J. THOMAS MARTEN, District Judge.
Presently before this court is plaintiff's Motion to Remand, or in the Alternative, for Default Judgment (Dkt. No. 3) and
On August 11, 2010, plaintiff sued defendants for breach of contract in the Johnson County, Kansas District Court. Plaintiff personally served defendants with summons and the Complaint on August 18, in Narrowsburg, New York. On September 17, 2010, defendants filed a Notice of Removal with this court (Dkt. No. 1). That notice contained the following provisions:
(Dkt. No. 1). On October 6, plaintiff filed a Motion to Remand to State Court, or in the Alternative, for Default Judgment. (Dkt. No. 3). Defendants have failed to respond to plaintiff's motion. However, on November 24, defendants filed an Amended Notice of Removal (Dkt. No. 6). The amended notice contained the following provisions pertinent to this motion:
Defendants failed to attach process to its Amended Notice. In response to defendants' Amended Notice, plaintiff filed its Supplemental Motion to Remand to State Court.
A defendant may remove a civil action to federal court if the plaintiff originally could have filed suit in federal court. See 28 U.S.C. § 1441(a) (2006); see also Cunningham v. BHP Petroleum Great Britain PLC, 427 F.3d 1238, 1244-45 (10th Cir.2005). Under 28 U.S.C. § 1446(a) (2006), a defendant must:
Id. (emphasis added). A defendant must also "file a copy of the notice with the clerk of such State court, which shall effect the removal and the State court shall proceed no further unless and until the case is remanded." Id. § 1446(d). The removal statutes are construed narrowly. Pritchett v. Office Depot, Inc., 420 F.3d 1090, 1094-95 (10th Cir.2005). And, "there is a presumption against removal jurisdiction." Laughlin v. Kmart Corp., 50 F.3d 871, 873
Plaintiff argues that the court should remand this case back to state court because defendants (1) failed to attach service of process to its Notice of Removal and Amended Notice of Removal, (2) failed specifically to allege diversity jurisdiction, and (3) failed properly to file the Notice of Removal in state court. Plaintiff also argues in its Supplemental Motion to Remand that defendants' Amended Notice of Removal must be filed within the thirty-day period set forth in 28 U.S.C. § 1446(b), and because it was not, the court must order remand. Last, plaintiff seeks default judgment because defendants have not filed an answer in the time provided under Fed.R.Civ.P. 81. The main issue is whether defendants' procedural failures require this court to remand the case to state court or whether to allow defendants to cure these defects.
Under 28 U.S.C. § 1447(c) (2006), there are "two types of improperly removed cases: those in which the federal court has no subject matter jurisdiction and those with defects in the removal procedure itself." Huffman v. Saul Holdings, Ltd. P'ship, 194 F.3d 1072, 1076 (10th Cir. 1999). A defect in subject matter jurisdiction is never waived and can be raised at any time. Id. at 1076-77. A procedural defect does not involve subject matter jurisdiction and may be waived if a party fails to object within 30 days after removal. Id. at 1077.
There are two competing viewpoints on whether a failure to attach process to a notice of removal requires remand. Yellow Transp., Inc. v. Apex Digital, Inc., 406 F.Supp.2d 1213, 1215 (D.Kan.2005). "The predominant view is that the removing party's failure to file the required state court papers is `curable in the federal courts if there is a motion to remand.'" Id. (quoting 14C CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE § 3733 (3d ed. 1998)). The Fifth, Seventh, and Eleventh Circuits have generally followed this approach. See, e.g., Cook v. Randolph County, Ga., 573 F.3d 1143, 1150 (11th Cir.2009) (holding that "failure to include all state court pleadings and process with the notice of removal is procedurally incorrect but is not a jurisdictional defect"); Riehl v. Nat'l Mut. Ins. Co., 374 F.2d 739, 742 (7th Cir.1967) (holding that defendant's failure to attach a copy of the Complaint to its notice of removal did not deprive the district court of jurisdiction and stating that "[t]o permit this minor irregularity to defeat the District Court's jurisdiction would be to elevate form over substance"); Covington v. Indem. Ins. Co. of N. Am., 251 F.2d 930, 932-33 (5th Cir.1958) (holding that a defendant's failure to attach process to its notice of removal was not fatal and did not require remand).
Many district courts in several different circuits, including the District of Kansas, have also followed this approach. See, e.g., Berbig v. Sears Roebuck & Co., Inc., 568 F.Supp.2d 1033, 1039 n. 9 (D.Minn.2008) (stating that "a failure to comply with the requirements of [Section 1446(a)] ordinarily is not grounds to deny removal"); Riggs v. Fling Irrigation, Inc., 535 F.Supp.2d 572, 579 (W.D.N.C.2008) (holding "[w]hile there may be some case law to support Plaintiff's argument, the majority approach is that the [failure to attach process] defect is merely procedural and that this particular procedural defect may be cured"); Yellow, 406 F.Supp.2d at 1215; In re Methyl Tertiary Butyl Ether Prods. Liab. Litig., 399 F.Supp.2d 340, 356 (S.D.N.Y.2005) (stating that procedural rules in 28 U.S.C. § 1446(a) are not jurisdictional
In Yellow, the District of Kansas confronted nearly the same lack-of-process issue presently before this court. The court held that "[s]o long as the defect in removal procedure does not involve a lack of federal subject matter jurisdiction, there is no reason why either State or Federal courts, or the parties, should be subject to the burdens of shuttling a case between two courts that each have subject matter jurisdiction." Yellow, 406 F.Supp.2d at 1219. In reaching this conclusion, the court undertook an extensive analysis of the case law and legislative history surrounding the requirement that the defendant attach process to a notice of removal. Id. at 1215-19. First, the court noted that a majority of courts have held that "`mere modal or procedural defects [in removal] are not jurisdictional' and that under § 1446(b) missing state court papers may be supplied later." Id. at 1215 (quoting Covington, 251 F.2d at 933). Because process may be supplied later, failure to attach it is a curable defect rather than a substantive error that requires remand. Id. at 1216. The court also recognized that a failure to attach process—although never addressed by the Tenth Circuit— was not the type of error that typically justifies remand. Id. at 1217; see Huffman, 194 F.3d at 1077-79 (defendant's failure to file notice of removal within the thirty-day period necessitated remand upon plaintiff's motion); see also Cornwall v. Robinson, 654 F.2d 685, 686-87 (10th Cir.1981) (finding that remand was appropriate when the notice was defective because a co-defendant had not joined the notice of removal). Last, the court found that the sole objective sought by Congress when it amended the removal statutes was to force the parties to raise objections promptly so procedural defects cannot later be used to prejudice the other party in court. Yellow, 406 F.Supp.2d at 1219. The defendant in Yellow, like the defendants here, failed to attach process to its notice of removal. Id. at 1214. In denying remand, the court stated that the failure to attach process was inadvertent and trivial and "did not unduly burden the court or reflect the complete failure to follow the removal procedure that typically leads to remand orders.... Important, also, is the fact that plaintiff has suffered absolutely no prejudice whatsoever from the defect and this defect can be promptly and easily remedied by allowing the defendant to file its proposed amended notice of removal." Id.
Plaintiff argues that this court must remand the case back to state court because defendant failed to attach process. To support this proposition, plaintiff cites Albonetti
While recognizing that some districts have reached different conclusions, this court does not find that line of cases persuasive. The general reasoning of the cases—granting remand motions upon procedural defects—is based on a narrow reading of 28 U.S.C. § 1447(c). That statute states: "A motion to remand the case on the basis of any defect other than lack of subject matter jurisdiction must be made within 30 days after the filing of the notice of removal under section 1446(a)." Id. These courts read the statute as requiring remand if a plaintiff objects to a procedural defect within thirty days of the filing of a notice of removal. Such a restrictive reading is unwarranted. Rather than requiring remand, § 1447(c) only requires a plaintiff to file its motion to remand within thirty days of a notice of removal, if the remand motion is based on a procedural defect. The statute does not say "if plaintiff makes a motion to remand based on a procedural defect within thirty days, the court must grant the motion." The plain language of the statute makes this conclusion untenable.
However, this court wishes to stress that it is not saying a court may not order a remand based on a procedural defect. It is quite clear that procedural defects may be the basis of a remand order. See Huffman, 194 F.3d at 1077-79; Cornwall, 654 F.2d at 686-87; see also Freebird, Inc. v. Merit Energy Co., 597 F.Supp.2d 1245, 1249-50 (D.Kan.2009) (remanding for failure to allege the requisite amount in controversy under 28 U.S.C. § 1332(a) and the Class Action fairness Act); Marshall v. Skydive America South, 903 F.Supp. 1067, 1070-71 (E.D.Tex.1995) (holding that a failure to specify co-defendant's consent in notice of removal was a procedural defect not amenable after the thirty-day time for amendment had passed). Nevertheless, just because a court may order remand based on a procedural defect, does not mean that a court
In accord with this district's decision in Yellow and the other circuit and district court decisions refusing to require remand because of a defendant's failure to attach process, this court holds that defendants' failure to attach process to its initial Notice of Removal and its Amended Notice of Removal does not deprive this court of subject matter jurisdiction and does not require immediate remand. In holding so, this court is well within its discretion to prevent remand based upon a mere technical defect. As stated above, this minor procedural defect is not the type that typically justifies remand. See Huffman, 194 F.3d at 1077-79; Cornwall, 654 F.2d at 686-87. The court also notes that 28 U.S.C. § 1447(b) grants the district court the authority to "require the removing party to file with its clerk copies of all records and proceedings in such State court." This authority is consistent with the court's authority (1) to prevent remand on the basis of minor procedural defects and (2) to grant the defendant an opportunity to cure the defect. Finally, nothing indicates that defendants intentionally or maliciously withheld process, rather it appears that the failure was an oversight.
Plaintiff's second argument is that defendants' failure specifically to allege diversity of citizenship requires this court to remand this case to state court. Plaintiff argues that the initial Notice of Removal alleges "the case involves a Missouri corporation Plaintiff, two New York corporation Defendants, and an amount claimed as damages in excess of $300,000.00" but failed to provide information about each defendant's principal place of business; thus, defendants failed to plead diversity jurisdiction. (Dkt. No. 1, para. 4).
The Tenth Circuit, in Buell v. Sears, Roebuck & Co., stated the rule a defendant must follow when alleging diversity in a notice of removal. 321 F.2d 468, 470 (10th Cir.1963). The rule provides:
Id. It is clear that a defendant must allege its principal place of business in a notice of removal. Id. Nevertheless, an initial failure to allege principal place of business does not require immediate remand. Id. at 471. The defendant in Buell did not allege diversity properly, yet the court granted it 20 days to amend its notice of removal. Id. In Hendrix v. New Amsterdam Casualty Co., 390 F.2d 299 (10th Cir. 1968), the Tenth Circuit reaffirmed and clarified Buell. In Hendrix, the defendant timely filed a notice of removal alleging it was a Maryland corporation and the plaintiff was a "resident" of New Mexico. Id.
Id. at 301 (internal footnotes omitted).
Defendants in this case failed to specify diversity as required by the statute in their initial Notice of Removal. See Hendrix, 390 F.2d at 300; Buell, 321 F.2d at 470. The Complaint and the Notice of Removal contained general allegations of diversity, but the defendants failed to specify their principal places of business showing each is diverse from the plaintiff's. This failure is a technical violation of 28 U.S.C. § 1446(a). Defendants' Amended Notice of Removal cures this defect by alleging that defendants' principal places of business are in Sullivan County, New York. Under Buell and Hendrix, this court has discretion to allow defendants to amend their Notice of Removal. Hendrix, 390 F.2d at 302; Buell, 321 F.2d at 471. Like, defendants' failure to attach process, their failure to specify diversity jurisdiction in the initial notice is not fatal. Allowing remand on such a technical defect would unnecessarily further the already
Plaintiff's third argument is that defendants failed properly to file the Notice of Removal in the state court action as required under 28 U.S.C. § 1446(d). Under this statute, a defendant "shall file a copy of the notice with the clerk of such State court, which shall effect the removal." Id. Plaintiffs argues that the notice filed in state court was signed by John Hector, an attorney licensed in New York. Plaintiff further argues that because Hector does not represent himself as an attorney licensed in Kansas, he has no authority to file pleadings in Kansas. Under Kansas law: "Rule 116(a) allows an attorney from another state, upon motion, to be admitted for a specific case or hearing after he or she has associated with an attorney licensed in Kansas. The rule further requires the Kansas attorney to be `actively engaged in the conduct of the matter or litigation.' The rule further prohibits any court, agency, or tribunal from proceeding or hearing a matter if Rule 116 is violated."
It is unclear from the record at this stage whether Hector is admitted to practice in Kansas. If not, Hector has violated Kan. Sup.Ct. R. 116 and defendants' notice to the state court under 28 U.S.C. § 1446(d) is invalid. However, this type of error—like the minor procedural defects
In this motion, plaintiff argues that defendants failed to file their Amended Notice of Removal within the thirty-day time frame set forth in 28 U.S.C. § 1446(b), justifying a remand. This statute provides: "The notice of removal of a civil action or proceeding shall be filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based...." Id. This particular section only requires a defendant to file its initial notice of removal within thirty days of receiving the complaint, it does not address the time frame for an amended notice of removal. As such, this court finds that 28 U.S.C. § 1446(b) does not require a defendant to file an amended notice of removal within thirty days of receiving the complaint. For the reasons detailed above, the district court does have discretion to allow a defendant to cure minor procedural defects in a notice of removal; therefore, plaintiff's arguments to the contrary are unpersuasive. Plaintiff's Supplemental Motion to Remand to State Court is denied.
Last, plaintiff argues that because defendants failed to file an Answer within the time provided in Fed.R.Civ.P. 81, this court should grant plaintiff a default judgment under either Fed.R.Civ.P. 55(b)(1) or (b)(2). Under Fed.R.Civ.P. 81(c)(2)(A)-(C):
The longest period in this case was 7 days under subsection (c)(2)(C). Defendants filed their Notice of Removal on September 17, 2010. They had seven days from that date, excluding weekends, to file an answer. It is undisputed that defendants failed to file an Answer.
Fed.R.Civ.P. 55 contemplates a two-step process in which a plaintiff must first apply to the clerk for entry of default under subsection (a). Under subsection (a) "[w]hen a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend, and that failure is shown by affidavit or otherwise, the clerk must enter the party's default." If the clerk enters default, the plaintiff may file a motion for default judgment under Fed.R.Civ.P. 55(b). Under 55(b), a party may seek default judgment from the clerk or from the court. If plaintiff's claim is for a sum certain, or a sum that can be calculated, the defendant has defaulted for not appearing, and is not a minor or incompetent person, the clerk must enter default judgment upon request of the plaintiff. FED.R.CIV.P. 55(b)(1). In all other cases, a plaintiff must seek default
By moving for default judgment first, plaintiff is trying to skip step one and jump to step two. A plaintiff may not seek default judgment before it has applied for entry of default. FED.R.CIV.P. 55; see Kelly v. Wilson, No. 09-2188, 2009 WL 3122519, at *1 (D.Kan. Sept. 29, 2009). Because the motion is premature, the court denies plaintiff's Motion for Default Judgment. If plaintiff seeks default judgment, it must first apply to the clerk for entry of default.
IT IS ACCORDINGLY ORDERED this 21st day of March 2011, that plaintiff's Motion to Remand, or in the Alternative, for Default Judgment (Dkt. No. 3) and Supplemental Motion to Remand to State Court (Dkt. No. 7) are denied.
IT IS FURTHER ORDERED that defendants shall have 10 days to file a Second Amended Notice of Removal with attached process.
IT IS FURTHER ORDERED that defendants shall have 10 days to file properly their Notice of Removal in state court, if they have not already done so.
KAN. SUP.CT. R. 116(a)-(b).