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Tucker v. Equifirst Corp.

United States District Court, S.D. Alabama, Southern Division

November 6, 2014

CHARLES TUCKER, et al., Plaintiffs,
v.
EQUIFIRST CORPORATION, et al., Defendants

For Charles Tucker, Rosetta Tucker, Plaintiffs: Kenneth James Lay, LEAD ATTORNEY, Birmingham, AL.

For Equifirst Corporation, Defendant: Amelia Killebrow Steindorff, LEAD ATTORNEY, Balch & Bingham LLP, Birmingham, AL; Gregory C. Cook, Balch & Bingham, Birmingham, AL; John Wesley Naramore, Balch & Bingham LLP, Montgomery, AL.

For U.S. Bank, N.A., as Trustee, Defendant: B. Ashten Kimbrough Seay, LEAD ATTORNEY, Birmingham, AL; Juan Carlos Ortega, LEAD ATTORNEY, Sirote & Permutt, P.C., Mobile, AL; Kerry P. McInerney, Robert Ryan Daugherty, LEAD ATTORNEYS, Sirote & Permutt, P.C., Birmingham, AL.

For Select Portfolio Servicing, Inc., Defendant: B. Ashten Kimbrough Seay, LEAD ATTORNEY, Birmingham, AL; Kerry P. McInerney, Sirote & Permutt, P.C., Birmingham, AL.

Page 1348

ORDER

WILLIAM H. STEELE, CHIEF UNITED STATES DISTRICT JUDGE.

This matter is before the Court on the plaintiffs' motion for remand. (Doc. 13). The parties have filed briefs in support of their respective positions, (Docs. 13, 19-21), and the motion is ripe for resolution. After careful consideration, the Court concludes that the motion is due to be granted.

Page 1349

BACKGROUND

The plaintiffs filed an action in state court in June 2013, seeking to quiet title to certain property. (Doc. 1-1 at 8-10). The only named defendant was Equifirst Corporation (" Equifirst" ). In December 2013, U.S. Bank, National Association, as trustee on behalf of the holders of certain certificates (" U.S. Bank" ), filed a motion to intervene as of right as a defendant in the state action. ( Id. at 192-94). In January 2014, the motion to intervene was granted. ( Id. at 240). U.S. Bank promptly filed a motion to dismiss and amended motion to dismiss. ( Id. at 250-56, 288-94). On March 24, 2014, the plaintiffs filed an amended complaint, which named U.S. Bank as a defendant. ( Id. at 402-15). On April 23, 2014, U.S. Bank removed the action on the basis of the amended complaint. (Doc. 1 at 2).

DISCUSSION

" [T]he burden of establishing removal jurisdiction rests with the defendant seeking removal." Scimone v. Carnival Corp., 720 F.3d 876, 882 (11th Cir. 2013); accord Adventure Outdoors, Inc. v. Bloomberg, 552 F.3d 1290, 1294 (11th Cir. 2008). The removing defendant's burden extends to demonstrating, when properly challenged, its compliance with the procedural requirements for removal. Timbercreek Investments, LLC v. City of Daphne Planning Commission, 2010 WL 3613854 at *2 & n.4 (S.D. Ala. 2010). The plaintiffs raise a number of jurisdictional and procedural challenges, but the Court finds one dispositive.

" The notice of removal of a civil action or proceeding shall be filed within 30 days after the 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 ...." 28 U.S.C. § 1446(b)(1). The plaintiffs assert that their original complaint was removable based on diversity jurisdiction and that U.S. Bank lost the right to remove by failing to do so within 30 days after its motion to intervene was granted. (Doc. 13 at 8-9; Doc. 21 at 5).[1] The Court agrees.

" Intervenors may file notices of removal if they are properly aligned as defendants ...." 14C Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 3730 (4th online ed. 2014) (" FPP" ). Once its motion to intervene was granted, U.S. Bank was properly aligned as a defendant to the original complaint.[2]

U.S. Bank received the initial complaint before filing its motion to intervene. (Doc. 1-1 at 193, ¶ 4). Thus, if the case was then removable, the 30-day period began to run when the motion to intervene was granted.[3]

Page 1350

The parties to the original action were of diverse citizenship. As U.S. Bank points out in its notice of removal, at all times since the commencement of the state action, the plaintiffs have been citizens of Alabama, and Equifirst and U.S. Bank have not. (Doc. 1 at 4-5).

By U.S. Bank's own argument, the amount in controversy under the original complaint to quiet title exceeded $75,000. U.S. Bank is the holder of a note secured by a mortgage on the plaintiffs' property. (Doc. 1-1 at 290). As U.S. Bank argued in its motions to dismiss, the plaintiffs' quiet title claim, if successful, would " eliminate [its] mortgage lien" and award the plaintiffs title to the property " free and clear of their debt" or " loan obligation." ( Id. at 253, 255, 291-93). U.S. Bank insists in opposition to remand that, in the amended complaint, the plaintiffs " have pled the entire debt into issue by seeking to have the mortgage extinguished and removed from the property." (Doc. 19 at 11). Since the original complaint likewise sought to have the mortgage extinguished and removed from the property, by U.S. Bank's reasoning the original complaint likewise placed the entire debt amount in issue. That amount, as U.S. Bank has demonstrated from its own records, exceeds $138,000. ( Id.).[4]

The accuracy of U.S. Bank's analysis is not before the Court. What matters is that, by U.S. Bank's own insistence, more than $75,000 was in controversy under the original complaint. Because the parties to the original complaint were diverse, because U.S. Bank was a defendant to that complaint once it intervened, and because it had by that time received a copy of the original complaint, its 30-day window for removal opened in January 2014 and closed in February 2014.

U.S. Bank does not deny that the original complaint was removable once it intervened or that it failed to remove within the 30-day period of Section 1446(b)(1). Instead, it invokes a so-called " revival exception" as bestowing upon it a fresh, second 30-day removal period under that subsection, triggered by the filing of the amended complaint. (Doc. 19 at 9).

" Section 1446(b) of the Judicial Code provides that if a case filed in a state court, though removable to federal court, is not removed by petition within 30 days of the receipt of the complaint, it is not removable thereafter." Wilson v. Intercollegiate (Big Ten) Conference Athletic Association, 668 F.2d 962, 965 (7th Cir. 1982). According to Wilson, " [t]he courts, however, have read into the statute an exception for the case where the plaintiff files an amended complaint that so changes the nature of his action as to constitute substantially a new suit begun that day." Id. (internal quotes omitted). In such a situation, the defendants are given a " right to revive" the 30-day removal period. Id. Relying on Wilson, the Fifth Circuit has adopted the phrase, " revival ...


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