MADISON POWELL, a Minor, by THERESA POWELL, Guardian, and THERESA POWELL, Individually, Plaintiffs,
SMITHKLINE BEECHAM CORPORATION d/b/a GLAXOSMITHKLINE, and PAR PHARMACEUTICALS, Defendant.
MEMORANDUM RE: PLAINTIFFS’ MOTION TO REMAND
Michael M. Baylson, U.S.D.J.
An issue that has recently divided judges in this District is whether a defendant can remove to federal court a previously remanded case when jurisdiction depends on diversity and more than a year after the action commenced, the legal basis of the first remand is invalidated by an appellate court in a similar, but unrelated action. This Court holds that such a case is not removable and will GRANT Plaintiffs’ Motion to Remand.
I. Facts and Procedural History
Plaintiffs Madison Powell (“Daughter”) and Theresa Powell (“Mother”) are citizens of California who allege suffering harm from Mother’s use of the drug Paxil during pregnancy. Paxil is an antidepressant medication produced by Defendant GlaxoSmithKline (“GSK”). A generic version of Paxil is produced by the Co-Defendant Par Pharmaceuticals LLC (“Par”).
On June 8, 2011, Plaintiffs commenced this action by filing a short form complaint in the Philadelphia Court of Common Pleas Mass. Torts Program. After Defendants filed a timely notice of removal, Plaintiffs moved to remand. Our Chief Judge ordered that the motion be consolidated with several other remand motions in similar Paxil cases before Judge Savage. On December 12, 2011, Judge Savage granted the consolidated motion, holding that GSK was a citizen of Pennsylvania and that the “forum defendant rule” barred GSK from removing the cases. Maldonado v. SmithKline Beecham Corp., 841 F.Supp.2d 890 (E.D. Pa. 2011). After the remand order was transmitted to state court, the parties engaged in substantial discovery, resolved numerous motions on the admissibility of expert testimony, and filed various pre-trial motions that are currently pending before Judge Arnold New in Philadelphia’s Mass. Torts Program.
Simultaneous to the Paxil litigation, a separate series of cases were filed against GSK over alleged birth defects from the drug thalidomide. As with the Paxil cases, GSK filed notices of removal, plaintiffs filed motions to remand, which were consolidated. On June 2012, Judge Diamond denied the consolidated motions based on his conclusion that GSK is a Delaware citizen. Johnson v. SmithKline Beecham Corp., 853 F.Supp.2d 487 (E.D. Pa. 2012). Judge Diamond recognized, however, that an “extremely troubling” legal uncertainty existed about GSK’s citizenship status and certified his ruling for interlocutory review so that the Third Circuit could provide “much-needed guidance.” Id. at 497-98. The Third Circuit agreed to decide the appeal and affirmed Judge Diamond’s decision, holding that GSK is a citizen of Delaware. See Johnson v. SmithKline Beecham Corp., --- F.3d ---, 2013 WL 2456043, at *1 (3d Cir. 2013). The Third Circuit was silent, however, on what effect, if any, its ruling would have on similar cases, such as the one at bar.
On June 26, 2013, less than 30 days after the Third Circuit published its Johnson opinion, Defendants filed a second notice of removal in this and eight other Paxil cases,  and Plaintiffs again moved to remand. On July 24, 2013, Judge Bartle denied the motion to remand in one of the eight related cases. Guddeck v. SmithKline Beecham Corp., __ F.Supp.2d __, 2013 WL 3833252, at *5 (E.D. Pa. July 24, 2013). According to Judge Bartle, the Third Circuit’s decision in Johnson makes Judge Savage’s remand opinion a “nullity” that can be disregarded when assessing the removability of the initial pleading. Id. at *5. In Judge Bartle’s view, the Paxil cases were “initially removable” at the pleading stage and, as such, are not subject to the one-year time limit on removal. Two other judges in this Court (Judge McLaughlin and Judge Buckwalter) have followed Judge Bartle with summary orders that reference and adopt Judge Bartle’s reasoning.
More recently, however, Judge Padova granted the motion to remand in Cammarota v. SmithKline Beecham Corp., No. 13-3677, 2013 WL 4787305 (E.D. Pa. Sept. 9, 2013). Judge Padova held that GSK’s second removal was untimely because the action was not initially removable and GSK’s second notice of removal was filed more than a year after the action commenced.
On September 11, 2013, the Court held a hearing in which counsel for the parties argued their respective positions. The parties submitted short supplemental briefs after the hearing, which the Court has carefully considered.
II. Legal Framework
A. Federal Removal Statute
Congress enacted the removal statute with an intent to ‘abridge the right of removal, ’” Am. Fire & Cas. Co. v. Finn, 341 U.S. 6, 9-10 (1951), an intent that gives due regard to the comity principles that underlie our federal system, Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108–09 (1941). The removal statute evinces this intent, in part, by barring courts from reviewing, “by appeal or otherwise, ” previous remand orders. 28 U.S.C. § 1447(d); United States v. Rice, 327 U.S. 742, 751 (1946). Under this provision, “[e]ven a federal court, persuaded that it has issued an erroneous remand order, cannot vacate the order once entered.” Hunt v. Acromed Corp., 961 F.2d 1079, 1081 (3d Cir. 1992); accord Kircher v. Putnam Funds Trust, 547 U.S. 633, 642 (2006). Since “nothing could be more inclusive than the phrase ‘on appeal or otherwise, ’” In re La Providencia Development Corp., 406 F.2d 251, 252-53 (1st Cir. 1969), courts have warned against creating remedies that become “the functional equivalent of a motion to review or reconsider, ” Brierly v. Alusuisse Flexible Packaging, Inc., 184 F.3d 527, 532 (6th Cir. 1999). The removal statute’s protection of comity and federalism principles is particularly apparent in cases that raise only state law claims, as the statute’s one-year time limit on removal applies only to diversity jurisdiction cases. 28 U.S.C. § 1446(b).
A civil action may be removed from state court to federal court if there is original jurisdiction and the removal complies with the statute’s procedural requirements. 28 U.S.C. §§ 1441(a) and § 1446. The statute’s procedural requirements are set forth in Section 1446, which Congress amended in 2011. Since the amendment did not take effect until January 6, 2012, this Court will interpret the removal statute as it existed when this action first commenced.
When a defendant files for removal, the plaintiff may move to remand on either jurisdictional or procedural grounds. 28 U.S.C. § 1447(c). Here, Plaintiffs base their motion on the procedural grounds that GSK’s second removal is untimely under 28 U.S.C. § 1446(b). To be timely under § 1446(b), a defendant must remove within 30 days of receiving the initial pleading if the case’s removability is ascertainable from the pleading’s allegations. If removability is not ascertainable from the initial pleading, the defendant must remove within 30 days of receiving “an amended pleading, motion, order or other paper from which it may first be ascertained that the case is or has become removable.” The statute’s one-year time limit on removing diversity cases applies only to cases that are not initially removable. Brown v. Tokio Marine & Fire Ins. Co., 284 F.3d 871, 873 (8th Cir. 2002).
B. Standard of Review
The Third Circuit instructs that the federal removal statute be “strictly construed against removal and all doubts should be resolved in favor of remand.” Steel Valley Auth. v. Union Switch & Signal Div., 809 F.2d 1006, 1010 (3d Cir. 1987). When challenged, the defendant bears the burden of proving the propriety of removal. Dukes v. U.S. Healthcare, Inc., 57 F.3d 350, 359 (3d Cir. 1995); Corinthian Marble & Granite, Inc. v. T.D. Bank, N.A., No. 12-3744, 2013 WL 272757, at *2 (E.D. Pa. Jan. 24, 2013).
III. The Issues
This case presents the following four issues:
(A) Does 28 U.S.C. § 1447(d) prohibit removal? Plaintiffs argue that § 1447(d)’s non-reviewability provision prohibits Defendants’ second removal because it “is, in effect, a request for review of a remand order already issued by this Court.” Pl. Mot. at 8. Defendants contend, however, that the Third Circuit “directly addressed and rejected this argument” in Doe v.
American Red Cross, 14 F.3d 196 (3d Cir. 1993). Def. Resp. Br. at 3. Defendants argue that the Johnson decision qualifies as an “intervening order” under Doe and thus provides new grounds for removal. Accordingly, Defendants assert that removing this case based on Johnson would not run afoul of § 1447(d)’s prohibition on reviewing prior remands.
(B) Does the first paragraph of 28 U.S.C. § 1447(d) govern this dispute? At the time this action commenced, § 1446(b) contained two unenumerated paragraphs. The first paragraph, which is now § 1446(b)(1), governs cases whose removability is ascertainable from the initial pleading. The second paragraph, which is now § 1446(b)(3), governs cases whose removability does not become apparent until some later point in the litigation. The question of which paragraph governs is significant because courts have held,  and Plaintiffs do not dispute, that the one-year time limit only applies to cases governed by the second paragraph.
Defendants argue that the first paragraph governs this dispute because the Johnson decision demonstrates that the removability of this case was ascertainable from the initial pleading. It is irrelevant that Judge Savage reached a different conclusion, Defendants argue, because the Johnson has rendered Judge Savage’s opinion a legal nullity. Under Defendants’ theory, therefore, nothing stops this Court from retroactively determining that the case was removable at the time of the initial pleading.
Plaintiffs counter by arguing that Judge Savage’s remand order, erroneous or not, provides the definitive word on whether this case was removable at the initial pleading stage. Since Judge Savage held that the case was not initially removable, Plaintiffs argue that ...