Opinion
Case No. 4:05 CV 1084.
July 18, 2005
MEMORANDUM OF OPINION AND ORDER
On 3 January 2005, plaintiff Integrated Disability Resources, Inc. ("IDR") filed a three-count complaint in the Eastern Division of the Municipal Court for Columbiana County, Ohio, seeking to recover $4,607.03 from defendant William Cicchillo. (Docket #1, Ex. 1). In state municipal court, Mr. Cicchillo answered the complaint and filed a counterclaim contending that he was wrongfully denied disability benefits under a group policy issued by IDR. (Docket #1, Ex. 3). On 29 April 2005, plaintiff IDR filed a notice of removal, pursuant to 28 U.S.C. § 1446. (Docket #1). In its notice of removal, plaintiff alleges that this Court has removal jurisdiction, pursuant to 28 U.S.C. § 1441(b), because this "is an action arising under the laws of the United States." (Docket #1, ¶ 4). Specifically, it asserts that Mr. Cicchillo's counterclaim is governed by the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001 et seq.
In every case filed in or removed to federal court, the "first and fundamental question" is whether the federal court has jurisdiction to hear it. Douglas v. E.G. Baldwin Assoc, Inc., 150 F.3d 604, 606-607 (6th Cir. 1998). Accordingly, even when the parties do not themselves raise any jurisdictional issues, "federal courts have an independent obligation to investigate and police the boundaries of their own jurisdiction." Id. at 607. Having carefully reviewed plaintiff's notice of removal, this Court finds it to be fundamentally flawed in two respects.
First, IDR improperly seeks to establish removal jurisdiction based on Mr. Cicchillo's counterclaim. Such a basis for jurisdiction has been soundly rejected by the United States Supreme Court. In Holmes Group, Inc. v. Vornado Air Circulation Sys., the Court explained that "a counterclaim — which appears as part of the defendant's answer — cannot serve as the basis for [a district court's] `arising under' jurisdiction." 535 U.S. 826, 831 (2002). In light of Holmes clear directive, it is evident that this Court may not exercise "arising under" jurisdiction on the basis of Cicchillo's counterclaim alone. See Cross Country Bank v. McGraw, 321 F.Supp.2d 816, 818-20 (S.D. W.Va. 2004).
Even if IDR could somehow overcome that jurisdictional hurdle, its removal notice would nonetheless be defective as it is well-established that "[p]laintiffs cannot remove, even when they are in the position of a defendant with regard to a counterclaim against them." Ballard's Service Center, Inc. v. Transue, 865 F.2d 447, 449 (1st Cir. 1989); Hamilton v. Aetna Life and Cas. Ins. Co., 5 F.3d 642, 643, (2nd Cir. 1993); Murray v. Hy Cite Corp./Royal Prestige, 150 F.Supp.2d 527, 529 (E.D.N.Y. 2001);Duckson, Carlson, Bassinger, LLC v. Lake Bank, N.A., 139 F.Supp.2d 1117, 1119 (D. Minn. 2001). Based on the plain language of 28 U.S.C. 1441 and 1446, "it is clear that the privilege of removal extends only to defendants, and not to plaintiffs." McCane v. McCane, 47 F.Supp.2d 848, 851 (E.D. Mich. 1999); see also Shamrock Oil Gas Corp. v. Sheets, 313 U.S. 100, 105-108 (1941) (interpreting an earlier version of the removal statute).
Because jurisdiction is lacking and because IDR, as a plaintiff, lacks the statutory right of removal, this case shall be remanded to the Columbiana County, Ohio Municipal Court, Eastern Division, the state court from which it was removed.
IT IS SO ORDERED.