Angus v. John Crane Inc.

Filing 21

ORDER GRANTING MOTION TO REMAND by Judge Jon S. Tigar; granting #15 Motion to Remand. (wsn, COURT STAFF) (Filed on 8/22/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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JAMES ANGUS, et al.,

Case No. 16-cv-03532-JST

Plaintiffs,
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v.

ORDER GRANTING MOTION TO
REMAND

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JOHN CRANE INC.,

Re: ECF No. 15

Defendant.

United States District Court
Northern District of California

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Before the Court is Plaintiffs’ Motion to Remand. ECF No. 15. The Court will grant the

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motion.

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I.

Plaintiffs are citizens of Virginia. ECF No. 1 ¶ 7. Defendant, a business organized under

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BACKGROUND

the laws of Delaware, has its principal place of business in Illinois. Id.

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On July 9, 2014, Plaintiffs filed this asbestos action in San Francisco Superior Court. ECF

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No. 1-1 at 4. Nearly two years later, on June 23, 2016, Defendant John Crane Inc. (“John Crane”)

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removed this case to federal court on the basis of diversity jurisdiction. ECF No. 1. Defendant’s

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Notice of Removal was filed four days before trial was set to begin on June 27, 2016. ECF No. 17

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at 2.
On June 30, 2016, Plaintiffs filed a motion to remand, ECF No. 15, which motion the

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Court now considers.

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II.

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LEGAL STANDARD
A defendant may remove a civil action filed in State court to federal district court so long

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as the district court could have exercised original jurisdiction over the matter. 28 U.S.C. §

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1441(a). “Federal jurisdiction must be rejected if there is any doubt as to the right of removal in

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the first instance.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). There is “a ‘strong

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presumption against removal jurisdiction [which] means that the defendant always has the burden

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of establishing that removal is proper.’” Geographic Expeditions, Inc. v. Estate of Lhotka ex rel.

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Lhotka, 599 F.3d 1102, 1107 (9th Cir. 2010) (quoting Gaus, 980 F.2d at 566).

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III.

ANALYSIS

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A.

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“[A]ny civil action brought in a State court of which the district courts of the United States

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have original jurisdiction, may be removed by the defendant or the defendants, to the district court

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of the United States for the district and division embracing the place where such action is

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pending.” 28 U.S.C. § 1441(a). However, “[a] civil action otherwise removable solely on the

Motion to Remand

basis of [diversity jurisdiction] may not be removed if any of the parties in interest properly joined

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United States District Court
Northern District of California

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and served as defendants is a citizen of the State in which such action is brought.” 28 U.S.C. §

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1441(b)(2). “[I]f the case stated by the initial pleading is not removable, a notice of removal may

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be filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of

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an amended pleading, motion, order or other paper from which it may first be ascertained that the

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case is one which is or has become removable.” 28 U.S.C. § 1446(b)(3). Nonetheless, “[a] case

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may not be removed under subsection (b)(3) on the basis of [diversity jurisdiction] more than 1

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year after commencement of the action, unless the district court finds that the plaintiff has acted in

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bad faith in order to prevent a defendant from removing the action.” 28 U.S.C. § 1446(c)(1).

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According to Defendant, this case was “not initially removable because Plaintiffs joined

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and served several defendants who were citizens of California.” ECF No. 1 ¶8; 28 U.S.C.

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§1441(b)(2). Defendant asserts that it first became aware that this case was properly removable

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under 28 U.S.C. § 1446(b)(3) on June 6, 2016 when “Plaintiffs served and filed their Trial Brief”

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listing only non-California Defendants. ECF No. 1 ¶8. Defendant asserts that removal was proper

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because it filed a Notice of Removal on June 23, 2016, within 30 days from the date on which

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Defendant first ascertained that the case had become removable, as required by 28 U.S.C. §

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1446(b)(3).

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Plaintiffs argue that removal is barred by 28 U.S.C. § 1446(c)(1), which forbids removal
on the basis of diversity jurisdiction “more than 1 year after commencement of [an] action, unless
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the district court finds that the plaintiff has acted in bad faith in order to prevent a defendant from

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removing the action.” Defendant does not contest that 28 U.S.C. § 1446(c)(1) would generally

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apply to the facts of this case. Rather, Defendant argues that the one year bar should not be

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applied here because Plaintiffs have acted in bad faith to prevent removal. ECF No. 16 at 7–9. In

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particular, Defendant asserts that “Plaintiffs acted in bad faith by joining California citizens as

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defendants to prevent removal when they knew they did not have facts to succeed on any of the

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claims against those California defendants.” Id. at 8. This is simply not true.
For instance, Defendant admits that Thomas Dee Engineering Company (“Dee”) was a

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properly-served California defendant which had not yet been dismissed from the case within a

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year of its commencement. Id. Defendant asserts that “at his deposition, [Mr. Angus] denied

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United States District Court
Northern District of California

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recognition of Thomas Dee . . . .” Id. Defendant argues that “[r]egardless of the above lack of

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requisite facts to succeed on claims against [this]California defendant[], Plaintiffs kept [Dee] in

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this case until after the one-year deadline to Remove.” Id. at 8–9. However, as Plaintiffs assert in

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their Reply brief, which Defendant has not contested, “the last remaining California defendant,

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[Dee,] was dismissed after settling with plaintiffs and paying the amount of $10,000.00. The basis

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for naming Dee as a defendant and the basis for its liability is that it was the boiler contractor on

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the USS BOYD in 1963 and Mr. Angus was a Boiler Tender on that ship from 1968-1969. He

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was exposed to asbestos materials that Dee previously installed.” ECF No. 17 at 3. Based on

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these allegations, the Court concludes that Plaintiffs did not act in bad faith in joining California-

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defendant Dee.

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As a result, the Court concludes that it lacks jurisdiction over this matter because

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Defendant removed this case “more than 1 year after commencement of the action.” 28 U.S.C. §

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1446(c)(1). Accordingly, the Court will grant Plaintiffs’ motion to remand.1
Attorneys’ Fees and Costs

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B.

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Plaintiffs have also moved for an award of attorneys’ fees and costs. ECF No. 15 at 5.

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The Court rejects Defendant’s estoppel argument because Defendant cites no authority estopping
a plaintiff from moving to remand a case to state court based on the plaintiff’s “filing of a parallel
case in Federal Court.” ECF No. 16 at 6.
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“[A]n order remanding [a] case may require payment of just costs and any actual expenses,

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including attorney’s fees, incurred as a result of removal.” 28 U.S.C. § 1447(c). “Absent unusual

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circumstances, courts may award attorney’s fees under § 1447(c) only where the removing party

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lacked an objectively reasonable basis for seeking removal. Conversely, when an objectively

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reasonable basis exists, fees should be denied.” Martin v. Franklin Capital Corp., 546 U.S. 132,

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141 (2005). A finding of bad faith on the part of the removing party is not required. Moore v.

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Permanente Med. Grp., Inc., 981 F.2d 443, 447 (9th Cir. 1992). “The appropriate test for

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awarding fees under § 1447(c) should recognize the desire to deter removals sought for the

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purpose of prolonging litigation and imposing costs on the opposing party, while not undermining
Congress’ basic decision to afford defendants a right to remove as a general matter, when the

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United States District Court
Northern District of California

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statutory criteria are satisfied.” Id.
In this case, Defendant’s theory of removal was so flawed as to be objectively

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unreasonable. Moreover, Defendant appears to have acted in bad faith, waiting until four days

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before trial was to commence before filing its Notice of Removal. Plaintiffs’ request for an award

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of attorneys’ fees and costs is therefore granted.

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Plaintiffs shall submit either a stipulated request for entry of an order for a specific amount

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of fees and costs, or an itemized application for fees and costs, by September 9, 2016. If Plaintiffs

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submit a contested application, Defendants may file written objections by September 23, 2016.

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Plaintiffs may reply by September 30, 2016. At that time, the Court will take the matter under

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submission. 2

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IT IS SO ORDERED.

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Dated: August 22, 2016
______________________________________
JON S. TIGAR
United States District Judge

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A district court retains jurisdiction to award costs and fees pursuant to section 1447(c) after
remand. Moore, 981 F.2d at 445.
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