BROCK BY BROCK v. Syntex Laboratories, Inc., Civ. 4-91-101.

• Decision Date: 19 May 1992
• Docket Number: No. Civ. 4-91-101.,Civ. 4-91-101.
• Citation: 791 F. Supp. 721
• Parties: Craig McKown BROCK, a minor, by next friend, Edward W. BROCK and Sherry Ray Brock, and Edward W. Brock and Sherry Ray Brock, Individually, Plaintiffs, v. SYNTEX LABORATORIES, INC., Defendant.
• Court: U.S. District Court — Eastern District of Tennessee

791 F. Supp. 721

Craig McKown BROCK, a minor, by next friend, Edward W. BROCK and Sherry Ray Brock, and Edward W. Brock and Sherry Ray Brock, Individually, Plaintiffs, v. SYNTEX LABORATORIES, INC., Defendant.

No. Civ. 4-91-101.

United States District Court, E.D. Tennessee, Winchester Division.

May 19, 1992.

Robert S. Peters, Winchester, Tenn., Lawrence B. Clark, James F. Walsh, Birmingham, Ala., for plaintiffs.

Henry H. Hancock, G. Ray Bratton, Rebecca P. Tuttle, Farris, Hancock, Gilman, Branan & Hellen, Memphis, Tenn., for defendant.

MEMORANDUM OPINION

JARVIS, Chief Judge.

The determinative issue is whether or not the one-year bar on removal of diversity cases found at 28 U.S.C. § 1446(b) is jurisdictional. Because I conclude that it is, plaintiffs' motion to remand, though untimely under 28 U.S.C. § 1447(c), must be granted.

I. Factual and Procedural Background

The defendant contends that the plaintiffs have obviously manipulated their pleadings to defeat this court's diversity jurisdiction. Plaintiffs' original products liability action was filed on November 29, 1979 in this court against Syntex Laboratories, Inc. on the basis of diversity jurisdiction, requesting $1 million in damages. That action was voluntarily dismissed pursuant to Rule 41, Federal Rules of Civil Procedure, on September 17, 1980. On September 11, 1981, plaintiffs filed a virtually identical complaint against Syntex Laboratories in the Circuit Court of Franklin County, Tennessee, which reduced their ad damnum to the then pending jurisdictional limit for amount in controversy in diversity cases, $10,000.00.

On November 19, 1988, an amendment to the Judicial Improvements and Access to Justice Act, PL100-702, 102 Stat. 4669 (1988), became effective. Among other things, that amendment provided that a case could not be removed from state court on the basis of diversity "more than one year after commencement of the action." 28 U.S.C. § 1446(b).

In this case, although some discovery had been conducted, the state court action lay dormant until plaintiffs' motion to amend their complaint on September 18, 1991. The state court granted the motion to amend on November 21, 1991, and at that time Syntex Corporation was added as an additional defendant and the ad damnum was increased from $10,000.00 to over $5 million.

On December 10, 1991, defendants removed the action to this court on the basis of diversity of citizenship, and on January 28, 1992, this court granted Syntex Corporation's motion to dismiss for lack of in personam jurisdiction. On March 5, 1992, almost three months after defendant's notice of removal, plaintiffs filed the pending motion to remand, contending that contrary to the provisions of the amendments in § 1446(b), the action was not removed within one year of its commencement in state court. Plaintiffs contend that although the motion to remand was not timely within the 30-day period required by 28 U.S.C. § 1447(c), the one-year limitation found in § 1446(b) is jurisdictional and, therefore, may be raised at any time. Defendant contends that the one-year limitation is merely procedural and that plaintiffs have waived any objection to the removal by failing to move to remand the case within the 30-day period required by 28 U.S.C. § 1447(c).

II. Analysis

28 U.S.C. § 1446(b) provides in relevant part:

If the case stated by the initial pleading is not removable, a notice of removal may be filed within 30 days after receipt by the defendant, through service or otherwise, of a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable, except that a case may not be removed on the basis of jurisdiction conferred by § 1332 of this title more than one year after commencement of the action.

Since this case is a diversity case and it was not removable until the Circuit Court granted plaintiffs' motion to amend on November 21, 1991, it clearly falls within the parameters of this section.

28 U.S.C. § 1447(c) provides in relevant part:

A motion to remand the case on the basis of any defect in removal procedure must be made within 30 days after the filing of the notice of removal under § 1446(b). If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.

Thus, the issue here is whether or not the one-year limitation found in § 1446(b) is jurisdictional. If it is, then the issue may be raised at any time and the case must be remanded. If it is not, then plaintiffs have clearly waived any procedural objection to it.

The case law addressing the issue of whether the one-year limitation is jurisdictional has produced a split of authority. Compare Smith v. MBL Life Assurance Corp., 727 F.Supp. 601 (N.D.Ala.1989) (one-year period jurisdictional) with Gray v. Moore Business Forms, 711 F.Supp. 543 (N.D.Cal.1989) (one-year period procedural).

For several reasons, I am in agreement with those cases holding that the one-year period is jurisdictional. The plain language of the amendment provides that a case "may not be removed ... more than one year after commencement". I read this as a blanket prohibition on removal of diversity cases more than one year after commencement.

The legislative history of the 1988 Act further supports the conclusion that the one-year limitation is mandatory as opposed to permissive. See H.R.Rep. No. 889, 100th Cong., 2d Sess. (1988), reprinted in 1988 U.S.Code Cong. & Admin.News, 5982. The House Report explained that the one-year limit is intended to prevent disruption of state court proceedings resulting from dismissal of a non-diverse party late in a case. The report states:

Subsection (b)(2

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