Parker v. Chevron U.S.A., Inc. et al

Filing 16

MEMORANDUM OPINION AND ORDER granting 4 Motion to Remand to State Court. Ordered that this civil action is remanded to the Circuit Court of Jackson County, Mississippi, and that a certified copy of this Order of remand shall be immediately mailed by the Clerk to the clerk of the state. Plaintiffs requestfor costs and expenses, including attorneys fees under 28 U.S.C. § 1447(c), isGRANTED. See Order for more details. Signed by District Judge Halil S. Ozerden on 11/10/16. (RLW)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
SOUTHERN DIVISION
AMY E. PARKER
v.

PLAINTIFF
CIVIL NO. 1:16-cv-324-HSO-JCG

CHEVRON U.S.A., INC.,
CHEVRON CORPORATION,
CHEVRON REFINERY PASCAGOULA,
and JOHN DOES 1-10

DEFENDANTS

MEMORANDUM OPINION AND ORDER GRANTING
PLAINTIFF’S [4] MOTION TO REMAND AND REQUEST
FOR COSTS AND EXPENSES, INCLUDING
ATTORNEYS’ FEES UNDER 28 U.S.C. § 1447(c)
BEFORE THE COURT is Plaintiff’s Motion to Remand [4] filed September
30, 2016. This Motion is now fully briefed. Plaintiff seeks remand of this matter to
state court and an award of costs and expenses under 28 U.S.C. § 1447(c) for an
improper removal. Having considered Plaintiff’s Motion, the record as a whole, and
relevant legal authority, the Court is of the opinion that Defendants Chevron
U.S.A., Inc., Chevron Corporation, and Chevron Refinery Pascagoula have not
carried their burden of establishing that removal to this Court was proper, thus
Plaintiff’s Motion is well taken and should be granted and this matter should be
remanded to the Circuit Court of Jackson County, Mississippi. The Court is further
of the opinion that Plaintiff should be granted costs and expenses, including
attorneys’ fees, under 28 U.S.C. § 1447(c).

I. BACKGROUND
This case arises out of alleged unlawful employment practices by Defendants
Chevron U.S.A., Inc., Chevron Corporation, and Chevron Refinery Pascagoula for
allegedly violating Plaintiff Amy E. Parker’s (“Plaintiff”) rights under Title VII of
the Civil Rights Act, 42 U.S.C. § 2000e-2. Compl. [1-2] at 14-18. On April 15, 2016,
Plaintiff filed a Complaint [1-2] in the Circuit Court of Jackson County, Mississippi,
asserting claims against Defendants for discrimination, and seeking lost wages and
other compensatory damages, punitive damages, attorneys’ fees, and costs. Id. On
July 22, 2016, Plaintiff filed an Amended Complaint [1-2]. Am. Compl. [1-2] at 2-5.
On September 2, 2016, Defendants Chevron U.S.A., Inc., Chevron
Corporation, and Chevron Refinery Pascagoula (“Chevron”)1 filed a Notice of
Removal [1] from state court on the basis of federal question jurisdiction. Notice of
Removal [1] at 1-3. The Notice of Removal alleges that Chevron was served “[o]n or
about August 2, 2016,” thus “[f]ewer than 30 days have elapsed since this action
became removable.” Notice of Removal [1] at 2. The Notice further asserts that

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On October 6, 2016, Defendant Chevron U.S.A., Inc., filed its Disclosure
Statement [7] in which it averred that it was the sole proper Defendant and that
Chevron U.S.A., Inc., had been “incorrectly sued as Chevron, U.S.A., Inc., Chevron
Corporation, and Chevron Refinery of Pascagoula.” In the Response [12] to
Plaintiff’s Motion for Remand, Defendant Chevron U.S.A., Inc., asserted that
Chevron Corporation is “not registered to do business in the State of Mississippi,”
Resp. [12] at 4, and that “Chevron Refinery of Pascagoula is not even a legal entity
capable of being sued,” Resp. [12] at 4, n.2. Based upon the representations of
Defendant Chevron U.S.A., Inc., in its pleadings, the only proper Defendant in this
case is Defendant Chevron U.S.A., Inc.
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Chevron has “no record of being served with this action” but was basing the service
date and the timeliness of the removal on information provided by Plaintiff’s
counsel on September 2, 2016. Id. at n.1.
On September 30, 2016, Plaintiff filed her Motion to Remand [4] asserting
that the Notice of Removal was defective as follows:
2. The defects in the Removal include the following:
a. Removal was not timely, as it was filed more than thirty (30)
days after service on first defendant;
b. Notice of Removal did not include copy of all process, pleadings
and orders served upon defendants to Plaintiff’s Complaint, in
violation of 28 U.S.C. § 1446(a);
Mot. to Remand [4] at 1.
In the Response [12], Chevron contends that, although its registered agent
for process, Corporation Service Company (“CSC”), was served with the Summonses
and the Complaint on August 2, 2016, CSC failed to forward the Summonses and
the Complaint to Chevron, and therefore the removal should be deemed timely
based upon the date of Chevron’s discovery of the existence of the Complaint on
September 2, 2016.2 Resp. [12] at 1-7. Chevron contends that removal was timely

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In support of its Response, Chevron attaches the Affidavit of Steve Kirvan
in which he admits that on August 2, 2016, CSC received “via personal service”
three Summonses and the Complaint in the present matter, as well as two other
lawsuits against the same Defendants. Resp. [12-2] at 1-2. The CSC employee who
processed the “document packet” did not realize that there were three Summonses
and processed only the “top-most Summons in the packet” for the present matter.
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because the case was removed the “same day it became aware of its existence” and
“[g]iven the circumstances, there are no procedural or substantive defects” in the
Notice of Removal. Resp. [12] at 1. Chevron proffers that the removal clock did not
start running until it received “actual notice of the complaint and summons” which
makes its situation “analogous to that addressed by the Fifth Circuit in City of
Clarksdale v. Bellsouth Telecommunications, Inc, 428 F.3d 206 (5th Cir. 2005).” Id.
at 5 (emphasis in original).
II. DISCUSSION
A.

The Removal Procedure
28 U.S.C. § 1441 provides for the removal of civil actions brought in a state

court of which the district courts have original jurisdiction. 28 U.S.C. § 1441(a)
(2012). “A federal district court may exercise original jurisdiction over any civil
action that either satisfies diversity requirements or that arises under the federal
constitution, statutes, or treaties—commonly referred to as ‘federal question’
jurisdiction.” Energy Mgmt. Servs., LLC v. City of Alexandria, 739 F.3d 255, 258-59
(5th Cir. 2014) (citing 28 U.S.C. §§ 1331, 1332, 1369). “Thus, under § 1441, removal
is proper only when the court has original jurisdiction over at least one asserted

Id. Thus, in the present matter only the Summons issued to “Chevron Corporation,
an entity for which CSC is not the registered agent in Mississippi” was processed.
Id. On August 8, 2016, CSC mailed a “Rejection of Service of Process letter” for
Chevron Corporation to Plaintiff’s counsel. Id.; Letter [12-2] at 16.
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claim under either federal question or diversity jurisdiction.” Id. at 259 (citation
omitted).
Federal courts are courts of limited jurisdiction, having subject matter
jurisdiction only over those matters specifically designated by the Constitution or
Congress. Halmekangas v. State Farm Fire & Cas. Co., 603 F.3d 290, 293 (5th Cir.
2010) (citing Epps v. Bexar-Medina-Atascosa Counties Water Improvement Dist. No.
1, 665 F.2d 594, 595 (5th Cir. 1982)). For this reason, removal statutes are subject
to strict construction “in favor of remand.” Ernewayn v. Home Depot U.S.A. Inc.,
727 F.3d 369, 370 (5th Cir. 2013) (citing Manguno v. Prudential Prop. and Cas. Ins.
Co., 276 F.3d 720, 723 (5th Cir. 2002)); see also Willy v. Coastal Corp., 855 F.2d
1160, 1164 (5th Cir. 1988).
28 U.S.C. § 1446(b) provides a 30 day window within which a defendant may
remove a civil action. Clarksdale, 428 F.3d at 209. “The removing party bears the
burden of showing that federal jurisdiction exists and that removal was proper.”
Manguno, 276 F.3d at 723 (citing De Aguilar v. Boeing Co., 47 F.3d 1404, 1408 (5th
Cir. 1995)).
B.

Chevron did not timely remove this matter within the 30 day time limit
under 28 U.S.C. § 1446(b).
Plaintiff asserts that Chevron’s Notice of Removal was procedurally defective

for two reasons: (1) lack of timeliness; and (2) failure to attach all required
documents. The Court finds that this matter can be resolved on the issue of
timeliness.
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Chevron does not dispute that on August 2, 2016, Plaintiff perfected service
of process on its registered agent for process, CSC. Resp. [12] at 2. Chevron also
acknowledges that its Notice of Removal was filed on September 2, 2016, thirty-one
days after the actual date of service of the Summonses and Complaint. Resp. [12]
at 1. The argument that Chevron advances is that because it did not receive “actual
notice” of this matter until September 2, 2016, “the date for the 30-day countdown”
for removal should be deemed to have commenced on September 2, 2016, based
upon the Fifth Circuit’s reasoning in Clarksdale. Resp. [12] at 6.
The Court finds Chevron’s reliance upon Clarksdale to be misplaced. In
Clarksdale, the Fifth Circuit held that under Mississippi law, service of process is
perfected upon the service of a summons and complaint to a defendant corporation’s
“registered-agent corporation” at a time when the “registered-agent corporation” is
open for business. Clarksdale, 428 F.3d at 211-13. In Clarksdale, the defendant
was held to have received actual notice of the lawsuit on December 29, the first day
the registered-agent corporation was open for business, not December 24, when
plaintiff had actually delivered the summons and complaint, because the registeredagent corporation was closed for the holidays. Id.
In the present case, Plaintiff effected service of process on CSC on August 2,
2016. CSC was open for business that day. Chevron’s removal on September 2,

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2016, was therefore untimely by Chevron’s own admission.3 Because the removal
was untimely, remand is required based upon a procedural defect in the removal.
C.

Plaintiff is entitled to costs and expenses, including attorneys’ fees, because
Chevron has not carried its burden of showing that it had an objectively
reasonable basis for removal.
Plaintiff seeks costs and expenses, including attorneys’ fees, “incurred as

result of this improvident and improperly maintained removal.” Mot. to Remand [4]
at 2. Chevron contends that Plaintiff’s request should be denied because “Chevron
removed this action in good faith without the ability to verify the dates of service.”
Resp. [12] at 7, n.4.
Section 1447(c) provides that “[a]n order remanding the case may require
payment of just costs and any actual expenses, including attorney fees, incurred as
a result of the removal.” 28 U.S.C. § 1447(c). The Fifth Circuit has held that “§
1447(c) fee awards are cost recoupments, hence punitive in policy only,” and should
only be awarded if the removing party lacks an objectively reasonable basis for
removal. American Airlines, Inc. v. Sabre, Inc., 694 F.3d 539, 542 (5th Cir. 2012)
(citing Martin v. Franklin Capital Corp., 546 U.S. 132, 140-41 (2005); Howard v. St.
Germain, 599 F.3d 455, 457 (5th Cir. 2010)).

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Chevron spends the majority of its Response attempting to cast blame on
Plaintiff’s counsel for CSC’s failure to properly process the Summonses and
Complaint. Chevron has cited to no legal authority, nor has the Court located any,
to support the position that Chevron’s designated agent’s mishandling of the
Summonses and Complaint somehow tolled the start of the 30 day clock.
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The application of § 1447(c) requires consideration of the propriety
of the removing party’s actions based on an objective view of the legal and
factual elements in each particular case. We evaluate the objective
merits of removal at the time of removal, irrespective of the fact that it
might ultimately be determined that removal was improper. “The
propriety of the defendant’s removal continues to be central in
determining whether to impose fees.” Id. at 928. See also Daleske v.
Fairfield Communities, Inc., 17 F.3d 321 (10th Cir. 1994) (declining to
award fees on conclusion that defendant had legitimate basis for
believing district court had jurisdiction); Schmitt v. Ins. Co. of N. Am.,
845 F.2d 1546, 1552 (9th Cir. 1988) (holding fees to be inappropriate
where removal was “fairly supportable”); cf. Morgan Guar. Trust Co., 971
F.2d at 923 (awarding fees only after finding fault with defendant’s
tactics). In other words, the question we consider in applying § 1447(c)
is whether the defendant had objectively reasonable grounds to believe
the removal was legally proper.
Valdes v. Wal-Mart Stores, Inc., 199 F.3d 290, 293 (5th Cir. 2000) (footnote omitted).
The Fifth Circuit has explained that a district court’s discretion in awarding
ordinary court costs under § 1447(c), such as those available under Federal Rule of
Civil Procedure 54(d)(1), is broader. Hornbuckle v. State Farm Lloyds, 385 F.3d
538, 541 n.5 (5th Cir. 2004). However, this discretion is not unlimited. Id.
In the present case, at the time Chevron filed its Notice of Removal on
September 2, 2016, Chevron’s understanding from Plaintiff’s counsel was that
service of process had been perfected on August 2, 2016, which rendered removal 31
days later on September 2, 2016, untimely. It is obvious to the Court, as it should
have been to Chevron, that if service of process had occurred on August 2, 2016,
Chevron’s removal on September 2, 2016, would be untimely under 28 U.S.C. §
1446(b). Chevron’s assertions that it acted in good faith because it was “without the
ability to verify the dates of service” affords it little support because Chevron’s own
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agent, and therefore by extension Chevron, was served with the Summonses and
Complaint on August 2, 2016. The documents Chevron claims it needed to review
to verify service were in the custody and control of its own designated agent, CSC,
and Chevron could have confirmed the date of service prior to filing the removal on
September 2, 2016. Indeed, Chevron acknowledges in its Response that when it
actually contacted CSC on October 10, 2016, CSC was able to verify that CSC had
in fact received the Summonses and Complaint on August 2, 2016. Resp. [12] at 4.
Having considered the pleadings, the record as a whole, and relevant legal
authority, and for the reasons set forth herein, the Court finds Chevron has not
shown that it had an objectively reasonable basis for removing this case. Plaintiff’s
request for costs and expenses, including attorneys’ fees, will be granted.
III. CONCLUSION
Because Chevron has not carried its burden of demonstrating that removal
was proper or objectively reasonable, Plaintiff’s Motion to Remand must be granted.
Plaintiff’s request for costs and expenses, including attorneys’ fees under 28 U.S.C.
§ 1447(c), will also be granted. Accordingly,
IT IS, THEREFORE, ORDERED AND ADJUDGED, that Plaintiff Amy
E. Parker’s Motion to Remand [4] is GRANTED.
IT IS, FURTHER, ORDERED AND ADJUDGED, that this civil action is
remanded to the Circuit Court of Jackson County, Mississippi, and that a certified

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copy of this Order of remand shall be immediately mailed by the Clerk to the clerk
of the state court pursuant to 28 U.S.C. § 1447(c).
IT IS, FURTHER, ORDERED AND ADJUDGED, that Plaintiff’s request
for costs and expenses, including attorneys’ fees under 28 U.S.C. § 1447(c), is
GRANTED. If Plaintiff chooses to pursue such an award, she shall file in this
Court the appropriate documentation or other proof within ten (10) calendar days of
entry of this Order, including an itemized accounting of costs and actual expenses,
including attorneys’ fees, incurred as the result of Chevron’s removal of this case.
Defendant Chevron U.S.A., Inc., shall have ten (10) calendar days thereafter to file
any objections. If Plaintiff fails to file this documentation within the time allotted
herein, the request for costs and actual expenses, including attorneys’ fees, will be
deemed waived.
SO ORDERED AND ADJUDGED, this the 10th day of November, 2016.

s/ Halil Suleyman Ozerden
HALIL SULEYMAN OZERDEN
UNITED STATES DISTRICT JUDGE

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