Summary
finding amount-in-controversy requirement to be met where the complaint was silent on damages, but alleged that the plaintiff suffered "severe and permanent personal injuries"
Summary of this case from Gen. Motors LLC v. Gen. Motors LLCOpinion
Civil Action No. 04 Civ. 1380 (DGT)(KAM).
November 10, 2004
MEMORANDUM AND ORDER
Plaintiff Dexter James ("plaintiff") commenced a personal injury action in New York State court against Team Fleet Financing Corporation ("defendant Team Fleet") and Charlene Gardner ("defendant Gardner"). Defendant Team Fleet removed the case to federal court pursuant to 28 U.S.C. §§ 1332, 1441(a), and 1441(b). Plaintiff moves pursuant to 28 U.S.C. §§ 1446 and 1447 to remand this case to state court, where it was originally filed. For the following reasons, plaintiff's motion to remand is denied.
An additional lawsuit brought by the passenger of plaintiff's vehicle against Team Fleet Financing Corporation and Charlene Gardner is pending in federal court. Since the dispute before this court concerned whether plaintiff's motion to remand should be granted, this court will not address the issue of consolidation at this time.
Background
On or about February 13, 2004, plaintiff commenced an action in New York Supreme Court, Kings County, seeking money damages for injuries suffered from a car accident that took place in Kings County on March 25, 2001. Verified Complaint ("Verif. Compl.") ¶¶ 10, 13, 17. Plaintiff alleges severe and permanent personal injuries as a result of defendant Gardner's negligent driving. Verif. Compl. ¶¶ 16, 17.On or about April 1, 2004, defendant Team Fleet removed the action to federal court. Plaintiff moved for remand claiming that (i) Team Fleet's motion lacks the required unanimity of consent for removal and (ii) Team Fleet cannot demonstrate that the amount in controversy exceeds $75,000. Plaintiff's Affirmation ("Pl. Aff.") at 4, 5.
Because removal is appropriate, the court will not address Team Fleet's argument that plaintiff's motion is untimely.
Discussion
"Removal jurisdiction must be strictly construed, both because the federal courts are courts of limited jurisdiction and because removal of a case implicates significant federalism concerns." In re NASDAQ Market Makers Antitrust Litigation, 929 F.Supp. 174, 178 (S.D.N.Y. 1996), citing Shamrock Oil Gas Corp. v. Sheets, 313 U.S. 100, 109 (1941). "The burden is on the removing party to prove that it has met the requirements for removal." Codapro Corp. v. Wilson, 997 F.Supp. 322, 325 (E.D.N.Y. 1998), quoting Avon Products, Inc. v. The A/J Partnership, 89 Civ. 3743/8032, 1990 WL 422416, at *1 (S.D.N.Y. March 1, 1990). When a plaintiff challenges removal through a motion to remand, "the defendant bears the burden of demonstrating the propriety of removal." California Pub. Employees' Retirement System v. Worldcom, Inc., 368 F.3d 86, 100 (2d Cir. 2004), citing Grimo v. Blue Cross/Blue Shield of Vermont, 34 F.3d 148, 151 (2d Cir. 1994) (internal quotation marks omitted). Defendant must "establish its right to federal forum by `competent proof.'" United Food Commercial Workers' Union v. CenterMark Properties Meridian Square, Inc., 30 F.3d 298, 305 (2d Cir. 1994), citing McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 189 (1936).(1) The Rule of Unanimity
Plaintiff alleges, first, an absence of unanimous consent, a necessary condition for any removal action within the Second Circuit. Pl. Aff. at 4. This requirement, known as the "rule of unanimity," mandates that all defendants in a given action consent to removal within 30 days of the service of the plaintiff's summons or complaint. See Smith v. Kinkead, 2004 WL 728542 at *2 (S.D.N.Y. Apr. 5, 2004); see also Ell v. S.E.T. Landscape Design, Inc., 34 F.Supp.2d 188, 193 (S.D.N.Y. 1999) (noting "widespread agreement" to the rule of unanimity "among the district courts, including those in the Second Circuit") (citing cases). "Consent has been interpreted by a `majority of courts . . . to mean that each defendant must submit written consent unambiguously agreeing to removal.'" Smith, 2004 WL 728542 at *2, citing Payne v. Overhead Door Corp., 172 F. Supp. 2d 475, 477 (S.D.N.Y. 2001) (emphasis added) (internal citation omitted). The Notice of Removal, filed by Team Fleet's attorneys, asserts that "[a]ll defendants join in this notice." But that hardly constitutes unambiguous evidence, much less written consent, of Gardner's consent to the removal. See Codapro Corp. v. Wilson, 997 F.Supp. 322, 325 (E.D.N.Y. 1998) ("Specifically, [e]ach [defendant] must independently and unambiguously file notice of consent and intent to join in the removal.") (internal citation omitted). Consequently, defendant Team Fleet's removal action would appear to lack the required unanimity of consent by all defendants necessary to bring this action in federal court.
However, courts within the Second Circuit recognize three exceptions to the rule of unanimity, one of which applies in the case at bar. Exceptions have been recognized where: "(1) the non-joining defendants have not been served with service of process at the time the removal petition is filed; (2) the non-joining defendants are merely nominal or formal parties; and (3) the removed claim is a separate and independent claim as defined by 28 U.S.C. § 1441(c)." Ell, 34 F. Supp. 2d at 194. Any of the above-mentioned defects will defeat a removal action to state court. Because defendant Gardner has not been properly served with notice of the underlying state-court action, the unanimous consent requirement does not apply in the first place.
Plaintiff attempted to effect service on defendant Gardner under § 253 of New York's Vehicle and Traffic Law. Pl. Aff. at 3, 4. Under the statute, plaintiff must meet two requirements: "one, that the summons shall be mailed to the secretary of state, and two, that notice of such service upon the secretary shall be mailed to the nonresident defendant."Kohler v. Derderian, 187 F. Supp. 173, 175 (S.D.N.Y. 1960). Service shall be completed once plaintiff files with the clerk of court "either a return receipt purporting to be signed by the defendant . . . or, if acceptance was refused by the defendant or his agent, the original envelope bearing a notation by the postal authorities that receipt was refused." N.Y. Vehicle and Traffic Law § 253 (McKinney 2004). Jurisdiction is not obtained through attempted service of a summons on the defendant in a case involving a vehicle if the plaintiff does not present return receipts to establish that certified mail was received, refused, or unclaimed by the defendant. Elliot v. James, 97 A.D.2d 428, 467 N.Y.S.2d 393 (2d Dep't 1983). Vehicle and Traffic Law § 253 (2) specifically contemplates only three circumstances after service on the Secretary of State where mailing will complete service and confer jurisdiction: (1) where the defendant or his agent actually signs the return receipt; where the postal authorities return the original envelope marked "refused"; or where the original envelope is returned by the postal authorities marked "unclaimed." Executive Ins. Co. v. Yeshiva Mikdash Melech, Inc., 164 Misc. 2d 764, 626 N.Y.S.2d 420 (City Civ. Ct. 1995); see also Kohler, 187 F. Supp at 175-76 ("It is firmly established that where the return receipt is not signed and therefore not returned, this failure to conform with the provisions of [§ 253, formerly § 52] is fatal to the action."). The statute must be strictly construed and only strict compliance with the service requirements will confer jurisdiction upon the court. See Yeshiva, 164 Misc. 2d 764 at 767; Bingham v. Ryder Truck Rental, Inc., 110 A.D. 2d 867, 869 (1985). The statute was enacted to make sure that a nonresident defendant motorist receives actual notice of an action commenced against him. See Yeshiva, 164 Misc.2d at 767.
Although a defendant who has received practically effective, though technically defective, service, might in some circumstances be required to join in a removal action, it is well-settled that "a defendant who has not yet been served is not required to join in the notice of removal."Barnes v. Cathers and Dembrosky, 2003 WL 22928640 (S.D.N.Y. Dec. 10, 2003) at *2 (citing Ell, 34 F.Supp.2d at 184). Plaintiff claims that he "attempted to complete service" but provides no return receipt signed by Charlene Gardner or a person qualified to accept service on her behalf. Moreover, plaintiff does not provide an affidavit of compliance and signed return receipt with either the clerk of this court or the clerk of the state court. Plaintiff notes that Team Fleet's representation of Gardner's address matches the one used by plaintiff in attempting to effect service and that, therefore, "service should be deemed complete." Pl. Aff. at 4. But merely attempting service on defendant Gardner is not sufficient. Under the circumstances, service is defective, and neither this court nor the state court has acquired jurisdiction over defendant Gardner. Consequently, the rule of unanimity requirement will not block defendant Team Fleet's removal action to federal court.
Any attempt by plaintiff to serve defendant Gardner going forward must take place "in the same manner as in cases originally filed in such district court." 28 U.S.C. § 1448. Gardner, upon being served, may consent to removal by submitting written consent, see supra, or, alternatively, move to remand the case. See id. ("This section shall not deprive any defendant upon whom process is served after removal of his right to move to remand the case."); Murphy Brothers v. Michetti Pipe Stringing, Inc., 526 U.S. 344, 355 n. 6 (1999) (noting that § 1448 "explicitly reserves the unserved defendant's right to take action (move to remand) after service is perfected") (emphasis in original).
(2) Amount in Controversy
Plaintiff also claims Team Fleet has not established the $75,000 amount in controversy requirement for federal jurisdiction and that this threshold amount is not evident from the complaint. Pl. Aff. at 5.
The parties do not dispute diversity of citizenship.
Where the pleadings do not establish the amount in controversy and "where . . . jurisdictional facts are challenged, the party asserting jurisdiction must support those facts with `competent proof' and justify its allegations by a preponderance of the evidence." United Food Commercial Workers' Union v. CenterMark Properties Meridian Square, Inc., 30 F.3d 298, 305 (2d Cir. 1994), citing McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 189 (1936). Contrary to plaintiff's argument, Team Fleet need not prove the amount in controversy to an absolute certainty. Instead, defendant "has the burden of proving that it appears to a reasonable probability that the claim is in excess of the statutory jurisdictional amount." Mehlenbacher v. Akzo Nobel Salt, Inc., 216 F.3d 291, 296 (2d Cir. 2000), citing United Food, 30 F.3d at 305 (additional citations omitted). "To determine whether that burden has been met, [courts] look first to the [plaintiff's] complaint and then to [defendants'] petition for removal." Mehlenbacher, 216 F.3d at 296.
Plaintiff, for his part, made no representation as to the amount in controversy other than the $25,000 jurisdictional amount required in New York State court. Pl. Aff. at 3, 5. But plaintiff's complaint alleges "severe and permanent personal injuries," "serious injuries as defined by § 5102 of the Insurance Law of the State of New York," and "economic loss greater than basic economic loss as defined by § 5104 of the Insurance Law of the State of New York." Verif. Compl. ¶¶ 17, 18, 19. Plaintiff has never averred that the sum of these claims does not exceed $75,000, and Team Fleet has offered to stipulate to a remand if plaintiff will limit its attempted recovery to $75,000. Def. Aff. at 4.
New York Insurance Law § 5102 defines basic economic loss as up to $50,000 per person. N.Y. Insurance Law § 5102 (McKinney 2004).
Moreover, "[w]here the pleadings themselves are inconclusive as to the amount in controversy . . . federal courts may look outside those pleadings to other evidence in the record." United Food, 30 F.3d at 305. In that regard, Team Fleet refers to plaintiff's medical reports, which show that plaintiff sustained a disc herniation, bulging disc, central disc herniation, tear of the mid to distal Achilles tendon, partial tear anterior horn medial meniscus, partial tear posterior horn lateral meniscus, and synovitis of knee and condromalacia lateral tibial condyle. Defendant's Affirmation in Opposition at 5. These injuries indicate a likelihood that the $75,000 threshold will be met. See Walker v. Burnett, 2004 WL 725335 (D. Conn. Mar. 19, 2004) (denying motion to remand when plaintiff's damages included ongoing medical procedures and treatments, some degree of permanent impairment and permanent pain, as well as pain and suffering).
Based on plaintiff's alleged damages as stated in the complaint, as well as plaintiff's alleged injuries as set forth in the exchanged medical records, there is a reasonable probability that the amount in controversy exceeds $75,000. Therefore, it would be inappropriate to remand for lack of subject matter jurisdiction.
Conclusion
For the aforementioned reasons, plaintiff's motion to remand is denied.
SO ORDERED.