Chapman et al v. RevClaims, LLC et al
Filing
31
MEMORANDUM OPINION AND ORDER granting 8 Motion to Remand. Ordered that this case is remanded to the Chancery Court of Harrison County, Mississippi, First Judicial District, and that a certified copy of this Order of remand shall be immediately mailed by the Clerk to the clerk of the state court; and ordered that Plaintiffs request for costs and expenses is denied. Signed by District Judge Halil S. Ozerden on 2/14/18. (RLW)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
SOUTHERN DIVISION
CHARLES E. CHAPMAN, ET AL.
v.
PLAINTIFFS
CIVIL NO. 1:17cv75-HSO-JCG
REVCLAIMS, LLC, ET AL.
DEFENDANTS
MEMORANDUM OPINION AND ORDER GRANTING
PLAINTIFFS’ MOTION [8] TO REMAND
BEFORE THE COURT is Plaintiffs Charles E. Chapman, Margaret L.
Chapman, and Alexander C. Chapman’s Motion [8] to Remand. This Motion is
fully briefed. The Court, having considered the pleadings on file, the record as a
whole, and relevant legal authority, finds that because there was a procedural
defect in the removal of this case, remand is required.
I. FACTS AND PROCEDURAL HISTORY
This case arises out of “catastrophic injuries” suffered by Plaintiff
Alexander C. Chapman (“Alexander”), a minor at the time, in an automobile
accident that occurred on May 26, 2014, in the State of Louisiana.1 Am. Compl.
[1-2] at 6. On July 18, 2014, an Order Appointing Co-Guardians and Granting
Other Relief was entered in the Chancery Court of Harrison County, Mississippi,
First Judicial District, Case Number 24CH1:14cv1815-JP, appointing Plaintiffs
Charles E. Chapman and Margret L. Chapman (“Plaintiffs”) Guardians of Plaintiff
Plaintiff Alexander C. Chapman reached the age of majority on January 29, 2015,
when he turned 21. Am. Compl. [1-2] at 6.
1
A.C.C.2 State Court Record [2] at 17-20. The Order granted the Chapmans the
authority to retain counsel and “to take such action and seek relief and recovery of
damages, benefits and such other remedies which may accrue for said Minor
Child’s injuries, losses, disabilities and damages.” Id. at 18. Plaintiffs filed suit in
the United States District Court for the Eastern District of Louisiana against
“third parties” and on or around November 18, 2015, settled these claims. Notice
of Removal [1] at 4.
On February 13, 2017, Plaintiffs filed an Amended Complaint for
Interpleader, Injunctive and Other Relief in the Chancery Court case. Am. Compl.
[1-2] at 4-27. Plaintiffs named RevClaims, LLC, Memorial Hospital at Gulfport,
United Health Care Services, Inc., OPTUM, Lowe’s Welfare Plan, and John Does
1-5 as Defendants. Plaintiffs tendered $167,511.89 into the registry of the
Chancery Court and sought a judicial determination of whether any of Defendants
held a valid claim to the any of the interpleaded funds, and if not sought return of
the funds to Plaintiffs.3 Id. Plaintiffs filed a Second Amended Complaint on
March 7, 2017. State Court Record [2] at 64-91.
The original case number was 14-1815(1) however it appears to the Court that the
case number was revised to 24CH1:14cv1815-JP when the Chancery Court began
accepting electronic filings. See State Court Record [2] at 2-5.
2
An Agreed Order for Interpleader of Funds was signed by the Chancellor on
February 17, 2017, and the funds were deposited into the Registry of the Chancery
Court. State Court Record [2] at 61-63.
3
2
Defendants United Health Care, Inc., OPTUM, and Lowe’s Welfare Plan
(“Removal Defendants”) removed the case to this Court on March 15, 2017,
invoking federal question jurisdiction under 28 U.S.C. § 1441(a), specifically,
claims under the Employee Retirement Income Security Act of 1974, 29 U.S.C. §
1001, et seq. (“ERISA”). Notice of Removal [1] at 1-7. The Notice of Removal
asserts that OPTUM was served on February 14, 2017, and was the first
Defendant to be served.4 Id. at 2. The Removal Defendants stated that they
“procured the consent of each of the other defendants in this lawsuit to this
removal.” Id.
Plaintiffs filed a Motion [8] to Remand arguing that the Removal was
procedurally defective, including the failure of all Defendants to file written
joinders or written consent to the removal, and that ERISA does not preempt their
Chancery Court Interpleader case. Mot. to Remand [8] at 1-4.
The Removal Defendants filed a Response [15] maintaining that removal
was proper because each Defendant that had been served with process consented
to the removal, Resp. in Opp’n [15] at 2-3, and that the Notice of Removal
contained a “short plain statement demonstrating entitlement to this removal,”
The Chancery Court Docket reflects that on March 29, 2017, Plaintiffs filed
Affidavits attesting that they had effected service of process of the Amended
Complaint on RevClaims, LLC, UnitedHealthCare Services, Inc., and OPTUM on
February 14, 2017. Chancery Court Docket [10-1] at 4.
4
3
id. at 4. The Removal Defendants contend that Plaintiffs’ claims for “unjust
enrichment” are preempted by ERISA and thus removable, citing as authority
Carducci v. Aetna U.S. Healthcare, 204 F. Supp. 2d 796 (D.N.J. 2002).
II. DISCUSSION
A.
The Removal Procedure
28 U.S.C. ' 1441(a) 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).
Section 1446 sets forth the procedure for removing a civil action to federal court:
(a)
(b)
Generally.C
A defendant or defendants desiring to remove any civil action
from a State court shall file in the district court of the United
States for the district and division within which such action is
pending a notice of removal signed pursuant to Rule 11 of the
Federal Rules of Civil Procedure and containing a short and
plain statement of the grounds for removal, together with a copy
of all process, pleadings, and orders served upon such defendant
or defendants in such action.
Requirements; Generally.C
* * *
(2)
(A)
When a civil action is removed solely under section
1441(a), all defendants who have been properly joined
and served must join in or consent to the removal of the
action.
(B)
Each defendant shall have 30 days after receipt by
or service on that defendant of the initial pleading or
summons described in paragraph (1) to file the notice of
removal.
(C)
If defendants are served at different times, and a
later-served defendant files a notice of removal, any
earlier-served defendant may consent to the removal
4
even though that earlier-served defendant did not
previously initiate or consent to removal.
28 U.S.C. ' 1446(a), (b)(2)(A)-(C).
Removal of cases from state court implicates significant federalism
concerns. Gutierrez v. Flores, 543 F.3d 248, 251 (5th Cir. 2008). “Federalism
concerns animate the rule requiring strict construction of removal statutes.”
Beiser v. Weyler, 284 F.3d 665, 674 (5th Cir. 2002). “The removing party bears the
burden of showing that federal jurisdiction exists and that removal was proper.”
Manguno v. Prudential Property and Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir.
2002) (citing De Aguilar v. Boeing Co., 47 F.3d 1404, 1408 (5th Cir. 1995)).
The principle embodied in ' 1446(b)(2)(A) is sometimes referred to as the
“rule of unanimity.” Spillers v. Tillman, 959 F. Supp. 364, 368 (S.D. Miss. 1997);
see Pike Cty., Miss. v. Aries Bldg. Sys., LLC, No. 5:17-CV-17-DCB-MTP, 2017 WL
1737722, at *2 (S.D. Miss. May 3, 2017) (citing 28 U.S.C. § 1446(b)(2)(A)). “The
rule of unanimity requires that all defendants to an action either sign the original
petition for removal or timely file written consent to the removal.” Powers v.
United States, 783 F.3d 570, 576 (5th Cir. 2015) (emphasis in original) (citing
Getty Oil Corp. v. Ins. Co. of N. Am., 841 F.2d 1254, 1262 n.11 (5th Cir. 1988)).
The Fifth Circuit has held that
while it may be true that consent to removal is all that is required
under section 1446, a defendant must do so itself. This does not mean
that each defendant must sign the original petition for removal, but
5
there must be some timely filed written indication from each served
defendant, or from some person or entity purporting to formally act on
its behalf in this respect and to have authority to do so, that it has
actually consented to such action. Otherwise, there would be nothing
on the record to “bind” the allegedly consenting defendant.
Getty Oil, 841 F.2d at 1262 n.11.
“A motion to remand the case on the basis of any defect other than lack of
subject matter jurisdiction must be made within 30 days after the filing of the
notice of removal under section 1446(a).” 28 U.S.C. ' 1447(c). By filing a timely
motion to remand, a plaintiff is deemed to have “explicitly refused to ‘acquiesce’ to
the choice of forum.” Schexnayder v. Entergy Louisiana, Inc., 394 F.3d 280, 285 (5th
Cir. 2004). In this case, Plaintiffs filed their Motion [8] to Remand on April 4, 2017,
within thirty days of the March 15, 2017, Notice of Removal [1].
B.
Remand is required because the removal was procedurally defective.
The Notice of Removal [1] was filed on March 15, 2017, and stated that the
Removal Defendants had “procured the consent of each of the other defendants in
this lawsuit to this removal.” Therefore, to perfect the removal, written consents
to the removal were required to be filed by each of the other Defendants within
thirty days of service upon them of the Amended Complaint. See Powers, 783 F.3d
at 576.
According to the Chancery Court docket, Defendant RevClaims, LLC
(“RevClaims”), was served with the Amended Complaint on February 14, 2017.
6
State Court Docket [13] at 5. The record in this Court reflects that RevClaims did
not file a written consent to the removal. The only pleading filed by RevClaims
that could possibly be construed to be written consent to the removal was its April
19, 2017, Joinder [16] in the Removal Defendants’ Response [15] in Opposition to
Plaintiffs’ Motion [8] to Remand.5 However, this Joinder was filed more than 30
days after RevClaims was served on February 14, 2017, and would therefore
constitute an untimely consent.
Plaintiffs timely raised a procedural defect in the removal of this case.
Defendants have not carried their burden of demonstrating that removal was
proper, as they have not shown compliance with the rule of unanimity required by
28 U.S.C. ' 1446. Because the Court finds that remand is appropriate based on this
procedural defect, it need not reach the question of its subject-matter jurisdiction.
C.
Plaintiffs’ request for costs and expenses will be denied.
Plaintiffs seek an award of costs and expenses from the Removal Defendants
pursuant to 28 U.S.C. § 1447(c). Mot. to Remand [8] at 4 (citing 28 U.S.C. §
1447(c)). The Court finds that this request should be denied.
RevClaims’ Answer, filed on March 22, 2017, did not contain an unambiguous
statement of consent to the removal, or even mention the removal, and cannot be
construed as written consent to the removal. “The mere filing of an answer is
hardly a clear, unambiguous expression of consent.” Granderson v. Interstate Realty
Mgmt. Co., No. 5:06cv100, 2006 WL 3422359, at *2 (S.D. Miss. Nov. 27, 2006) (citing
Spillers v. Tillman, 959 F. Supp. 364 (S.D. Miss. 1997)).
5
7
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 lacked 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)). In determining whether attorneys’
fees should be awarded, the district court does not consider the motive of the
removing defendant, but must 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.” Valdes v. Wal-Mart Stores, Inc., 199 F.3d 290, 292-93 (5th
Cir. 2000).
Having considered the record as a whole, the Court finds that the Removal
Defendants did not lack an objectively reasonable basis for removing the case.
Plaintiffs are therefore not entitled to an award of costs and expenses under §
1447(c), and this request will be denied. See American Airlines, 694 F.3d at 542;
Valdes, 199 F.3d at 292-93.
8
III.
CONCLUSION
Because Defendants United Health Care, Inc., OPTUM, and Lowe’s Welfare
Plan have not carried their burden of demonstrating that removal was procedurally
proper, Plaintiffs Charles E. Chapman, Margaret L. Chapman, and Alexander C.
Chapman’s Motion [8] to Remand must be granted. Plaintiffs’ request for costs and
expenses under 28 U.S.C. § 1447(c) will be denied.
IT IS, THEREFORE, ORDERED AND ADJUDGED that Plaintiffs
Charles E. Chapman, Margaret L. Chapman, and Alexander C. Chapman’s Motion
[8] to Remand is GRANTED.
IT IS, FURTHER, ORDERED AND ADJUDGED that this case is
remanded to the Chancery Court of Harrison County, Mississippi, First Judicial
District, and that a certified 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 Plaintiffs’ request
for costs and expenses under 28 U.S.C. § 1447(c) is DENIED.
SO ORDERED AND ADJUDGED, this the 14th of February, 2018.
s/ Halil Suleyman Ozerden
HALIL SULEYMAN OZERDEN
UNITED STATES DISTRICT JUDGE
9
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?