Commercial Litigation and Arbitration

Removal: May a Non-Forum Defendant Remove before Service Is Effected on a Forum Defendant? — Circuit Split — Held, a Forum Defendant May Remove before It Has Been Served Even If There Are No Non-Forum Defendants

Hwang v. Gladden, 2016 U.S. Dist. LEXIS 177479 (M.D. Ala. Dec. 21, 2016):

This matter is before the court on plaintiffs' motion to remand (Doc. 9), which is opposed by defendants Brent Gladden and University Real Estate Group, LLC (collectively, "defendants"). This case was initially assigned to the undersigned as presiding judge, and the parties subsequently consented to the exercise of final dispositive jurisdiction by the Magistrate Judge pursuant to 28 U.S.C. 636(c) and Federal Rule of Civil Procedure 73(a). (Docs. 17, 18).


IV. Discussion

The governing removal statute states, inter alia, as follows:

   (b) Removal Based on Diversity of Citizenship . . .

(2) A civil action otherwise removable solely on the basis of the jurisdiction under section 1332(a) of this title may not be removed if any of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.

28 U.S.C. § 1441(b)(2) (emphasis added).


B. Does the forum defendant rule prohibit defendants from removing this case?

Given plaintiffs' failure to demonstrate that defendants were served properly, the court must now determine whether the forum defendant rule prohibits unserved defendants from removing cases to federal court. Defendants argue that the plain language of the forum defendant rule only precludes forum defendants who have been properly joined and served from removing cases to federal court, and thus allows unserved forum defendants to remove cases to federal court. (Doc. 16 at 10). Plaintiffs respond that the forum defendant rule necessarily contemplates the existence of at least one non-forum defendant and thus, has no application in cases [like this one] involving only forum defendants. (Doc. 10 at 9-11). Plaintiffs also contend that defendants' interpretation of the forum defendant rule produces an absurd result, encouraging gamesmanship [*15]  and contradicting the statute's purpose. (Doc. 10 at 11-14).

As set forth above, the forum defendant rule states that "[a] civil action otherwise removable solely on the basis of the jurisdiction under Section 1332(a) of this title may not be removed if any of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought." 28 U.S.C. § 1441(b)(2) (emphasis added). The most common fact situation that gives rise to a question about the applicability of the emphasized text is one in which there is both a non-forum and a forum defendant, and the non-forum defendant files a notice of removal prior to service on the forum defendant. Courts nationwide and within the Eleventh Circuit are split on whether, in such a situation, a non-forum defendant can remove the case. In a recent memorandum opinion, United States District Judge W. Harold Albritton held that the plain language of the statute allows a non-forum defendant to remove the case, despite the existence of a yet-unserved forum defendant. Judge Albritton based his decision on the plain language of the statute, as well as the weight of authority within the Eleventh Circuit, and explained:

   The Plaintiff argues that [*16]  Jackson National removed this case "for forum shopping purposes" and did so "before Plaintiff was even allowed a chance to serve the two named Alabama forum Defendants." (Doc. # 11 at 4-5.) The Plaintiff argues that despite the language of the statute, remand is proper under these facts. For support, the Plaintiff cites a decision by the District Court for the District of New Mexico that found remand to be the correct result under similar circumstances. See generally Lone Mountain Ranch, LLC v. Santa Fe Gold Corp., 988 F.Supp.2d 1263 (D.N.M.2013). In particular, the Plaintiff cites that court's decision in Lone Mountain Ranch for its discussion of the purposes of the forum defendant rule and why allowing removal in these circumstances contravenes those purposes. The court reasoned in relevant part as follows:

   "The purpose of diversity jurisdiction is to provide a separate forum for out-of-state citizens against the prejudices of local courts and local juries by making available to them the benefits and safeguards of the federal courts." S.Rep. No. 1830, 85th Cong., 2d Sess., reprinted in 1958 U.S. Code Cong. & Admin. News 3099, 3102. "The forum defendant rule, 28 U.S.C. § 1441(b)(2), recognizes that the rationale for diversity jurisdiction no longer exists when one of the defendants [*17]  is a citizen of the forum state since the likelihood of local bias is reduced, if not eliminated." Swindell-Filiaggi v. CSX Corp., 922 F.Supp.2d 514, 518 (E.D.Pa.2013) (citation omitted). The Court finds that the reduction of bias generated by a forum defendant's participation in a case is present whether the forum defendant is served before or shortly after the matter is removed. The Court also notes that the purpose of the "properly joined and served" language in the rule was to prevent plaintiffs from adding a forum defendant solely to prevent removal, i.e. fraudulent joinder. Therefore, it would make no sense for Congress to enact the "properly joined and served" language in order to prevent gamesmanship on the part of a plaintiff only to have that language allow for a different type of gamesmanship by a defendant.

Id. at 1266 (emphasis added). Lonnie Correll also cited this language in support of its own Motion to Remand.

While the court in Lone Mountain Ranch reached the result that the Plaintiff and Defendant Lonnie Correll seek here for the reasons it described, it also recognized that there is a split of authority on the proper role of the forum defendant rule in these types of cases. Id. ("The Court acknowledges that there is a split of authority on whether [*18]  the forum defendant rule prohibits a non-forum defendant from removing a case where there are unserved forum defendants."). Not surprisingly, Jackson National has cited to cases reaching the opposite conclusion from Lone Mountain Ranch in arguing that removal was proper in this case. In one such decision, the District Court for the Middle District of Florida surveyed case law on the issue and concluded that the "unambiguous text" of the statute gives non-forum defendants the ability to remove a case when a plaintiff has "joined, but not yet served, a forum defendant." North v. Precision Airmotive Corp., 600 F.Supp.2d 1263, 1268 (M.D.Fla.2009). The court also found that "the majority of courts" had concluded likewise as of 2009. See id. (collecting cases). The North decision also acknowledged the courts on the other side of the debate, stating that they had relied "putatively on legislative intent." Id. It further highlighted the fact that many of those decisions "involved unserved forum defendants that had effected removal-not non-forum defendants," and that some of them distinguished between the two different scenarios and concluded that removal was appropriate in situations where a non-forum defendant removed a case involving multiple defendants. Id. at 1268-69.

At the [*19]  core of the North decision's holding was its reliance on clear statutory text rather than on inferred legislative intent:

   Although Congress may not have anticipated the possibility that defendants could actively monitor state court dockets to quickly remove a case prior to being served, on the facts of this case, such a result is not so absurd as to warrant reliance on "murky" or non-existent legislative history in the face of an otherwise perfectly clear and unambiguous statute. Nonetheless, if Congress intends a different result, "it is up to Congress rather than the courts to fix it." [Exxon Mobil Corp. v.] Allapattah Servs., Inc ., 545 U.S. [546, 565 (2005) ].

Id. at 1269-70 (footnote omitted). In 2012, the District Court for the Northern District of Alabama reached the same result on similar reasoning, and noted that interpreting the statute to permit removal in this scenario was the consensus result among district courts within the Eleventh Circuit. See Goodwin v. Reynolds, No. 2:12-cv-0033-SLB, 2012 WL 4732215, at *4 (N.D.Ala. Sept. 28, 2012) ("Turning to the statute itself, the court finds its language clear, and thus, like other district courts within the Eleventh Circuit, will not stray from its plain and unambiguous words."). The Goodwin decision also emphasized that the Eleventh Circuit's [*20]  precedent requires courts to interpret statutes based on their language alone, when it is unambiguous, and to turn to legislative history only to avoid an "unjust or absurd conclusion." Id. (internal quotations and citations omitted).

The court is persuaded by the reasoning in North and Goodwin, and does not see a reason to deviate from the consensus of district courts in the Eleventh Circuit.


The court is further persuaded by the fact that in one of the only decisions by any of the circuits addressing this issue, the Sixth Circuit held, albeit with limited analysis, that removal is permissible on these facts. See McCall v. Scott, 239 F.3d 808, 813 n. 2 (6th Cir.2001) ("Where there is complete diversity of citizenship ... the inclusion of an unserved resident defendant in the action does not defeat removal under 28 U.S.C. § 1441(b)." (emphasis in original)).

The Plaintiff does not dispute that neither of the forum defendants in this case had been served at the time of removal. Because the text of the statute is clear, and the court must give effect to that text, the court has diversity jurisdiction over this case. The Motions to Remand will be denied.

Pathmanathan v. Jackson Nat. Life Ins. Co., 2015 WL 4605757, *2-5 (M.D. Ala. 2015). The undersigned agrees with the Pathmanathan court, and the majority of the courts within the Eleventh [*21]  Circuit, and concludes that the plain language of the forum defendant rule does not prohibit a non-forum defendant from removing a case to federal court, even when there is an unserved forum defendant.

For the same reasons discussed above, the undersigned agrees with defendants that a forum defendant can likewise remove a case to federal court, so long as that forum defendant has not yet been served. The language of the statute is clear, and this court must apply it as written - not as plaintiffs argue it is intended. First, the statute states that "a defendant or defendants" may remove a case - not "a non-forum defendant or defendants." 28 U.S.C. § 1441(b). Second, the statute is clear that a case is removable by said defendant or defendants if none of the parties "properly joined and served as defendants is a citizen of the State in which such action is brought." 28 U.S.C. § 1441(b). In the instant case, the forum defendants had not been served when they removed the case to this court. Because they had not been "properly joined and served" at the time of removal, the forum defendant rule fails to aid the plaintiffs in this case.

While the question of whether an unserved forum defendant can remove a case - especially when [*22]  there are no non-forum defendants - has not been litigated as extensively as the former question, courts that have applied the plain language of the statute have reached this same conclusion. See e.g. Munchel v. Wyeth LLC, 2012 WL 4050072, *3-4 (D. Del. 2012)(holding that the plain language of 28 U.S.C. § 1441(b) does not prohibit removal by unserved forum defendants and that "nothing in the statute limits the opportunity to remove only to non-forum defendants."); Terry v. J.D. Streett & Co., Inc., 2010 WL 3829201 (E.D. Mo. 2010)(while recognizing strong arguments in opposition to its conclusion, holding that "nothing in in § 1441(b) prohibits removal [by the forum defendant] in a case where a forum defendant has not been served."). See also Robertson v. Iuliano, 2011 WL 453618, at *3 (D. Md. 2011) ("[S]ection 1441(b) does not bar removal because the Maryland defendants ... were not properly joined and served at the time of removal."); Chace v. Bryant, 2010 WL 4496800, at *2 (E.D.N.C. 2010)("The plain language of Section 1441(b) implies that a diverse but resident defendant who has not been served may be ignored in determining removability. Therefore, 28 U.S.C. § 1441(b) does not apply to bar removal of this action.")(internal quotation marks and citations omitted); Harvey v. Shelter Ins. Co., 2013 WL 1768658, at *2 (E.D. La. 2013)("[T]he plain language of the statute must prevail over the plaintiff's arguments to the contrary."); Regal Stone Ltd. v. Longs Drug Stores Cal., L.L.C., 881 F. Supp.2d 1123, 1128-29 (N.D. Cal. 2012)(applying a plain meaning of the statue that permits pre-service removal by a forum defendant).6

6   Plaintiffs urge the court to follow the lead of the court in Hawkins v. Cottrell, Inc., 785 F.Supp.2d 1361 (N.D. Ga. 2011) and hold that a forum defendant may not remove an action prior to being served. While the Hawkins opinion is a thoughtful one, it is neither binding on this court nor persuasive here. This court is bound by the plain meaning of the statute. Moreover, as the Hawkins court itself notes, the approach that that the plain meaning of the forum defendant rule is controlling appears to be the majority view. Id. at 1368.

In conclusion, [*23]  the text of 28 U.S.C. § 1441(b) is clear and unambiguous. This court joins other courts who have applied the plain language of the statute in holding that forum defendants may remove cases to federal court, so long as they have not yet been served. While this result may be peculiar, the court is bound to follow the statute as written. "It is the prerogative of Congress, if it should so choose, to delete this requirement of service, not the courts. To hold otherwise would presume either than Congress included the words 'and served' for no reason whatsoever or that it did not know what it was doing." Pathmanathan at *5.

V. Conclusion

Accordingly, for the reasons set forth above, it is

ORDERED that plaintiffs' motion to remand is DENIED.

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