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Dixon v. Allstate Insurance Co.

United States District Court, E.D. Pennsylvania

March 27, 2017

ANNE M. DIXON, Plaintiff,
v.
ALLSTATE INSURANCE COMPANY et al., Defendants.

          MEMORANDUM

          GENE E.K. PRATTER United States District Judge.

         Anne Dixon moves to remand this action to the Philadelphia Court of Common Pleas. For the reasons that follow, the Court will grant Ms. Dixon's motion.

         I. PROCEDURAL BACKGROUND

         On January 21, 2017, Ms. Dixon filed a complaint in the Philadelphia Court of Common Pleas against (i) Allstate Insurance Company, Tracey Miller, Wendy McClure, Longacre Appraisal and Adjustment Service, Inc., Karen Washko, and Laura Kerns (the “Allstate Defendants”), and (ii) Steven Feinstein and Zenstein Ballard, P.C. (the “Zenstein Defendants”). Ms. Dixon alleged violations of the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. § 1961 et seq. (“RICO”), and the Pennsylvania Unfair Trade Practices and Consumer Protection Law, 73 P.S. § 201-1 et seq., arising out of Ms. Dixon's dealings with the Allstate and Zenstein Defendants in connection with previous litigation. On February 6, 2017, the Allstate Defendants filed a Notice of Removal. The Notice of Removal expressly states that it was filed on behalf of the Allstate Defendants only and that the Zenstein Defendants had not been served with process at the time the Notice was filed. One week later, the Allstate and Zenstein Defendants filed separate motions to dismiss. After Ms. Dixon failed to timely respond to the Allstate and Zenstein Defendants' motions, the Court ordered Ms. Dixon to respond. Thereafter, on March 8, 2017, Ms. Dixon filed a motion for summary remand, which the Allstate and Zenstein Defendants oppose.[1]

         II. LEGAL STANDARD

         Section 1441(a) of 28 U.S.C. authorizes a defendant to remove “any civil action brought in a State court of which the district courts of the United States have original jurisdiction.” 28 U.S.C. § 1441(a). A defendant seeking removal must file a notice of removal with the district court within 30 days of plaintiff's service of the complaint. 28 U.S.C. § 1446(a), (b). “When a civil action is removed solely under section 1441(a), 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). “The defendants bear the burden of establishing removal jurisdiction and compliance with all pertinent procedural requirements.” Ramos v. Quien, 631 F.Supp.2d 601, 606 (E.D. Pa. 2008) (citations omitted). Because federal courts are courts of limited jurisdiction, the federal removal statutes are to be strictly construed. Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108-09 (1941); Boyer v. Snap-on Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990). “[A]ll doubts should be resolved in favor of remand.” In re Briscoe, 448 F.3d 201, 217 (3d Cir. 2006) (citation omitted).

         Once a defendant has removed an action, 28 U.S.C. § 1447 authorizes a plaintiff to seek a remand to state court. A district court can remand a case for lack of subject matter jurisdiction or for a defect in the removal procedure. PAS v. Travelers Ins. Co., 7 F.3d 349, 352 (3d Cir. 1993). A motion to remand based on a procedural defect in the notice of removal must be made within 30 days of the filing of the notice of removal. 28 U.S.C. § 1447(c). A motion for remand premised on lack of subject matter jurisdiction can be made at any time before final judgment. 28 U.S.C. § 1447(c).

         III. DISCUSSION

         Ms. Dixon argues that the Allstate Defendants did not properly remove this action because the Zenstein Defendants did not join in or consent to the removal of this action, even though the Zenstein Defendants were served with the state court complaint on February 2, 2017, four days before the Allstate Defendants filed their Notice of Removal. The Allstate Defendants respond that their failure to obtain the Zenstein Defendants' consent is excused because, after exercising what they describe as reasonable diligence, they determined that the Zenstein Defendants had not been served. The Zenstein Defendants take the position that they did consent to removal because counsel for the Zenstein Defendants discussed removal with counsel for the Allstate Defendants and “[t]here was an agreement reached as to removal, who was going to remove it and when.” Zenstein Def. Br. Opp. Remand 2 (Doc. No. 11). Notwithstanding these after-the-fact protestations, the Court will grant Ms. Dixon's motion for remand because (i) the Allstate Defendants have not met their burden to establish compliance with the applicable removal procedures, and (ii) the Zenstein Defendants' alleged oral consent for removal does not satisfy the § 1446 procedural requirements.

         A. Relevant Facts Recounted

         Ms. Dixon filed her state court complaint on January 21, 2017. The complaint was served on the Allstate Defendants on January 23, 2017. On January 27, 2017, counsel for the Allstate Defendants allegedly spoke with Mr. Feinstein (one of the defendants), who stated that neither he nor his firm, Zenstein Ballard, had been served with the complaint. The Zenstein Defendants were, however, served with Ms. Dixon's complaint on February 2, 2017.[2] The state court record did not include the information concerning the February 2 service on the Zenstein Defendants until February 15, 2017. The Allstate Defendants filed their Notice of Removal on February 6, 2017.

         B. Allstate Defendants' Argument

         The Allstate Defendants' argument opposing remand is based entirely on the rule set forth in Laurie v. Nat'l R.R. Passenger Corp., No. 01-6145, 2001 WL 34377958 (E.D. Pa. Mar. 13, 2001), that when removing an action to federal court “a defendant is required to obtain consent only from those codefendants who it knew or should have known, in the exercise of reasonable diligence, had been served.” Id. at *1 (citing Milstead Supply Co. v. Cas. Ins. Co., 797 F.Supp. 569, 573 (W.D. Tex. 1992)). District courts in this Circuit are split on whether to follow the Laurie inclusion of a “reasonable diligence” exception into what is now a statutory consent requirement. Compare Cacoilo v. Sherwin-Williams Co., 902 F.Supp.2d 511, 522 (D.N.J. 2012) (holding “that the exercise of reasonable diligence in attempting to obtain consent of all codefendants prior to removal is not the controlling standard with respect to the rule of unanimity”); Leuzzi v. Dollar Tree Stores Inc., No. 05-4814, 2005 WL 2972982, at *1-*2 (E.D. Pa. Nov. 4, 2005) (finding the fact that a state court docket did not reflect proof of service did not excuse removing defendant from obtaining consent of co-defendants where removing defendant knew the identity of its co-defendants at time of removal); Johnson v. Vertis, Inc., No. 02-6711, 2002 WL 31388817, at *1 (E.D. Pa. Oct. 23, 2002) (refusing to excuse failure to obtain consent of co-defendants prior to removal based on an alleged delay in proof of service appearing on the state court docket) with Greco v. YellowPages.com, LLC, No. 09-1502, 2009 WL 3571897, at *1 (M.D. Pa. Oct. 26, 2009) (embracing Laurie as correctly stating the applicable law); DiLoreto v. Costigan, Nos. 08-989, 08-990, 2008 WL 4072813, at *4 (E.D. Pa. Aug. 29, 2008) (quoting the Laurie rule approvingly).

         Here, the Court need not decide whether or not the exercise of reasonable diligence excuses a removing defendant from obtaining the consent of its co-defendant because the ...


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