Eccles v. National Semiconductor Corp., CIV. Y-98-373.

• Decision Date: 12 June 1998
• Docket Number: No. CIV. Y-98-373.,CIV. Y-98-373.
• Citation: 10 F.Supp.2d 514
• Parties: Sallie C. ECCLES v. NATIONAL SEMICONDUCTOR CORP.
• Court: U.S. District Court — District of Maryland

10 F.Supp.2d 514

Sallie C. ECCLES v. NATIONAL SEMICONDUCTOR CORP.

No. CIV. Y-98-373.

United States District Court, D. Maryland.

June 12, 1998.

Glen M. Fallin, Columbia, MD, for Plaintiff.

Jana Howard Carey, Scharon L. Ball, Baltimore, MD, for Defendant.

MEMORANDUM OPINION

YOUNG, Senior District Judge.

I.

Plaintiff, Sallie C. Eccles, sued Defendant National Semiconductor Corp. ("NSC") in the Circuit Court for Baltimore City, Maryland on January 4, 1996, alleging racial discrimination violating Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. NSC subsequently removed the case to this court on February 6, 1998. Currently pending before the Court are NSC's motion to dismiss under FED. R. CIV. P. 4(m), and Plaintiff's motion to remand and opposition to NSC's motion to dismiss.

The following facts are relevant to resolving these motions. As mentioned above, Plaintiff filed this case in state court on January 4, 1996. Plaintiff has not to date served the summons and complaint on NSC according to Maryland or federal law. Apparently, Plaintiff did not prosecute her case before the state court, because the state court, on November 25, 1997, issued a notice of contemplated dismissal pursuant to Maryland Rule 2-507. Plaintiff responded by filing a timely motion to defer dismissal in the state court.

NSC apparently possessed some source of extrajudicial knowledge of this litigation¹ after its filing, though the nature and source of this knowledge are not clear from the record. Moreover, NSC received a copy of the notice of contemplated dismissal on December 1, 1997. However, NSC did not receive a copy of the complaint filed in the state court until February 5, 1998, when it obtained a copy from the state court. The next day, NSC filed a notice of removal to this court pursuant to 28 U.S.C. § 1441.

NSC contends the Court must dismiss the case under FED. R. CIV. P. 4(m) because Plaintiff has failed to serve the complaint under Maryland or federal law within 120 days of filing the complaint in state court. Plaintiff, however, argues the Court must remand the case for lack of subject-matter jurisdiction because NSC did not timely file its notice of removal, thereby depriving the Court of removal jurisdiction.

II.

The question of subject-matter jurisdiction necessarily precedes any inquiry into the merits of a case. Oregon v. Hitchcock, 202 U.S. 60, 68, 26 S.Ct. 568, 569-570, 50 L.Ed. 935 (1906). Accordingly, the Court must first decide whether NSC timely removed the case from state court. Initially, the Court notes that its removal jurisdiction is "scrupulously confined," Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 109, 61 S.Ct. 868, 872, 85 L.Ed. 1214 (1941), and the Court must remand the case if doubts exist about its removal jurisdiction. Mulcahey v. Columbia Organic Chem. Co., 29 F.3d 148, 151 (4th Cir.1994). The party invoking removal jurisdiction bears the burden of proving facts sufficient to sustain removal. Egle Nursing Home, Inc. v. Erie Ins. Group, 981 F.Supp. 932, 933 (D.Md.1997), and cases therein cited.

A.

The statute delineating the procedure for removal states:

The notice of removal of a civil action ... 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, or within thirty days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant, whichever is shorter.

28 U.S.C. § 1446(b). The second sentence of § 1446(b) provides that if the defendant cannot remove the case stated by the initial pleading, the defendant may file a notice of removal "within thirty days after receipt ... 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 ... removable." Id.

As with any other federal statute, the Court must look first to the plain language of § 1446(b) to discern Congress' intent, and if that intent is clear from the language, the Court may look no further to deduce the statute's meaning. E.g., Good Samaritan Hosp. v. Shalala, 508 U.S. 402, 409, 113 S.Ct. 2151, 2157, 124 L.Ed.2d 368 (1993). The plain language of § 1446(b) establishes a two-tiered timetable for removal of a state civil action to federal district courts. First, the defendant must file a notice of removal within thirty days after receipt through service or otherwise of the initial pleading (usually the complaint) establishing the removable claim. Second, if the complaint or initial pleading fails to state a removable claim, the defendant may remove within thirty days of receipt or service of any other paper from which the defendant may ascertain that the case is removable.

The Court must initially resolve the issue of whether the thirty-day period for removal begins upon service or upon receipt of the initial pleading to determine whether NSC's removal is timely under the first sentence of § 1446(b). Federal courts have split between the "receipt rule" and the "proper service rule," and the Fourth Circuit has not resolved this question. See Egle, 981 F.Supp. at 935; see also Bowman v. Weeks Marine, Inc., 936 F.Supp. 329, 332-342 (D.S.C.1996) (describing history of each rule and surveying which courts have adopted each rule). However, most federal courts considering the issue, including the Fifth, Sixth, and Seventh Circuits, have adopted the receipt rule. See Benton v. Washington Radiology Assocs., 963 F.Supp. 500, 501-02 (D.Md.1997); Schwartz Bros., Inc. v. Striped Horse Records, 745 F.Supp. 338 (D.Md. 1990).²

In Striped Horse, this court employed a three-tiered analysis to adopt the receipt rule. First, the court, following the plain meaning of the statute, found that the phrase "through service or otherwise" in § 1446(b) clearly evinced Congress' intent to start the removal clock running when the defendant receives a copy of the complaint or initial pleading setting forth the claim for relief, whatever the means of receipt. 745 F.Supp. at 340; Benton, 963 F.Supp. at 502. Second, the court found that this construction of § 1446(b) best achieved Congress' purpose in enacting this section — to establish a uniform system for removing cases to federal court. Striped Horse, 745 F.Supp. at 340. Additionally, as the Benton court noted, a copy of the complaint provides all the information needed to decide whether federal law permits removal in a given case. 963 F.Supp. at 502. Finally, the Striped Horse court found this construction consistent with the proposition, discussed above, that federal courts must narrowly construe removal jurisdiction, because the statute's primary aim is to start the removal period when the defendant receives notice of the action, not when the plaintiff commences the action. Id. (citing 14A CHARLES A. WRIGHT, ARTHUR R. MILLER & MARY KAY KANE, FEDERAL PRACTICE & PROCEDURE § 3732, at 513, 516).

The Court finds the reasoning of Benton and Striped Horse compelling, and adopts their reasoning in toto. Moreover, the factual posture of this case displays another reason to adopt the receipt rule. Were the Court to follow the proper service rule here, it would never become removable because Plaintiff has not to date served NSC with the complaint, despite Plaintiff's initiation of the suit more than two years ago. Applying the proper service rule would permit Plaintiff effectively to hamstring NSC's right to remove through such dilatory tactics, despite the clear federal question presented. Accordingly, the Court, following the reasoning of Benton, Striped Horse, and the majority of federal courts considering the issue, holds that the thirty-day period for filing a notice of removal under the first sentence of 28 U.S.C. § 1446(b) begins to run when the defendant receives through any means a copy of the initial pleading setting forth the claim for relief.

B.

NSC timely filed its notice of removal under the receipt rule. As stated above, NSC first received a copy of the complaint on February 5, 1998, and filed its notice of removal the following day. Plaintiff, however, argues that NSC has not timely filed the notice of removal because NSC received a notice of contemplated dismissal from the state court on December 1, 1997. In support of its argument, Plaintiff relies on the second sentence of § 1446(b), contending that NSC's receipt of this notice from the state court, coupled with its actual knowledge of the allegations of the complaint stemming from the administrative proceedings before the filing of this suit, renders NSC's removal untimely because that notice revealed the removable claim to NSC.

As discussed above, the second sentence of § 1446(b) permits removal within thirty days after receipt of a copy of an amended pleading, motion, order, or other paper from which the defendant can discover the removability of the case, if the case stated by the initial pleading is not removable. See also Neal v. Trugreen Limited Partnership, 886 F.Supp. 527, 528 (D.Md.1995). Plaintiff's argument under this sentence fails. Turning first to the plain language of the statute, see Good Samaritan Hosp., supra, the second sentence of § 1446(b) does not apply because its language contemplates application only upon initial receipt of an initial pleading that fails to state a removable claim under the first sentence of § 1446(b), and later receipt of a document that reveals the basis for removal. Here, the Title VII claim was removable from the outset of the litigation, and Plaintiff neglected to ensure NSC's receipt of the complaint by service of process. Moreover, the structure of § 1446(b) implicitly contemplates the defendant's receipt of the initial pleading before the second sentence applies, because a defendant cannot know that the complaint fails to state a...