PRN PHARMACEUTICAL SERVICES, LP v. KENTUCKIANA HEALTHCARE, LLC, LIQUIDATING DEBTOR et al

Filing 43

ORDER. The Court concludes that Kentuckiana has not met its burden as the removing party to establish federal jurisdiction. Thus, the Court GRANTS the PRN Parties' Motion To Remand. [Filing No. 14.] This action is hereby REMANDED to Marion Superior Court pursuant to 28 U.S.C. § 1452(b) and 28 U.S.C. § 1447 (d). The Court DENIES the PRN Parties' Motion to Strike, [Filing No. 37], and Kentuckiana's Motion for Extension of Time to File a Response to the Motion to Strike and to File a Motion for Leave to File a Sur-reply Brief, [Filing No. 40]. The Court DENIES AS MOOT Kentuckiana's Motion To Sever, [Filing No. 24], Motion for a Finding that the Dispute with the PRN Parties is a Core Proceeding and to Strike Their Jury Demand, [Filing No. 26], and Motion to Change Venue, [Filing No. 29]. Final judgment shall issue accordingly. (See order.) Signed by Judge Jane Magnus-Stinson on 4/15/2016. (BGT)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION
PRN PHARMACEUTICAL SERVICES, LP,
Plaintiff,
vs.
KENTUCKIANA HEALTHCARE, LLC, et
al.,
Defendants.
______________________________________
KENTUCKIANA HEALTHCARE, LLC, et
al.,
Counter-Plaintiffs,
vs.
PRN PHARMACEUTICAL SERVICES, LP,
Counter-Defendant.
______________________________________
KENTUCKIANA HEALTHCARE, LLC,
Third-Party Plaintiff,
vs.
OMNICARE, INC.,
Third-Party Defendant.

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1:15-cv-2030-JMS-DKL

ORDER
Presently pending before the Court is a Motion to Remand or, Alternatively, for Abstention
filed by PRN Pharmaceutical Services, LP (“PRN”) and Omnicare, Inc. (“Omnicare”)
(collectively, the “PRN Parties”).

[Filing No. 14.]

Kentuckiana Healthcare, LLC

(“Kentuckiana”), opposes that motion, [Filing No. 31], and the PRN Parties have filed a Motion
to Strike Certain Exhibits and Incorporation of Other Briefs into Kentuckiana’s opposition brief.
[Filing No. 37.] Kentuckiana asks for an extension of time to file a response to the motion to strike
as well as to move for leave to file a surreply brief, [Filing No. 40], and the PRN Parties oppose
those requests, [Filing No. 41].
This case’s six-year journey through state, federal, and bankruptcy courts in Indiana and
Kentucky calls to mind various lyrics from “The Long and Winding Road.” THE BEATLES, The
Long and Winding Road, LET IT BE (Apple Records 1970). Because this Court lacks subject matter
jurisdiction over this action, the road indeed leads back to the Marion Superior Court’s door. For
reasons detailed more fully herein, the Court grants the PRN Parties’ Motion to Remand, [Filing
No. 14], denies the PRN Parties’ Motion to Strike, [Filing No. 37], denies Kentuckiana’s extension
request, [Filing No. 40], and denies all other pending motions as moot, [Filing No. 24; Filing No.
26; Filing No. 29].
I.
STANDARD OF REVIEW
“[S]ubject matter jurisdiction is a fundamental limitation on the power of a federal court to
act.” Del Vecchio v. Conseco, Inc., 230 F.3d 974, 980 (7th Cir. 2000) (collecting cases). Thus, it
cannot be waived and “always comes ahead of the merits.” Leguizamo-Medina v. Gonzales, 493
F.3d 772, 774 (7th Cir. 2007).
A party that removes a state court case to federal court has the burden of establishing
federal jurisdiction. Schur v. L.A. Weight Loss Centers, Inc., 577 F.3d 752, 758 (7th Cir. 2009);
see also Walker v. Trailer Transit, Inc., 727 F.3d 819, 824-25 (7th Cir. 2013) (“The removing
defendant has the burden of proving the jurisdictional predicates for removal.”). “[F]ederal courts
should interpret the removal statute narrowly, resolving any doubt in favor of the plaintiff’s choice
2

of forum in state court.” Schur, 577 F.3d at 758. “If at any time . . . it appears that the district
court lacks subject matter jurisdiction, the case shall be remanded” to state court. 28 U.S.C. §
1447.
II.
RELEVANT BACKGROUND
A. Original Indiana State Court Proceeding
PRN initially filed this case in Marion Superior Court (“Indiana State Court”) on April 14,
2010, against Brownsburg Health Care Center, LLC, Plainfield Health Care Center, LLC, and
Castleton Health Care Center, LLC (the “Nursing Home Owners”); Paramount of Indianapolis,
LLC and Paramount Healthcare Management, LLC (the “Paramount Defendants”); and
Kentuckiana. [Filing No. 1-4 at 4; Filing No. 14-5.] PRN sought payment for goods and services
provided to various nursing homes under a series of contracts, asserting state-law claims for breach
of contract, unjust enrichment, promissory estoppel, and tortious interference. [Filing No. 1-4 at
4; Filing No. 14-5.] Kentuckiana and the Paramount Defendants responded with a counterclaim
against PRN for breach of contract, fraud, unjust enrichment, and civil conversion, and also
asserted third-party claims against Omnicare for breach of a third-party agreement and tortious
interference with a business relationship. [Filing No. 14-14 at 2-3.]
B. First Removal to Indiana District Court
On May 18, 2010, the Nursing Home Owners removed PRN’s state court action to the
United States District Court for the Southern District of Indiana (“Indiana District Court” or “this
Court”), alleging that this Court could exercise diversity jurisdiction. [Cause No. 1:10-cv-616LJM-DML, Dkt. 1.] Because the Nursing Home Owners later conceded that they improperly pled
their own citizenship and all parties agreed that diversity jurisdiction did not exist, the action was

3

remanded to the Indiana State Court on June 2, 2010. [Cause No. 1:10-cv-616-LJM-DML, Dkt.
7, Dkt. 8.]
C. Kentuckiana Bankruptcy
On August 10, 2010, Kentuckiana filed a voluntary petition under Chapter 11 of the
Bankruptcy Code in the United States Bankruptcy Court for the Western District of Kentucky
(“Kentucky Bankruptcy Court”). [Filing No. 14-6.]
On October 6, 2010, Kentuckiana and the Paramount Defendants removed this action from
the Indiana State Court to the United States Bankruptcy Court for the Southern District of Indiana
(“Indiana Bankruptcy Court”) pursuant to 28 U.S.C. § 1334, 28 U.S.C. § 1452, and Federal Rule
of Bankruptcy Procedure 9027. [Filing No. 14-10.] Kentuckiana and the Paramount Defendants
moved to transfer the removed action to the Kentucky Bankruptcy Court, and the Indiana
Bankruptcy Court granted that motion on December 20, 2010. [Filing No. 14-12.]
D. Kentucky District Court Proceedings
On March 30, 2012, the parties filed a Joint Motion to Withdraw Reference with the United
States District Court for the Western District of Kentucky (“Kentucky District Court”). [Filing
No. 14-14.] The Kentucky District Court ordered the parties to brief the issue “of the jurisdictional
basis for this court to entertain the case . . . as the case is grounded entirely in state law and there
is no diversity jurisdiction.” [Filing No. 14-15 at 2.] The Kentucky District Court noted that it
would have jurisdiction “over the matter only if it arises in or relates to a bankruptcy case.” [Filing
No. 14-15 at 2 (citing 28 U.S.C. § 1334(b)).] Ultimately, on October 24, 2012, the Kentucky
District Court concluded that “this matter is ‘related to’ a bankruptcy” because of a right to
indemnity asserted against Kentuckiana that “will potentially impact Kentuckiana’s liabilities, and
[is] therefore related to the bankruptcy proceeding.” [Filing No. 14-15 at 2-3.] Thus, the Kentucky
4

District Court concluded that good cause had been shown for withdrawing the reference from the
Kentucky Bankruptcy Court, and it did so pursuant to 28 U.S.C. § 157(d) for purposes of
conducting a trial by jury. [Filing No. 14-15 at 4-5.]
On November 15, 2013, the PRN Parties filed an Amended Complaint—which remains
the operative complaint in this action—with the Kentucky District Court. [Filing No. 14-8.] On
March 7, 2014, the Kentucky District Court sua sponte entered a memorandum opinion and order
proposing that it abstain from exercising jurisdiction pursuant to 28 U.S.C. § 1334(c)(1) (the
“Abstention Order”). [Filing No. 14-1.] The Kentucky District Court noted that the parties had
made “little progress toward trial readiness” and that certain motions pending before it had
“prompted future review [of] the tentative decision of this court to abstain from hearing this matter,
pursuant to 28 U.S.C. § 1334(c)(1).” [Filing No. 14-1 at 4-5.] The Kentucky District Court
analyzed the permissive abstention factors and was “strongly persuaded that abstention is the
appropriate course of action.” [Filing No. 14-1 at 7-9.] It observed that “this matter was originally
brought as a garden variety Indiana state court civil action. There are no issues of federal law
implicated in the resolution of this adversary proceeding. There is no other ground for jurisdiction
by a federal court absent the relation to a bankruptcy.” [Filing No. 14-1 at 9.] The Kentucky
District Court concluded that “[t]hese state law claims may be easily severed from core bankruptcy
proceedings, and post-trial enforcement of any Indiana judgments can be handled by the
bankruptcy court. In this court’s view, the plaintiff’s initial choice of forum, the Indiana state
courts, should be respected, and the Indiana courts should be afforded the opportunity to address
these significant state law contract matters.” [Filing No. 14-1 at 10.] For these reasons, the
Kentucky District Court concluded that “the balance of factors weigh strongly in favor of
abstention by this court and remand of this action to the Indiana State Court from which it was
5

removed.” [Filing No. 14-1 at 11.] Because it had raised the abstention issue sua sponte, it gave
the parties fourteen days to show cause why its decision should not be rendered final. [Filing No.
14-1 at 11.] Ultimately, on May 14, 2014, the Kentucky District Court adopted the Abstention
Order as final and remanded this action back to the Indiana State Court. [Filing No. 14-2.]
Kentuckiana appealed the Kentucky District Court’s Abstention Order to the Sixth Circuit
Court of Appeals. [Filing No. 14-17.] On December 12, 2014, the Sixth Circuit dismissed
Kentuckiana’s appeal for lack of jurisdiction, concluding that appellate review of the Abstention
Order and remand were barred by 28 U.S.C. § 1334(d) and 28 U.S.C. § 1452(b). [Filing No. 1419.]
D. Back to Indiana State Court
After the action was transferred back to the Indiana State Court, the parties briefed various
summary judgment motions throughout 2015. The Indiana State Court held a summary judgment
hearing on August 17, 2015, and the PRN Parties believe it was clear from that hearing that the
Indiana State Court was not going to grant a summary judgment motion filed by Kentuckiana
regarding certain bankruptcy defenses. [Filing No. 17 at 8.]
On September 25, 2015, Kentuckiana filed a Motion to Enforce its Bankruptcy Plan of
Liquidation and Order of Confirmation with the Kentucky Bankruptcy Court, asking that court to
bar the PRN Parties from asserting claims and defenses against Kentuckiana in the Indiana State
Court. [Filing No. 14-25.] The PRN Parties objected to that motion, [Filing No. 14-26], and the
Kentucky Bankruptcy Court held a hearing on October 7, 2015. [Filing No. 14-27.] At a
reconvened hearing later that month, Kentuckiana’s Motion to Enforce was withdrawn without
prejudice. [Filing No. 14-29.]

6

The Indiana State Court ruled on the pending summary judgment motions on October 19,
2015. [See, e.g., Filing No. 14-20 (October 19, 2015 Order denying Kentuckiana’s second and
third summary judgment motions); Filing No. 31-28 (October 19, 2014 Order denying
Kentuckiana’s first motion for summary judgment).] 1 Kentuckiana asked the Indiana State Court
to certify those decisions for interlocutory appeal, [Filing No. 14-23], but the Indiana State Court
later denied that motion, [Filing No. 14-24].
On November 19, 2015, the PRN Parties and the Nursing Home Owners informed the
Indiana State Court that they had reached a settlement agreement resolving all claims and defenses
between them. [Filing No. 14-21.] They moved to dismiss those claims and defenses with
prejudice, and the Indiana State Court granted that motion over Kentuckiana’s objection on
December 17, 2015. [Filing No. 31-26.]
The PRN Parties filed a Motion for Summary Judgment on Kentuckiana’s only remaining
counterclaim in the state court action on December 10, 2015. [Filing No. 14-30 at 17; Filing No.
17 at 9 (characterizing substance of motion).]
Kentuckiana filed a Notice of Removal on December 22, 2015, [Filing No. 1; Filing No.
14-30 at 17], and the Indiana State Court cancelled the jury trial for this action that was scheduled
to begin in February 2016, [Filing No. 14-30 at 17].
E. Second Removal to Indiana District Court
Kentuckiana’s Notice of Removal alleges that this Court has original jurisdiction under 28
U.S.C. § 1334 and that the action is removable under 28 U.S.C. § 1452(a), 28 U.S.C. § 1441(a)-

1

The Indiana State Court also ruled on summary judgment motions filed by the PRN Parties and
the Nursing Home Owners on October 19, 2015, [see Filing No. 14-23 (Kentuckiana’s Motion to
Certify Interlocutory Appeal, detailing the Indiana State Court’s rulings on those motions)], but
the Court could not locate that order in the almost 1,000 pages of briefs and evidence the parties
submitted on the pending remand motion.
7

(b), and 28 U.S.C. § 1331. [Filing No. 1 at 1-2.] Kentuckiana sets forth the six-year history of the
case and alleges that “[w]ith the dismissal of the Nursing Home Owners, the only claims remaining
between PRN/Omnicare and Kentuckiana are core [bankruptcy] claims” pursuant to 28 U.S.C. §
157(b). [Filing No. 1 at 6-9.] In light of the allegedly “changed circumstances” resulting from the
dismissal of the Nursing Home Owners, Kentuckiana analyzed the permissive abstention factors
and concluded that the Kentucky District Court’s rationale for permissive abstention was no longer
supported. [Filing No. 1 at 9-12.] Kentuckiana represented that it “will be filing a motion seeking
transfer of venue pursuant to 28 U.S.C. § 1412” to the Kentucky District Court for immediate
referral to the Kentucky Bankruptcy Court “so that the claims in the State Court Action and core
matters raised therein can be determined by the same court administering Kentuckiana’s
bankruptcy estate.” [Filing No. 1 at 18.]
On January 21, 2016, the PRN Parties filed a Motion to Remand these proceedings to
Indiana State Court. [Filing No. 14.] On March 7, 2016, Kentuckiana filed its Response in
Opposition to the PRN Parties’ Motion to Remand. [Filing No. 31.] The PRN Parties replied in
support of their motion on March 17, 2016, [Filing No. 34], and also filed a Motion to Strike
Certain Exhibits and Incorporation of Other Briefs into Kentuckiana’s Brief in Opposition to the
Motion to Remand, [Filing No. 37]. Kentuckiana has asked for an extension of time to respond to
the PRN Parties’ Motion to Strike as well as an extension of time to move for leave to file a surreply
in opposition to the Motion to Remand “until thirty-days after a final non-appealable order is issued
by the Bankruptcy Court for the Western District of Kentucky on whether this is a core

8

proceeding . . . .” 2 [Filing No. 40.] The PRN Parties object to Kentuckiana’s extension request,
[Filing No. 41], and Kentuckiana has filed a reply in support of that motion, [Filing No. 42].
III.
DISCUSSION
The Court will address the PRN Parties’ Motion to Strike, [Filing No. 37], and then turn to
the merits of the PRN Parties’ remand request, [Filing No. 14].
A. The PRN Parties’ Motion to Strike
The PRN Parties ask the Court to strike various exhibits that Kentuckiana filed with its
opposition brief that the PRN Parties contend are irrelevant to the remand request. [Filing No. 38
at 3-5.] The PRN Parties also contend that Kentuckiana “tries to evade the proper procedures of
this Court and confuse the issues by purporting to incorporate” two briefs on other substantive
motions it filed into its opposition brief to the remand request. [Filing No. 38 at 5-7.] The PRN
Parties argue that allowing such incorporation would prejudice the PRN Parties, who only have a
20-page limit for their reply brief. [Filing No. 38 at 7.]
Instead of responding to the PRN Parties’ Motion to Strike, Kentuckiana has requested an
extension of time to “until thirty-days after a final non-appealable order is issued by the
Bankruptcy Court for the Western District of Kentucky on whether this is a core proceeding . . . .”
[Filing No. 40.]

2

The Kentucky Bankruptcy Court held a status hearing in Kentuckiana’s bankruptcy proceeding
on March 31, 2016. [Filing No. 41-3.] In response to that court’s question regarding whether
there was anything to report, counsel for Kentuckiana informed that court that “[t]he case keeps
getting worse.” [Filing No. 41-3 at 3.] After a brief exchange, the Kentucky Bankruptcy Court
gave Kentuckiana 45 days “to file whatever [it] needs to file with the court” and the PRN Parties
30 days to respond to whatever was filed. [Filing No. 41-3 at 4.] The Kentucky Bankruptcy Court
indicated that it would set a hearing on whatever Kentuckiana files. [Filing No. 41-3 at 5.]
9

Although the Court does not condone Kentuckiana’s possible attempt to evade page limits
by incorporating two other substantive filings into its opposition brief, under the circumstances
presented herein, the Court denies the PRN Parties’ Motion to Strike. [Filing No. 37.] The PRN
Parties have not been prejudiced by Kentuckiana’s opposition brief because, despite their
concerns, they were able to file a compliant 20-page reply brief. [Filing No. 34.] Moreover,
because the Court ultimately agrees with the PRN Parties that it lacks subject matter jurisdiction
over this action and that it must be remanded, the PRN Parties have not been prejudiced by the
allegedly irrelevant exhibits or Kentuckiana’s possible attempt to evade page limits. Thus, the
Court denies the PRN Parties’ Motion to Strike, [Filing No. 37], and Kentuckiana’s request for an
extension of time to file a response to that motion, [Filing No. 40].
B. The PRN Parties’ Remand Request
The PRN Parties present various arguments in favor of their remand request, [Filing No.
17], but the Court will only detail the dispositive arguments concerning its subject matter
jurisdiction. 3 The PRN Parties argue that this Court lacks subject matter jurisdiction because the
Kentucky District Court’s permissive abstention decision terminated any concurrent bankruptcy
jurisdiction the federal courts had pursuant to 28 U.S.C. § 1334(c)(1) and, thus, removal under 28
U.S.C. § 1452 is unavailable. [Filing No. 17 at 12-15.] The PRN Parties emphasize that they filed
their action before Kentuckiana declared bankruptcy, that the Kentucky District Court analyzed
the nature of the claims in the operative complaint and concluded that permissive abstention was

3

The PRN Parties present numerous other arguments, including that this action is still a non-core
proceeding, that equitable remand under 28 U.S.C. § 1452(b) is appropriate, that Kentuckiana’s
removal was untimely and not properly consented to by all defendants, and that either permissive
or mandatory abstention applies. [Filing No. 17 at 21-34.] Because the Court concludes that it
does not have subject matter jurisdiction over this action, it will not address these additional
arguments or Kentuckiana’s responses thereto.
10

appropriate, that the abstention decision is not reviewable, and that the nature of this action has
not materially changed since the abstention decision. [Filing No. 17 at 14-21.]
In response, Kentuckiana contends that the Indiana State Court’s dismissal of the Nursing
Home Owners from this action made this action removable to federal court because the remaining
claims are “core” matters within Kentucky Bankruptcy Court’s “exclusive” and “core”
jurisdiction. [Filing No. 31 at 11-12; Filing No. 31 at 19-21.] Kentuckiana contends that it is not
collaterally attacking the Abstention Order and that its removal is not barred by law. [Filing No.
31 at 19-21.] Alternatively, Kentuckiana contends that the PRN Parties’ December 2015 summary
judgment motion filed in Indiana State Court constitutes an amendment of the pleadings triggering
Kentuckiana’s timely removal of the case. [Filing No. 31 at 23.]
In reply, the PRN Parties again point to the Kentucky District Court’s Abstention Order,
emphasizing the statutory bar to its review and that there is no other basis for federal jurisdiction.
[Filing No. 34 at 2-3.] The PRN Parties claim that the Indiana State Court’s dismissal of the
Nursing Home Owners does not affect the nature of this action or bring it within “core” bankruptcy
matters. [Filing No. 34 at 7.] Finally, the PRN Parties point out that Kentuckiana’s opposition
brief fails to address the statutory bar to reviewing the Abstention Order, as recognized by the
Sixth Circuit Court of Appeals. [Filing No. 34 at 14-15.]
Federal jurisdiction, which is a threshold issue, “is the power to declare law.” Wernsing v.
Thompson, 423 F.3d 732, 743 (7th Cir. 2005) (citation omitted). Without it, “the federal courts
cannot proceed.” Id. A challenge to subject matter jurisdiction is not waivable or “a mere nicety
of legal metaphysics.” U.S. Catholic Conference v. Abortion Rights Mobilization, Inc., 487 U.S.
72, 77 (1988). Instead, it rests “on the central principle of a free society that courts have finite
bounds of authority.” Id.
11

Two federal statutes are key to the Court’s review of its subject matter jurisdiction in this
case—28 U.S.C. § 1334 and 28 U.S.C. § 1452. The first of those statutes, 28 U.S.C. § 1334,
provides that federal district courts have original and exclusive jurisdiction over Chapter 11
bankruptcy cases. That statute specifically allows a district court “in the interest of justice, or in
the interest of comity with State courts or respect for State law” to abstain from hearing a
proceeding arising under or related to a Chapter 11 bankruptcy. 28 U.S.C. § 1334(c)(1). An
abstention decision is not reviewable. 28 U.S.C. § 1334(d); see In re Seven Fields Dev. Corp., 505
F.3d 237, 249 (3d Cir. 2007) (“appeals of decisions involving permissive abstention, whether or
not the court abstains, are barred”). The second statute, 28 U.S.C. § 1452, is the removal statute
for claims over which the district court has jurisdiction pursuant to 28 U.S.C. § 1334. That statute
provides that the district court may “remand such claim or cause of action on any equitable
ground.” 28 U.S.C. § 1452(b). A remand decision is not reviewable. 28 U.S.C. § 1452(b).
Once a federal court determines that permissive abstention is appropriate under 28 U.S.C.
§ 1334, “everything” that transpires in federal court after that point “take[s] place in the absence
of any jurisdiction.” In re C & M Properties, L.L.C., 563 F.3d 1156, 1161 (10th Cir. 2009)
(concluding sua sponte that everything that occurred in the bankruptcy court and the district court
in the years following the district court’s decision to permissively abstain on a state law
malpractice claim was done without federal jurisdiction). The claims on which the federal court
abstains “reside[] in state court and any further litigation by the parties in federal court is beside
the point, something like playing ‘air guitar’ rather than the real thing, a sort of mimesis of
litigation rather than an actual case or controversy.” Id. at 1162. Therefore, “[a]ny district court
order putatively deciding any aspect of a claim remanded to state court is but an advisory opinion.”
Id. The effects of ignoring the boundaries of jurisdiction in this context can be profound. Id. at
12

1168 (“We are loathe . . . to deliver the unwelcome news that the parties have been litigating in
vain in federal court for over four years based on a mistaken premise.”).
The Court agrees with the PRN Parties that it lacks subject matter jurisdiction over this
action in light of the statutory bar to reviewing abstention orders pursuant to 28 U.S.C. § 1334.
The Kentucky District Court thoughtfully analyzed the claims at issue in this litigation more than
two years ago and determined that even though “the matter ‘related to’ a bankruptcy,” the
applicable factors favored permissive abstention pursuant to 28 U.S.C. § 1334(c)(1) and remand
to the Indiana State Court was appropriate. [Filing No. 14-1.] In light of that decision, the federal
courts—including this one—lost subject matter jurisdiction over the claims that were remanded.
See In re C & M Prop., 563 F.3d at 1161-63. The Sixth Circuit Court of Appeals recognized this
well-established principle of law when it dismissed Kentuckiana’s appeal of the Abstention Order
for lack of subject matter jurisdiction. [Filing No. 14-19 (citing 28 U.S.C. § 1334(d) and 28 U.S.C.
§ 1452(b)).] Although Kentuckiana’s opposition brief ignores that decision and the general effect
of the statutes at issue, this Court will not do so.4

4

The Court notes that Kentuckiana’s nineteen-page Notice of Removal barely mentions the
Kentucky District Court’s Abstention Order, omits any reference to the Sixth Circuit’s denial of
Kentuckiana’s appeal on jurisdictional grounds, and does not acknowledge the statutory bar to
reviewing abstention decisions. [Filing No. 1.] Instead, Kentuckiana conducts an abstention
analysis and argues that “discretionary abstention is no longer appropriate.” [Filing No. 1 at 912.] While it is possible, although unlikely, that Kentuckiana did not realize the significance of
the Sixth Circuit’s decision and the statutes prohibiting review at the time it filed its Notice of
Removal, that could not be the case after the PRN Parties pointed out those issues in the opening
brief of their Motion to Remand. [Filing No. 17 at 10-15.] Instead of conceding this point and
consenting to remand, however, Kentuckiana filed an opposition brief again ignoring the Sixth
Circuit’s decision and persisting in its erroneous position that this Court could have jurisdiction.
[Filing No. 31.] Kentuckiana’s litigation strategy borders on unreasonably protracting these
proceedings, and its counsel should take care to avoid such behavior or risk sanctions pursuant to
28 U.S.C. § 1927.
13

The Court will not belabor its decision, but it will address a few additional points raised by
the parties’ briefs. 5 The Court specifically rejects Kentuckiana’s position that dismissal of the
Nursing Home Owners somehow results in “changed circumstances” that revive this Court’s
subject matter jurisdiction. [Filing No. 31 at 21-22.] Because the PRN Parties’ operative
complaint was filed a few months before the Abstention Order, all legal claims at issue in this
case—including those that still remain pending—were considered by the Kentucky District Court
in determining that abstention was appropriate. [Filing No. 14-8 (filed November 2013); Filing
No. 14-1 (issued March 2014).] While this Court would typically be inclined to defer to the
abstention decision on the bases of comity and law of the case doctrine alone, the applicable
statutes forbid review of that decision at all. 28 U.S.C. § 1334(d); 28 U.S.C. § 1452(b).
The Court also rejects Kentuckiana’s position that the PRN Parties’ December 2015
summary judgment motion filed in the Indiana State Court should be construed as an “amended
pleading triggering a new right to remove.” [Filing No. 31 at 23.] The Federal Rules of Civil
Procedure specifically identify the “only” pleadings allowed, and a summary judgment motion is
not among those listed. See Fed. R. Civ. Pro. 7(a) (listing the “only” pleadings as a complaint, an
answer, an answer to a counterclaim, an answer to a crossclaim, a third-party complaint, an answer
to a third-party complaint, and possibly a reply to an answer).

5

Kentuckiana asks for an extension of time to file a motion for leave to file a surreply brief in
support of its opposition to the remand request, [Filing No. 40], and the parties have fully briefed
that motion, [Filing No. 41; Filing No. 42]. The Court denies Kentuckiana’s extension request
because there is no need for a surreply on the issue of the Court’s subject matter jurisdiction, which
is the only issue on which the Court rules. The parties’ opening, response, and reply briefs
sufficiently address that issue, and the procedural history of this case is not in dispute. Thus, a
surreply is not necessary and Kentuckiana’s request for an extension of time to pursue one is
denied. [Filing No. 40.]
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For the reasons stated herein, the Court concludes that Kentuckiana has failed to meet its
burden as the removing party to establish that this Court has subject matter jurisdiction over this
action. Accordingly, this Court must remand this action to the Indiana State Court pursuant to 28
U.S.C. § 1452(b) and 28 U.S.C. § 1447(d).
IV.
CONCLUSION
For the reasons detailed herein, the Court concludes that Kentuckiana has not met its
burden as the removing party to establish federal jurisdiction. Thus, the Court GRANTS the PRN
Parties’ Motion To Remand. [Filing No. 14.] This action is hereby REMANDED to Marion
Superior Court pursuant to 28 U.S.C. § 1452(b) and 28 U.S.C. § 1447(d). The Court DENIES the
PRN Parties’ Motion to Strike, [Filing No. 37], and Kentuckiana’s Motion for Extension of Time
to File a Response to the Motion to Strike and to File a Motion for Leave to File a Sur-reply Brief,
[Filing No. 40]. The Court DENIES AS MOOT Kentuckiana’s Motion To Sever, [Filing No.
24], Motion for a Finding that the Dispute with the PRN Parties is a Core Proceeding and to Strike
Their Jury Demand, [Filing No. 26], and Motion to Change Venue, [Filing No. 29]. 6 Final
judgment shall issue accordingly.

Date: April 15, 2016

_______________________________
Hon. Jane Magnus-Stinson, Judge
United States District Court
Southern District of Indiana

Electronic Distribution via CM/ECF:
Michael Wayne McClain, II
BALLINGER MCCLAIN, PLLC
6

Briefing was suspended on these motions pending the Court’s ruling on the PRN Parties’ remand
motion. [Filing No. 39.] Because the Court is remanding this action to the Indiana State Court,
the motions are denied as moot.
15

[e-mail]
Peter M. Gannott
GANNOTT LAW GROUP
[e-mail]
Norris Cunningham
HUDDLESTON BOLEN LLP
[e-mail]
Kaitlyn Jordan Marschke
ICE MILLER
[e-mail]
Aaron D. Grant
ICE MILLER LLP
[e-mail]
Adam Arceneaux
ICE MILLER LLP
[e-mail]
George A. Gasper
ICE MILLER LLP
[e-mail]
Tyson Crist
ICE MILLER LLP (Columbus)
[e-mail]
Bradley Scott Salyer
MORGAN & POTTINGER, P.S.C.
[e-mail]

16