Stephens et al v. Holcomb Logging, LLC et al
Filing
45
MEMORANDUM OPINION re 44 Order on Motion for Miscellaneous Relief, Order on Motion to Dismiss/Lack of Jurisdiction, Order on Motion to Continue, Order on Motion to Expedite. Signed by Senior Judge Glen H. Davidson on 4/21/14. (rel)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF MISSISSIPPI
ABERDEEN DNISION
LISA STEPHENS, et al.
v.
PLAINTIFFS
CNIL ACTION NO.: 1: 13-cv-00244-GHD-DAS
PROGRESSNE GULF INS. CO.
GARNISHEE
v.
HOLCOMB LOGGING, LLC, et al.
DEFENDANTS
MEMORANDUM OPINION GRANTING GARNISHEE'S MOTION TO
ENJOIN, DENYING PLAINTIFFS' MOTION TO DISMISS, DENYING PLAINTIFFS'
MOTION TO CONTINUE AND STAY, AND DENYING AS MOOT PLAINTIFFS' MOTION
TO EXPEDITE HEARINGS ON PENDING MOTIONS
This cause comes before the Court on Garnishee's motion to enjoin [27] Plaintiffs from
continuing to seek relief in state court when this action has been removed to this court by
Garnishee. Plaintiffs have responded in opposition, and have also filed a motion to dismiss for
lack of jurisdiction [31] and a motion to continue and stay [33]. The parties have filed responses
and replies concerning these motions. Upon due consideration of the memoranda submitted, the
state court record, and the relevant law, the Court finds that Garnishee's motion to enjoin [27]
should be granted; Plaintiffs' motion to dismiss for lack of jurisdiction [31] should be denied;
Plaintiffs' motion to continue and stay [33] should be denied; and Plaintiffs' motion to expedite
hearings on pending motions [39] should be denied as moot.
The underlying state court cause of action was filed February 12, 2009 in the Circuit
Court of Itawamba County: Lisa Beam Stephens and Pamela Beam Drake, as wrongful death
beneficiaries of Truman Edward Beam v. Holcomb Logging, LLC, Darryl Holcomb and James
Holcomb,09-040PI. A judgment was entered against Defendants on August 23, 2013, and that
judgment has not been satisfied. Subsequently, a Writ of Garnishment was filed against
Garnishee Progressive Gulf Insurance Company on the allegation that a policy of insurance was
issued in the name of Holcomb Logging, LLC; Darryl Holcomb; and IC Trucking. Progressive
was served with the Writ on November 26,2013. On December 23,2013, Progressive filed with
this Court a notice of removal, an answer to the Writ, and a counterclaim. Thereafter,
it
IS
undisputed that Plaintiffs did not file a motion to remand and that the parties conducted
discovery with filings in the Court. However, on April 1, 2014, Plaintiffs filed a motion for
default judgment in the Circuit Court ofItawamba County.
Plaintiffs argue that "they relied upon the representations of Garnishee set forth [in the
notice of removal] that the required [n]otice was being filed with the Circuit Court of Itawamba
County, Mississippi [and] [i]mmediately upon learning that said required [n]otice had not been
filed, Plaintiffs asserted their rights in State court." This ignores Plaintiffs' own actions in
engaging in litigation this matter in federal court, and not filing a motion to remand. Progressive
argues that after recognizing a procedural defect in filing of the Notice of Removal in state court,
they filed a formal state court notice of removal with the Itawamba Circuit Clerk on April 4,
2014.
Removal is a three-step process, and Section 1446(d) requires a removing party to file the
notice of removal in the federal court, give written notice to all adverse parties, and file a copy of
the notice with the clerk of the state court, which shall effect the removal. 28 U.S.C. ยง 1446.
The Fifth Circuit has held that a state court continues to have jurisdiction until it has been given
actual or constructive notice of removal. Medrano v. Texas, 580 F.2d 803, 804 (5th Cir. 1978).
It is arguable that the Circuit Court of Itawamba County had constructive notice of removal
before the motion for default judgment was filed, but regardless, the state court now has actual
notice.
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In the case of Dukes v. South Carolina Insurance Co., 770 F.2d 545 (5th Cir. 1985), the
Fifth Circuit relied upon its decision in Medrano and found that constructive notice was
accomplished by notice to counsel for the plaintiffs.
The Fifth Circuit presumed that the
attorneys for plaintiffs fulfilled their ethical responsibility to advise the state court of the removal
to federal court before the default judgment was taken. "Failure to file a copy of the removal
petition with the state court clerk is a procedural defect, and does not defeat the federal court's
jurisdiction." Id. at 545; Prewitt v. City ofGreenville, Miss., 202 F.3d 265 (5th Cir. 1999).
Removal statutes are to be strictly construed against removal and the removing party
bears the burden of establishing the district court's jurisdiction. See Davis v. Estate ofHarrison,
214 F. Supp. 2d 695, 696 (S.D. Miss. 2002) (citing Brown v. Demeo, Inc., 792 F.2d 478 (5th Cir.
1986)); Wilson v. Republic Iron & Steel Co., 257 U.S. 92, 97,42 S. Ct. 35, 66 L. Ed. 144 (1921).
Progressive has met its burden. Plaintiffs had notice of removal and participated in the
federal cause of action. The failure of Progressive to file a notice of removal in the state court
does not defeat this Court's jurisdiction. Further, the state court now has actual notice of
removal.
Although a motion for default judgment is pending in the Circuit Court of Itawamba
County, this matter was properly removed before any final judgment had been entered by the
Circuit Court, and therefore, this Court has jurisdiction. The Court also agrees with Progressive
that Plaintiffs have not timely filed an objection to the removal of this action, and have waived
their right to insist that this Court is bound to defer to the state court's ruling on the motion for
default judgment.
For all the foregoing reasons, Garnishee's motion to enjoin plaintiffs from proceeding
further in the state court action [27] is GRANTED; Plaintiffs' motion to dismiss for lack of
3
jurisdiction/adjudication of failure of removal [31] is DENIED; Plaintiffs' motion to continue
and stay [33] is DENIED; and Plaintiffs' motion to expedite hearings on pending motions [39] is
now DENIED AS MOOT.
Jt /jy~
An order in accordpce with this opinion shall issue this day.
THIS,thed{:'-YOfAPril,2014.
SENIOR JUDGE
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