Fiskus et al v. Bristol-Myers Squibb Company et al
Filing
16
OPINION & ORDER re: 12 MOTION to Remand . filed by Vicky Fiskus, Charles Fiskus. For the foregoing reasons, the motion to remand is granted. The Clerk of the Court is directed to close this motion and to remand this action to New York Supreme Court, New York County. (Signed by Judge Paul A. Crotty on 10/1/2014) (lmb)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
------------------------------------------------------------X
:
CHARLES FISKUS and VICKY FISKUS,
:
:
:
Plaintiffs,
:
:
-against:
:
BRISTOL-MYERS SQUIBB COMPANY
:
and INHIBITEX, INC.,
:
:
Defendants.
:
:
:
------------------------------------------------------------X
14 Civ. 3931 (PAC)
OPINION & ORDER
HONORABLE PAUL A. CROTTY, United States District Judge:
Plaintiffs Charles and Vicky Fiskus (collectively, “Plaintiffs”) seek remand of this action
to New York State Court under 28 U.S.C. § 1447(c) because 28 U.S.C. § 1441(b)(2), the forum
defendant rule, prohibits Defendants, both residents of New York, from removing the action to
federal court here in the Southern District. For the reasons stated below, Plaintiff’s motion to
remand the action to New York State Court is granted.
BACKGROUND
On Friday, May 30, 2014, plaintiffs filed this action against Defendants Bristol-Myers
Squibb Company and Inhibitex, Inc. (collectively, “Defendants”) in New York State Supreme
Court for negligence arising out of Charles Fiskus’s participation in a clinical trial for a hepatitis
C drug manufactured, marketed, and distributed by Defendants. On the following business day,
Monday, June 2, 2014, prior to service being effected, Defendants removed this action to the
Southern District of New York. (Dkt. 1). Plaintiffs timely moved to remand the action on July
1
9, 2014. (Dkt. 12).
Defendants argue that removal of the suit was proper because at the time of removal, they
had not yet been served. Therefore, section 1441(b) does not yet apply and Defendants are
allowed to remove the action. (Defendants’ Memorandum of Law in Opposition to Plaintiffs’
Motion to Remand (“Def. Mem.”), at 2-7). Plaintiffs argue that such an understanding of the
statute is improper and that allowing removal here would produce absurd results contrary to the
statute’s purpose. (Memorandum of Law in Support of Plaintiffs’ Motion to Remand (“Pl.
Mem.”), at 2-6).
DISCUSSION
I.
Applicable Law
In a challenge to the propriety of removal, the party seeking to remove an action bears the
burden of establishing federal court jurisdiction. See Allstate Ins. Co. v. CitiMortgage, Inc.,
2012 WL 967582, at *2 (S.D.N.Y. Mar. 13, 2012). Courts must “construe all disputed questions
of fact and controlling substantive law in favor of the plaintiff” on a motion to remand, and
“removal statutes are construed narrowly.” Torchlight Loan Servs., LLC v. Column Fin., Inc.,
2013 WL 3863887, at *2 (S.D.N.Y. July 24, 2013) (internal citations omitted). “[O]ut of respect
for the limited jurisdiction of the federal courts and the rights of states, we must resolve any
doubts against removability.” In re Methyl Tertiary Butyl Ether (“MTBE”) Prods. Liab. Litig.,
488 F.3d 112, 124 (2d Cir. 2007).
The federal removal statute authorizes removal of a “civil action brought in a State court
of which the district courts of the United States have original jurisdiction.” 28 U.S.C. § 1441(a).
The forum defendant rule provides an exception to removal and prohibits removal where “any of
the parties in interest properly joined and served as defendants is a citizen of the State in which
2
such action is brought.” Id. § 1441(b)(2). The principle behind allowing removal by nonresident
defendants, similar to that of diversity jurisdiction, is that “out-of-state parties might be subjected
to undue prejudice in state courts, and thus ought to be afforded the opportunity to have their
cases tried to an impartial forum.” Prudential Oil Corp. v. Phillips Petroleum Co., 546 F.2d 469,
475 (2d Cir. 1976) (internal citations omitted); Eicher v. Macquarie Infrastructure Mgmt. (USA)
Inc., 2013 WL 4038601, at *2 (S.D.N.Y. Aug. 8, 2013). The purpose of the “properly joined and
served” requirement in the forum defendant rule is to prevent plaintiffs from frustrating removal
by the expedient of joining resident parties against which it does not intend to proceed. See Stan
Winston Creatures, Inc. v. Toys “R” Us, Inc., 314 F. Supp. 2d 177, 181 (S.D.N.Y. 2003); accord
Sullivan v. Novartis Pharms. Corp., 575 F. Supp. 2d 640, 643 n.1 (D.N.J. 2008) (the “properly
joined and served” language seeks to prevent “improper joinder[, which is] . . . the practice of
naming a forum-resident entity as a defendant solely to prevent an action from being removed to
federal court”).
II.
Analysis
Defendants are both citizens of New York properly named as parties in interest. Here,
rather than using the “properly joined and served” requirement as a shield—that is, to prevent
gamesmanship by plaintiffs—Defendants seek to use it as a sword to achieve removal, even
though it serves no legitimate purpose to do so. The proposed removal capitalizes on the brief
time period between filing and service of the complaint, with a tactic made possible by the
advent of electronic filing. See Eicher, 2013 WL 4038601, at *3 (“Under the Defendants’
proffered interpretation of the forum defendant rule, defendants could effectively prevent the
imposition of the rule by monitoring state dockets and removing the action before a plaintiff can
serve any of the parties.”). The Court finds that removal under these circumstances is improper.
3
“[W]hen, as in this case, a defendant—who indisputably is a proper party to the suit—learns of
the suit and removes it to federal court before being served, unconsidered application of the rule
serves primarily to reward procedural games instead.” In re IntraLinks Holdings, Inc. Derivative
Litig., 2013 WL 929836, at *2 (S.D.N.Y. Mar. 11, 2013).
The Court is aware of the split of authority on this issue. While several courts have
adhered literally to the statute and allowed pre-service removal by a forum defendant, the Court
believes that such an interpretation leads to an unintended result, allowing a “Flash Boys”
approach to speedy removal to override the rule’s purpose. See Sullivan, 575 F. Supp. 2d at 643
(prohibiting pre-service removal by a forum defendant and noting that those courts that have
adhered to a too literal interpretation of section 1441(b) “have ignored a less often cited, but
equally important, principle of statutory construction which holds that when the literal
application of statutory language would either produce an outcome demonstrably at odds with
the statute’s purpose or would result in an absurd outcome, a court must look beyond the plain
meaning of the statutory language.”). Here the only defendants involved are New York forum
defendants and they are indisputably legitimate defendants. They were not named to frustrate
removal. Removal prior to service was enabled by the expedient of continuous monitoring of the
electronic docket. Giving appropriate consideration to the statute’s purpose, a narrow
interpretation of the statute avoids an absurd result, and adheres to the original intent of the rule.
It makes no sense to allow removal of an action where service is not achieved (or could even be
attempted), when it is barred after service.1 See, e.g., Eicher, 2013 WL 4038601, at *2-3
1
Defendants argue that Congress adopted their interpretation when it retained the “properly joined and served” language in
Section 1441, while making other “sweeping changes” in the Federal Courts Jurisdiction and Venue Clarification Act of 2011.
Def. Mem. at 6-7. This argument is rejected. First of all, the argument incorrectly assumes Congressional awareness of the split
in interpretations. See Perez v. Forest Labs., Inc., 902 F. Supp. 2d 1238, 1245 n.8 (E.D. Mo. 2012) (noting that Congressional
awareness of the conflicting interpretations of this statute is unlikely because most remand orders are unreviewable). Second, the
argument ignores the far more likely (and reasonable) possibility that Congress sought simply to preserve the original purpose
4
(prohibiting pre-service removal by a forum defendant); Torchlight, 2013 WL 3863887, at *3
(same). Accordingly, section 1441(b) prohibits Defendants from removing the action to federal
court.
CONCLUSION
For the foregoing reasons, the motion to remand is granted. The Clerk of the Court is
directed to close this motion and to remand this action to New York Supreme Court, New York
County.
Dated: New York, New York
October 1, 2014
SO ORDERED
p~~
United States District Judge
of the rule- that is, to prevent plaintiffs from blocking removal by improperly joining irrelevant forum defendants.
Thus, Congress's preservation of that language represents an intention to retain the requirement to that end.
5
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?