Gianelli v. Schoenfeld
| Decision Date | 25 May 2021 |
| Docket Number | No. 2:21-cv-0477-JAM-KJN PS,2:21-cv-0477-JAM-KJN PS |
| Parties | SHEILA GIANELLI, Plaintiff, v. RONALD STEVEN SCHOENFELD, et al., Defendants. |
| Court | U.S. District Court — Eastern District of California |
ORDER & FINDINGS AND RECOMMENDATIONS
Presently before the court is plaintiff's motion to remand this case to state court.1 (ECF No. 17.) All four of the active defendants in this case filed a joint opposition, to which plaintiff replied.2 (ECF Nos. 23, 26.) The court took the motion under submission pursuant to Local Rule 230(g). (ECF No. 25.) For the following reasons, the undersigned recommends denying the motion to remand.
On January 29, 2021, plaintiff Sheila Gianelli filed this suit in California state court, naming five defendants. (ECF No. 1.1 (Complaint in Gianelli v. Schoenfeld, et al., Cal. Sup. Ct., San Joaquin Cty., No. STK-CV-UMR-2021-0000849).) The complaint asserts six state employment law causes of action and two federal causes of action for violations of the Racketeer Influenced and Corrupt Organizations Act ("RICO"). (Id. at 15-26.) The complaint generally stems from alleged retaliation plaintiff experienced at work after reporting a co-worker's conspiracy to defraud their mutual employer, Pacific Gas and Electric Company ("PG&E").3
Over the next several weeks, plaintiff filed in the state court proofs of service of the summons and complaint on each of the five defendants. (ECF No. 18 (Gianelli RJN) at 4-20, Exs. A-E).4 As reflected in the proofs of service, process servers personally served the four individual defendants as follows: defendant Nick Dujmovich was served in Texas on January 30, 2021 ; defendant Ronald Schoenfeld was served in Arizona on February 6, 2021 (id. at 7, Ex. B); defendant Debra Silver was served in California on February 15, 2021 (id. at 16, Ex. D); and defendant Lance Schultz was served in California on February 19, 2021 (id. at 19, Ex. E). As for the corporate defendant, PG&E, the proof of service shows that the company was served by substituted service on February 17, 2021. (Id. at 11, Ex. C.)
The case proceeded in state court for a short while. As relevant to this motion, on March 11, 2021, counsel for PG&E, Mr. Bren Thomas—who also represents defendants Schultz and Dujmovich—filed in the state court a Notification of Effective Date of Chapter 11 Plan and Imposition of Plan Injunction ("Notification of Plan Effective Date"). The three-page Notification of Plan Effective Date advised the state court and plaintiff of several key details of PG&E's ongoing bankruptcy proceeding and its effect on plaintiff's claims against PG&E. The Notification of Plan Effective Date stated that on January 29, 2019, PG&E Corporation and PG&E each filed in the Northern District of California petitions for bankruptcy under Chapter 11; that the bankruptcy court confirmed PG&E's Chapter 11 Plan of Reorganization on June 20, 2020; that the effective date of the Plan occurred on July 1, 2020, and as a result the Plan had been "substantially consummated," and PG&E had been "revested with [its] property, and discharged from [its] debts" as provided in the Plan; that prior to the July 1, 2020 Plan effective date, an automatic stay was in place under 11 U.S.C. § 362(a); and that as of the confirmation of the Plan, a permanent injunction applied to enjoin plaintiff's claims against PG&E. (ECF No. 23.2 at 2-4.) Beneath counsel's signature on the Notification of Plan Effective Date, an italicized statement reads: "No general appearance intended; appearance for limited purpose of notifying court that action is enjoined as to PG&E." (Id. at 4.)
A few other state court filings, all regarding defendant Dujmovich, deserve note. On March 15, 2021, with no answer or appearance by Dujmovich, plaintiff requested entry of default against him, which the state court entered the same day (without granting default judgment). (ECF No. 17 at 8; ECF No. 23.1 (Thomas Decl.) ¶ 4.) On March 22, 2021, Dujmovich objected to entry of default on the ground that there was no personal jurisdiction over him, as he is domiciled in Texas and does not have sufficient minimum contacts with California. (ECF No. 17.1 (Gianelli Decl.) at 10-13, Ex. B.) And on March 30, 2021, Dujmovich moved the state court to quash the summons served on him—so as to set aside the default—for lack of personal jurisdiction. (ECF No. 18 (Gianelli RJN) at 22-30, Ex. F; ECF No. 23.3 (Thomas Decl.) ¶ 6.)
Meanwhile, on March 16, 2021, defendant Silver—represented by her own separate counsel, Mr. Peter Rausch—filed a notice of removal removing the case to this court ("Notice of Removal"). (ECF No. 1.) The Notice of Removal confirmed that defendant Silver first received a copy of the complaint when she was served on February 15, 2021, and it invoked this court's subject-matter jurisdiction based on the federal questions raised by the RICO claims. (Id. at 2.)Regarding the other defendants' consent, the Notice of Removal stated: "All other defendant(s) who have been served with Summons and complaint [sic] have joined in this Notice of Removal, as evidenced by the Joinders of defendants Ronald Steven Schoenfeld and Lance Schultz, filed concurrently herewith."5 (Id.) It made no express mention of the other two defendants, Dujmovich and PG&E.
On April 8, 2021, Dujmovich made his first appearance in this court by filing a joinder to the Notice of Removal. (ECF No. 13.) The joinder specified that (Id. at 2.) PG&E has not entered any appearance in the action in this court—and did not participate in the state court proceeding after filing the Notification of Plan Effective Date.
On April 15, 2021, exactly 30 days after the Notice of Removal, plaintiff timely filed the instant motion to remand, asserting procedural defects in the removal. (ECF No. 17.) See 28 U.S.C. § 1447(c) ().6
A defendant generally may remove any civil action from state court to federal district court if the district court has original jurisdiction over the matter. 28 U.S.C. § 1441(a). "The mechanics and requirements for removal are governed by 28 U.S.C. § 1446." Kuxhausen v. BMW Fin. Servs. NA LLC, 707 F.3d 1136, 1139 (9th Cir. 2013). To remove an action, theremoving defendant(s) "shall file [in the appropriate district court] a notice of removal signed pursuant to Rule 11 of the Federal Rules of Civil Procedure and containing a short and plain statement of the grounds for removal, together with a copy of all process, pleadings, and orders served upon such defendant or defendants in such action." 28 U.S.C. § 1446(a). Each defendant has 30 days after receiving the initial pleading or summons evidencing the case's removability to file a notice of removal. 28 U.S.C. § 1446(b)(1), (b)(2)(B); see Destfino v. Reiswig, 630 F.3d 952, 955-56 (9th Cir. 2011).
When there is more than one defendant in the action, "all defendants who have been properly joined and served must join in or consent to the removal of the action." 28 U.S.C. § 1446(b)(2)(A); see Destfino, 630 F.3d at 956; Emrich v. Touche Ross & Co., 846 F.2d 1190, 1193 n.1 (9th Cir. 1988). This is commonly referred to as the unanimity requirement, or rule of unanimity. Lewis v. City of Fresno, 627 F. Supp. 2d 1179, 1182 (E.D. Cal. 2008). The Ninth Circuit does not require each defendant to submit written notice of consent, so long as at least one defendant's attorney certifies in the notice of removal that all defendants consent to removal. Proctor v. Vishay Intertechnology Inc., 584 F.3d 1208, 1224-25 (9th Cir. 2009) (). And, as implied in the rule itself, there are exceptions to the unanimity requirement. Most relevant to this case is the exception for defendants who were not properly served before notice of removal. See Destfino, 630 F.3d at 957 (); Salveson v. W. States Bankcard Ass'n, 731 F.2d 1423, 1429 (9th Cir. 1984) (), superseded by statute on other grounds. Absent an applicable exception, however, failure to comply with the unanimity requirement renders the removal procedurally defective. See Emrich, 846 F.2d at 1193 n.1.
"A correlate rule to the unanimity requirement and its exceptions logically follows . . . ." Mitchell v. Paws Up Ranch, LLC, 597 F. Supp. 2d 1132, 1135 (D. Mont. 2009). "Where fewer than all the defendants have joined in a removal action, the removing party has the burden undersection 1446(a) to explain affirmatively the absence of any co-defendants in the notice for removal." Prize Frize, Inc. v. Matrix (U.S.) Inc., 167 F.3d 1261, 1266 (9th Cir. 1999), superseded by statute on other grounds as stated in Abrego Abrego v. Dow Chem. Co., 443 F.3d 676, 681 (9th Cir. 2006). "If, for example, named co-defendants believe an exception to the unanimity rule applies to them and therefore they are not required to join in the notice of removal, the removing defendants should explain this in their notice." Paws Up Ranch, 597 F. Supp. 2d at 1135-36. Failure to explain the absence of consent from any co-defendant is also a procedural defect. Prize Frize, 167 F.3d at 1266 (...
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