Pope v. State Farm Fire & Casualty Company et al
Filing
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ORDER granting 7 Motion to Remand. Case remanded to District Court of Cleveland County. Signed by Honorable Timothy D. DeGiusti on 2/24/2015. (mb)
IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF OKLAHOMA
ANDREA POPE,
Plaintiff,
v.
STATE FARM FIRE AND CASUALTY
COMPANY, et al.,
Defendants.
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Case No. CIV-14-1009-D
(District Court of Cleveland County,
Oklahoma, Case No. CJ-2013-1241)
ORDER
This matter is before the Court on Plaintiff’s Motion to Remand [Doc. No. 7].
Plaintiff asserts that the Notice of Removal was not timely filed by Defendant State Farm
Fire and Casualty Company (“State Farm”), that State Farm waived its right of removal, and
that its allegations and evidence of fraudulent joinder of a nondiverse defendant are
insufficient. State Farm has timely opposed Plaintiff’s Motion and filed its Alternative
Motion to Conduct Jurisdictional Discovery and for Stay of Ruling on Plaintiff’s Motion to
Remand [Doc. No. 14]. Both motions are fully briefed.
Factual and Procedural Background
This case concerns damage to Plaintiff’s home in Moore, Oklahoma, in May 2013 that
was covered by a State Farm homeowner’s insurance policy. Plaintiff sued State Farm in the
District Court of Cleveland County, Oklahoma, on September 30, 2013, claiming that State
Farm failed to pay the full amount due under the policy and breached its duty of good faith
and fair dealing. Plaintiff also sued the State Farm agent who sold her the policy, Terry
Cavnar (“Cavnar”), asserting claims of negligence, constructive fraud, and breach of
fiduciary duty. Plaintiff claims that Cavnar failed to exercise reasonable care and skill in
procuring a replacement cost policy that would provide the coverage she requested, failed
to inform Plaintiff that she would have to bear the expense of replacement before she could
obtain replacement cost benefits, and failed to monitor the policy for adequate coverage in
subsequent years.
The parties litigated this case, and others like it, for almost a year before State Farm
removed it to federal court on September 18, 2014, pursuant to 28 U.S.C. §§ 1441 and 1446.
State Farm invokes diversity jurisdiction under 28 U.S.C. § 1332 based on an assertion that
Cavnar was fraudulently joined because Plaintiff’s “claims against Cavnar lack both factual
and legal basis.” See Notice of Removal [Doc. No. 1], ¶ 8. Further, State Farm contends the
case became removable, and that its Notice of Removal was timely filed, within 30 days of
Plaintiff’s filing a motion to quash a notice to take her deposition. State Farm’s position is
that certain statements made by Plaintiff’s counsel in a hearing on July 21, 2014, together
with Plaintiff’s refusal to be deposed before the one-year removal deadline of 28 U.S.C.
§ 1446(c)(1), allowed it to ascertain removability. Id. ¶ 33.
As stated above, Plaintiff challenges both State Farm’s allegations of fraudulent
joinder and the timeliness of removal. Plaintiff contends nothing has occurred during the
litigation that caused the case to become removable, and State Farm has not identified any
“motion, order or other paper” which triggered its right of removal under § 1446(b)(3).
Plaintiff also contends State Farm waived any right of removal by defending the case in state
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court rather than removing it. Plaintiff argues that her petition states viable claims against
Cavnar and that State Farm lacks any evidence that would defeat her claims. Because the
Court finds that State Farm has failed to establish the timeliness of its removal, the Court
limits the discussion of Plaintiff’s arguments to this issue.
Standard of Decision
The timeliness of removal depends on State Farm’s compliance with the statutory
procedure set forth in § 1446(b), which requires the filing of a notice of removal “within
30 days after the receipt by the defendant . . . of a copy of the initial pleading” or “if the case
stated by the initial pleading is not removable, . . . within 30 days after receipt by the
defendant . . . of a copy of an amended pleading, motion, order or other paper from which
it may first be ascertained that the case is one which is or has become removable.” See
28 U.S.C. § 1446(b)(1), (3). Where, as here, a defendant relies on the latter provision, the
30-day time limit begins to run when the defendant with a right to remove receives
unequivocal notice, normally as a result of a voluntary act of the plaintiff, from which “the
defendant is able to intelligently ascertain removability.” See Huffman v. Saul Holdings Ltd.
P’ship, 194 F.3d 1072, 1078 (10th Cir. 1999) (internal quotation omitted); see also Akin v.
Ashland Chem. Co., 156 F.3d 1030, 1035-36 (10th Cir. 1998).
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Discussion
State Farm asserts that Plaintiff’s motion to quash the notice of her deposition
“constituted the ‘other paper’ providing State Farm with unequivocal notice that this case
was removable.” See State Farm’s Resp. Br. [Doc. No. 13], p.13; see also Notice of
Removal [Doc. No. 1], ¶ 33. This is so, State Farm argues, because the motion confirmed
that statements Plaintiff’s counsel had made in the July 21, 2014 hearing regarding other
cases also applied to this case. Id. pp.13-14.
The statements of counsel to which State Farm refers were also presented in Misner
v. State Farm Fire & Cas. Co., Case No. CIV-14-873-D (W.D. Okla.), as a basis for
removability. The undersigned carefully examined those statements in Misner and rejected
State Farm’s position that “counsel’s statements [were] concessions that Plaintiffs’ testimony
would not provide factual support for their claims against [the local agent].” See id. Order
of Dec. 4, 2014, p. 8 (available at 2014 WL 6879094, *4). Plaintiff’s counsel “did not
provide any facts or make any concessions bearing on the issue of whether Plaintiffs’ claims
against [the agent] were factually supported or supportable.” Id. 2014 WL 6879094 at *5.
Accordingly, the Court finds that neither these statements nor Plaintiff’s motion allegedly
adopting them triggered the removability of this case.
Alternatively, State Farm urges the Court to find that the removal of Plaintiff’s case
was timely because “Plaintiff waived any defects in State Farm’s compliance with the
removal procedure set forth in 28 U.S.C. § 1446(b).” See State Farm’s Resp. Br. [Doc.
No. 13], p.14. Although State Farm is correct that a procedural defect in removal can be
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waived, it provides no legal authority for the proposition that a litigant’s conduct in state
court may operate as a prospective waiver of an improper removal. In a footnote, State Farm
cites two treatises as support for its contention that Plaintiff’s conduct in delaying her
deposition should operate as a waiver of her right to remand. These authorities are not on
point. The type of conduct that may operate as a waiver is “affirmative federal court conduct
by the plaintiff.” See 29A Fed. Proc. L. Ed. § 69:129. In this case, Plaintiff has not engaged
in any such conduct.1 Further, following amendment of the removal statutes in 2011, an
exception to the one-year time limit for removal is expressly provided if a plaintiff engages
in conduct in state court that prevents removal, as State Farm now appears to contend. See
28 U.S.C. § 1446(c)(1).
State Farm requests that it be permitted to conduct jurisdictional discovery “in the
event the Court determines that the current record is not sufficient to establish the fraudulent
joinder of the non-diverse defendant.” See State Farm’s Mot. Conduct Jurisdictional
Discovery [Doc. No. 14], p.1. Because the Court does not reach the issue of fraudulent
joinder, this request is unnecessary to the decision.
Finally, Plaintiff requests that she be awarded a reasonable attorney fee and costs
incurred as a result of Defendant’s improper removal, as permitted by § 1447(c). “[T]he
award of attorney’s fees rests squarely within the discretion of the district court when a
remand is ordered.” Martin v. Franklin Capital Corp., 393 F.3d 1143, 1146 (10th Cir. 2004).
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If Plaintiff’s state court conduct were considered, the Court would not find unequivocal conduct
or a statement of position that might operate as a waiver of Defendant’s improper removal of the case.
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Where a defendant’s “removal position was objectively reasonable at the time [it] sought
removal,” a district court may properly decline to award fees to the plaintiff. Id. at 1147-48.
The Court finds that to be the situation here, and exercises its discretion not to require the
payment of costs and expenses, including attorney fees.
Conclusion
For these reasons, the Court concludes that the case was improperly removed and
must be remanded, but that an award of costs and expenses should not be ordered.
IT IS THEREFORE ORDERED that Plaintiff’s Motion to Remand [Doc. No. 7] is
GRANTED and Defendant’s Alternative Motion to Conduct Jurisdictional Discovery [Doc.
No. 14] is DENIED. This case is REMANDED to the District Court of Cleveland County,
Oklahoma.
IT IS SO ORDERED this 24th day of February, 2015.
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