Opinion ID: 222642
Heading Depth: 3
Heading Rank: 3

Heading: Timing of Removal

Text: Appellants argue that, even if McLelland was improperly joined, the district court erred by equitably tolling the one-year limitation for removal for cases not initially removable. They contend that the district court improperly applied the three-prong equities test found in Tedford by failing to consider the defendants’ conduct or that the case had substantially progressed in state court over several years, and by finding that Plaintiffs had engaged in forum manipulation. Defendants contend that the district court correctly applied equitable tolling to this case. We need not address this issue, however, because we find that the one-year removal period stated in the second paragraph of 28 U.S.C. § 1446(b) is inapplicable because this case was removable on this initial pleading. 28 U.S.C. § 1446(b) states: The notice of removal of a civil action or proceeding shall be filed within thirty days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based, or within thirty days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant, whichever period is shorter. If the case stated by the initial pleading is not removable, a notice of removal may be filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of an amended pleading, motion, order or other paper from which it may first be 13 Case: 10-31132 Document: 00511563753 Page: 14 Date Filed: 08/05/2011 No. 10-31132 ascertained that the case is one which is or has become removable, except that a case may not be removed on the basis of jurisdiction conferred by section 1332 of this title more than 1 year after commencement of the action. In New York Life Insurance Co. v. Deshotel, 142 F.3d 873 (5th Cir. 1998), we considered “whether the one-year limitation for removal of diversity cases under Section 1446(b) applies only to those state court cases that are not initially removable, or to all diversity cases that a defendant seeks to remove.” Id. at 885. We found that read as a whole, “[s]ection 1446 requires that we interpret the one-year limitation on diversity removals as applying only to the second paragraph of that section, i.e., only to cases that are not initially removable.” Id. at 886. Therefore, where a case is “removable upon its initial pleading, the [defendants’] ultimate removal of [a] case is not governed by the second paragraph of § 1446(b) or its one-year limitation.” Johnson v. Heublein Inc., 227 F.3d 236, 241 (5th Cir. 2000). Applying this principle to the present case, the one-year limitation does not apply because the case was removable based on its initial pleading. In Plaintiffs’ original complaint, the defendants were as follows: (1) CTL, a Delaware corporation with its principal place of business in Florida; (2) McLelland, a Louisiana citizen; and (3) “John Doe,” a Louisiana citizen. Because Plaintiffs are citizens of Louisiana and Texas, the presence of McLelland and the “John Doe” defendant initially appear to destroy complete diversity and make the case nonremovable. Despite this appearance, 28 U.S.C. § 1441(a) instructs that “[f]or purposes of removal under this chapter, the citizenship of defendants sued under fictitious names shall be disregarded.” Further, our opinion affirms the district court’s finding that McLelland was improperly joined and therefore would not destroy complete diversity. See, e.g., Curry v. State Farm Mut. Auto. Ins. Co., 599 F. Supp. 2d 734, 739–40 (S.D. Miss. 2009) (finding that because the defendant who would have destroyed diversity was improperly joined, the case 14 Case: 10-31132 Document: 00511563753 Page: 15 Date Filed: 08/05/2011 No. 10-31132 was initially removable and the one-year limitation did not apply). Thus, with “John Doe” and McLelland out of the picture, and because there has been no dispute that the amount in controversy is more than $75,000, the case was removable on the initial pleading based on complete diversity. Further, despite the parties’ failure to address this issue, CTL complied with the first paragraph of § 1446(a) and preserved error by initially removing the case within thirty days and arguing that both McLelland and “John Doe” were improperly joined. The case was only remanded after the district court allowed Plaintiffs to amend their pleading the first time and add several additional non-diverse defendants. Because CTL preserved error by removing the initial case within thirty days and arguing improper joinder, the parties’ mutual failure to address this argument in their briefing need not preclude us from reaching the issue. Therefore, we agree with the district court’s decision to deny the motion to remand, albeit on grounds that CTL’s removal is not time-barred.