Adair v. Amerus Leasing, Inc.

Page 518

566 F.Supp.2d 518

Glenn Allen ADAIR d/b/a Super D # 229, et al., Plaintiffs v. AMERUS LEASING, INC., et al., Defendants.

Civil Action No. 3:07CV608TSL-JCS.

United States District Court, S.D. Mississippi, Jackson Division.

June 6, 2008.

Paul N. Davis, Butler, Snow, O'Mara, Stevens & Cannada, Jackson, MS, for Plaintiffs.

David W. Clark, Bradley, Arant, Rose & White, LLP, Roy H. Liddell, Trey Christian Dellinger, Wells, Marble & Hurst, Jackson, MS, Julianne Farnsworth-PHV, Farnsworth Law Firm, LLC, Charleston, SC, James P. Caldwell, Kevin Bryan Smith, Riley, Caldwell, Cork & Alvis, PA, Tupelo, MS, for Defendants.

MEMORANDUM OPINION AND ORDER

TOM S. LEE, District Judge.

On October 12, 2007, after the Federal Deposit Insurance Corporation (FDIC) was appointed Receiver for defendant Net-Bank, which was the successor to one of the original defendants, Republic Leasing Company, Inc., the FDIC removed the case to this court pursuant to 12 U.S.C. § 1819(b)(2)¹ and 28 U.S.C. § 1331. Thereafter, plaintiffs moved to dismiss the FDIC and moved separately to remand the case to the Circuit Court of Hinds County, from which it was removed.² Plaintiffs' motion to dismiss, in which they acknowledge that they have no real possibility of collecting any judgment they might obtain against the FDIC, is joined by the FDIC. Defendants have responded to the motion, taking the position that they do not oppose dismissal of the FDIC, but that if the FDIC is dismissed, then those plaintiffs who are asserting claims against the FDIC should be dismissed from the case as well. For their part, while plaintiffs argue that defendants other than the FDIC have no standing to object to their motion, they nevertheless have agreed to the dismissal of those plaintiffs who have claims only against the FDIC. Accordingly, the motion to dismiss the FDIC will be granted, and the claims of plaintiffs Joe Ray Bourn d/b/a The Drug Store, Stan Berry, Delta Pharmacy, Inc. D/b/a Lee Pharmacy, Gerald Pugh, Rawls Drug Co., Inc., Vickie S. Ellington d/b/a Attala Discount Drugs, J. Edwin White, Service Rexall Drugs, Inc., Daryl G. Pitts and Waynesboro Animal Clinic, Inc., against the FDIC will be dismissed.

The parties all recognize that the dismissal of the FDIC does not deprive the court of jurisdiction. See Bank One Texas Nat'l Assoc. v. Morrison, 26 F.3d 544, 547 (5th Cir.1994) ("Because jurisdiction is determined as of the time of removal and post-removal events will generally not deprive the court of jurisdiction, the FDIC's subsequent dismissal from the case did not deprive the court of subject matter jurisdiction."); Walker v. FDIC, 970 F.2d 114, 120 (5th Cir.1992) (noting that "federal jurisdiction persists even though the FDIC is subsequently dismissed" from an action). However, plaintiffs take the position in their motion to remand that once the FDIC is dismissed, this court should decline to exercise jurisdiction and should remand the case to state court. On the other hand, defendants have filed separate responses in opposition to the motion to remand, variously arguing that (1) the fact that the court had jurisdiction at the time of removal due to the inclusion of the FDIC "alone demonstrates that the Court deny plaintiffs' Motion to Remand"; (2) the court has jurisdiction not only because of the FDIC's inclusion in the suit but also due to the federal preemption of plaintiffs' claim for usury; (3) the court also has jurisdiction based on diversity of citizenship; and (4) there is diversity jurisdiction based on plaintiffs' fraudulent misjoinder of claims and parties.³

There is no merit to defendants' suggestion that the court must deny plaintiffs' motion to remand solely because there was federal jurisdiction at the time of removal. Unquestionably there was jurisdiction at the time of removal based on the FDIC's presence in the suit; and that jurisdiction continues despite dismissal of the FDIC. However, the fact that the court may continue to exercise jurisdiction does not mean that it should do so.

In support of their argument that the court should retain jurisdiction notwithstanding dismissal of the FDIC, defendants argue that there are bases for this court's jurisdiction over this case apart from the FDIC's inclusion in the suit, namely, the complete federal preemption of plaintiffs' claims for usury and diversity of citizenship. As to the former, plaintiffs do not deny that they have asserted a claim for usury, nor do they dispute that such claim is completely preempted by the National Banking Act, 12 U.S.C. § 85 and 86. See Beneficial National Bank v. Anderson, 539 U.S. 1, 11, 123 S.Ct. 2058, 156 L.Ed.2d 1 (2003) (concluding that §§ 85 and 86 of the National Banking Act completely preempt state law claims of usury against national banks). Moreover, it appears from the FDIC's notice of removal that the FDIC purported to include preemption of plaintiffs' usury claim as an additional basis for its removal. Notwithstanding this, plaintiffs maintain that the case was not removable on the basis of preemption of their usury claim inasmuch as all defendants, including Republic Leasing Company, for whose successor the FDIC is now the receiver, had long ago waived the right to assert removal jurisdiction on this ground by failing to timely remove on this basis. Plaintiffs submit that having been previously waived, this could not validly be asserted as a basis for removal by the FDIC, and that therefore, this court may not, or certainly should not, assert jurisdiction over the case on a basis that was not properly asserted in the removal notice.

Plaintiffs usury claim was set forth in their original complaint, filed in February 1996. It may be debatable whether the case was removable on the basis of complete preemption at that time; but certainly, if not then removable, the case became removable on the basis of complete preemption of the usury charge not later than the date of the Supreme Court's decision in Anderson, and thus, at the latest, the defendants in the case at the time (including Republic Leasing) had thirty days following the Supreme Court's decision in Anderson to remove the case on the basis of the usury charge.⁴ See Landry v. Cross Country Bank, 431 F.Supp.2d 682, 686 (S.D.Tex.2003) (finding that complaint charging usury became removable under federal question jurisdiction on the date of the Anderson decision, so that pursuant to 28 U.S.C. 1446(b), the defendant had thirty days from June 2, 2003 to remove this case).⁵ They failed to do this and thereby waived their right to remove on this ground.

More than four years later, after having been substituted as the real party in interest for NetBank, the FDIC purported to remove this case on the basis of 12 U.S.C. § 1819(b)(2)(A), under which practically any case in which the FDIC is a party is "deemed to arise under the laws of the United States." See also Pollock v. FDIC, 17 F.3d 798, 801 (5th Cir.1994) ("[E]xcept in very limited circumstances, all civil cases to which the FDIC is a party are deemed to arise under federal law."). However, the FDIC also recited in its notice of removal that "Sections 85 and 86 ... preempt state usury laws."

While the general removal statutes have been held applicable to the FDIC, see FDIC v. Loyd, 955 F.2d 316 (5th Cir.1992), § 1819(b)(2), which applies only to the FDIC, grants the FDIC "several procedural advantages ... that go beyond the general removal authorization found in (the general removal statutes) 28 U.S.C. §§ 1441-1452." Bullion Services, Inc. v. Valley State Bank, 50 F.3d 705, 707 (9th Cir.1995). For example, the statute gives the FDIC ninety days to remove, whereas the general removal statute establishes a thirty-day removal time period, compare § 1819(b)(2) with 28 U.S.C. § 1446; whereas the general removal statute provides only for removal by defendants, under § 1819, the FDIC may remove an action even as a plaintiff, see Doe v. Kerwood, Doe v. Kerwood, 969 F.2d 165, 168 (5th Cir.1992) ("the FDIC may remove cases as a plaintiff'); and under the authority of § 1819, the FDIC may remove a case even after a state court has entered judgment, a right not accorded defendants by the general removal statute, see NCNB Texas Nat. Bank v. Johnson, 11 F.3d 1260, 1263 (5th Cir.1994). Thus, it has been held that the FDIC is subject to the general removal statutes where there is no conflict with the FDIC's broad removal rights under § 1819(b)(2). See Matter of Meyerland Co., 960 F.2d 512, 521 (5th Cir.1992) ("To the extent that the specific powers or mechanisms in the statute are inconsistent with the general removal statutes, [§ 1819(b)(2)] supersedes the general statutes."); Loyd, 955 F.2d at 327 n. 12 (recognizing that whereas "the general removal statute applies to the FDIC," the FDIC "is truly an exceptional entity in the application of the (removal) statutes," and observing that this can "render[] it very difficult faithfully, yet practicably, to apply § 1446 to" cases involving removal by the FDIC); Buczkowski v. F.D.I.C., 415 F.3d 594, 596 (7th Cir.2005)(observing that, "given § 1819(b)(2)(B) the FDIC need not play by the normal (removal) rules").

In the court's opinion, to the extent the FDIC may have purported to remove this case based on complete preemption of plaintiffs' usury claim, the removal could not have been premised on § 1819(b)(2), but must instead have been based on the general removal statute because § 1819(b)(2) does not purport to authorize the FDIC to remove on any basis other than its becoming a party to the litigation. Thus, with respect to this additional basis for removal, i.e., complete preemption of the usury claim, the FDIC is subject to the same rules as any other party and enjoys no enhanced removal rights.

Under the general removal statute, when a complaint is amended to add a new defendant, the rule of unanimity (which rule requires the timely joinder or consent of all properly served defendants...