OSHA Security, Inc. et al v. Koch Foods of Alabama LLC

Filing 17

MEMORANDUM OPINION AND ORDER denying 8 Motion to Remand for reasons set out in the opinion; denying as moot 16 Motion to file a further reply. Signed by Honorable William Keith Watkins on 11/18/09. (Attachments: # 1 Civil Appeals Checklist)(br, )

IN THE UNITED STATES DISTRICT COURT F O R THE MIDDLE DISTRICT OF ALABAMA N O R T H E R N DIVISION O S H A SECURITY, INC., a foreign corporation, et al., ) ) ) P la in tif f s , ) ) v. ) ) K O C H FOODS OF ALABAMA, LLC, ) e t al., ) ) D e f e n d a n ts. )

C A S E NO. 2:09-CV-889-WKW [WO]

MEMORANDUM OPINION AND ORDER B e f o re the court is Plaintiff OSHA Security, Inc.'s motion to remand (Doc. # 8) this c a s e to state court. The motion has been fully briefed. (Docs. # 12, 13, 15.) For the f o llo w in g reasons, the motion is due to be denied. I . BACKGROUND T h e dispute in this case turns on the timing of the removal; therefore, the relevant d a te s must be set forth in some detail. This case was originally filed in the Circuit Court of M o n tg o m e ry County, Alabama, on June 19, 2009, and Defendants were properly served on J u n e 25 and 26, 2009.1 (See Doc. # 1, Attach. 3 and 4; Doc. # 11 at 1-2.) Claim VII in P la in tif f s ' original complaint (Doc. # 1, Attach. 3 at 8) is entitled simply "Discrimination," a n d asserts, without citation to any statute or other particular source of law, that OSHA

In Plaintiffs' motion to remand, it is asserted that Defendants were served on July 1, 2009. (Doc. # 8.) The dates claimed by Defendants appear better supported by the state court record (Doc. # 1, Ex. A at 22), and, in any event, the outcome of the motion to remand does not depend on which of the two dates is correct.

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Security and its owner were discriminated against on the basis of race. On July 27, 2009, D e f e n d a n ts filed a motion to dismiss in state court, arguing in relevant part that the claim for " D is c rim in a tio n " did not state a claim under Alabama law. (Doc. # 1, Ex. A (Defs.' Mot. to D is m iss ).) On September 1, 2009, Plaintiffs responded to the motion to dismiss by arguing th a t the "Discrimination" claim was actually a federal-law claim premised on 42 U.S.C. § 1981, which forbids racial discrimination in contracting.2 (Doc. # 1, Ex. A (Pls.' Resp. to D e f s .' Mot. to Dismiss).) Then, on September 17, 2009, Defendants filed a notice of re m o v a l, bringing the case before this court. (Doc. # 1.) The ground for removal is that the " D is c rim in a tio n " count is one "arising under" federal law. See 28 U.S.C. § 1441(b). The o n ly issue for resolution is whether the removal was timely. II. ANALYSIS P la in tif f s argue that the notice of removal was untimely because it failed to comply w ith 28 U.S.C. § 1446(b)'s timing requirements. Section 1446(b) provides that a notice of re m o v a l "be filed within thirty days after the receipt by the defendant . . . of a copy of the in itia l pleading setting forth the claim for relief upon which such action or proceeding is b a s e d . . . ." It further provides, however, that "[i]f the case stated by the initial pleading is n o t removable, a notice of removal may be filed within thirty days after receipt by the d e f e n d a n t . . . of an amended pleading, motion, order or other paper from which it may first b e ascertained that the case is one which is or has become removable." § 1446(b).
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The state court appears to have granted the motion as to Count II, and denied it as to the remaining counts, on September 2, 2009. (See Doc. # 1, Ex. A, at 81 (handwritten note).)

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The issue between the parties is relatively simple to frame:3 Plaintiffs contend that D e f e n d a n ts were on notice as to the federal character of the "Discrimination" claim from the tim e they were served; if this is correct, the notice of removal was indisputably well over a m o n th late. Defendants, however, claim that they were not on notice of any federal claim u n til the September 1 response citing a federal statute and making clear the legal basis for th e "Discrimination" claim. T h e relevant legal standards are well established. The determination of whether a c la im "arises under" federal law for purposes of Section 1441(b), and hence of the removal tim e ta b le set by Section 1446(b), is whether the basis for removability is apparent from the f a c e of a plaintiff's well-pleaded complaint. "Under the longstanding well-pleaded

c o m p la in t rule . . . a suit `arises under' federal law `only when the plaintiff's statement of his o w n cause of action shows that it is based upon federal law.'"4 Vaden v. Discover Bank, 129

The court declines to consider the theory, asserted for the first time in Plaintiffs' reply brief (Doc. # 12) that Defendants waived their right to remove the case because they litigated the case on the merits in state court. See Belfast v. Upsilon Chapter of Pi Kappa Alpha Fraternity of Auburn Univ., 267 F. Supp. 2d 1139, 1147-48 (M.D. Ala. 2003) (noting that a court has the general discretion not to address arguments made for the first time in a reply brief). Moreover, for the reasons stated in the sur-reply (Doc. # 15), the argument would fail on the merits; Defendants did not litigate this case in state court after they had an awareness of the federal character of the "Discrimination" count, but entirely on state-law grounds before the September 1 filing clarified the nature of Plaintiffs' claims. The argument essentially rises or falls depending on the conclusion the court draws on the main issue; therefore, the court will focus its energies there. Nothing in the proposed reply to the sur-reply (Doc. # 16) would change this result. To call a complaint "well-pleaded" in this sense does not express a judgment as to whether it is ultimately meritorious, or whether it should survive a motion to dismiss. Rather, it reflects that whether a complaint contains a federal question must be determined by whether the complaint, as properly or completely pled (but no more), raises an issue of federal law. In the context of removal, for example, a plaintiff cannot avoid removal by so-called "artful pleading," in which a federal cause of action is
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S. Ct. 1262, 1272 (2009) (quoting Louisville & Nashville R. Co. v. Mottley, 211 U.S. 149, 1 5 2 (1908)) (internal punctuation omitted). The parties also spar over another theory, formulated as whether removability must h a v e been "intelligently ascertainable" from the face of the state-court complaint. Clingan v . Celtic Life Ins. Co., 244 F. Supp. 2d 1298, 1302 (M.D. Ala. 2003). The court is somewhat s k e p tic a l, however, of what independent work is done by the "intelligently ascertainable" s ta n d a rd in a straightforward federal-question removal case such as this. Clingan was a d iv e rsity case, and the principal other case from this district relying on that standard was an E R IS A preemption case. See Webster v. Dow United Tech. Composite Prods., Inc., 925 F. S u p p . 727 (M.D. Ala. 1996). In neither case, then, could the normal logic of the wellp le a d e d complaint rule be applied. Moreover, this formulation is absent from Eleventh Circuit and Supreme Court case la w . To the contrary, those courts have been clear that the well-pleaded complaint rule is the p ro p e r yardstick for measuring whether a case is removable on federal-question principles. See Vaden, 129 S. Ct. at 1272; Adventure Outdoors v. Bloomberg, 552 F.3d 1290, 1295 (11th C ir. 2008) ("In determining whether jurisdiction exists under 28 U.S.C. § 1331, a court must lo o k to the well-pleaded complaint alone.") (emphasis added). To the extent the

" in te llig e n tly ascertainable" language has any application to a case such as this, the court

concealed as containing only issues of state law. Ayres v. Gen. Motors Corp., 234 F.3d 514, 519 n.7 (11th Cir. 2000).

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concludes it is only as a means of further explaining the meaning of the well-pleaded c o m p la in t rule, not as a standard with any sort of independent meaning. Plaintiffs' argument that their original complaint was sufficient under the well-pleaded c o m p la in t rule runs as follows: Since Defendants recognized, in their motion to dismiss, that th e "Discrimination" count did not state a claim under Alabama law, it must have been o b v io u s that the "Discrimination" count was premised on federal law. (Doc. # 8.) Plaintiffs d o not cite any case with analogous facts decided in their favor, perhaps because their a rg u m e n t fails to consider the third possibility that a claim may state no cause of action under e ith e r federal or state law. A defendant who argued that any state-court complaint that failed to state a claim under state law was thereby necessarily removable to federal court would be m a k in g an argument that bordered on frivolous. If Defendants had attempted to remove the c o m p la in t as soon as it was filed in state court, the court suspects that Plaintiffs would be the f irs t to argue that the original complaint did not raise a federal question on its face, and was th u s not removable. Plaintiffs cannot play a game of "gotcha," first leaving out all reference to federal law in their complaint, then, once the removal clock has run, claiming that the f e d e ra l nature of the claim was obvious from the start.5

While the result here is that this case will remain on the federal docket, adopting Plaintiffs' rule would likely lead to an overall increase in erroneously removed cases, since future defendants would feel compelled to remove cases if there is even the possibility that a vague or poorly fleshed out claim might later be found to arise under federal law.

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III. CONCLUSION B e c a u s e the original complaint in this case would not have been sufficient to make th e case removable under the well-pleaded complaint rule, Section 1446(b) provided D e f e n d a n ts an additional thirty days from the time they could first ascertain that the case was re m o v a b le to properly effect removal. That date was September 1, 2009, when Plaintiffs re s p o n d e d to the state-court motion to dismiss. (See Doc. # 1, Ex. A (Pls.' Resp. to Defs.' M o t. to Dismiss).) Accordingly, the case was timely removed on September 17, 2009, and it is ORDERED that the motion to remand (Doc. # 8) is DENIED. Plaintiffs' motion to file a further reply (Doc. # 16) is DENIED as moot. D O N E this 18th day of November, 2009. /s/ W. Keith Watkins UNITED STATES DISTRICT JUDGE

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