Generally, plaintiffs choose to file a lawsuit in the forum and venue most favorable to their position. As such, evaluating their forum choice and determining the proper jurisdiction is a fundamental first step in any case. This is particularly important in mass tort litigation, as defendants may be sued in any number of local courts where plaintiffs reside. If a plaintiff files in state court, the threshold analysis should include assessing whether the case should be removed to federal court under 28 U.S.C. § 1446. The removal procedure includes numerous technical steps and potential pitfalls—including jurisdiction-specific requirements. Below are some typical steps to consider, though every case is different and may dictate different actions.
Deadlines
Once a case is served, the defendant has 30 days to remove it to federal court. If a case is not initially removable, but becomes removable later—due to amendment, joinder, or otherwise—this typically triggers the 30-day deadline from the date of the operative event.
Removability Determination and Federal Subject Matter Jurisdiction
- Federal question. Does the case arise under or involve a federal statute or U.S. constitutional question?
- Diversity jurisdiction. Are all opposing parties from different states (the “complete diversity” requirement), and is the amount in controversy $75,000 or greater (the “amount in controversy” requirement)?
- Note: A case cannot be removed to federal court under diversity jurisdiction if any defendant is a citizen of the state in which the case is filed (the “forum defendant rule”).
- In the mass torts context, diversity jurisdiction is the most common basis for removal, and attorneys evaluating such jurisdiction should pay careful attention to the “complete diversity” requirement.
- Domicile. Accurately identify the state or states where all parties are domiciled for purposes of evaluating diversity. Corporations are only citizens of the state in which they are incorporated or have their principal place of business; maintaining a registered agent within the state is not enough. The citizenship of an LLC requires evaluating the citizenship of each of its members.
- Improper or fraudulent joinder. Consider whether parties, who would defeat diversity jurisdiction, were improperly joined. For example, cases often name as defendants the local retailer that simply distributed a product, but such entities may qualify as “innocent sellers” subject to dismissal on a finding that they were joined solely for the purpose of defeating removal.
Potential Pitfalls
- Unanimity rule. Unanimous consent is a procedural requirement and failure to comply with this rule may result in the case being remanded to state court. While this rule requires every served defendant to consent to removal, there is a circuit split on how consent can be expressed. Some courts require that all defendants—individually—express their consent to removal, while other courts permit one defendant to pledge unanimous consent in the notice of removal.
- Time limit for removal based on diversity jurisdiction. A case cannot be removed on diversity jurisdiction more than one year from the date of commencement of the action unless plaintiff acted in bad faith to prevent removal.
- “Later-served defendant rule.” Each served defendant will have 30 days to remove the case. In essence, a new 30-day deadline starts each time a defendant is served.
- Waiver. Prior to removal, a defendant’s active defense of the lawsuit in state court may be considered as a waiver of removal.
