From Bank of N.Y. v. Ukpe, 2009 U.S. Dist. LEXIS 115557 (D.N.J. Dec. 9, 2009):

[W]hether a third-party defendant may remove an action has not been addressed by the United States Supreme Court or by the United States Court of Appeals for the Third Circuit.

The majority of courts analyzing this issue have decided that a third-party defendant is not empowered to remove a case. See, e.g., Monmouth-Ocean Collection Serv., Inc. v. Klor, 46 F. Supp. 2d 385, 388-89 (D.N.J. 1999) (Judge Hayden adopting the report and recommendation of former Magistrate Judge Hedges who followed majority view that third party may not remove under § 1441); Kaye Associates v. Board of Chosen Freeholders of Gloucester, 757 F. Supp. 486, 487-89 (D.N.J. 1991) (in context of removal based on diversity jurisdiction, Chief Judge Gerry concluding that third-party defendants have no right to remove under section 1441).

These courts have found that "third-party defendants are not proper parties for removal because they are not 'defendants' under § 1441(a) and/or because § 1441(c) only applies to claims joined by plaintiffs." Kaye, 757 F. Supp. at 487. They also have noted that allowing removal by third-party defendants would conflict with other well-established rules regarding removal. Id. at 488 (cases cannot be removed solely on the basis of a defendant's counterclaim, removability is determined by the initial pleadings filed by the plaintiff, and a case nonremovable on the initial pleadings can become removable only pursuant to a voluntary act of the plaintiff). The majority of courts also have reasoned that the legislative history of the statute indicates that the section was not intended to extend the right of removal to third-party defendants. Id. at 489 ("Looking at that legislative history, it seems clear that the intent of § 1441(c) was to ensure that the plaintiff cannot preclude the right to remove a removable claim through the device of joining a wholly separate and independent nonremovable claim.") (internal quotations and citation omitted).

The minority rule is that third-party defendants may remove State claims to federal court where the third-party claims are "separate and independent" from the main cause of action. See, e.g., Hackensack Univ. Med. Ctr. v. Lagno, Civil Action No. 06-687, 2006 WL 3246582, at *4-5 (D.N.J. Nov. 3, 2006) (Judge Cavanaugh finding that third-party claim may serve as basis for removal under section 1441(c), but ultimately remanding because removal was impermissible absent "separate and independent" indemnification and violation of ERISA third party claims); Patient Care, Inc. v. Freeman, 755 F. Supp. 644, 649-50 (D.N.J. 1991) (Judge Debevoise concluding that third-party defendant may properly remove "separate and independent" claim asserted against it to federal court pursuant to section 1441(c), but ultimately remanding case because third-party claim for indemnification was not "separate and independent" claim).

These courts have noted that § 1441(c) does not provide that only claims joined by the plaintiff may be removed. Patient Care, 755 F. Supp. at 649 ("Construing § 1441(c) to include only claims joined by the plaintiff inserts qualifying language into the statute not placed there by Congress." (quoting Ford Motor Credit Co. v. Aaron-Lincoln Mercury, Inc., 563 F. Supp. 1108, 1112 (N.D.Ill. 1983))). The minority-view courts further recognize that a third-party defendant "never voluntarily submitted itself to the jurisdiction of the state court" but instead is "dragged into state court by service of process the same way that any other defendant is brought into court" and "is as much a defendant as if the case had been originally brought against it." Id. .... Finally, "removability under 28 U.S.C. § 1441(c) cannot rationally be made to depend on the accident of who sues first . . . ." Bond v. Doig, 433 F. Supp. 243, 247 (D.N.J. 1977).

"The common ground between these two views is that removal should only be allowed for claims that are, in the language of Section 1441(c), 'separate and independent' from the main cause of action." Lagno, 2006 WL 3246582, at *4.... The Supreme Court has held that claims are not separate and independent "where there is a single wrong to plaintiff, for which relief is sought, arising from an interlocked series of transactions." American Fire & Casualty Co. v. Finn, 341 U.S. 6, 14 (1951). If the third-party claim is "substantially derived from the same set of facts" as the non-removable main claim, it is not a "separate and independent" claim under Section 1441(c). New Venture Gear, Inc. v. Fonehouse, 982 F. Supp. 892, 893 (N.D.N.Y. 1997) (citing Mignogna v. Sair Aviation, Inc., 679 F. Supp. 184, 190 (N.D.N.Y. 1988); Lewis v. Louisville & Nashville R. Co., 758 F.2d 219, 221 (7th Cir. 1985)). Claims by third-party defendants, especially those for indemnity, are rarely separate and independent from the main cause of action in removal cases. See First Nat'l Bank v. Pulaski, 301 F.3d 456, 465 (6th Cir. 2002) ("[E]ven in the courts holding that § 1441(c) permits third-party defendants to remove to federal court, as a general proposition, those courts have often held that the third-party claims at issue did not satisfy the 'separate and independent' requirement of § 1441(c).").

In this case, the removal is defective because the Third-Party Defendants have failed to show how the allegations of the Ukpe Defendants regarding the fraudulent origination of the mortgage are separate and independent from the action to foreclose. The Ukpes' FHA and ECOA claims are among eight State consumer fraud and contractual issues that form the theory of the case regarding Plaintiff's right to foreclose as an assignee of the Third-Party Defendants.