Howell v. State Farm Mutual Automobile Insurance Company et al
ORDER & REASONS that Plaintiff's 5 Motion to Remand is hereby DENIED. Signed by Judge Eldon E. Fallon on 4/27/2017. (cms)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
FRANK H. HOWELL
STATE FARM MUTUAL AUTOMOBILE INSURANCE
SECTION "L" (2)
ORDER & REASONS
Before the Court is Plaintiff’s Motion to Remand. R. Doc. 5. Defendant State Farm
Mutual Automobile Insurance Company opposes the motion. R. Doc. 8. Having reviewed the
parties’ briefs and the applicable law, the Court now issues this Order & Reasons.
On March 24, 2016, Plaintiff Frank Howell filed suit in the Civil District Court for the
Parish of Orleans seeking to recover damages for injuries stemming from an automobile collision
in Orleans Parish, Louisiana, on March 28, 2015. Plaintiff alleges that Defendant Chauncey
Parker rear-ended Plaintiff’s vehicle when he stopped in traffic on the Pontchartrain Expressway.
R. Doc. 1-2 at 1. Plaintiff avers that the accident was caused solely by Parker’s negligence. R.
Doc. 1-2 at 2. In his Petition, Plaintiff seek damages for unspecified injuries, including medical
care and related expenses. R. Doc. 1-2 at 2. In accordance with Louisiana Code of Civil
Procedure article 893(a), Plaintiff did not plead a specific damage amount in his Petition.
Plaintiff also did not note whether the amount in controversy met, or did not meet, the amount
required for federal diversity jurisdiction.
Defendant Progressive Casualty Insurance Company (“Progressive”) provided liability
coverage for the vehicle operated by Defendant Parker. R. Doc. 1-2 at 2. Plaintiff contends that
the Progressive liability policy fails to cover the damages he sustained as a result of the accident.
R. Doc. 1-2 at 2. As such, Plaintiff filed a claim against his uninsured/uninsured motorist
provider, State Farm Mutual Automobile Insurance Company (“State Farm”).
After Plaintiff filed suit, Progressive scheduled Plaintiff’s deposition for August 15,
2016. R. Doc. 5-1 at 1. Prior to the deposition, Plaintiff settled with Progressive, and State Farm
was notified of the settlement. R. Doc. 5-1 at 2. On August 12, 2016, State Farm confirmed in
writing that it knew Plaintiff had settled his claims against Progressive. R. Doc. 5-1 at 2. On
September 7, 2016, Progressive filed a partial motion and order to dismiss in Orleans Parish
Civil District Court; the order was signed September 14, 2016. R. Doc. 5-1 at 2. However, State
Farm was not served with a copy of the order dismissing Plaintiff’s claims against Parker and
Progressive. R. Doc. 5-7.
In November, 2016, State Farm arranged to depose Plaintiff, but did not coordinate
scheduling with Progressive. R. Doc. 5-1 at 3. The parties exchanged additional discovery in
December, 2016, where Plaintiff again indicated he had settled with Progressive, but did not
disclose that Packer and Progressive had been dismissed from the suit. R. Doc. 1 at 6. When
State Farm took Plaintiff’s deposition on February 13, 2017, it learned Parker and Progressive
had been dismissed from the suit. R. Doc. 1 at 6; R. Doc. 5-1 at 3.
Invoking this Court’s diversity jurisdiction, State Farm filed a Notice of Removal on
March 10, 2017, asserting that this action involves a controversy between citizens of different
states and the amount in controversy exceeds $75,000. R. Doc. 1 at 1. Plaintiff Howell is a
Louisiana citizen, while State Farm is a foreign insurance company licensed to do business in the
state. State Farm explains that this case was not initially removable, as Plaintiff’s original
Petition included claims against Chauncey Parker, a Louisiana citizen, and Parker’s insurer,
Progressive. R. Doc. 8 at 1. However, State Farm explains that the case became removable when
it received the order dismissing the claims against Parker and Progressive on March 9, 2017;
State Farm then filed its Notice of Removal on March 10, 2017. R. Doc. 1.
On April 4, 2017, Plaintiff filed the present motion to remand, arguing that Notice of
Removal is untimely under 28 U.S.C. § 1446(b). R. Doc. 5-1 at 1. Defendant opposes remand,
maintaining the Notice of Removal was filed within the requisite time limit. R. Doc. 8.
A. Plaintiff’s Motion to Remand (R. Doc. 5)
Plaintiff explains that in August, 2016, Defendant State Farm (herein after “Defendant”)
confirmed in writing that Plaintiff had settled his claims with Progressive. R. Doc. 5-3. Plaintiff’s
counsel sent another email confirming settlement. R. Doc. 5-4. Plaintiff explains that in
November 2016, he discussed discovery issues with Defendant, and verbally confirmed
Progressive was no longer a party. R. Doc. 5-1 at 2-3. Later in November, 2016, Defendant
scheduled and noticed Plaintiff’s deposition; but did not contact Progressive. R. Doc. 55-1 at 3.
According to Plaintiff, this demonstrates that Defendant knew Progressive was no longer
involved in the case, and therefore knew the case was removable in—at the very least—
November, 2016. R. Doc. 5-1 at 4.
Based on the foregoing, Plaintiff avers that Defendant’s Notice of Removal on March 10,
2017 was untimely, as it was filed more than thirty days after Defendant first received written
notice that the case had become removable. According to Plaintiff, the removal statue should be
strictly construed, with any ambiguities resolved in favor of remand. R. Doc. 5-1 at 3-4. Further,
Plaintiff argues that under Fifth Circuit precedent, written communications between counsel,
such as email correspondence, are sufficient to satisfy the “other paper” requirement of 28
U.S.C. §1446(b)(3). R. Doc. 5-1 at 4. Because Defendant had written notice of the settlement
between Plaintiff and Progressive in August 2016, Plaintiff argues that the March 10, 2017
Notice of Removal was untimely, and therefore this case must be remanded. R. Doc. 5-1 at 5.
Additionally, Plaintiff argues that because there was no reasonable basis for removal, he
is entitled to attorney fees. R. Doc. 5-1 at 5 (citing Martin v. Franklin Capital Corp., 546 U.S.
132, 141 (2005)).
B. Defendant State Farm’s Opposition (R. Doc. 8)
Defendant opposes the Motion, and argues its Notice of Removal was timely. R. Doc. 8
at 1. According to Defendant, the thirty-day time clock for timely removal did not begin to run
until it received notice Progressive was dismissed from the case, not merely that Plaintiff and
Progressive had reached a settlement. R. Doc. 8 at 1. Defendant argues that while it did receive
written notice Plaintiff had settled with Progressive, this notice was not “unequivocally clear and
certain notice” that the case had become removable, as it did not know that Progressive was no
longer a party. R. Doc. 8 at 3 (citing Drago v. Sykes, No. 13-563, 2013 WL 3804834, at *5 (E.D.
La. July 19, 2013)). Instead, Defendant contends it did not receive “clear and certain notice” the
case was removable until—at the earliest—February 14, 2017, when it received the unsigned
copy of Plaintiff’s motion to dismiss Progressive, or when it received a signed copy of the
dismissal order on March 9, 2017. R. Doc. 8 at 4-5. Thus, Defendant avers that under either date,
its March 10, 2017 Notice of Removal was timely. R. Doc. 8 at 5.
C. Plaintiff’s Reply (R. Doc. 11)
Plaintiff re-urges his original argument, and argues that the removal time clock started
once Defendant received any “other paper . . . from which it may be ascertained that the case is
removable.” R. Doc. 11 at 1 (quoting Bosky v. Kroger Texas LP, 288 F.3d 208, 211 (5th Cir.
2002)). Plaintiff contends not only did Defendant have notice that Progressive had settled in
August, its subsequent actions also demonstrate it knew Progressive was no longer a party. R. 11
at 2. According to Plaintiff, when Defendant scheduled Plaintiff’s deposition in November, 2016,
it certified that “all counsel of record” were provided notice—yet Defendant did not notify
Progressive. R. Doc. 11 at 2. Thus, Plaintiff avers that not only did Defendant know Progressive
was no longer in the case, it acted in accordance with this position. R. Doc. 11 at 2-3.
LAW AND ANALYSIS
A. Applicable Law
A defendant may remove a civil action filed in state court if a federal court would have
had original jurisdiction over the issue. 28 U.S.C. § 1441(a). A federal court would have original
jurisdiction over cases involving complete diversity of citizenship among the parties where the
amount in controversy exceeds $75,000. 28 U.S.C. § 1332(a).
28 U.S.C. § 1446 creates two distinct thirty-day filing deadlines for a notice of removal.
In Chapman v. Powermatic, Inc., the Fifth Circuit held that this provision creates a two-step test
to analyze the timeliness of removal. 969 F.2d 160, 161 (5th Cir. 1992). First, a court must
determine if the case was removable when initially filed:
[t]he 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, or within 30
days after the service of summons upon the defendant if such initial
pleading has then been filed in court and is not required to be served
on the defendant, whichever period is shorter.
28 U.S.C. § 1446(b)(1). Under Chapman, for a case to be removable when filed the pleading
must affirmatively reveal on its face that the plaintiff seeks damages in excess of $75,000. 969
F.2d at 163 (reaffirmed by Mumfrey v. CVS Pharmacy, 719 F.3d 392, 400 (5th Cir. 2013)). A
defendant’s subjective knowledge of the amount of damages is not enough to convert a non5
removable action into a removable one. S.W.S. Erectors, Inc. v. Infax, Inc., 72 F.3d 489, 494 (5th
If the action is not removable when initially filed, the court then evaluates if the case
became removable at a later time. Section 1446(b)(3) provides that:
[e]xcept as provided in subsection (c), if the case stated by the initial
pleading is not removable, a notice of removal may be filed within
thirty days after receipt by the defendant, through service or
otherwise, of a copy of 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.
Thus, under Section 1446(b)(3), a case is removable upon the defendant’s receipt of “a copy of
an amended pleading, motion, order or other paper” from which the possibility of removal may
first be ascertained. To trigger the removal timer, the information contained in the “other paper”
must be “unequivocally clear and certain.” Bosky v. Kroger Texas, LP, 288 F.3d 208 (5th Cir.
2002). Under Fifth Circuit precedent, written correspondence between counsel and discovery
responses are considered “other paper.” See Addo v. Global Life and Acc. Ins. Co., 230 F.3d 759,
761 (5th Cir. 2000).
Defendant’s removal in this case is only timely if: (1) the timing provision of 28 U.S.C.
§ 1446(b)(1) was not triggered by Plaintiff’s initial pleading and (2) the timing provision of
§ 1446(b)(3) was triggered thirty days or fewer before the March 10, 2017 date of removal. The
parties agree that Plaintiff’s initial complaint did not trigger the timing provisions of §
1446(b)(1). Additionally, the parties do not dispute that the amount in controversy requirement is
satisfied in this case. As such, the Court’s analysis will focus on when Defendant State Farm first
received “other paper” from which it could first ascertain that the case had become removable.
Under Section 1446(b)(3), the thirty-day time limit is triggered by the receipt “of a copy
of an amended pleading, motion, order or other paper” which is “unequivocally clear and
certain” regarding the information supporting removal. Bosky, 288 F.3d at 211. On August 12,
2016, Defendant confirmed in writing that Plaintiff had settled his claims with Progressive. R.
Doc. 5-3. Progressive was dismissed from the case on September 14, 2016; however, notice of
dismissal was not sent to Defendant at that time. R. Doc. 5-7. Thus, the question currently before
the Court is: Was Plaintiff’s written confirmation of settlement in August 2016 “unequivocally
clear and certain” notice that the case had become removable?
The Court finds that it was not. Settlement agreements are often nuanced, and do not
necessarily resolve all the claims against a particular party. As another section of this Court has
recently held, notice of settlement “does not provide ‘unequivocally clear and certain’ notice that
the case had become removable. It does not state that . . . (the only non-diverse defendant) had
been dismissed.” Drago v. Sykes, No. 13-563, 2013 WL 3804834, at *5 (E.D. La. July 19, 2013).
While written confirmation of settlement put Defendant on notice that the case might become
removable, such notice is insufficient to trigger the thirty-day time limit of § 1446(b)(3). The
Fifth Circuit has rejected this inquiry notice, reasoning that the time limit for removal is not
triggered when a defendant might have discovered a case was removable “had it exercised due
diligence.” Chapman, 969 F.2d at 163; see also Mumfrey, 2013 WL 2476402 at *5; Bosky, 288
F.3d at 211.
Thus, written notice of settlement did not put Defendant on notice that the case had
become removable. In fact, if Defendant had attempted to remove the case in August 2016, when
it was first notified of the settlement, it would have been unable to do so, as Progressive
remained a party to the case until September 2016.
Plaintiff argues that Defendant knew Progressive had been dismissed as early as
November 2016, when Defendant noticed a deposition to “all counsel of record,” yet failed to
include Progressive. While this may indeed be evidence that Defendant knew of Progressive’s
dismissal, such subjective knowledge is not the standard articulated in § 1446(b)(3). The Fifth
Circuit has held that in determining the timeliness of removal, courts should not “inquire into
what a particular defendant may or may not subjectively know.” Bosky, 288 F.3d at 210. Instead,
the Court must determine when the Defendant received “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).
The case became removable when Progressive was dismissed as a party, creating
complete diversity. Here, Defendant received an unsigned draft of the motion to dismiss on
February 14, 2017. R. Doc. 8 at 3. It received a signed copy of the order dismissing Progressive
on March 9, 2017. R. Doc. 1-13. The Court does not find it necessary to determine whether
receipt of the unsigned draft of a motion to dismiss was sufficient to put Defendant on notice the
case was removable, thereby triggering the thirty-day time limit. Either date, February 14, 2017
or March 9, 2017, was less than thirty days prior to Defendant’s March 10, 2017 notice of
removal. Therefore, removal was timely, and Plaintiff’s motion to remand must be denied.
For the aforementioned reasons, IT IS ORDERED that Plaintiff’s Motion to Remand, R.
Doc. 5, is hereby DENIED.
New Orleans, Louisiana, this 27th day of April, 2017.
UNITED STATES DISTRICT JUDGE
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?