The opinion of the court was delivered by: Jones, J.
On May 19, 2005, Plaintiff M. Diane Koken, Insurance Commissioner of the Commonwealth of the Pennsylvania ("the Commissioner"), in her official capacity as Liquidator of Reliance Insurance Company ("Reliance"), filed a Complaint in the Commonwealth Court of Pennsylvania to recover $9,257,302.86 that Defendant Mizuho Corporate Bank, Limited ("Mizuho"), a successor in interest to Fuji Bank, Limited ("Fuji"), received from Reliance. Mizuho removed the action to this court based on diversity jurisdiction. Presently before the court is the Commissioner's Motion to Remand to the Commonwealth Court of Pennsylvania (Doc. No. 3) and Mizuho's Response in Opposition thereto (Doc. No. 5). For the following reasons, the Commissioner's motion will be denied.
On March 17, 1998, Reliance entered into a series of written agreements with Woodbridge Films ("Woodbridge") and Mizuho*fn1 under which Reliance became obligated to guarantee certain loans to be made by Mizuho to Woodbridge to finance motion picture prints and advertising for four motion pictures to be produced by Woodbridge. (Compl. ¶ 18; Resp. in Opp'n to Mot to Remand 3.) Woodbridge's first film failed to generate sufficient income to repay Mizuho's loan, and on September 15, 2000, Mizuho demanded that Reliance make up the shortfall. (Compl. ¶ 21.) On December 21, 2000, Reliance paid $9,257,302.86 to Mizuho in satisfaction of its loan-guarantee obligation. (Compl. ¶ 22.)
On May 29, 2001, upon consideration of the Commissioner's petition filed that day, the Commonwealth Court placed Reliance in rehabilitation pursuant to 40 P.S. § 221.20. (Compl. ¶ 7; Pl.'s Mot. to Remand, Ex. B, Commonwealth Ct. Order of Rehab., May 29, 2001 ("Rehab. Order") ¶ 2.) On October 3, 2001, the Commonwealth Court terminated the rehabilitation of Reliance and appointed the Commissioner as Liquidator of Reliance. (Mot. to Remand, Ex. A, Commonwealth Ct. Order of Liquidation, Oct. 3, 2001 ("Liquidation Order") ¶¶ 1, 3.) The court's Liquidation Order states:
The Commissioner, as Liquidator, is vested with title to all property, assets, contracts and rights of action ("assets") of Reliance, of whatever nature and wherever located, whether held directly or indirectly, as of the date of the filing of the Petition for Liquidation. All assets of Reliance are hereby found to be in custodia legis of this Court; and this Court specifically asserts, to the fullest extent of its authority, (a) in rem jurisdiction over all assets of the Company whereverthey may be located and regardless of whether they are held in the name of the Company or any other name; (b) exclusive jurisdiction over all determinations of the validity and amount of claims against Reliance; and (c) exclusive jurisdiction over the determination of the distribution priority of all claims against Reliance. (Liquidation Order ¶ 5.)
On March 26, 2002, Mizuho filed a $19,972,475.76 proof of claim against Reliance in the Commonwealth Court. (Mot. to Remand, Ex. D, Mizuho Proof of Claim, March 26, 2002.)
On May 19, 2005, the Commissioner filed a Complaint in the Commonwealth Court to recover from Mizuho the $9,257,302.86 that Reliance had paid to Mizuho on December 21, 2000. (Compl.) The Commissioner claims that, as the statutory Liquidator of Reliance, she is authorized to recover the $9,257,302.86 as a voidable preference because (1) Reliance was insolvent at the time of the transfer (Count I) and (2) at the time of the transfer Mizuho had reasonable cause to believe that Reliance was insolvent or was about to become insolvent (Count II).*fn2 (Compl. ¶ 30.)
Mizuho filed its Notice of Removal to this District Court on June 24, 2005. Mizuho asserts that the action is removable under 28 U.S.C. § 1441(a) because the Court has diversity jurisdiction. On July 25, 2005, Plaintiff filed a Motion to Remand to the Commonwealth Court of Pennsylvania. Mizuho responded on August 15, 2005. The matter was reassigned to my docket on April 28, 2009.
A civil action properly may be removed from state court to the federal district court if the district court would have original jurisdiction over the action. 28 U.S.C. § 1441(a) (2008). Federal district courts have diversity jurisdiction over cases where there exists complete diversity between citizens of different states and where the amount in controversy exceeds the sum or value of $75,000, exclusive of interest and costs. 28 U.S.C. § 1332(a). If the district court lacks subject matter jurisdiction over a removed action, it must be remanded. 28 U.S.C. § 1447(c) (2008).
Any preference may be avoided by the liquidator, if (i) the insurer was insolvent at the time of the transfer; (ii) the transfer was made within four months before the filing of the petition; (iii) the creditor receiving it or to be benefited (sic) thereby or his agent acting with reference thereto had, at the time when the transfer was made, reasonable cause to believe that the insurer was insolvent or was about to become insolvent.... Where the preference is voidable, the liquidator may recover the property or, if it has been converted, its value from any person who has received or converted the property....