In Re: B Xpress-Elysian Fields, LLC

Filing 7

ORDER REMANDING CASE TO STATE COURT. Signed by Judge Martin L.C. Feldman on 11/6/2014. (Attachments: # 1 Transmittal Letter)(caa)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
IN RE:

*

CIVIL ACTION

ALBERTA INC.

*

NO. 14-1910
c/w 14-1911,
14-1912,
14-19131

*

SECTION "F"

ORDER AND REASONS
Before the Court are two motions: (1) the plaintiff's motion
to remand and (2) the defendants’ motion to strike plaintiff’s
motion to remand.

For the reasons that follow, the motion to

remand is GRANTED and the motion to strike is DENIED as moot.
Background
These consolidated cases arise from decisions of Troy Hebert,
the Commissioner of Alcohol and Tobacco Control of the State of
Louisiana, in which he revoked permits to sell alcohol and failed
to renew the permits issued to Aberta, Inc. and B Express Elysian
Fields, LLC, which are convenience stores or gas stations.
In April 2013, the Commissioner revoked the permits for these
stores on the ground that the companies were violating La. R.S.
26:80, which prohibits the spouse of a convicted felon from
receiving a permit, and disqualifies any company in which any
prohibited person acts as officer or director, or in which the

1

This Order relates to all cases.
1

prohibited person owns more than 5% of the stock or membership
interest.

The Commissioner’s investigation revealed that Fatmah

Hamdan owned all of the interest in Aberta and B Xpress from 2009
until 2013 and that her husband, Omar Hamdan, was a convicted
felon.
In light of the administrative action and after several
hearings before the Commissioner, Mrs. Hamdan sold the two stores
to

her

nephew.

But

Mrs.

Hamdan

then

rescinded

that

sale;

ultimately, she resold the stores to Robert G. Harvey, III, the
plaintiff and acting attorney in these cases.
new

owner,

the

Commissioner

companies in June 2013.

reinstated

With Harvey as the

the

permits

for

the

The Commissioner, however, promptly

revoked the permits to the two companies a few months later, after
an administrative hearing on September 10, 2013.2 The Commissioner
reasoned that the Hamdans continued to run the Aberta store and
that

Fatmah

Hamdan

continued

to

hold

an

ownership

interest,

contrary to prior administrative orders and La. R.S. 26:80(C)(1).
Harvey, in his capacity as sole owner, president and secretary
of Aberta and as managing member/sole owner of B Xpress filed a
lawsuit for a temporary restraining order and preliminary and
permanent injunction in Civil District Court (case no. 13-8714)
against the State of Louisiana, Department of Revenue, Office of

2

The Commissioner found that he had authority to revoke
the permits of both Aberta and B Xpress pursuant to La. R.S. 26:94
because both companies were operated by the same management.
2

Alcohol

and

Tobacco

Control

(ATC),

and

Troy

Herbert,

both

individually and in his official capacity as Commissioner of the
ATC (the Injunction Proceeding).
from

enforcement

of

the

Harvey sought injunctive relief

administrative

companies’ permits to sell alcohol.

order

revoking

the

On September 13, 2013,

presiding Judge Cates granted a TRO and, then on September 25,
2013, Judge Cates granted the plaintiff’s request for preliminary
injunction.3

On December 30, 2013, the defendants appealed; the

writ application and the appeal are currently pending in state
court.
On September 19, 2013, the plaintiff, Harvey, filed a second
case (case no. 2013-8925) in Civil District Court (the Review
Proceeding). Here, he sought a de novo review of the permit
revocation orders issued by the Commissioner allowed for under La.
R.S. 26:106. On February 4, 2014, Judge Cates, with the consent of
the

parties,

entered

an

order

consolidating

the

Injunction

Proceeding and Review Proceeding.

3

The injunction, signed December 19, 2013, specifically
provided that:
[T]he State of Louisiana, Department of Revenue,
Office of Alcohol and Tobacco Control is enjoined,
restrained, and prohibited from enforcing its
of
Commissioner
September
11,
2013
Order
Herbert...in any way suspending, revoking, and/or
taking any action whatsoever against the permit
numbers [of the companies]; and further enjoining
and prohibiting the ACT from preventing or
otherwise impeding the sale of the businesses at
issue.
3

Because the permits issued to Aberta and B Xpress were set to
expire May 31, 2014, they applied for new permits.

On May 30,

2014, Commissioner Herbert issued a written order determining that
the permits would not be renewed due to outstanding tax liabilities
owed by both companies to the Louisiana Department of Revenue.4
On June 5, 2014, Harvey received certified letters from the
revenue department informing him that a jeopardy assessment had
been levied under L.S.A.-R.S. 47:1566 for unpaid taxes.5

On the

same date, the plaintiff, again acting on behalf of Aberta and B
Xpress, filed a second petition in the Injunction Proceeding
seeking a TRO and preliminary and permanent injunction to prevent
the Commissioner from enforcing the order denying renewal of the
permits.

Harvey also requested that the court hold defendants in

contempt for violating the September 25, 2013 injunctive judgement
entered by Judge Cates.

On June 20, 2014, Judge Cates granted a

preliminary injunction, ordering the ATC to immediately issue the
renewal permits and restraining ATC and the Commissioner from any
further action against Harvey’s stores.
Commissioner in contempt of court.

Judge Cates also held the

The Commissioner appealed the

4

A factual dispute exists with regard to whether the tax
liabilities were cleared with the Louisiana Department of Revenue.
5

Plaintiff claims that he had no notice of his alleged
jeopardy status and that the assessment was an “extraordinary
remedy” inappropriately employed under the circumstances. Thus,
plaintiff submits that the ATC, Hebert and the LDR intentionally
fabricated the jeopardy assessment to cloak Hebert with the
statutory authority to deny plaintiff’s permit renewal.
4

judgment; that appeal is also pending.
On June 6, 2014, before judgment was rendered with regard to
the second petition, Harvey had learned that the revenue department
had seized all bank accounts of Aberta and B Xpress in an effort to
satisfy the alleged delinquent taxes.

This forced both companies

to seek bankruptcy relief under Chapter 11 in the bankruptcy court
of the Eastern District of Louisiana on June 20, 2014.
On July 30, 2014, Harvey, acting again on behalf of Aberta and
B Xpress, filed an amended petition in the Injunction Proceeding.
Harvey

added

as

defendants

the

Department

of

Revenue

and

Unknown/Unnamed Employees of the LDR for those acts connected with
the issuance of the jeopardy assessment. By this amended petition,
the plaintiff seeks damages, as well as a TRO, and a preliminary
and permanent injunction against the Department. Harvey also added
claims that the defendants’ acts worked to deprive him of his civil
rights, including his constitutional due process right to notice.6
That same day, Commissioner Hebert removed both the Injunction
Proceeding and the Review Proceeding to this Court, invoking the
Court's federal question and bankruptcy jurisdiction.
Because the Injunction and Review Proceedings were removed to
this Court pursuant to 28 U.S.C. § 157(a), they were automatically

6

The plaintiff does not specify whether he seeks relief
under the State or U.S. Constitutions. Defendants suggest that
they were not served with this pleading, and that the Department
has not appeared in the proceeding.
5

transferred to the bankruptcy court pursuant to Local Rule 83.4.1.7
While the cases were pending in the bankruptcy court, in August
2014, Hebert noticed for submission before this Court his request
that

the

bankruptcy

reference

be

withdrawn.8

Meanwhile,

on

September 4, 2014, however, the bankruptcy proceedings involving
Aberta and B XPress were dismissed. Because bankruptcy jurisdiction
no longer existed under 28 U.S.C. § 1334, this Court denied as moot
the motion to withdraw the reference on October 16, 2014.

The

plaintiff now seeks remand to state court and the defendants
request that the Court strike the motion to remand.
I.
A.
A defendant may generally remove a civil action filed in state
court if the federal court has original jurisdiction over the case,
that is, if the plaintiff could have brought the action in federal
court from the outset.

See 28 U.S.C. § 1441(a).

Although the plaintiff challenges removal in this case, the
removing defendant carries the burden of showing the propriety of
this Court's removal jurisdiction.

See Jernigan v. Ashland Oil,

Inc., 989 F.2d 812, 815 (5th Cir.), cert. denied, 510 U.S. 868, 114

7

Local Rule 83.4.1 provides that all cases under Title 11
and any case arising in or related to cases under Title 11 are
automatically “transferred by the district court to the bankruptcy
judges of this district.”
8

Four requests to withdraw the reference were filed, in
Civil Action numbers 14-1910, 14-1911, 14-1912, and 14-1913; but on
February 4, 2014 the cases were consolidated.
6

S. Ct. 192, 126 L.Ed.2d 150 (1993); Willy v. Coastal Corp., 855
F.2d

1160,

1164

(5th

Cir.

1988).

“Because

removal

raises

significant federalism concerns, the removal statute is strictly
construed.” Gutierrez v. Flores, 543 F.3d 248, 251 (5th Cir. 2008).
Further, informed by notions of comity and in recognition of the
limited nature of federal court jurisdiction, “any doubt as to the
propriety of removal should be resolved in favor of remand.”

Id.

B.
The plaintiff insists that remand is required because only
state law is invoked by the state court petitions.
further

contends

that

removal

was

untimely

The plaintiff

and

defective because not all defendants have joined.

procedurally
Additionally,

the defendant state agencies have not waived sovereign immunity
from being sued in federal court.

Lastly, the plaintiff cites to

equitable grounds for compelling this Court to remand because the
defendants’ motions amount to nothing more than a forum shopping
ploy.
The defendants counter that the plaintiff's claims arise under
this Court’s federal question jurisdiction; that the untimeliness
argument fails because the supplemental petition was the first
instance in which federal claims were alleged.

The defendants

suggest that those defendants that had not been served need not
join in the removal under 28 U.S.C. § 1446(2)(A).

Lastly, the

defendants insist that sovereign immunity can be, and has been,

7

waived.
II.
A.
The Court takes up the issue of sovereign immunity first. The
plaintiff contends that the defendants (agencies of the State of
Louisiana) have not waived their sovereign immunity from being sued
in federal court.

The defendants, and this Court, disagree.

The Eleventh Amendment bars any suit against a State in
federal court, unless either the State has waived its sovereign
immunity

or

Congress,

Constitution,

has

pursuant

expressly

to

another

abrogated

the

provision
State’s

in

the

immunity.

Atascadero State Hosp. v. Scanlon, 473 U.S. 234, 237-40 (1985).

A

State may constructively waive this immunity protection by making
“‘an unequivocal indication that the State intends to consent to
federal jurisdiction.’” Lockett v. New Orleans City, 639 F.Supp.2d
710, 721-22 (E.D. La. 2009)(quoting Atascadero State Hosp. v.
Scanlon, 473 U.S. 234, 238 (1985)).

The Fifth Circuit instructs

that a State’s voluntary action in removing a case from state to
federal

court

constitutes

Amendment immunity.

an

unequivocal

waiver

of

Eleventh

Meyers ex. rel. Benzing v. Tx., 410 F.3d 236,

255 (5th Cir. 2005)(citing Lapides v. Bd. of Regents, 535 U.S. 613
(2002)); see

also

Archie v. LeBlanc, No. 8-CV-1381, 2010 WL

3522296, at *4 (W.D. La. Jul. 28, 2010); Levy v. Office of the
Legislative Auditor, 362 F. Supp. 2d 729, 735 (M.D. La. 2005);
Varnado v. Hegmann, 211 F. Supp. 2d 801 (M.D. La. 2002); Dimitric
8

v. Tx. Workforce Comm’n, No. 07-0247, 2008 WL 687463 (S.D. Tex.
Mar. 11, 2008)(noting that because the Fifth Circuit has broadly
interpreted Lapides, waivers exist where a state defendant merely
consents to a co-defendant’s removal); compare Union Pac. R.R. Co.
v. Louisiana Pub. Serv. Comm’n, 662 F.3d 336, 341 (5th Cir.
2011)(reasoning that where the State of Louisiana was involuntarily
haled

into

federal

court

as

a

defendant,

there

was

never

a

voluntary invocation of, or unequivocal submission to, federal
jurisdiction).

Because the defendant state actors have removed or

consented to removal, they have made the choice to invoke federal
jurisdiction and thus waive sovereign immunity.
B.
The Court now considers whether it has federal question
jurisdiction over the subject matter of this dispute.
The defendants base removal on 28 U.S.C. § 1441(b);9 federal
district courts have original jurisdiction over cases “arising
under the Constitution, laws, or treaties of the United States.”
28 U.S.C. § 1331. The parties agree that no diversity jurisdiction

9

Because diverse citizenship is lacking, it appears that
the defendants intended to invoke amended Section 1441(a), the
general removal provision, which provides:
[A]ny civil action brought in a
State court of which the district
courts of the United States have
original
jurisdiction,
may
be
removed by the defendant or the
defendants....
9

exists in this case.

Accordingly, the case is removable only if

the suit raises a federal question.
1.

The Well-Pleaded Complaint Rule

Whether a claim “arises under” federal law is determined by
reference to the allegations of the well-pleaded complaint.

See

Merrell Dow Pharm. Inc. v. Thompson, 478 U.S. 804, 808, 106 S.Ct.
3229, 92 L.Ed.2d 650 (1986) (citing Franchise Tax Bd. v. Constr.
Laborers Vacation Trust, 463 U.S. 1, 9-10, 103 S. Ct. 2841, 77 L.
Ed. 2d 420 (1983)); see also Howery v. Allstate Ins. Co., 243 F.3d
912, 916 (5th Cir. 2001).
face of the complaint.

The federal question must appear on the

See Tores v. Southern Peru Copper Corp.,

113 F.3d 540, 542 (5th Cir. 1997) (citations omitted).
The defendants contend that, for the first time in the
supplemental state court petition, the plaintiff alleges federal
claims.

On its face, the petition does not reference a specific

law or constitutional provision but, rather, states in generic
terms:
Defendants actions, inactions and ultra vires
acts under color of law are a denial of
petitioner[‘s] constitutional due process
rights and civil rights for which petitioner
is entitled to damages all in an amount to be
determined by the trier of fact.
The defendants insist that this Court has jurisdiction because the
plaintiff is asserting due process and civil rights deprivation
claims arising under federal law, triggering federal question

10

jurisdiction under 28 U.S.C. § 1331.

The defendants also point to

language in the petition in which the plaintiff alleges that
unnamed persons in the Louisiana Office of Alcohol and Tobacco
Control and the Department conspired with Commissioner to deprive
plaintiff of his civil rights.

Such language, the defendants

argue, constitute civil rights conspiracy claims falling within the
court’s specific federal question jurisdiction under 28 U.S.C. §
1343.10

The

defendants

finally

urge

the

Court

to

exercise

supplemental jurisdiction over any and all remaining state law
claims under 28 U.S.C. § 1367(a).11

The plaintiff counters that

remand is required because he chose a state forum and none of his
allegations explicitly invoke federal law.

The Court agrees.

The plaintiff is considered master of his complaint, and
whether a case “arises under” federal law is to be determined by
the allegations of the petition.

Great Northern Ry., Co. v.

Alexander, 246 U.S. 276, 281 (1918).

If the case is not then

removable, it cannot be made removable by subsequent pleadings by
the defendant.

Id.

To be sure, a plaintiff cannot avoid federal

jurisdiction by “artfully pleading” a federal cause of action in
state

terms,

but

when

both

federal

and

state

remedies

are

10

The Court notes that the defendants inadequately brief
this contention.
11

The defendants had originally premised removal also upon
bankruptcy jurisdiction, 28 U.S.C. § 1452(a) and 28 U.S.C. § 1334,
but given that the underlying bankruptcy proceedings involving
Aberta and B XPress have been dismissed, these arguments are moot.
11

available, plaintiff’s election to proceed exclusively under state
law does not give rise to federal jurisdiction.

Avitts v. Amoco

Prod. Co., 53 F.3d 690, 693 (5th Cir. 1995).12
2.
Applying these principles to the state court petitions, the
Court finds that the plaintiff pleads only state law claims, and is
not asserting federal civil rights claims. Indeed, where, as here,
courts are confronted with vague allegations concerning deprivation
of civil rights and liberties, courts do not read the complaint to
assert a federal claim for removal purposes when clear state law
concurrently protects such rights.

See Stinson v. Scoggins, No.

07-1757, 2008 WL 631204, at *3 (W.D. La. Mar. 4, 2008) (citing MSOF
Corp. v. Exxon Corp., 295 F.3d 485 (5th Cir. 2002); Avitts v. Amoco
Prod. Co., 53 F.3d 690 (5th Cir. 1995));

see also Brumfield v.

City of Baker, No. 11-507, 2011 WL 5178267, at *2 (M.D. La. Sept.
30, 2011)(“[F]ederal question jurisdiction does not exist merely
because a federal claim, such as a § 1983 claim, that was not
pleaded by the plaintiff may be available to him/her.”); Patrick v.
McLaughlin, No. 06-2102, 2007 WL 1229024, at *2 (W.D. La. Mar. 9,

12

In addition to the “artful pleading doctrine,” there is
another exception to the well-pleaded complaint rule. If federal
law has completely preempted state law that serves as the basis for
the complaint, then removal is permitted.
Caterpillar Inc. v.
Williams, 482 U.S. 386, 393 (1987). As to this exception, complete
preemption does not apply to § 1983 claims; nothing in the history
of that legislation suggests Congress intended to preempt the civil
rights area.
Brumfield v. City of Baker, No. 11-507, 2011 WL
5178267, at *2 (M.D. La. Sept. 30, 2011).
12

2007)(“The fact that [the plaintiff] omitted references to the U.S.
Constitution, 42 U.S.C. §1983, and the Civil Rights Act in this
suit is a strong indication that he intended to proceed under state
law.”); Smith v. Bank One Corp., No. Civ.A. 03-3372, 2004 WL
1274480,

at

*2

(E.D.

La.

June

7,

2004)(concluding

that

the

“conclusory mention that a private actor’s conduct violates civil
and constitutional rights” did not insinuate that the plaintiff was
pursuing a federal claim).
Civ.A.

01-2103,

2001

WL

Compare Warner v. Whitney Corp., No.
1083771,

at

*1

(E.D.

La.

Sept.

14,

2001)(finding federal jurisdiction where the petition alleged
denial of rights “as enumerated under Section 1983" and the U.S.
Constitution).

These courts have further determined that where a

plaintiff unequivocally states that he is proceeding based on state
law causes of action, the defendant may not remove based on a
federal claim that the plaintiff may possess but has chosen not to
assert.

See Stinson, 2008 WL 631204, at *3; see also Brumfield,

2011 WL 5178267, at *3 (remanding a case where the petition did not
cite to any specific federal law or constitutional right, and where
the plaintiff stated unequivocally that she was proceeding solely
upon a state law claim); Anderson v. Nissan Motor Acceptance Corp.,
326 F. Supp. 2d 760, 764 (S.D. Miss. 2003)(finding an unequivocal
election to pursue state law claims when plaintiff’s petition
expressed a state law basis for such despite the availability of a
federal remedy).

13

The Court declines to read into the plaintiff's state court
petition a federal claim.

However, even if the Court determined

that the plaintiff’s allegations created an ambiguity as to whether
federal question jurisdiction exists, the removal statute is to be
strictly construed and “any doubt as to the propriety of removal
should be resolved in favor of remand.”

See Gutierrez v. Flores,

543 F.3d 248, 251 (5th Cir. 2008); see also Lewis v. Godawa, No. 11541, 2011 WL 4703102, at *2 (M.D. La. Aug. 29, 2011)(holding that
where a reference to civil rights violation could constitute a
claim under state or federal law, ambiguities are construed against
removal).
Accordingly, the plaintiff’s motion to remand is GRANTED and
the defendants' other pending motions are DENIED as moot.13

These

consolidated cases are hereby remanded to the Civil District Court
for the Parish of Orleans.
New Orleans, Louisiana, November 6, 2014.
_________________________________
MARTIN L. C. FELDMAN
UNITED STATES DISTRICT JUDGE

13

The defendants suggest in their motion to strike the
motion to remand that the motion to remand was improperly filed by
non-parties to the litigation. The defendants also request a
reconsideration of this Court’s prior ruling denying as moot the
motion to withdraw the reference. The briefing on these (and all
issues) has been woefully inadequate.
But, because this Court
lacks subject matter jurisdiction over these consolidated cases,
these remaining issues are moot. The Court admonishes all counsel
and parties -- should they find themselves in federal court again
-- to be mindful of 28 U.S.C. § 1927.
14