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Plaxe v. Fiegura

United States District Court, E.D. Pennsylvania

April 27, 2018

CHRISTOPHER D. PLAXE, Plaintiff,
v.
STEVEN R. FIEGURA, et al., Defendants.

          MEMORANDUM OPINION

          Goldberg, J.

         This dispute stems from an automobile accident that occurred in Pike County, Pennsylvania, involving two drivers who are citizens of Pennsylvania: Plaintiff, Christopher Plaxe, and one of two Defendants in this action, Steven Fiegura (“Defendant Fiegura”). The other Defendant is the manufacturer of the vehicle Plaintiff was driving, Chrysler Group LLC (“Defendant Chrysler”), which is not a citizen of Pennsylvania.

         More than one year after Plaintiff filed this action in state court, Defendant Chrysler removed to this Court. Citing the expiration of the one-year deadline to remove set out in 28 U.S.C. § 1446(c)(1), Plaintiff has moved to remand to state court and for his related attorneys' fees. Defendant Chrysler responds that an exception to the one-year deadline applies, as Plaintiff acted in bad faith to prevent timely removal, by prolonging his claim against Defendant Fiegura after they had effectively settled. For the reasons that follow, I will remand this action to state court, but will deny Plaintiff's request for related attorneys' fees.

         I. FACTUAL & PROCEDURAL BACKGROUND

         The following facts are derived from Defendant Chrysler's Notice of Removal, Plaintiff's Motion to Remand, the responses and replies thereto, and the exhibits attached to each.[1] Except where noted, these facts are undisputed.

         Plaintiff and Defendant Fiegura were involved in a motor vehicle accident on October 16, 2013, in Pike County, Pennsylvania. The accident allegedly left Plaintiff partially paralyzed and wheelchair-dependent. (Pl.'s Mot. to Remand, ¶ 2; Id., Ex. A, ¶¶ 21, 25-26.)

         On May 19, 2014, Plaintiff filed a complaint in the Philadelphia County Court of Common Pleas, naming Defendant Fiegura as the sole Defendant and asserting a negligence claim against him. Plaintiff promptly served the complaint on Defendant Fiegura, who filed an answer. (Chrysler's Resp., Exs. B, H.)

         At some point during the next few months, before October 13, 2014, Plaintiff and Defendant Fiegura reached an agreement that they did not reduce to writing, but which Defendant Fiegura's counsel reported to his insurance company. Under this agreement, Plaintiff agreed to not seek damages against Defendant Fiegura in excess of $50, 000, the limits of his insurance policy. In return, Defendant Fiegura agreed that he would not contest venue in the Philadelphia County Court of Common Pleas.[2] (Chrysler's Supp. Br., Exs. A-C.)

         By that time, Plaintiff had informed Defendant Fiegura that he would also be pursuing a claim against Defendant Chrysler. Accordingly, as part of their agreement, Defendant Fiegura also agreed not to side with Defendant Chrysler in contesting venue in the Philadelphia County Court of Common Pleas, once it became a party to the action.[3] (Chrysler's Supp. Br., Exs. A-C.)

         Plaintiff did not add Defendant Chrysler to the existing action, but rather, on August 13, 2015, filed a second lawsuit in the Philadelphia County Court of Common Pleas. Plaintiff's second suit named both Defendant Fiegura and Defendant Chrysler, reasserting Plaintiff's negligence claim against Defendant Fiegura and asserting products liability and negligence claims against Defendant Chrysler.[4] Defendant Fiegura did not object to the filing of a second suit, and appears to have accepted service of the newly filed complaint.[5] (Pl.'s Mot. to Remand, Ex. A, ¶ 29-45; Chrysler's Supp. Br., Ex. C.)

         Defendant Chrysler, which is not a citizen of Pennsylvania, did not attempt to remove the action at the outset, presumably in light of the presence of Defendant Fiegura, a non-diverse defendant. Instead, Defendant Chrysler answered the suit and asserted a cross-claim against Defendant Fiegura for contribution and indemnification. (Pl.'s Mot. to Remand, Ex. B, ¶ 82-84.)

         On December 28, 2015, the state court entered a Case Management Order, setting a March 6, 2017, deadline to complete discovery. The discovery deadline was subsequently extended to May 1, 2017. (Chrysler's Not. of Removal, Ex. C, Doc. No. 1 at 42-43, 75; Pl.'s Mot. to Remand, Ex. C, Doc. No. 6-3 at 8, 15-16.)

         On February 21, 2017, Plaintiff executed a “Joint Tortfeasor Release, ” releasing his claims against Defendant Fiegura in exchange for the $50, 000 limits of Defendant Fiegura's insurance policy.[6] After learning of this settlement from Plaintiff's counsel during a deposition of Plaintiff taken the following day, Defendant Chrysler removed the suit to this Court on the basis of diversity jurisdiction. Despite the settlement, Defendant Fiegura has remained a party to this action. (Pl.'s Mot. to Remand, Ex. E; Chrysler's Not. of Removal, ¶ 19.)

         On April 4, 2017, Plaintiff filed the instant Motion to Remand and Request for Related Attorneys' Fees. Defendant Chrysler has responded and filed a supplemental brief, to which Plaintiff has filed a reply. The matter is now ripe for decision.

         II. LEGAL STANDARD

         District courts have original jurisdiction whenever: (1) the amount in controversy exceeds $75, 000 and (2) the matter in controversy is between citizens of different states. 28 U.S.C. § 1332(a). However, because § 1332(a) requires “complete diversity, ” if any plaintiff is a citizen of the same state as any defendant, the district court does not have jurisdiction. See Zambelli Fireworks Mfg. Co., Inc. v. Wood, 592 F.3d 412, 419 (3d Cir. 2010).

         When an action over which a district court would have diversity jurisdiction is brought in state court, a defendant may remove to district court. See 28 U.S.C. § 1441(a). And even when a case is not initially removable to district court, a defendant may remove if and when the case later becomes removable. See 28 U.S.C. § 1446(b)(3). However, a case may not be removed on the basis of diversity jurisdiction “more than [one] year after the commencement of the action, unless the district court finds that the plaintiff has acted in bad faith in order to prevent a defendant from removing the action.” 28 U.S.C. § 1446(c)(1) (emphasis added).

         This “bad faith” provision was added to the removal statute as part of the Federal Courts Jurisdiction and Venue Clarification Act of 2011. See Ehrenreich v. Black, 994 F.Supp.2d 284, 288 (E.D.N.Y. 2014). “As Congress explained, the intent behind [the provision] was to clarify ambiguity in the case law concerning whether the one-year limitation [for removal] in § 1446(c) was jurisdictional or procedural, ” clarifying that “the limitation is procedural, ” and thus “excusable by federal courts upon a proper showing of bad faith.” Id. (citing H.R. Rep. No. 112-10 at 15); Rulis v. LA Fitness, No. 13-cv-1582, 2015 WL 1344745, at *2 (E.D. Pa. Mar. 24, 2015) (noting that the bad faith provision “is a recent codification of a slightly more expansive, judicially created ‘equitable tolling' of the former statute”). Before the enactment of the bad faith provision, the United States Court of Appeals for the Third Circuit was among those courts that had concluded that the one-year deadline was procedural, and thus waivable for equitable reasons. See A.S. ex rel. Miller v. SmithKline Beecham Corp., 769 F.3d 204, 211 (3d Cir. 2014).

         While few courts within the Third Circuit have addressed what constitutes “bad faith” under the current version of § 1446(c)(1), see Venuto v. Ford Motor Co., No. 14-cv-02898, Or. (Doc. No. 22) at 3 n.1 (E.D. Pa. Jan. 21, 2015) (noting that “because th[e] amendment was recently enacted, there is limited case law concerning what constitutes bad faith to prevent removal”), several district courts within this Circuit have addressed the issue in determining whether, under the previous version of the removal statute, the one-year deadline for removal should be waived for equitable reasons. See, e.g., Namey v. Malcolm, 534 F.Supp.2d 494, 498 (M.D. Pa. 2008) (declining to equitably waive the one-year deadline for removal and noting that removing defendant had failed to demonstrate “intentional conduct on the part of the plaintiffs to circumvent removal”) And “[f]ederal courts that have examined the new language agree that the issue is whether the plaintiff engaged in intentional conduct to deny the defendant the chance to remove the case to federal court.” Hiser v. Seay, No. 14-cv-170, 2014 WL 6885433, at *4 (W.D. Ky. Dec. 5, 2014).

         Courts have noted that a plaintiff's bad faith in preventing removal may be ascertained by circumstantial evidence. In re Asbestos Prods. Liab. Litig. (No. VI) (“In re Asbestos”), MDL No. 875, 2016 WL 4264193, at *2 (E.D. Pa. Aug. 11, 2016) (noting that because “it would be extraordinary for a party directly to admit a bad faith intention, his motive must of necessity be ascertained from circumstantial evidence” (internal quotation marks omitted)). However, “[b]ecause a party who urges jurisdiction on a federal court bears the burden of proving that jurisdiction exists, ” and because “all doubts should be resolved in favor of remand, ” Boyer v. Snap-on Tools Corp., 913 F.2d 108, 111 (3d. Cir. 1990), a removing party who contends that the plaintiff acted in bad faith to prevent removal bears a “heavy burden of persuasion, ” cf. Id. (holding that a removing party who charges that a plaintiff has ...


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