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Corinthian Marble & Granite, Inc v. T.D. Bank

January 23, 2013

CORINTHIAN MARBLE & GRANITE, INC.,
PLAINTIFF,
v.
T.D. BANK, N.A. DEFENDANT.



The opinion of the court was delivered by: DuBois, J.

MEMORANDUM

I.INTRODUCTION

Corinthian Marble & Granite, Inc. filed a lawsuit against TD Bank, N.A. and Melissa C. Boyd in the Pennsylvania Court of Common Pleas. After the state court dismissed all claims against Boyd, the only non-diverse defendant, TD Bank removed to this Court. Corinthian now moves to remand the case back to state court because the removal occurred one year after the case commenced, in violation of 28 U.S.C. § 1446. For the reasons set forth below, the Court grants the motion.

II.BACKGROUND

A. Factual Background

Corinthian claims that five individuals -- labeled in the Second Amended Complaint as the "Perpetrators" -- "plotted a coup" to take over Corinthian. (Resp. Ex. A, Second Am. Compl., at ¶¶ 4.) Specifically, it asserts that they closed Corinthian's account at TD Bank, reopened a new bank account in Corinthian's name, and raided the company's assets. (Id. at ¶¶ 8, 34-37.)

Corinthian sued TD Bank and its employee, Melissa Boyd, on numerous grounds for permitting these transactions. Currently, all that remains for adjudication is a breach of contract claim against TD Bank.

B. Procedural History

On March 28, 2011, the original plaintiff in this case, Anastasios Papadopoulos, filed a Praecipe to Issue Writ of Summons in the Pennsylvania Court of Common Pleas. (Notice of Removal, Ex. C.)*fn1 The Praecipe named as defendants TD Bank, Boyd, and "additional defendants." (Id.) Additionally, the caption stated that the plaintiff was "Anastasios Papadopoulos & on behalf of Corinthian Marble & Granite, Inc. (Shareholder Derivative Suit)." (Id.)

Little occurred in the case for three months, at which point the state court directed Papadopoulos to file a complaint. (Resp. Ex. N.) Papadopoulos did so, and after defendants filed Preliminary Objections, he filed an Amended Complaint. (Resp. Ex. O, June 7, 2012 Civil Docket Report, at 8-9). TD Bank and Boyd responded by filing Preliminary Objections once again. (Id. at 10.)

The state court sustained the objections, reasoning that Papadopoulos failed to meet the requirements of Pa. R. Civ. P. 1506, which requires plaintiffs who bring a derivative action to set forth in their complaint "the efforts made to secure enforcement by the corporation . . . or the reason for not making such efforts. . . ." (Resp. Ex. M, at 1, 3.) The state court dismissed the Amended Complaint, but gave Papadopoulos leave to file a second amended complaint. (Id. at 1.) That court also noted that if the allegations in the Amended Complaint were true -- that Papadopoulos is the sole stockholder of Corinthian and may also be its sole director -- Papadopoulos would have authority to either elect directors to commence an action in Corinthian's name, or commence such an action himself under his own authority as director. (Id. at 4.)

In response, Papadopoulos neither filed a new action in Corinthian's name nor maintained his derivative suit. Rather, on January 26, 2012, a Second Amended Complaint was filed, this time, with Corinthian itself as the plaintiff. (Resp. Ex. A.) In this version of the complaint, only TD Bank and Boyd were named as defendants, and they once again filed Preliminary Objections. (Id.; Resp. Ex. B.)

The state court sustained in part and overruled in part their objections. (Resp. Ex. B, at 1.) All claims against Boyd were dismissed, and the state court dismissed her as a defendant. (Id. at 1-2.) All claims against TD Bank were dismissed except for the breach of contract claim in Count I of the Second Amended Complaint. (Id. at 1.)

With Boyd dismissed, there was complete diversity of citizenship. As a result, TD Bank removed to this Court on July 3, 2012 -- over a year after Papadopoulos filed his Praecipe to Issue Writ of Summons but less than six months after the Second Amended Complaint with Corinthian as the plaintiff was filed.

Corinthian now moves to remand the case back to state court on the ground that the removal occurred one year after the case commenced, in violation of 28 U.S.C. § 1446.

III.LEGAL STANDARD

In a motion to remand, "the removal statute should be strictly construed and all doubts should be resolved in favor of remand." Abels v. State Farm Fire & Cas. Co., 770 F.2d 26, 29 (3d Cir. 1985). "The party seeking removal has the burden of showing that federal subject-matter jurisdiction exists, that filing of the notice of removal was timely, and that removal is proper." Mountain Ridge State Bank v. Investor Funding Corp., 763 F. Supp. 1282, 1288 (D.N.J. 1991) (superseded by statute on other grounds). A case may be remanded to state court on the ground of a defect in the removal procedure. 28 U.S.C. § 1447(c). Failure to file a notice of removal within the limitations periods of § 1446 is cause for remand. Capone v. Harris Corp., 694 F. Supp. 111, 112 (E.D. Pa. 1988); Namey v. Malcolm, 534 F. Supp. 2d 494 (M.D. Pa. 2008).

The parties refer to the new version of § 1446, which the President signed into law on December 7, 2011. See Advanced Surgery Ctr. v. Conn. Gen. Life Ins. Co., No. 12-2715, 2012 WL 3598815, at *3 n.2 (D.N.J. July 21, 2012). However, the new version of the statute only apples to cases which were commenced after January 6, 2012. See id.; Pub. L. No. 112--63, § 205, 125 Stat. 758, § 205. Because the Court concludes below ...


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