Source: http://cabfinancial.com/articles/mendoza-v-ferro/
Timestamp: 2019-04-21 16:18:41+00:00

Document:
Michael FERRO, Celadon Trucking Service, Inc., Celadon Trucking Services, Inc. and Celadon Group, Inc.
Daniel Joseph Sherry, Jr., Eisenberg, Rothweiler, Winkler, Eisenberg & Jeck P.C., Philadelphia, PA, for Diana Claudia Ramirez Mendoza.
John T. Pion, Stephanie L. Hersperger, James Decinti, Pion, Nerone, Girman, Winslow & Smith, P.C., Harrisburg, PA, June J. Essis, Diane Bernoff Sher, Fineman Krekstein & Harris PC, Philadelphia, PA, for Michael Ferro, Celadon Trucking Service, Inc., Celadon Trucking Services, Inc. and Celadon Group, Inc.
*1 Moving to remand this motor vehicle personal injury action, plaintiff Diana Ramirez Mendoza (“Mendoza”) contends that defendant Michael Ferro, a Pennsylvania citizen, improperly removed this action in violation of the forum defendant rule set out in 28 U.S.C. § 1441(b)(2). Ferro counters that removal was proper because although he is a home-state resident, he had not been served at the time of removal.
We agree with Ferro that the recent Third Circuit case, Encompass Ins. Co. v. Stone Mansion Rest. Inc., 902 F.3d 147 (3d Cir. 2018), controls our decision. The Encompass court held that the plain meaning of the forum defendant rule “precludes removal on the basis of in-state citizenship only when the defendant has been properly joined and served.” Id. at 152. Therefore, because Ferro had not been served at the time of removal, we shall deny the motion to remand.
Mendoza initiated the state court action by writ of summons on October 25, 2017. She filed her complaint on December 15, 2017. Three days later, Celadon removed the action, asserting diversity jurisdiction under 28 U.S.C. § 1332(a)(1).3 At that time, Ferro had not been served.
Both Celadon and Mendoza acknowledged that the Third Circuit had not yet addressed the issue of whether a defendant may remove a case before a forum defendant has been served. They recognized the split among the district courts in the Third Circuit about the meaning of the forum defendant rule’s “properly joined and served” language. Celadon relied on cases that literally interpreted the language. Mendoza cited those that looked beyond the “joined and served” language, holding that removal is not permitted by either a forum or non-forum defendant even where the forum defendant has not been served.
*2 Agreeing with the reasoning of the courts that held that a literal interpretation of the “properly joined and served” language of § 1441(b)(2) would undermine the rationale behind the forum defendant rule and encourage a “race-to-remove” before the forum defendant had been served, we granted the motion to remand.6 Almost three months later, the Third Circuit decided the issue in Encompass, resolving the district court split in favor of a literal reading of § 1441(b)(2). In light of Encompass, Ferro removed the case.
The “forum defendant rule,” 28 U.S.C. § 1441(b)(2), does not permit removal of an otherwise removable civil action based on diversity jurisdiction “if any of the parties in interest properly joined and served as defendants is a citizen of the State” where the action was brought. At the time that Mendoza moved to remand the action that Celadon had removed, the Third Circuit had not yet addressed whether § 1441(b)(2) ’s “properly joined and served” language allows a defendant to remove a case before a forum defendant has been served. Since then, it has. We must follow Encompass.
Two weeks after Encompass was decided, Ferro removed this case based on diversity jurisdiction. He argues that even though he is a Pennsylvania citizen, removal is not precluded because at the time of removal he had not been formally served with the writ of summons or complaint. Encompass held that § 1441(b)(2)’s limitation on removal only applies if the home-state defendant has been “properly joined and served” at the time of removal. Thus, under current Third Circuit law, removal did not contravene the forum defendant rule.
Seeking remand, Mendoza makes two arguments to distinguish Encompass. First, she argues that Encompass “did not involve repeated removal to federal court,” as does this case. Second, she asserts that the purpose of the forum defendant rule, as addressed by Encompass, is “to prevent a plaintiff from blocking removal by joining [an in-state party as a defendant] against whom it does not intend to proceed, and whom it does not even serve,” is not present in this case because she has demonstrated her intention to proceed against Ferro by her numerous attempts to serve him.
The Encompass court rejected the argument that permitting removal by an unserved forum state defendant would contravene the purpose of the “properly joined and served” language to prevent the plaintiff from fraudulently joining a forum-state defendant to block removal, and would render the statute nonsensical or superfluous. The court held that even if there is no fraudulent joinder, permitting removal “does not contravene the apparent purpose to prohibit that particular tactic.” Id. at 153.
Despite Mendoza’s effort to avoid the Encompass holding, she cannot do so. We must apply the holding. Any defendant, forum or non-forum, may remove an action as long as the forum state defendant has not yet been properly served. Encompass, 902 F.3d at 152.
Because Ferro, the forum state defendant, had not been properly served at the time of removal, this action was properly removed from the state court. Therefore, the motion to remand will be denied.
Not. Of Removal at ¶¶ 10-13 (Doc. No. 1).
Compl. ¶¶ 2, 10-13 (Doc. No. 12-1, Ex. “A” to Mot. to Remand).
See Celadon’s Not. of Removal (Doc. No. 1 in Mendoza v. Ferro, et al., Civ. A. No. 17-5673 (E.D. Pa. Dec. 18, 2017), docketed in this action at Doc. No. 12-2 at Doc. No. 5, Ex. “B” to Mot. to Remand).
See Mot. to Remand ¶ 25 (Doc. No. 9 in Civ. A. No. 17-5673, docketed in this action at Doc. No. 12-3 at Doc. No. 39, Ex. “C” to Mot. to Remand).
See May 30, 20189 Order (Doc. No. 18 in Civ. A. No. 17-5673) (docketed in this action at Doc. No. 12-4, at Doc No. 42, Ex. “D” to Mot. To Remand).

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