a remand order. The change in the law that followed the remand did not make the case removable. See supra note 4. Accordingly, in a final attempt to remove the case, Wheaton was relegated to advancing a feckless position.
III
Ervin requests an award of attorney's fees under 28 U.S.C. § 1447(c), which provides that "[a]n order remanding the case may require payment of just costs and any actual expenses, including attorney fees, incurred as a result of the removal." The decision to award attorney's fees is a matter of discretion. Avitts v. Amoco Prod. Co., 111 F.3d 30, 32 (5th Cir. 1997); Miranti v. Lee, 3 F.3d 925, 928 (5th Cir. 1993). The ultimate question considered by the court when applying § 1447(c) is "whether the defendant had objectively reasonable grounds to believe the removal was legally proper" at the time of removal. Valdes v. Wal-Mart Stores, Inc., 199 F.3d 290, 292-93 (5th Cir. 2000). In this case, Wheaton did not. Accordingly, Ervin is entitled to recover her attorney's fees and expenses, limited to the "fees and costs incurred in federal court that would not have been incurred had the case remained in state court." Avitts, 111 F.3d at 32. Ervin may apply for an award no later than 30 days from the date this memorandum opinion and order is filed if the parties cannot agree on the amount.
* * *
The court grants Ervin's April 6, 2004 motion to remand and remands this case to the 382nd Judicial District Court of Rockwall County, Texas. The clerk of court shall effect the remand according to the usual procedure.