City of Fort Worth v. Employees' Retirement Fund of the City of Fort Worth

Filing 26

Memorandum Opinion and Order: The court ORDERS that plaintiff have and recover from defendant $24,000.00 pursuant to the authority of 28 U.S.C. § 1447 (c). (Ordered by Judge John McBryde on 3/19/2013) (dnw)

v,s, mSTRWT COURT
NORTHERN DISTRICT OF TEXAS

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FI]~RD

IN THE UNITED STATES DISTRICT OURT
NORTHERN DISTRICT OF TEXA
FORT WORTH DIVISION

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CIJERK. ll.S.

CITY OF FORT WORTH,

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EMPLOYEES' RETIREMENT FUND OF
THE CITY OF FORT WORTH,

msnm'T

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Defendant.

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VS.

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Plaintiff,

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NO. 4:12-CV-829-A

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MEMORANDUM OPINION
AND

ORDER
Before the court for decision is the motion of plaintiff,
City of Fort Worth, for award of necessary and reasonable
expenses incurred as a result of the removal of this action by
defendant, Employees' Retirement Fund of the City of Fort Worth,
to this court.

After having considered such motion, defendant's

response thereto, the positions the parties took on the issue of
whether this court had subject matter jurisdiction over the
above-captioned action when it was removed by defendant to this
court, and applicable legal authorities, the court has concluded
that plaintiff should recover from defendant the amount specified
in this memorandum opinion and order as attorney's fees under
28 U.S.C.

§

1447(c).

I.

Pertinent Historical Facts
State Activity Before Removal
For the background and procedural history of this action up
to the point when the court ordered its remand to the state court
from which it was removed, the court here adopts by reference the
contents of the Memorandum Opinion and Order this court signed in
this action on February 21, 2013.

In summary form:

Plaintiff initiated this action in state court for the
purpose of obtaining declarations bearing on the validity of
action taken by the city council of plaintiff.

The action was

filed because (1) plaintiff had been told by representatives of
defendant that the action the city council was taking would
violate the Texas Constitution, and (2) representatives of
defendant had informed representatives of plaintiff that if city
council took the action in question, defendant might have to sue
plaintiff.

The declaratory relief sought by plaintiff did not

involve any federal question.

Rather, the declarations sought

were limited to applicability of a state statute and provisions
of the Texas Constitution to the action taken by the city council
and events leading thereto.
In defendant's state court answer to the pleading by which
plaintiff initiated this action, defendant recognized the
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legitimacy of the relief sought by plaintiff in its pleading by
joining with plaintiff in requesting a ruling on the
constitutionality under the Texas constitution of the city
council action in question.

But, defendant went further in its

answer by asserting what best would be characterized as a
counter-declaratory judgment claim requesting that the state
court enter a finding on the constitutionality of the action of
the city council under the united States Constitution and 42
U.S.C.

§

1983.

Defendant's notice of removal of the action to this court
asserted two theories as to why this court had subject matter
jurisdiction.

First, in reliance on Grable & Sons Metal Prods.

v. Daru Eng'g & Mfg., 545 U.S. 308 (2005) and Franchise Tax Bd.
v. Construction Laborers vacation Trust, 463 U.S. 1 (1983),
defendant asserted the plaintiff's requested declaratory relief
necessarily implicated a question of federal law.

Second,

defendant asserted that "even though Plaintiff is not alleging an
affirmative claim arising under federal law against Defendant,
this Court has jurisdiction because Defendant could affirmatively
allege in its own well-pleaded complaint a claim arising under
federal law against Plaintiff."

Notice of Removal at 2-3

* * * * *

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5.

As reflected by the discussion at pages 7-11 of this court's
February 21, 2013 Memorandum Opinion and Order, the court
concluded that the theories urged by defendant in support of its
contention that this court had subject matter jurisdiction were
without merit; and, the court granted plaintiff's motion to
remand this action to the state court from which it was removed.
By order signed February 21, 2013, the court fixed a deadline of
February 28, 2013, for the filing by plaintiff of a motion
pursuant to the authority of 28 U.S.C.

§

1447(c) for an award of

attorney's fees and costs.
II.
Plaintiff's Motion, and Defendant's Response
A.

The Motion
On February 28, 2013, plaintiff filed its motion pursuant to

28 U.S.C.

§

1447(c) for an award of necessary and reasonable

expenses incurred as a result of defendant's removal of this
action to this court.

The motion, which was verified by the

affidavit of an attorney for plaintiff, sought recovery of
attorney's fees in the total amount of $27,044.50, representing
$20,542.50 incurred in legal activities on behalf of plaintiff
directly related to the removal and remand issues and $6,502.00
in legal expenses incurred by reason of a motion to transfer this
action from the docket of the undersigned to the docket of
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another United states District Judge in this district and
division (Judge Means), which was filed the day after defendant
filed its notice of removal.

Plaintiff alleged in its motion

that defendant's "removal action was objectively unreasonable
because (1) the removal action was based solely on [defendant's]
federal defenses, and (2)

[plaintiff's] state court pleading did

not necessarily raise a federal issue."

Mot. at 2.

The request for an award of $27,044.50 was supported by a
detailed itemization of legal services rendered, giving the date,
identity of attorney, description of services rendered, amount of
time devoted to the work, and amount charged, for each item of
work included in the $27,044.50 total.
B.

Defendant's Response to the Motion
Defendant's response in opposition to plaintiff's motion did

not take issue with plaintiff's claim that the lawyer work
itemized in its motion was necessitated by defendant's removal of
this action to this court, nor does defendant take issue with the
reasonableness of the charges for that work.

Instead,

defendant's sole basis for opposing the fee award sought by
plaintiff is that attorney's fees should not be awarded against
it because it had a plausible, and thus objectively reasonable,
argument for federal court jurisdiction.

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Resp. at 7.

III.
Analysis
Defendant correctly observes that the standard to be applied
by the court in determining if it should make a

§

1447(c) award

is whether defendant had an objectively reasonable basis for
seeking removal.

American Airlines, Inc. v. Sabre, Inc., 694

F.3d 539, 542 (5th Cir. 2012).

"A defendant's subjective good

faith belief that removal was proper is insufficient

"

Id. at 542 n.2; Valdes v. Wal-Mart Stores, Inc., 199 F.3d 290,
292 (5th Cir. 2000).
In its response in opposition to plaintiff's motion,
defendant maintains that it removed this action in reliance on
the Supreme Court's decision in Franchise Tax Bd. v. Construction
Laborers Vacation Trust, 463 U.S. 1 (1983).

Resp. at 4.

On the

page specifically cited by defendant, id., the Supreme Court
said:
Federal courts have regularly taken original
jurisdiction over declaratory judgment suits in which,
if the declaratory judgment defendant brought a
coercive action to enforce its rights, that suit would
necessarily present a federal question.
Franchise Tax Bd., 463 U.S. at 19 (footnote omitted)
added) .

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(emphasis

Somewhat apropos are the concluding remarks of the Supreme
Court in Franchise Tax Bd., as follows:
Congress has given the lower federal courts
jurisdiction to hear, originally or by removal from a
state court, only those cases in which a well-pleaded
complaint establishes either that federal law creates
the cause of action or that the plaintiff's right to
relief necessarily depends on resolution of a
sUbstantial question of federal law.
Id. at 27 (emphasis added).
The court has concluded that no objectively reasonable
litigant would have thought that the outcome of the declaratory
judgment action brought by plaintiff in state court seeking a
declaration of strictly state law issues affecting the validity
of the disputed city council action necessarily depended on
resolution of a substantial question of federal law.

The federal

question was not presented until defendant injected it into this
action by its state court answer, in which defendant not only
took issue with the declaratory judgment relief sought by
plaintiff but, by way of a counter-declaratory claim, sought
relief based on the united States Constitution and a federal
statute.

Nor would an objectively reasonable litigant have

thought that if defendant had brought a coercive action to
enforce its rights, that suit would necessarily present a federal
question.

Such a suit would just as likely be a mirror image of

plaintiff's declaratory judgment action, seeking no more than an
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invalidation of the action of the city council based on a
contention that such action violated a Texas statute and/or
provisions of the Texas Constitution.
Nothing in the state court papers or the removal-remand
papers suggests that plaintiff filed its state court declaratory
judgment action in anticipation that defendant would make a
counter-declaratory judgment claim of invalidity of the
questioned city council action based on violation of the united
States Constitution or a federal statute; nor, is there any
suggestion that, if plaintiff had not filed its state court
declaratory judgment action, defendant would have filed an action
in any court seeking a declaration that the city council action
was imperfect by reason of violation of the united states
Constitution or a federal statute.

Plaintiff's concerns when it

filed the state court action were, so far as the record
disclosed, limited to potential claims that the city council
action was taken in violation of a state law or provisions of the
state Constitution.

Thus, the only issues that the state court

declaratory judgment action necessarily involved were the state
law issues that were raised by plaintiff's state court pleading.
Granted, defendant might be better off if it could have
removed this action to federal court and then caused it to be
consolidated with the federal court action that had been brought
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against plaintiff by individual firefighter employees of
plaintiff.

Thus, the removal of the action might have been

subjectively reasonable in the sense that defendant's potential
gain from a removal, were it not contested by a motion to remand,
could make the risk of remand worthwhile, including the risk of
suffering an adverse ruling on a motion for award of attorney's
fees under

§

1447(c).

However, as previously noted, the test is

one of objective reasonableness, not of subjective
reasonableness.

The court is satisfied that defendant did not

have an objectively reasonable basis for its removal of this
action.

Therefore, an award of attorney's fees under

§

1447(c)

is appropriate.
Considering the failure of defendant to contest the
necessity or reasonableness of the total $27,044.50 in attorney's
fees plaintiff seeks to have awarded against defendant, the court
is not devoting significant time or attention to a detailed
analysis on those subjects.

Taking into account all of the

factors the court should consider in determining reasonableness
and necessity of attorney's fees for the work done by the
attorneys for plaintiff as a result of defendant's removal, as
set forth in plaintiff's motion, the court has concluded that an
award of $24,000.00 would be appropriate.

In reducing the

$27,044.50 claimed amount to $24,000.00, the court has taken into
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account what appear to be instances of duplicative activity on
the part of the attorneys, and has made the reduction that
normally would be made by attorneys in the exercise of "billing
judgment."

See Walker v. u.S. Dep't of Hous. & Urban Dev., 99

F.3d 761, 769-70 (5th Cir. 1996).
IV.

Order
For the reasons stated above,
The court ORDERS that plaintiff have and recover from
defendant $24,000.00 pursuant to the authority of 28 U.S.C.
§

1447 (c) .
SIGNED March 19, 2013

."

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