Branson et al v. Mestre et al

Filing 17

MEMORANDUM OPINION. Signed by Judge Sherry R. Fallon on 6/16/2017. (Polito, Rebecca)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
ALBERT E. BRANSON, DAVID J. BRANSON,
and ROBERT J. BRANSON,
Plaintiffs,

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)
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v.

Civil Action No. 17-207-VAC-SRF

LEE MESTRE, VINCENT BRANSON, and
10 NORTH FOURTH STREET TRUST, and
)
)
JOHN DOES 1-20, INCLUSIVE and ALL
UNKNOWN OWNERS OR CLAIMANTS OF
)
PROPERTY LOCATED AT SOUTH BETHANY/ )
)
OCEAN HIGHWAY, LOT 39, BLK 1 N. ADD,
INDIAN RIVER HUNDRED, SUSSEX COUNTY,)
DELAWARE TMPNo. 134-17.20-199.00,
)
)
Defendants.
)
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MEMORANDUM OPINION
I.

INTRODUCTION
Presently before the court in_ this civil action to quiet title to real property is a motion to

remand the case to the Court of Chancery, filed by plaintiffs Albert E. Branson, David J.
Branson, and Robert J. Branson (collectively, "plaintiffs"). (D.I. 10) Defendants Lee Mestre
and Vincent Branson (together, "defendants"), oppose the motion. (D.I. 12) For the following
reasons, the court will grant plaintiffs' motion to remand and award costs and attorney's fees
incurred as a result of the removal of the case.

II.

BACKGROUND
In September 2001, Dorothea Branson died, and her will was probated in the Register of

Wills of Sussex County, Delaware on November 9, 2001. (D.I. 1, Ex. 48 at ifif 23, 26) The will
left her entire estate, including an interest in real property located at 10 N. Fourth Street, South
Bethany Beach, Delaware (the "Cottage"), to her children, Albert, David, Theresa, Robert, and

Vincent. (Id at ifif 24, 27) On November 21, 2001, defendant Vincent Branson accepted a
distribution of cash from the estate in lieu of any interest in the Cottage. (Id at if 30)
As executor of the estate, plaintiff David Branson asked each sibling to convey his or her
interest in the Cottage to the estate in the summer of 2004 to perfect Dorothea's interest in the
Cottage. (Id at if 33) All siblings, except defendant Vincent Branson, deeded their interests to
the estate. The quitclaim deeds conveying 80% legal title in the Cottage to the estate were
recorded on October 27, 2005. (Id)
In September 2004, Vincent Branson initiated an action in the Court of Chancery against
plaintiffs for specific performance of an alleged oral agreement or, alternatively, for a partition
and sale of the Cottage. (Id at if 34) Vice Chancellor Noble rejected both claims on September
1, 2010, finding that Vincent Branson had no interest in the Cottage. (Id at if 35) Vice
Chancellor Noble's ruling was affirmed by the Supreme Court of Delaware on December 9,
2011. (Id at if 36); Branson v. Branson, 35 A.3d 418 (Del. 2011).
On June 7, 2012, plaintiffs filed an action to quiet title against Vincent Branson in the
Court of Chancery. (Id at if 37) On July 19, 2013, the Court of Chancery ruled against Vincent
Branson on summary judgment, dismissing Vincent Branson's counterclaims and granting
plaintiffs' request to clear title. (Id at if 42) The Court of Chancery shifted fees to Vincent
Branson, describing his litigation conduct as "purely vexatious legal maneuvers," and
characterizing his arguments as "obviously meritless." (Id at ifif 42-43); Branson v. Branson,
C.A. No. 7603-VCG, 2013 WL 3789755, at *5 (Del. Ch. July 19, 2013), ajf'd, 91A.3d561 (Del.
2014). The Supreme Court of Delaware affirmed the Court of Chancery's ruling on April 15,
2014. (Id at if 46)

2

On August 3, 2012, Vincent Branson filed an action against plaintiffs in Delaware
Superior Court for "abusive and coercive conduct" in the Court of Chancery litigation. (Id at if
48) The Superior Court dismissed his claims with prejudice on September 21, 2012, citing the
Court of Chancery's 2010 ruling and imposing sanctions against Vincent Branson for his
"frivolous attempt to relitigate" the 2010 ruling. (Id at if 49) On March 19, 2013, the Supreme
Court of Delaware affirmed the Superior Court's dismissal of the action and award of sanctions.
(Id. at~ 50)

On April 19, 2013, Vincent Branson filed Amended Exceptions to the Final Account in
the Court of Chancery Office of the Register of Wills for Sussex County, alleging the existence
of an oral agreement between Dorothea and Albert Branson requiring Albert to leave the Cottage
to the grandchildren in fee simple in exchange for a life estate. (Id.

at~

51) On April 30, 2013,

Vice Chancellor Glasscock ruled that Vincent Branson had no standing to bring the Exceptions
because he had already taken his full and final distribution of the estate in cash. (Id.
Vice Chancellor Glasscock issued sanctions and shifted fees in the case. (Id.

at~

at~

53)

55)

On February 12, 2014, defendant Lee Mestre brought an action in the Circuit Court for
Montgomery County, Maryland (the "First Maryland Action") against plaintiff David Branson
and defendant Vincent Branson based on the alleged oral contract between Dorothea and Albert
Branson. (Id.

at~~

56-58) Before David Branson was served, Mestre filed a proposed consent

order granting partial summary judgment on liability against Vincent Branson, which was
granted on April 9, 2014. (Id.

at~

60) On August 12, 2014, Vincent Branson and Mestre

formed "The 10 North Fourth Street Trust" (the "Trust") under Maryland law, naming Mestre as
the trustee and Albert Branson as the beneficiary of the Trust, which purportedly contained title
to 20% of the Cottage. (Id.

at~~

62, 65) Thereafter, Vincent Branson and Mestre allegedly

3

induced the court in the First Maryland Action to enter an August 26, 2014 order approving a
settlement agreement commanding Vincent Branson to execute a quitclaim deed to Mestre as
trustee of the Trust. (Id at,, 72, 76) David Branson was not served with the summons and
con;iplaint in the First Maryland Action until September 9, 2014. (Id at, 80) On October 8,
2014, Vincent Branson recorded a quitclaim deed with the Assessment Division of Sussex
County, Delaware that quit claimed the purported 20% title interest held by Vincent Branson in
the Cottage .. (Id at, 77)
Mestre voluntarily dismissed the First Maryland Action without prejudice on January 15,
2015. (Id at, 81) On January 20, 2015, Mestre filed a new action in the Circuit Court of
Montgomery County, Maryland (the "Second Maryland Action") which was identical to the
complaint that was voluntarily dismissed on January 15, except that David Branson was the sole
defendant. (Id at, 82) Mestre's attorney executed and published a notice of !is pendens on
January 22, 2015, which stated that the orders dismissing the First Maryland Action had been
recorded, and Mestre was the trustee of the Trust in accordance with the orders. (Id at,, 83-84)
On September 15, 2015, plaintiffs filed a verified complaint in the Court of Chancery,
seeking to clear title to the Cottage. (D.I. 1, Ex. 7) The complaint set forth causes of action for
declaratory judgment, civil contempt, slander oftitle,primafacie tort, and civil conspiracy. (Id.
at,, 80-103) Plaintiffs filed an amended complaint on May 20, 2016, adding a cause of action
to quiet title and maintaining causes of action for civil contempt and slander of title. (D.I. 1, Ex.
48 at,, 85-104) By letter dated February 1, 2017, Vice Chancellor Glasscock scheduled a
March 1, 2017 oral argument on the pending motions to dismiss and for summary judgment.
(D .I. 1, Ex. 87) On February 14, 201 7, the Court of Chancery entered an order dismissing the

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causes of action for civil contempt and slander of title in the amended complaint, leaving only
the count to quiet title to the Cottage. (D.I. 1, Ex. 89)
Defendants filed a notice of removal to the United States District Court for the District of
Delaware on February 28, 2017. (D.I. 1) As a result of the filing of the notice of removal, the
March 1, 201 7 hearing on the motions pending before the Court of Chancery did not go forward.
On March 20, 2017, plaintiffs filed the instant motion to remand the action to the Court of
Chancery. (D.I. 10)

III.

ANALYSIS
A.

Timeliness of Removal

Plaintiffs contend that defendants' notice of removal is time-barred because the
complaint was filed in the Court of Chancery on September 15, 2015, and defendants did not
seek removal of the action until February 28, 2017, well after the thirty-day deadline imposed by
28 U.S.C. § 1446(b)(l). (D.I. 10 at ,-r,-r 1-3) In response, defendants allege that their notice of
removal is timely pursuant to 28 U.S.C. § 1446(b)(3) because it was filed within thirty days from
the Court of Chancery's February 1, 2017 letter, which asserted jurisdiction on the merits of the
quiet title claim without first resolving defendants' jurisdictional challenges. (D.I. 12 at 5)
Section 1446(b) dictates the timeliness of removal, providing that "the notice of removal
of a civil action or proceeding shall be filed within 30 days after the receipt by the defendant,
through service or otherwise, of a copy of the initial pleading setting forth the claim for relief
upon which such action or proceeding is based." 28 U.S.C. § 1446(b)(l). If the basis for
removal is not set forth in the initial pleading, however, a defendant must remove within thirty
days after receiving "an amended pleading, motion, order or other paper from which it may first
be ascertained that the case is one which is or has become removable." 28 U.S.C. § 1446(b)(3).

5

Thus, an action must be removed within thirty days of receipt of the initial pleading when
grounds for removal arise in the initial pleading. However, ifthe initial pleading does not give
rise to grounds for removal, then the thirty days begins to run after receipt of a subsequent
document setting forth grounds that warrant removal. See Addo v. Globe Life & Accident Ins.
Co., 230 F.3d 759 (5th Cir. 2000) ("[T]he purpose of the removal statute [is] to encourage

prompt resort to federal court when a defendant first learns that the plaintiff is alleging a federal
claim.").
The term "other paper," as used in§ 1446(b)(3), has been construed narrowly by some
courts to include only documents similar to a pleading, motion, or order, and more broadly by
other courts to include discovery documents and correspondence between the parties and their
attorneys. See Romulus v. CVS Pharmacy, Inc., 770 F.3d 67, 77-78 (1st Cir. 2014) (describing
circuit split and citing cases). The term is generally used to clarify the existence of federal
subject matter jurisdiction, rather than to establish it. See Dupree v. PennyMac Loan Servs, LLC,
2016 WL 5875016, at *3 (N.D. Tex. Sept. 2, 2016) (citing Lukawski v. FlightSafety Texas, Inc.,
2009 WL 2523808, at *2 (N.D. Tex. Aug. 17, 2009)). Consequently, courts have rarely relied on
the "other paper" language of § 1446(b)(3) to determine if subject matter jurisdiction exists on
the basis of a federal question. Id.
The defendant bears the burden of showing the timeliness of removal under § 1446(b).
See Mims v. 84 Lumber Co., et al., C.A. No. 13-298-SLR-CJB, 2013 WL 4775306, at *2 (D.

Del. Sept. 6, 2013) (citing Scearce v. 3M Co., 2013 WL 2156060, at *3 (D.N.J. May 16, 2013)).
Defendants have failed to meet their burden in the present case because the Court of Chancery's
February 1 letter does not clarify the federal nature of an existing claim, and therefore does not

6

qualify as an "other paper" in accordance with 28 U.S.C. § 1446(b). 1 The text of the letter states
as follows:
This will confirm that oral argument is now scheduled on the pending Cross
Motions for Partial Summary Judgment and Defendant's Motion to Dismiss on
March 1, 2017at1:00 p.m. at the Court of Chancery, Georgetown.
(D.I. 1, Ex. 87) (emphasis in original) Nothing in the letter could reasonably be construed to
provide notice that the case is removable because the letter does not expressly refer to any
claims, pleaded o~ otherwise, which are federal in nature. Even if the term "other paper" is
construed broadly, the Court of Chancery's February 1 letter does not qualify as an "other paper"
under § 1446(b)(3) because the letter fails to establish the federal nature of an existing claim.
The cases cited by defendants support the court's conclusion that defendants' notice of
removal is untimely. In Bahasa v. LensCrafters, Inc., the Ninth Circuit concluded that a
settlement letter constituted an "other paper" under 28 U.S.C. § 1446(b) because it provided
notice of the amount in controversy, which is relevant to establishing federal diversity
jurisdiction. 498 F.3d 972, 975 (9th Cir. 2007). Likewise, in Romulus v. CVS Pharmacy, Inc.,
the First Circuit held that email correspondence between the parties concerning damages
constituted an "other paper" under § 1446(b)(3) because it was "the first document in which the
plaintiff puts the defendant on notice that the criteria for removal are met." 770 F.3d 67, 78-79
(1st Cir. 2014). In Peters v. Lincoln Electric Co., the Sixth Circuit found that a deposition
transcript constituted an "other paper" under § 1446(b) because the testimony revealed for the
first time that the claims fell under the scope of the federal Employment Retirement and Income
Security Act of 1974 ("ERISA"). 285 F.3d 456, 465-66 (6th Cir. 2002). In contrast, the Court of

1

Defendants do not dispute that the notice of removal would be untimely under § 1446(b) if
based on either the original or amended complaints, filed on September 15, 2015 and May 20,
2016, respectively. (D.I. 12 at 3-4)
7

Chancery's February 1 letter provides no insight into the nature of the claims, the citizenship of
the parties, or the amount in controversy which could be used to establish federal jurisdiction.
During oral argument on the pending motion to remand, defendants raised for the first
time the Eastern District of Pennsylvania's decision in Powell ex rel. Powell v. SmithKline
Beecham Corp. to bolster their arguments on the timeliness of the notice of removal. 2013 WL
5377852 (E.D. Pa. Sept. 26, 2013). However, the court in Powell granted remand, and the
decision does not support defendants' position. Id. at * 13. The ruling addressed the issue of
"whether a defendant can remove to federal court a previously remanded case when jurisdiction
depends on diversity and more than a year after the action commenced, the legal basis of the first
remand is invalidated by an appellate court in a similar, but unrelated action." Id. at* 1. The
Powell decision is distinguishable from the present case on critical factual issues because it
involves the viability of a second notice of removal premised on diversity jurisdiction, as
opposed to a first notice of removal premised on federal question jurisdiction. Id.
The Powell court's timeliness analysis under§ 1446(b) is also inapposite. Id. at *10. In
Powell, the court evaluated whether a Third Circuit opinion resulting from a district judge's
certification of a question for interlocutory appeal in an unrelated litigation constituted an
"order" for purposes of§ 1446(b)(3). Id. The Powell court ultimately concluded that the Third
Circuit decision did not meet the§ 1446(b) standard's definition of an "order" because the
decision did not expressly authorize the defendant to remove other cases. Id. The Powell court
offered no insight as to what might constitute an "other paper" under § 1446(b)(3 ), which is the
pertinent issue before the court in the instant matter.
Defendants have failed to direct the court to any document filed within thirty days of the
notice of removal which provides notice of federal jurisdiction sufficient to establish the

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removability of the case. Consequently, defendants' notice ofremoval is time-barred pursuant to
28 U.S.C. § 1446(b).

B.

Federal Question Jurisdiction

Plaintiffs allege that defendants' notice of removal is improper because removal on the
basis of federal question jurisdiction may only be premised on the allegations in the complaint.
(D.I. 10 at ,-r,-r 4-6) In response, defendants contend that a federal question exists as to whether
the due process clause is violated when Delaware asserts long-arm jurisdiction over defendants
who have only minimal contacts with Delaware. 2 (D.I. 12 at 8-10) Moreover, defendants allege
that only a federal court may resolve the issue of whether the Court of Chancery must credit the
orders of the Maryland court in accordance with the full faith and credit clause. 3 (Id at 10-11)
To remove a case to federal district court, a party must establish that the district court has
original jurisdiction by either a federal question or diversity of citizenship. 28 U.S.C. §§ 1331,
1332, 1441. "Only state court actions that originally could have been filed in federal court may
be removed to federal court by the defendant." Kline v. Security Guards, Inc., 386 F.3d 246, 252
(3d Cir. 2004) (quoting Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987)). If the case could
not have been filed originally in federal court, then removal under 28 U.S.C. § 1441 is improper
and remand is appropriate. Id. (citations omitted). "The presence or absence of federal-question
jurisdiction is governed by the well-pleaded complaint rule, which provides that federal
jurisdiction exists only when a federal question is presented on the face of the plaintiffs properly

2

During the oral argument held on June 14, 2017, defendants alleged that their sole basis for
federal question jurisdiction rested on the full faith and credit clause. Nonetheless, the court
addresses the due process allegations in this decision because those allegations were fully
briefed.
3
During the June 14, 2017 oral argument, defendants alleged that this court does not have
jurisdiction over the case.
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pleaded complaint." Kline v. Sec. Guards, Inc., 386 F.3d 246, 251 (3d Cir. 2004) (internal
citations and quotation marks omitted).
A federal court must remand a removed case "[i]f at any time before final judgment it
appears that the district court lacks subject matter jurisdiction." 28 U.S.C. § 1447(c). The party
seeking removal bears the burden of demonstrating that removal is proper. Steel Valley Auth. v.

Union Switch Signal Div., 809 F.2d 1006, 1010 (3d Cir. 1987); Zoren v. Genesis Energy, L.P.,
195 F. Supp. 2d 598, 602 (D. Del. 2002). According to the Third Circuit Court of Appeals, it "is
settled that the removal statutes are to be strictly construed against removal and all doubts should
be resolved in favor ofremand." Steel Valley Auth. v. Union Switch Signal Div., 809 F.2d 1006,
1010 (3d Cir. 1987). In determining whether remand based on improper removal is appropriate,
the court "must focus on the plaintiffs complaint at the time the petition for removal was filed."

Id; Abels v. State Farm Fire & Cas. Co., 770 F.2d 26, 29 (3d Cir. 1985).
Defendants have failed to establish a basis for federal question jurisdiction. 4 The
remaining claim underlying the amended complaint is a cause of action to quiet title under
Delaware law. (D.I. 1, Ex. 48 at ifif 85-104) No federal rights are implicated by the amended
complaint.
The Court of Chancery's February 1 letter setting a hearing date to consider the pending
motions to dismiss and motions for summary judgment does not alter the court's analysis. 5
Defendants' notice of removal is based on the speculative assumption that the Court of Chancery
will resolve the pending motions for summary judgment before addressing the jurisdictional
4

Defendants do not allege the existence of divers.ity of citizenship. (D.1. 12 at 2) ("The parties
have stipulated in the joint letter to the court dated March 24, 2017, that defendants are not
raising citizenship in the context of diversity under 28 U.S.C. § 1332 .... "). .
5
During the June 14, 2017 oral argument, counsel for defendant Mestre conceded that, had the
Court of Chancery dispensed with the pending motions before it on the papers instead of
scheduling an oral argument, there would be no basis for removal to this court.
10

issues raised in the motions to dismiss. (D.I. 1 at ifif 6-9) However, the jurisdictional issues
identified in the motions to dismiss are federal defenses which do not create original federal
jurisdiction or allow for removal. "Federal jurisdiction cannot be predicated on an actual or
anticipated defense: 'It is not enough that the plaintiff alleges some anticipated defense to his
cause of action and asserts that the defense is invalidated by some provision of [federal law].'"

Vaden v. Discover Bank, 556 U.S. 49, 60 (2009) (quoting Louisville & Nashville R. Co. v.
Mottley, 211 U.S. 149, 152 (1908)).
Moreover, the notice of removal's invocation of the full faith and credit clause to resolve
discrepancies between rulings from the state courts of Maryland and Delaware does not provide
an independent basis of federal jurisdiction. See Luterman v. Levin, 318 F. Supp. 11, 13 (D. Md.
1970) ("The full faith and credit clause does not provide an independent basis of jurisdiction."
(citing Wisconsin v. Pelican Ins. Co., 127 U.S. 265, 291-92 (1888))). Otherwise, "any attempt,
at any time or place, by any person, to enforce the provisions of any state statute or judgment
would be, without more, a subject of federal jurisdiction." People ofState of Ca. v. Bruce, 129
F.2d 421, 424 (9th Cir. 1942). Invocation of the full faith and credit clause does not constitute a
claim arising under the Constitution for purposes of 28 U.S.C. §§ 1331or1441. Luterman, 318
F. Supp. at 13. Rather,
[i]t only prescribes a rule by which courts, Federal and state, are to be guided
when a question arises in the progress of a pending suit as to the faith and credit
to be given by the court to the public acts, records, and judicial proceedings of a
state other than that in which the court is sitting .... [T]o invoke the rule which it
prescribes does not make a case arising under the Constitution or laws of the
United States.

State ofMinn. v. N Sec. Co., 194 U.S. 48, 72 (1904). Consequently, defendants' assertion of the
full faith and credit clause does not preclude the court from remanding the present action to the
Court of Chancery.

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C.

Plaintiffs' Request for Fees

Pursuant to 28 U.S.C. § 1447(c), "[a]n order remanding the case may require payment of
just costs and any actual expenses, including attorney fees, incurred as a result of the removal."
When removal of an action is improper, the plaintiff may be entitled to recover attorney's fees,
costs, and expenses associated with opposing removal, regardless of whether the action was
removed in bad faith. See Mints v. Educational Testing Serv., 99 F.3d 1253, 1259 (3d Cir.
1996). However, an award of fees is appropriate only when "the removing party lacked an
objectively reasonable basis for seeking removal." Martin v. Franklin Capital Corp., 546 U.S.
132, 141 (2005). "[A] district court has broad discretion and may be flexible in determining
whether to require the payment of fees under section 1447(c)." Mints, 99 F.3d at 1260.
Having considered the record presently before the court and the parties' submissions, the
court concludes that defendants' notice ofremoval is objectively unreasonable. Specifically,
defendants' notice of removal is based on speculative factual assertions and sparse, inapposite
case authorities. No authority cited by the parties or located by the court supports defendants'
position that the administrative act of scheduling a hearing date on pending motions is adequate
to place the parties on notice that a federal question exists. The case law uniformly emphasizes
that federal question jurisdiction must originate from a well-pleaded complaint, and affirmative
defenses raising issues of federal law are inadequate to establish federal subject matter
jurisdiction. Consequently, plaintiffs' request for fees is granted.
Within thirty (30) days of the date of this ruling, plaintiffs are to provide the court and
opposing counsel with an accounting of attorneys' fees and costs, limited to expenses incurred as
the result of the removal. Plaintiffs are to attach a form of Order for the relief requested.

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V.

CONCLUSION
For the foregoing reasons, plaintiffs' motion to remand and request for fees are granted.

(D.I. 10) An Order consistent with this Memorandum Opinion shall issue.
This Memorandum Opinion is filed pursuant to 28 U.S.C. § 636(b)(l)(A), Fed. R. Civ. P.
72(a), and D. Del. LR 72.l(a)(2). The parties may serve and file specific written objections
within fourteen (14) days after being served with a copy of this Memorandum Opinion. Fed. R.
Civ. P. 72(a). The objections and responses to the objections are limited to five (5) pages each.
The parties are directed to the court's Standing Order For Objections Filed Under Fed. R.
Civ. P. 72, dated October 9, 2013, a copy of which is available on the court's website,
www.ded.uscourts.gov.

.

+h

Dated: June~' 2017
AGISTRATE JUDGE

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