April 07, 2020 Articles

If at First You Don’t Succeed: Prospects for a Second Removal after Remand

Fighting for removal, even in the face of a remand order, can often result in a second chance in federal court.

By Monee Hanna and Dustin Rawlin

In the mass tort arena, removing a case to federal court can make all the difference, especially when a defense like federal preemption is at issue. A remand order may seem like the death knell of an action’s time in federal court, but that is not always the case. It may take a little work—and good fortune—but it is sometimes possible to get back to federal court even after being remanded.

Experience tells us that plaintiffs will do anything to stay in favorable state court forums.

Experience tells us that plaintiffs will do anything to stay in favorable state court forums.

Credit: Freerange, Freerange Archives

Removal Basics

Federal courts are courts of limited jurisdiction and, as such, are empowered to hear only cases they have been authorized to hear by Congress. U.S. Const. art. III, § 2; see also Kokkonen v. Guardian Life Ins. Co., 511 U.S. 375, 377 (1994). Any civil action brought in state court that could have originally been brought in federal court may be removed to the relevant district court. 28 U.S.C. § 1441(a); see also Lincoln Prop. Co. v. Roch, 546 U.S. 81, 83 (2005). Federal courts have original jurisdiction over any action between citizens of different states where the jurisdictional amount in controversy exceeds $75,000. 28 U.S.C. § 1441(a); 28 U.S.C. § 1332(a); see also Caterpillar Inc. v. Lewis, 519 U.S. 61, 68 (1996). Federal courts also have original jurisdiction over actions involving a federal question. 28 U.S.C. § 1331.

Removals are governed by two different 30-day windows, depending on the time the action becomes removable: (1) When an action is initially removable on its face, each defendant has 30 days from receipt of the complaint to remove the action to federal court, and (2) when an action is not initially removable, the defendant has 30 days to remove to federal court after receiving a copy of “other paper from which it may first be ascertained” that the case is or has become removable. 28 U.S.C. § 1446(b).

A plaintiff has 30 days following removal to move to remand for any procedural defects in the notice of removal. 28 U.S.C. § 1447(c). An action may be remanded sua sponte by the court or by any party at any time for lack of subject matter jurisdiction. Id. If a plaintiff’s motion for remand is successful, a defendant’s post-remand options may be limited. Indeed, section 1447(d) not only forecloses appellate review but also bars reconsideration by the district court.

Not a Second Bite at the Apple, but a Bite of a Different Apple

Courts across the country have consistently held that section 1446(b) permits a party to file a second notice of removal after an unsuccessful attempt at removal. The mere fact that a case was previously remanded is not dispositive and does not by itself preclude a defendant from filing a second removal. “The only effect of adopting an absolute one-bite rule would be to be to encourage plaintiffs to be coy.” Benson v. SI Handling Sys., Inc., 188 F.3d 780, 783 (7th Cir. 1999).

Although on its face the removal statute does not address the propriety of subsequent removals, section 1446(b)(3) provides a pathway for avoiding the strict 30-day time limit imposed by section 1446(b)(1). In enacting this paragraph, Congress commented:

The second paragraph of the amendment to subsection (b) is intended to make clear that the right of removal may be exercised at a later stage of the case if the initial pleading does not state a removable case but its removability is subsequently disclosed. This is declaratory of the existing rule laid down by the decisions.

16 Moore’s Federal Practice ¶ 107 App.02[2] (3d ed. 2001) (quoting H.R. Rep. No. 352, 81st Cong., 1st Sess. (1949)).

Generally, once a case is remanded to state court, a defendant is precluded only from seeking removal on the same ground. “The prohibition against removal ‘on the same ground’ does not concern the theory on which federal question jurisdiction exists (i.e., federal question or diversity jurisdiction), but rather the pleading or event that made the case removable.” S.W.S. Erectors, Inc. v. Infax, Inc., 72 F.3d 489, 492 (5th Cir. 1996); see also O’Bryan v. Chandler, 496 F.2d 403, 410 (10th Cir. 1974) (“[D]ifferent grounds more precisely mean a different set of facts that state a new ground for removal.”).

For example, if a case is first removed under section 1446 and remanded for failure to establish the requisite jurisdictional amount, a defendant may later remove where events in the state court illuminate the amount in controversy. Indeed, section 1446(c)(3)(A) was specifically amended in 2011 to clarify that if a case is not initially removable “because the amount in controversy does not exceed the amount specified in section 1332(a), information relating to the amount in controversy in the record of the state proceeding, or in responses to discovery, shall be treated as ‘other paper.’”

Under Which Circumstances Will a Successive Removal Be Permitted?

To escape the prohibition against multiple removals on the same grounds, a defendant must rely on new information that was not available at the time of the first removal. The new information may come in the form of an amended pleading, motion, order, or “other paper.”

A successive removal can be premised on a variety of events or evidentiary submissions:

  • An amended pleading: an amended pleading that creates federal subject matter jurisdiction for the first time. A proposed but unfiled pleading may not be sufficient. See Rogers v. Humanscale Corp., No. Civ.A. 04-CV-2592, 2004 WL 1813282, at *2 (E.D. Pa. July 14, 2004) (holding that removal based on a motion to amend a complaint to add federal claims was “premature” and the event permitting removal is an order granting leave to amend).
  • State court trial order: an order—but not a tentative ruling—in the state court after the first remand that may establish jurisdiction. See Reyes v. Dollar Tree Stores, Inc., 781 F.3d 1185, 1188 (9th Cir. 2015) (allowing second removal where class certification order in trial court was “functionally indistinguishable from an order permitting the amendment of pleadings to alter the class definition” that established Class Action Fairness Act jurisdiction by increasing the amount in controversy).
  • Response to discovery requests: the plaintiff’s responses to requests for admissions or requests for production clarifying damages sought. See Sibilia v. Makita Corp., 782 F. Supp. 2d 1329, 1331 (M.D. Fla. 2010) (permitting second removal after first removal denied for failure to establish amount in controversy by preponderance of the evidence); Carson Cogeneration Co. v. Scottsdale Ins. Co., No. CV 19-10797, 2020 WL 815672, at *2–3 (C.D. Cal. Feb. 18, 2020) (permitting successive removal when plaintiff’s discovery responses allowed defendant to learn partnership’s citizenship).
  • Depositions: testimony confirming damages or providing additional evidence of fraudulent joinder. See Morgan v. Huntington Ingalls, Inc., 879 F.3d 602, 608–11 (5th Cir. 2018); Carvalho v. Equifax Info. Servs., 629 F.3d 876, 886–87 (9th Cir. 2010); Peters v. Lincoln Elec. Co., 285 F.3d 456, 465–66 (6th Cir. 2002); Huffman v. Saul Holdings Ltd. P’ship, 194 F.3d 1072, 1077–79 (10th Cir. 1999); S.W.S. Erectors, Inc. v. Infax, Inc., 72 F.3d 489, 494 (5th Cir. 1996); Vieira v. Mentor Worldwide LLC, 392 F. Supp. 3d 1117, 1128 (C.D. Cal. 2019); Effinger v. Philip Morris, Inc., 984 F. Supp. 1043, 1047, 1047–48 (W.D. Ky. 1997); Haber v. Chrysler Corp., 958 F. Supp. 321, 326 (E.D. Mich. 1997); Riggs v. Cont’l Baking Co., 678 F. Supp. 236, 238 (N.D. Cal. 1988); Fisher v. United Airlines, Inc., 218 F. Supp. 223, 225 (S.D.N.Y. 1963); Fuqua v. Gulf, Colo. & Santa Fe Ry. Co., 206 F. Supp. 814, 816 (E.D. Okla. 1962); Gilardi v. Atchison, Topeka & Santa Fe Ry. Co., 189 F. Supp. 82, 85 (N.D. Ill. 1960); but see Mill-Bern Assocs., Inc. v. Dallas Semiconductor Corp., 69 F. Supp. 2d 240, 241–44 (D. Mass. 1999) (neither oral deposition nor the transcript of that testimony constitutes “other paper” for purposes of 1446(b)); Harrell v. Reynolds Metals Co., 599 F. Supp. 966, 968 (N.D. Ala. 1985) (same).
  • Dismissal of a party: Voluntary dismissal of a party whose presence defeated diversity. See Knudsen v. Sys. Painters, Inc., 634 F.3d 968, 975–77 (8th Cir. 2011); 14B Charles Alan Wright, Arthur R. Miller, Edward H. Cooper & Joan E. Steinman, Federal Practice and Procedure § 3723 (4th ed. 2009).

When Is a Successive Removal Impermissible?

As noted above, section 1447(d) generally precludes defendants from appealing or moving for reconsideration of an order granting remand. Thus, a motion to reconsider masquerading as a second notice of removal will not survive a remand motion. See, e.g., Nicholson v. Nat’l Accounts, Inc., 106 F. Supp. 2d 1269, 1272 (S.D. Ala. 2000) (holding that defendant’s second attempt at removal on ERISA grounds after plaintiff’s deposition was “nothing more than a creative attempt to have the court reconsider its prior remand order”).

Similarly, documents generated outside a case in which removal is sought generally do not support removal under section 1446(b). This includes judicial decisions from unrelated cases or intervening case law. See Hughes v. Mylan, Inc., 2011 WL 5075133, at *5 (E.D. Pa. 2011) (noting that “courts have consistently held that the decision of another court is not an ‘other paper’ which can render a case removable”).

An action that is removable within the first 30 days but is remanded for a procedural defect cannot later be removed. If the information existed at the time of the first removal, the defendant will not get a second chance. See Leon v. Gordon Trucking, Inc., 76 F. Supp. 3d 1055, 1064 (C.D. Cal. 2014) (rejecting defendant’s second removal as “nothing more than an impermissible attempt to ‘offer[] additional evidence to prove what should have been proved in the first [n]otice of [r]emoval—[it]s citizenship’”) (citations omitted)).

Proceed with Caution

Like any other pleading, a removal is signed and submitted pursuant to Rule 11. See 28 U.S.C. § 1446(a). A federal court has discretion to award fees and costs where a second removal was not taken in good faith. “[A]bsent new and different grounds for removal based on newly discovered facts or law, a defendant who improperly removes a case after a federal court previously remanded it risks being sanctioned under Federal Rule of Civil Procedure 11.” Fed. Home Loan Mortg. Corp. v. Pulido, No. C 12-03489 LB, 2012 WL 3026423, at *2 (N.D. Cal. July 24, 2012); see also Benson v. SI Handling Sys., Inc., 188 F.3d 780, 783 (7th Cir. 1999) (“Multiple removals could encounter problems—could even lead to sanctions—if nothing of significance changes between the first and second tries.”) (internal citation omitted)).

While not common, sanctions or attorney fees can be imposed where attempts at successive removals are deemed to be frivolous. See, e.g., Cain v. CVS Pharmacy, Inc., No. 5:08cv79, 2009 WL 539975, at *5 (N.D. W. Va. Mar. 4, 2009) (awarding attorney fee and costs to plaintiff where defendant re-removed case on same legal basis without asserting new facts to justify it).

Your Case Has Been Remanded. Now What?

If an action is remanded for lack of subject matter jurisdiction, assess whether additional evidence can remedy the defect.

  • Promptly conduct discovery. Press the plaintiffs for the necessary written discovery or depositions to support a subsequent removal.
  • Watch the clock. Re-remove within 30 days of receipt of the amended pleading, motion, order, or other paper. Compare Huffman v. Saul Holdings Ltd. P’ship, 194 F.3d 1072, 1077–79 (10th Cir. 1999) (finding second removal untimely because the removal period commences with the giving of the testimony providing sufficient notice that the amount in controversy exceeded the jurisdictional amount, not the receipt of the transcript), with Morgan v. Huntington Ingalls, Inc., 879 F.3d 602, 608–11 (5th Cir. 2018) (reversing order of remand and finding removal period commences with the receipt of the deposition because oral deposition testimony cannot constitute “other paper”). Subsequent removals are also subject to the one-year deadline that requires any removal based on diversity of citizenship to occur within one year of the original filing. See Johnson v. Am. Online, Inc., 280 F. Supp. 2d 1018, 1023 (N.D. Cal. 2003); 28 U.S.C. § 1446(c)(1).

Conclusion

Experience tells us that plaintiffs will do anything to stay in favorable state court forums. Fighting for removal, even in the face of a remand order, can oftentimes result in a second chance in federal court.

Monee Hanna is counsel in the Medical & Pharmaceutical Liability Group at Tucker Ellis LLP in Los Angeles, California. Dustin B. Rawlin is a partner in the Medical & Pharmaceutical Liability Group at Tucker Ellis LLP in Cleveland, Ohio.


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