Hammerman & Gainer, Inc. v. New Orleans City et al

Filing 27

ORDER AND REASONS granting 12 Motion to Remand to State Court. This matter is REMANDED to the Civil District Court for the Parish of Orleans. Signed by Judge Jane Triche Milazzo. (Attachments: # 1 Remand Letter) (ecm)

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UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA

HAMMERMAN & GAINER, INC.

CIVIL ACTION

VERSUS

NO: 17-4780

CITY OF NEW ORLEANS, ET AL.

SECTION: “H”(2)

ORDER AND REASONS
Before the Court is Plaintiff’s Motion to Remand. For the following
reasons, this Motion is GRANTED. The matter is REMANDED to the Civil
District Court for the Parish of Orleans.
BACKGROUND
This suit stems from a Request for Proposals (“RFP”) for selection of a
Workers’ Compensation Claims Administrator issued by Defendant the City of
New Orleans (the “City”) in November 2016. Plaintiff Hammerman & Gainer,
Inc. (“HGI”) was the incumbent bidder on the contract; however, the City’s
selection committee selected a proposal submitted by Defendant CorVel
Enterprise Comp, Inc. (“CorVel”) as the winning bidder. HGI filed a protest
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with the City averring that it misapplied provisions relative to Disadvantaged
Business Entities in the RFP. The City rejected this protest, and HGI filed
suit in the Civil District Court for the Parish of Orleans on April 7, 2017.
Therein, Plaintiff asserted claims that (1) the City violated its own laws and
procedures in failing to properly follow selection criteria in handling the RFP
and (2) that Defendant Adolph Delaparte violated 42 U.S.C. § 1983 by making
false statements regarding HGI’s application to deprive it of its Constitutional
rights. Plaintiff subsequently amended its Petition to assert a state law tort
claim against CorVel. Following substantial proceedings in state court, the
City removed the action to this Court on May 8, 2017, citing the Court’s federal
question jurisdiction based on the § 1983 claim. Plaintiff immediately moved
for a temporary restraining order, which this Court denied. Plaintiff then
voluntarily dismissed his § 1983 claim against Delaparte. This Motion to
Remand follows.
LEGAL STANDARD
Generally, a defendant may remove a civil state court action to federal
court if the federal court has original jurisdiction over the action.1 The burden
is on the removing party to show “[t]hat federal jurisdiction exists and that
removal was proper.”2 When determining whether federal jurisdiction exists,
courts consider “[t]he claims in the state court petition as they existed at the
time of removal.”3 “In making a jurisdictional assessment, a federal court is
not limited to the pleadings; it may look to any record evidence, and may
receive affidavits, deposition testimony or live testimony concerning the facts
28 U.S.C. § 1441(a).
Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002).
3 Id.
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underlying the citizenship of the parties.”4 Removal statutes should be strictly
construed, and any doubt should be resolved in favor of remand.5
LAW AND ANALYSIS
Plaintiff has filed the instant Motion to Remand, arguing that the
dismissal of the § 1983 claim against Defendant Delaparte deprives the Court
of jurisdiction and necessitates remand. Defendants respond in opposition,
arguing (1) removal was proper because the federal question claims existed at
the time of removal; (2) that a federal claim remains pending despite dismissal
of the § 1983 claim against Delaparte; (3) even if the federal claims are
dismissed, the Court should exercise its discretion and retain supplemental
jurisdiction over the remaining state law claims. The Court will address these
arguments in turn.
I. Propriety of Original Removal
Defendants contend that Plaintiff’s subsequent dismissal of the claims
within the Court’s original jurisdiction does not by itself warrant remand. This
contention is correct. “[J]urisdictional facts are determined at the time of
removal, and consequently post-removal events do not affect that properly
established jurisdiction.”6 It appears undisputed that, at the time of removal,
Plaintiff asserted a § 1983 claim against Defendant Delaparte. Accordingly,
removal of this action was appropriate.
II. Whether Federal Question Claims Remain
Defendants next contend that remand is inappropriate because federal
question claims remain despite Plaintiff’s dismissal of the § 1983 claims
Coury v. Prot, 85 F.3d 244, 249 (5th Cir. 1996).
Id.
6 Louisiana v. Am. Nat. Prop. Cas. Co., 746 F.3d 633, 636 (5th Cir. 2014).
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against Delaparte. In support of this contention, they point to (1) Plaintiff’s
allegation that the City deprived them of a “federally-protected property right”
and (2) Plaintiff’s respondeat superior claims against the City based on
Delaparte’s conduct. The Court perceives no such federal claim.

“Where

removal jurisdiction is predicated on the existence of a federal question, the
federal question generally must appear on the face of the plaintiff's
complaint.”7 Though Plaintiff does allege that it holds a federally protected
property right, this, standing alone, is insufficient to state a claim for violation
of federal law. “The Fourteenth Amendment also requires that the plaintiff,
in order to establish a constitutional violation, prove that the deprivation of
the property right occurred without due process of law.”8 The Petition contains
no such allegation. Indeed, the Fifth Circuit has held, in the context of bidding
on public contracts, that due process requirements are satisfied by the
availability of relief via a state-court injunction.9 Plaintiff was seeking just
such relief when this action was removed. Accordingly, because there is no
allegation in the Petition that the available process is in any way deficient,
there is no federal question claim.
Defendants’ argument relative to the City’s respondeat superior liability
also fails.

Plaintiff’s Petition alleged that “the City of New Orleans is

responsible for the actions of its employee and agent, Adolph Delaparte under
the legal theory of Respondeat Superior.”

Notwithstanding the fact that

respondeat superior liability is inapplicable in § 1983 cases,10 any such claims
against the City would be premised on a finding of liability on the part of
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8

Baker v. Farmers Elec. Co-op., Inc., 34 F.3d 274, 278 (5th Cir. 1994).
Marco Outdoor Advert., Inc. v. Reg'l Transit Auth., 489 F.3d 669, 672 (5th Cir.

2007).
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Id.
Thompkins v. Belt, 828 F.2d 298, 303 (5th Cir. 1987).

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Delaparte. Such a finding is precluded by the dismissal of the claims against
him. Because there remains no claim against Delaparte for which the city can
be held liable, no federal question is presented on this front.
III. Whether the Exercise of Supplemental Jurisdiction is Appropriate
Though the dismissal of all federal claims within original jurisdiction
does not automatically warrant remand of the remaining claims, the Court will
now consider whether the exercise of supplemental jurisdiction is appropriate.
When all federal claims are dismissed or otherwise eliminated before trial, the
court should generally decline to exercise supplemental jurisdiction over any
remaining state law claims.11 In deciding whether to continue exercising
jurisdiction, courts should consider “both the statutory provisions of 28 U.S.C.
§ 1367(c) and the balance of the relevant factors of judicial economy,
convenience, fairness, and comity.”12 The statutory factors include (1) whether
the claim raises a novel or complex issue of State law, (2) whether the claim
substantially predominates over the claim or claims over which the district
court has original jurisdiction, (3) whether the district court has dismissed all
claims over which it has original jurisdiction, or (4) in exceptional
circumstances, whether there are other compelling reasons for declining
jurisdiction.13
The Court finds no reason to retain supplemental jurisdiction over this
matter.

Defendants argue that fairness and equity militate in favor of

maintaining jurisdiction because Plaintiff did not move for remand until after
this Court denied its request for a temporary restraining order. The Court

See Bass v. Parkwood Hosp., 180 F.3d 234, 247 (5th Cir. 1999); Petroleum v.
Dresser Indus., 962 F.2d 580, 585 (5th Cir. 1992).
12 Batiste v. Island Records Inc., 179 F.3d 217, 227 (5th Cir. 1999).
13 28 U.S.C. § 1367 (c).
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does not find this to be grounds for retaining jurisdiction. Upon removal,
Plaintiff filed its Motion for Temporary Restraining Order and Motion to
Remand on the same day. The Court declined to issue a temporary restraining
on procedural grounds and set the matter for a preliminary injunction hearing
in the coming weeks. At no point has it issued a ruling on the merits of the
case. Plaintiff has not lain in the gap only to move for remand following an
adverse ruling after substantial litigation.
Defendants also argue that remand is favored because Plaintiff has
attempted to manipulate the forum by eliminating its federal question claims.
The Court finds that there is at least as much evidence, if not more, that
Defendants have also engaged in forum manipulation. This matter was clearly
removable at the time of filing. Instead of promptly removing the matter,
Defendants elected to conduct substantial proceedings in state court prior to
filing a notice of removal. Only after receiving unfavorable rulings from the
state trial court did Defendants remove the action. Accordingly, this factor is
at best neutral.
Judicial economy favors remand, as the state court has gained great
familiarity with this matter through substantial proceedings prior to
removal.14 Additionally, the matter involves the disposition of complex issues
of state law relative to contract bidding that the state court is better equipped
to handle. As the Court has previously noted, there are no remaining claims
within its original jurisdiction. The Court therefore declines to exercise its
supplemental jurisdiction over the remaining state law claims, and the matter
is remanded.

14

This is evidenced by the fact that the pre-removal state court record exceeds 1,500

pages.

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CONCLUSION
For the forgoing reasons, Plaintiff’s Motion to Remand is GRANTED.
This matter is REMANDED to the Civil District Court for the Parish of
Orleans.
New Orleans, Louisiana this 23rd day of May, 2017.

____________________________________
JANE TRICHE MILAZZO
UNITED STATES DISTRICT JUDGE

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