Spigner v. Singh

VONCIL SPIGNER and DONALD SPIGNER Plaintiffs, v. SANDEEP SINGH, UNITED SPECIALTY INSURANCE COMPANY,PB30 TRANSPORT, INC., JAWAD ALWAN,and HALLMARK INSURANCE COMPANY, Defendants.

Civ. No. 21-123 SCY/LF

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW MEXICO

July 19, 2021

MEMORANDUM OPINION AND ORDER GRANTING MOTION TO REMAND

Plaintiffs Voncil Spigner and Donald Spigner brought this case in state court against two sets of defendants: (1) Sandeep Singh, Singh's employer PB30 Transport, and Singh's insurer United Specialty Insurance Company ("United"); and (2) Jawad Alwan and Alwan's insurer Hallmark Insurance Company ("Hallmark"). Doc. 1-1 at 1-5. Plaintiffs allege that Defendants Singh and Alwan were involved in a vehicle collision, resulting in Singh's trailer obstructing the roadway for traveling motorists. Id. at 2, ¶¶ 9-10. Plaintiffs were traveling on the same roadway (with Voncil Spigner driving a semi-trailer and Donald Spigner in the sleeper of the semi-trailer) when they collided with the trailer and debris from the Singh/Alwan collision, causing injuries to both Voncil Spigner and Donald Spigner. Id. at 2-3, ¶¶ 10-11, 14. On February 12, 2021, Defendant PB30 Transport filed a notice of removal, citing diversity jurisdiction under 28 U.S.C. § 1332(a). Doc. 1. On March 12, 2021, Plaintiffs filed a motion to remand the case to state court, Doc. 12, and that motion was fully briefed on April 9, 2021, Docs. 13, 17. Pursuant to 28 U.S.C. § 636(c), the parties consented to the undersigned to conduct any or all proceedings and to enter an order of judgment. Docs. 8, 9, 10, 11. Because not all Defendants timely consented to removal, thereby defeating the unanimity requirement, the Court concludes that removal was procedurally defective and this case must be remanded.

LEGAL STANDARD

28 U.S.C. § 1332(a) gives federal courts "original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between citizens of different States . . . ." When a plaintiff files a civil action in state court over which the federal court would have original jurisdiction based on diversity of citizenship, the defendant may remove the action to federal court, provided that no defendant is a citizen of the State in which such action is brought. See 28 U.S.C. § 1441(a), (b). However, if the federal court determines it lacks subject matter jurisdiction, such as lacking diversity jurisdiction, it must remand the matter to the state court. 28 U.S.C. § 1447(c). The removing party bears the burden of establishing the requirements for federal jurisdiction. Martin v. Franklin Capital Corp., 251 F.3d 1284, 1290 (10th Cir. 2001), abrogated on other grounds by Dart Cherokee Basin Operating Co. v. Owens, 574 U.S. 81 (2014).

DISCUSSION

In this case, the parties agree that diversity of citizenship exists.¹ See Doc. 12 at 3. Plaintiffs argue, however, that the Court lacks diversity jurisdiction because the removingDefendant failed to show by a preponderance of the evidence that the amount in controversy exceeds $75,000. Plaintiffs also argue that remand is appropriate because removal would prejudice Plaintiffs due to the progress of litigation in state court. The Court need not address these two arguments because the Court finds remand is appropriate based on Plaintiffs' third argument: the unanimity requirement is not met.

1. Unanimity Requirement

The procedures for removal are contained in 28 U.S.C. § 1446. Pursuant to that statute, a defendant must remove a case within thirty days after receipt of a copy of the initial pleading or service of summons, whichever period is shorter. See id. § 1446(b). In the event the initial pleading is not removable, "a notice of removal may be filed within 30 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 ascertained that the case is one which is or has become removable." Id. § 1446(b)(3). In other words, a notice of removal must be filed within thirty days from the date when the case qualifies for federal jurisdiction. Padilla v. Am. Modern Home. Ins. Co., 282 F. Supp. 3d 1234, 1253 (D.N.M. 2017). A plaintiff has thirty days after the notice of removal is filed to bring a motion to remand based on any defect other than subject matter jurisdiction, or the plaintiff waives those defects. 28 U.S.C. § 1447(c).

"When a civil action is removed solely under section 1441(a)," as this case was, "all defendants who have been properly joined and served must join in or consent to the removal ofthe action." 28 U.S.C. § 1446(b)(2)(A); see also Brady v. Lovelace Health Plan, 504 F. Supp. 2d 1170, 1172 (D.N.M. 2007) ("When there are multiple defendants, generally all must consent to join in the notice of removal in order for it to be effective."); State Farm Fire and Cas. Co. v. Dunn-Edwards Corp., 728 F. Supp. 2d 1273, 1275 (D.N.M. 2010) ("A valid removal requires the consent of all served defendants."). "The failure of one defendant to join in the notice renders the removal notice procedurally defective, which requires that the district court remand the case." Brady, 504 F. Supp. 2d at 1172-73; see also Henderson v. Holmes, 920 F. Supp. 1184, 1186 (D. Kan. 1996) ("The failure to join all proper defendants renders the removal petition procedurally defective."); Vasquez v. Americano U.S.A., LLC, 536 F. Supp. 2d 1253, 1257-58 (D.N.M. 2008) ("Where there are multiple defendants, all defendants served at the time of filing must join in the notice of removal . . . . It is well established that a notice of removal fails if this procedural requirement is not met."). This is referred to as the unanimity rule. "When fewer than all of the defendants have joined in a removal action, the removing party has the burden under 28 U.S.C. § 1446 to explain affirmatively the absence of any co-defendants in the notice of removal." Brady, 504 F. Supp. 2d at 1173.

Although all defendants are required to join in removal, not all defendants are required to sign the same notice of removal. See Vasquez, 536 F. Supp. 2d at 1258. "Instead, each defendant must independently and unambiguously file notice of its consent to join in the removal within the thirty-day period." Id.; see also State Farm Fire & Cas. Co., 728 F. Supp. 2d at 1275 ("The unanimity rule requires all served defendants to assure the court—generally by joining in the removal itself, filing their notice of removal, or filing a notice of consent—that they consent to removal."); Henderson, 920 F. Supp. at 1187 ("Each party must independently and unambiguously file notice of its consent and its intent to join in the removal within the thirty-dayperiod."). Accordingly, "[t]here must be a timely filed written indication from each served defendant, or from some person purporting to formally act on his/her behalf and with the authority to do so, that he/she has actually consented to removal." Todd v. DSN Dealer Service Network, Inc., 861 F. Supp. 1531, 1535 (D. Kan. 1994).

In this case, Defendant PB30 Transport filed its notice of removal on February 12, 2021 after receiving confirmation on January 14, 2021, by an email from Plaintiffs' counsel containing their settlement demand, that Plaintiffs seek damages in excess of $75,000 and that the case is removable. Doc. 1 ¶ 10, Doc. 1-3. At the time of this removal, all Defendants were properly joined and served, see Doc. 1-1, and therefore all needed to consent to removal. Defendant PB30 Transport filed the notice of removal, indicating that Defendant Jawad Alwan consents to removal. Doc. 1.² The notice of removal is signed by counsel that represents PB30 Transport, United, and Singh; the notice, however, states only that Defendant PB30 Transport brings the removal and provides no indication as to the position of Defendants United and Singh. Id. Shortly after removal, Defendants Alwan and Hallmark (who are represented by the same counsel) filed a notice of consent to removal. Doc. 4.

On March 12, 2021, Plaintiffs filed their motion to remand, asserting that removal is improper because Defendant Singh did not provide his consent to removal and the unanimity requirement is therefore not met.³ Doc. 12 at 6. Defendant PB30 Transport filed a response onMarch 26, 2021, explaining that "[t]hrough a technical error, the Notice of Removal did not reflect that it was filed on behalf of Sandeep Singh, although the undersigned counsel is reflected as counsel for Defendants PB30 Transport, Sandeep Singh, and United Specialty Insurance." Doc. 13 at 2. Accordingly, Defendants Singh, United, and PB30 Transport filed a Notice of Errata on March 26, 2021, identifying all three defendants as movants in the notice of removal. Doc. 14. At the same time, Defendants Singh, United, and PB30 Transport filed a notice of consent to removal. Doc. 15.

Although Defendants Singh, United, and PB30 Transport were all represented by the same counsel, Section 1446 provides no indication that representation by common counsel can serve as a substitute for the requirement that "all defendants who have been properly joined and served must join in or consent to the removal of the action." 28 U.S.C. § 1446(b)(2)(A). Because Defendant PB30 Transport's notice of removal provided no indication that Defendant Singh also consented to removal, the Court cannot infer Defendant Singh's consent from the notice of removal. See Doc. 1 at 1 (introduction reading "Defendant PB30 Transport, Inc. ('PB30 Transport') submits this timely-filed Notice of Removal"); id. at 4 (conclusion reading, "Therefore, PB30 Transport requests that the action now pending in the Fourth Judicial District of the State of New Mexico, County of Guadalupe, as Case No. D-424-CV-2020-00084, be removed to this United States District Court"). Stated differently, the Court cannot read into the notice of removal what is not there. See Maddox...