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GSL of ILL, LLC v. Pitt Penn Oil Co.

June 17, 2009

GSL OF ILL, LLC, PLAINTIFF,
v.
PITT PENN OIL CO., LLC, DEFENDANT.



The opinion of the court was delivered by: Arthur J. Schwab United States District Judge

ELECTRONICALLY FILED

MEMORANDUM OPINION

I. Introduction

On May 8, 2009, defendant, Pitt Penn Oil Co., LLC (Pitt Penn), filed a Notice of Removal with this Court pursuant to 28 U.S.C. § 1452, removing the plaintiff's Complaint in Replevin from the Court of Common Pleas of Allegheny County, Pennsylvania (Court of Common Pleas) to this Court. (Doc. No. 1). The plaintiff, GSL of IL, LLC (GSL), has filed a Motion for Remand, claiming that Pitt Penn failed to file a timely Notice of Removal and that even if the removal was timely, this Court should abstain and remand the Complaint in Replevin to the Court of Common Pleas. (Doc. No. 5). For the reasons given below, this Court will grant GSL's Motion for Remand.

II. Procedural History

On March 11, 2009, GSL filed a Complaint in Replevin against Pitt Penn in the Court of Common Pleas, at GD 09-4777, to take possession of equipment as collateral for a loan in default. (Doc. No. 10-2 at 4). The ex parte Writ of Seizure was executed on April 3, 2009, when the Allegheny County Sheriff changed the locks on Pitt Penn's Creighton manufacturing facility, securing the equipment. (Doc. No. 5-3). Pitt Penn received notice of the proceedings on April 6, 2009. (Doc. No. 1-5 at 4). One day after Pitt Penn received notice, the Court of Common Pleas entered an order confirming the Writ of Seizure. (Doc. No. 5-4). This order gave Pitt Penn until April 13, 2009, to file a counter bond. Id. When the counter bond was not filed, GSL took possession of the equipment. Pitt Penn then filed a Motion to Vacate the Writ of Seizure. (Doc. No. 1-5 at 13).

Pitt Penn filed Chapter 11 bankruptcy in the United States Bankruptcy Court, District of Delaware (Bankruptcy Court), Case No. 09-11476, on April 30, 2009. (Doc. No. 1-5 at 21). After filing its bankruptcy claim, Pitt Penn filed a Notice of Removal to move GSL's claim against it from the Court of Common Pleas to this Court. (Doc. No. 1). GSL filed a Motion to Modify the Automatic Stay, and after conducting a hearing on the issue, the Bankruptcy Court, on May 26, 2009, issued a Memorandum Order granting GSL relief from the automatic stay, allowing GSL to exercise its rights with respect to the equipment. (Doc. No. 5-5). GSL now files a Motion to Remand its Complaint in Replevin back to the Court of Common Pleas. (Doc. No. 5).

III. Discussion

The Plaintiff argues that its Complaint in Replevin should be remanded to the Court of Common Pleas of Allegheny County for three reasons: Pitt Penn failed to file a timely Notice of Removal; even if the removal was timely, this Court is required to abstain; and if mandatory abstention does not apply, permissive abstention should prevail. (Doc. No. 5). The Court finds that Pitt Penn's notice was timely; however, the Court will abstain and remand the Complaint in Replevin to the Court of Common Pleas.

A. Timeliness of Notice

Pitt Penn filed its Notice of Removal on May 8, 2009, pursuant to 28 U.S.C. § 1452(a) (2006)*fn1 . (Doc. No. 1 at 1). GSL relies on 28 U.S.C. § 1446(b) (2006), claiming that Pitt Penn failed to file its notice within thirty days after receiving notice of the replevin action, as required by the statute. (Doc. No. 5 at 3-4). Section 1452 is silent with regard to the time within which a party must file a notice of remand.

The minority of courts have agreed with GSL, determining that the thirty day limit established by Section 1446(b) also applies to Section 1452 removals. In re Donington, Karcher, Salmond, Ronan & Rainone, P.A., 194 B.R. 750, 755, 1996 U.S. Dist. LEXIS 3745 (D.N.J. 1996). On the contrary, the majority of the courts, along with the Bankruptcy Court for the Eastern District of Pennsylvania, have established that the time limits stated in Bankruptcy Rule 9027*fn2 should control with regard to Section 1452. Id. at 756; In re Philadelphia Gold Corp., 56 B.R. 87, 89-90 (Bankr. E.D. Pa. 1985). Further explanation has been set out in In re Pacor, Inc., 72 B.R. 927, 930-931 (Bankr. E.D. Pa. 1987):

When Congress enacted 28 U.S.C. § 1452, its intent was simply to alter the statutory reference from bankruptcy court to district court. S. Rep. No. 98-55, 98th Cong., 1st Sess. 43 (1983). It expressed no desire to alter the procedure or time periods set out in Rule 9027 which were then in effect. Indeed, the proposed amendments to Bankr. Rule 9027 maintain the time limits currently existing in this rule and alter the procedure by having the removed application filed with the district court clerk. Moreover, since § 1446 makes no provision for removal by a plaintiff, while § 1452 continues to allow plaintiffs to remove, it is difficult to see how Rule 9027 could be supplanted by § 1446 unless one also supplants § 1452 by § 1441. See generally Pacor, Inc. v. Higgins.

Under Section 1452, the time clock cannot begin to run until the bankruptcy claim has been filed. See Shared Network Users Group, Inc., 309 B. R. 446, 449 (E.D. Pa. 2004). Pitt Penn filed for Chapter 11 bankruptcy on April 30, 2009, triggering the start of the clock. Just over one week later, it filed its Notice of Removal, well within the time frame ...


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