Hampton Pugh Company LLC v. Monsanto Company et al

Filing 24

ORDER: Monsanto's embedded request for a divisional office transfer is denied; and Hampton Pugh's 12 Motion is granted. The case is remanded to the Circuit Court of Desha County, Arkansas. Signed by Judge D. P. Marshall Jr. on 1/4/2018. (jak)

IN THE UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF ARKANSAS
JONESBORO DIVISION
HAMPTON PUGH
COMPANYLLC

v.

PLAINTIFF/
COUNTER-DEFENDANT
No. 3:17-cv-200-DPM

MONSANTO
COMPANY

DEFENDANT/
COUNTER-CLAIMANT

DIVINE AND SERVICE LTD,
doing business as D&S LTD

DEFENDANT

ORDER
For many years, Hampton Pugh has bought and re-sold seed,
fertilizer, and crop-related items from Monsanto. Hampton Pugh filed
this case in the Circuit Court of Desha County, alleging usury, fraud,
and deceptive trade practices in that relationship. That Circuit Court
sits in Hampton Pugh's south Arkansas hometown, McGehee. D&S
collects on accounts for Monsanto; Hampton Pugh sued that limited
partnership, too. Monsanto and D&S removed the case. Their timely
notice established diversity jurisdiction: the parties are completely
diverse;

and the amount in controversy exceeds $75,000.

They

answered. Monsanto also counterclaimed for breach of contract and
unjust enrichment, saying Hampton Pugh owes it several hundred
thousand dollars. Monsanto and D&S also moved to transfer to the

United States District Court for the Eastern District of Missouri. They
invoked a forum selection clause in an agreement between the parties.
Hampton Pugh responded with a motion to remand, as well as
arguments against transfer to the Eastern District of Missouri.
Monsanto and D&S then acknowledged that they had made a mistake
in removal procedure: they removed the case to the wrong divisionthe Jonesboro division, not the Pine Bluff division, which includes
Desha County. They've asked the Court to correct the divisional
mistake with a 28U.S.C. §1406(a) transfer, and then enforce the forum
selection clause with a 28 U.S.C. § 1404(a) transfer. Hampton Pugh
presses for a return to the state court it chose. If the case is removed to
the Pine Bluff division, Hampton Pugh argues, in a fall-back point, it
should stay there.
The general removal statute says certain cases "may be removed
by the defendant or the defendants[] to the district and division
embracing the place where such action is pending." 28U.S.C. §1441(a).
The statute specifying removal procedure echoes and emphasizes this
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point. The defendant shall file in the district court of the United States
for the district and division within which such action is pending a
notice of removal" covering specific ground. 28 U.S.C. § 1446(a). A
plaintiff such as Hampton Pugh, who does not want to waive a removal
defect that doesn't involve subject matter jurisdiction, has thirty days
after the notice to move for remand. 28 U.S.C. § 1447(c). Hampton
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Pugh's motion was timely. Out of respect for Arkansas and her courts,
which do most of the law work in this state pursuant to their general
jurisdiction, this court must construe all the removal statutes strictly.

Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108-09 (1941); Syngenta
Crop Protection, Inc. v. Henson, 537 U.S. 28, 32 (2002); Dahl v . R.J. Reynolds
Tobacco Co., 478 F.3d 965, 968 (8th Cir. 2007). No binding precedent
from the United States Court of Appeals for the Eighth Circuit exists in
these particular circumstances. The parties' citation of many cases from
across the country reflects this gap. The leading treatise says the
circuits are divided, and suggests that curing this kind of defect by
transfer, rather than remanding the case, is the more sensible outcome.
14C Charles Alan Wright & Arthur R. Miller, Federal Practice and

Procedure§ 3739 at 821-24 (4th ed.). Monsanto and D&S emphasize a
close decision from this Court that took this route. Scoular Company v.

DJCB Farm Partnership, 2009 WL 2241592 (E.D. Ark 24 July 2009).
Hampton Pugh emphasizes an older decision from the Western District
of Arkansas that ordered remand. Willingham v. Creswell-Keith, Inc., 160
F. Supp. 741, 743-44 (W.D. Ark 1958). Both precedents are entitled to
respect, but neither binds.
The Court agrees with the parties that their dispute is not about
subject matter jurisdiction. It exists. Otherwise, remand would be
mandated. "If at any time before final judgment it appears that the
district court lacks subject matter jurisdiction, the case shall be
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remanded."

28 U.S.C. § 1447(c). Instead, the dispute calls on the

Court's judgment in applying the removal statutes. For five reasons,
the Court concludes that this case should be remanded.
First, the statute's rule about where to remove is clear. The correct
district and division are required. This is not a situation in which the
law' s requirement is vague or opaque.
Second, the key verb in the statute prescribing the general
removal requirements is shall.

When Congress uses that word it

usually means must. Kingdomware Techs., Inc. v . United States, 136 S. Ct.
1969, 1977 (2016).
Third, 28 U.S.C. § 1447(c) authorizes timely motions to remand
based on non-jurisdictional defects. This provision's premise is that
defects of this kind can justify remand.
Fourth, this area of the law needs clear and certain criteria. Parties
and courts need to know-at the door-where cases will be handled.
The initial thirty-day deadlines help achieve this clarity. If removed
cases come with the likelihood of tangled motions asking what are
essentially substantial compliance questions, then certainty will be
compromised and cases will bog down, as this one has. The law about
removal should minimize that possibility.
All four of these reasons arise from a strict construction of the
removal statutes. Respecting the plenary jurisdiction of the state courts
and the limited jurisdiction of this Court drives that construction. The
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Scoular decision is reasonable, pragmatic, and commendably forgiving
of human error. But it does not wrestle with the principle that parties
must turn square corners when effecting or disputing removal. Where
the statute gives no particulars, there's some flexibility. How all the
defendants express their consent to removal is a good example.

Griffioen v. Cedar Rapids and Iowa City Railway Co., 785 F.3d 1182, 118788 (8th Cir. 2015). If procedural defects are cured (or at least ventilated)
within the thirty-day removal period, then no harm, no foul. Macri v.

M & M Contractors, Inc., 897 F. Supp. 381, 383-84 (N.D. Ind. 1995). As
Hampton Pugh argues from the record in Scoular, something similar
happened there:

the defendant recognized its venue mistake, and

moved for transfer during its removal period. Supplying an omitted
paper would probably fall in the same category. But see Kisor v. Collins,
338 F. Supp. 2d 1279 (N.D. Ala. 2004) (omitted state court summons led
to remand). Highlighting cases that would come out differently leads
to a fifth and final reason for remand.
The Court must consider all the circumstances here and weigh
this procedural defect. There was no complicated legal question about
which court to remove to.

Compare Scoular, 2009 WL 2241592

(defendant followed the wrong venue provision). The statute creating
the divisions in the Eastern District of Arkansas is clear about which
counties are in which divisions.

28 U.S.C. § 83(a). There was no

confusion created by the names of various courts and divisions.
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Compare Shamrock Manufacturing Co. v. Ammex Corp., 2010 WL 3153976,

at *1 (E.D. Cal. 9 Aug. 2010)(eastern district versus eastern division of
central district). No elusive pro-se co-defendant was involved. Compare
Lewis

v.

West

Memphis

3:14-cv-92-DPM, NQ 14.

Meadows

1998

Apartments

LP,

No.

Each side is represented by able and

experienced counsel. Each side has a forum preference and is working
hard to secure its choice.

Monsanto and D&S have provided no

explanation for the mistake, and the Court concludes it was simply the
kind of fumble that human beings, including careful lawyers, make
every day. Monsanto and D&S did not seek to cure the mistake during
their removal period. If the removal had been a day late under the
statute because of a calendaring error, remand would almost certainly
result. Schild v. Tymco, Inc., 842 F. Supp. 225, 226 (M.D. La. 1994). If the
attached state court file had been incomplete, that hole probably could
be filled, especially if the omitted material wasn't a critical document.
Usatorres v. Marina Mercante Nicaraguenses, 768 F.2d 1285, 1286-87 (11th

Cir. 1985) (per curiam). Removing a case to the wrong division of the
right court is more akin to missing the deadline than to omitting a state
court paper.

Monsanto and D&S have offered no case-specific

circumstances that would justify the Court in holding that this removal
defect should be cured by transfer.
For all these reasons, Monsanto's embedded request for a
divisional transfer is denied; and Hampton Pugh's motion, NQ 12, is
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granted. The case is remanded to the Circuit Court of Desha County,
Arkansas. 28U.S.C.§1447(d).
So Ordered.

D.P. Marshall Jr.
United States District Judge

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