Local #1674 of Howard Mental Health v. HowardCenter, Inc.
Filing
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OPINION AND ORDER denying 35 Motion for Attorney Fees; denying 37 Motion for Certificate of Appealability; denying 37 Motion to Stay. Signed by Judge William K. Sessions III on 12/3/2014. (law)
UNITED STATES DISTRICT COURT
FOR THE
DISTRICT OF VERMONT
LOCAL #1674 OF HOWARD MENTAL
HEALTH, A SUBORDINATE BODY OF
COUNCIL 93 OF THE AMERICAN
FEDERATION OF STATE, COUNTY AND
MUNICIPAL EMPLOYEES AFL-CIO
a/k/a AFSCME LOCAL #1674,
Plaintiff,
v.
HOWARDCENTER, INC.,
Defendant.
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Case No. 2:14-cv-67
Opinion and Order
In light of the Court’s recent remand order, the parties
have each filed a motion now pending before the Court.
First,
Plaintiff moves for attorney’s fees for wrongful removal.
No. 35.
ECF
Second, Defendant moves for a certificate of
appealability and to stay the proceedings.
ECF No. 37.
For the
following reasons the Court denies both motions.
I. Relevant Background
Plaintiff originally filed this action in Vermont Superior
Court against Defendant for its alleged failure to properly
apply state Medicaid funds.
Plaintiff claims that Defendant is
obligated to raise the compensation for its direct service
employees as a result of a Vermont state statute.
On April 1, Defendant removed the action to this Court on a
theory of complete preemption under Section 301 of the Labor
Management Relations Act, 29 U.S.C. § 185.
Plaintiff
subsequently filed a motion to remand and Defendant filed a
motion to dismiss.
On August 27, 2014 the Court granted
Plaintiff’s Motion to Remand to State Court for Lack of Subject
Matter Jurisdiction and denied as moot Defendant’s Motion to
Dismiss for Failure to State a Claim.
ECF No. 34.
II. Plaintiff’s Motion for Attorney’s Fees
Plaintiff moves for attorney’s fees for wrongful removal
pursuant to 28 U.S.C. § 1447(c) and Federal Rule of Civil
Procedure 54(d)(2)(B).
“Absent unusual circumstances, courts
may award attorney’s fees under § 1447(c) only where the
removing party lacked an objectively reasonable basis for
seeking removal.”
Martin v. Franklin Capital Corp., 546 U.S.
132, 141 (2005).
When an objectively reasonable basis exists,
fees should be denied.
Id.
District courts retain discretion to consider whether
“unusual circumstances” warrant a departure from the rule in a
given case but any reason for departing from the general rule
should be “faithful to the purposes” of awarding fees.
Id.
Objective reasonableness is evaluated based on the circumstances
that existed at the time that the case was removed.
Int’l Gun-A-Rama, 416 F. App'x 97, 99 (2d Cir. 2011).
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Williams v.
Plaintiff argues that because Defendant never used the
proper term “complete preemption” in any of its pleadings that
even Defendant found its legal claim “fundamentally
implausible.”
ECF No. 35 at 3.
Moreover, Defendant’s “strained
factual assertions” were “always of a defensive character and
thus never legally sufficient grounds for removal.”
Id.
Defendant counters that it had an objectively reasonable
basis for removal and incorporates by reference arguments it
makes in the interlocutory appeal context.
Defendant argues
that there is substantial ground for difference of opinion
regarding preemption.
Moreover, Defendant notes that Plaintiff
never raised the issue of defensive preemption until the Court
did sua sponte and disputes Plaintiff’s statement that it never
raised the issue of complete preemption in its pleadings.
Plaintiff concedes in its reply that its initial statement
was overbroad and it should have stated that Defendant did not
present complete preemption as the sole basis for removal
jurisdiction.
Plaintiff suggests that if Defendant had done so
rather than also including “irrelevant if fascinating defensive
claims” the lack of removal jurisdiction would have been clear
and far less complex.
ECF No. 42 at 3.
The Court finds that Defendant had an objectively
reasonable basis for removal.
The Court issued a twenty-seven
page opinion explaining its reasoning and recognized that the
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boundary between claims requiring “interpretation” of a
collective bargaining agreement and those requiring
“consultation” can be “elusive.”
raised a colorable argument.
ECF No. 34 at 12.
Defendant
The Court simply rejected it.
Attorney’s fees, therefore, are not warranted at this time.
III. Defendant’s Motion for a Certificate of Appealability
Defendant moves for certification of the Court’s August 27,
2014 Opinion and Order for immediate interlocutory appeal
pursuant to 28 U.S.C. § 1292(b), which states:
When a district judge, in making in a civil action an order
not otherwise appealable under this section, shall be of
the opinion that such order involves a controlling question
of law as to which there is substantial ground for
difference of opinion and that an immediate appeal from the
order may materially advance the ultimate termination of
the litigation, he shall so state in writing in such order.
The Court of Appeals which would have jurisdiction of an
appeal of such action may thereupon, in its discretion,
permit an appeal to be taken from such order, if
application is made to it within ten days after the entry
of the order: Provided, however, That application for an
appeal hereunder shall not stay proceedings in the district
court unless the district judge or the Court of Appeals or
a judge thereof shall so order.
Defendant argues that certification should be granted because an
interlocutory appeal of the Court’s Order will materially
advance the ultimate termination of the litigation and prevent
Defendant from being unduly prejudiced.
Moreover, Defendant
submits that the issue of preemption under Section 301 involves
a controlling issue of law as to which there is substantial
ground for difference of opinion.
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Defendant also asks the Court
to stay proceedings in this action pending resolution of such an
appeal.
Plaintiff counters that the Court remanded this case for
lack of subject matter jurisdiction and, therefore, that the
Court’s remand order is unreviewable under federal law.
28
U.S.C. § 1447(d) (“An order remanding a case to the State court
from which it was removed is not reviewable on appeal or
otherwise.”).
Plaintiff argues that Defendant cannot circumvent
this statutory prohibition by creatively asking the Court to
stay the order so there would be no order of remand in effect.
The Second Circuit has explained that the provision in § 1447(d)
“encompasses attempts by means of a § 1292(b) certification and
discretionary appeal.”
367 (2d Cir. 2005).
In re WTC Disaster Site, 414 F.3d 352,
Moreover, Plaintiff notes that Defendant
offers no authority whatsoever to support any contention that
this Court retains jurisdiction to grant an interlocutory
appeal.
Defendant does not cite much less discuss the statutory
prohibition on further review in its motion.
However, in its
Reply to Plaintiff’s Opposition it changes tack somewhat by
suggesting that it is only seeking appellate review of the
Court’s Order to the extent that the Court ruled upon a matter
of law central to Defendant’s Motion to Dismiss, namely, whether
Plaintiff’s claims are completely preempted.
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In its Order the
Court acknowledged that the inquiry it conducted in the remand
context was identical to the dismiss context.
11 n.4.
See ECF No. 34 at
Defendant argues that this footnote somehow converts
the Court’s Order into not only a remand, but also a ruling of
law denying part of Defendant’s Motion to Dismiss.
While the Court generally might be permitted to certify
interlocutory appeals for orders denying motions to dismiss, it
issued no ruling on the merits of Defendant’s motion in this
case.
The Court decided the remand question first because if it
did not have subject matter jurisdiction, by definition, it
would not have the power to rule on the Defendant’s motion.
ECF
No. 34 at 6 (“Because the disposition on the motion to remand
will determine whether this Court has jurisdiction to decide the
motion to dismiss, the Court addresses the motion to remand
first.”).
The Court has already explicitly ruled that it lacks
subject matter jurisdiction.
Therefore it does not have
jurisdiction to stay its own remand order or to grant an
interlocutory appeal.
Moreover, the Second Circuit would also
lack appellate jurisdiction to review its remand order.
See
Calabro v. Aniqa Halal Live Poultry Corp., 650 F.3d 163, 165 (2d
Cir. 2011) (“Because the district court’s decision to remand
this case rested on a determination that it was without subjectmatter jurisdiction, we lack appellate jurisdiction to review
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it.).
Accordingly Plaintiff’s motion for a certificate of
appealability and for a stay of this proceeding is denied.
Dated at Burlington, in the District of Vermont, this 3rd
day of December, 2014.
/s/ William K. Sessions III
William K. Sessions III
District Court Judge
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