Griffith v. American Home Products Corp.

• Decision Date: 29 February 2000
• Docket Number: No. CS-99-344-FVS.,CS-99-344-FVS.
• Citation: 85 F.Supp.2d 995
• Court: U.S. District Court — District of Washington
• Parties: Debbie GRIFFITH and Loren E. Griffith, individually and on behalf of their marital community, Plaintiffs, v. AMERICAN HOME PRODUCTS CORPORATION; A.H. Robins Company, Inc.; Wyeth Laboratories, Inc.; Interneuron Pharmaceuticals, Inc.; Rugby Group, Inc., d/b/a/ Rugby Laboratories, Inc.; Geneva Pharmaceuticals, Inc.; and Eon Laboratory Manufacturers, Inc., Defendants.

85 F.Supp.2d 995

Debbie GRIFFITH and Loren E. Griffith, individually and on behalf of their marital community, Plaintiffs, v. AMERICAN HOME PRODUCTS CORPORATION; A.H. Robins Company, Inc.; Wyeth Laboratories, Inc.; Interneuron Pharmaceuticals, Inc.; Rugby Group, Inc., d/b/a/ Rugby Laboratories, Inc.; Geneva Pharmaceuticals, Inc.; and Eon Laboratory Manufacturers, Inc., Defendants.

No. CS-99-344-FVS.

United States District Court, E.D. Washington.

February 29, 2000.

David L. Ashbaugh, Stanislaw Ashbaugh LLP, Seattle, WA, Lynn Lincoln Sarko, Keller & Rohrback, Seattle, WA, Britt L. Tinglum, Michael Woerner, Amy NL Hanson, Keller Rohrback, Seattle, WA, for Plaintiffs.

Robert F. Sestero, Jr., Keefe King & Bowman, Spokane, WA, E. Pennock Gheen, Bullivant Houser Bailey, Pendergrass & Hoffman, Thomas V. Harris, Merrick Hofstedt Lindsey, Christopher W. Tompkins, Betts Patterson & Mines, Seattle, WA, for Defendants.

ORDER DENYING MOTIONS TO REMAND

VAN SICKLE, District Judge.

BEFORE THE COURT are the plaintiffs' motions to remand this action to state court. The Court heard oral argument on the motions on February 9, 2000. The plaintiffs were represented by Michael Woerner. Defendants American Home Products Corp., A.H. Robins Company, Inc., and Wyeth Laboratories, Inc. (collectively "AHP") were represented by Robert F. Sestero, Jr. Defendant Eon Laboratory Manufacturers, Inc. ("Eon") was represented by Glenn S. Draper. This Order will memorialize the Court's oral determination.

Background

The plaintiffs, Debbie and Loren Griffith, filed this "fen-phen" tort action in Spokane County Superior Court in October 1999. The defendants named in the complaint included Eon and AHP. AHP was served with a summons and a copy of the complaint on October 18, 1999. That same day, the plaintiffs attempted service on Eon's Washington, D.C. law firm. However, as was later communicated to the plaintiffs, Eon had not authorized its law firm to accept service on its behalf.

Eon received a copy of the summons and the complaint by certified mail on November 15, 1999. Eon's Chief Financial Officer accepted service on November 17, 1999.

AHP filed a notice of removal on December 1, 1999, asserting diversity jurisdiction. Eon filed a notice of removal on December 16, 1999, also asserting diversity jurisdiction. At that time, all defendants consented to removal.

Shortly thereafter, the plaintiffs filed a motion to remand this cause back to state court, claiming that AHP's notice of removal was untimely. The plaintiffs filed a second motion to remand several weeks later, arguing that Eon's notice of removal was also untimely. In addition, the plaintiffs seek costs and attorney's fees pursuant to 28 U.S.C. § 1447(c).

Analysis

The plaintiffs seek to remand this action to state court, arguing that neither AHP nor Eon filed a timely notice of removal. The removal of a state action to federal court is governed by 28 U.S.C. § 1446, which provides in part:

The notice of removal of a civil action or proceeding shall be filed within thirty 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, 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 period is shorter.

28 U.S.C. § 1446(b). Removal jurisdiction is strictly construed. See Gould v. Mutual Life Ins. Co., 790 F.2d 769, 773 (9th Cir. 1986).

The parties agree that AHP's notice of removal was untimely as it was not filed within thirty days of AHP's receipt of the summons and complaint. The parties sharply disagree, however, as to whether Eon's notice of removal was timely filed. It is well-established that all defendants in a multi-defendant case must consent to removal, a principle known as the "unanimity rule." See Parrino v. FHP, Inc., 146 F.3d 699, 703 (9th Cir.1998). Yet problems arise in applying the unanimity rule to § 1446(b), in part because the statute contemplates only one defendant to an action. The Court is now presented with two related questions that arise in cases with multiple defendants who are served at different times. The first question is whether each defendant has thirty days from the time it is served to petition to remove the case to federal court or, instead, whether § 1446(b) creates a single thirty-day period in which a case may be removed, beginning when the first defendant is served. The second, interrelated question before the Court is whether the first-served defendant can consent to removal by a later-served defendant after the first-served defendant's thirty-day removal period has lapsed or, instead, whether the first-served defendant waives its right to consent by failing to remove the action within its thirty-day period. If the latter interpretation is correct, then a defendant served more than thirty days after the first-served defendant is precluded from removing the action because it could never satisfy the unanimity rule.

1. Date of Service.

Before addressing the questions presented above, the Court must backtrack somewhat to determine whether Eon filed its notice of removal within thirty days of being served. If Eon failed to file a notice of removal within thirty days of being served, all parties concede that its removal would be untimely.

Eon first received constructive notice that it was a named defendant in this lawsuit in October 1999, when its legal counsel was improperly served. The Supreme Court recently held that the thirty-day period for removal in § 1446(b) is triggered by formal service only. See Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344, 119 S.Ct. 1322, 143 L.Ed.2d 448 (1999). The plaintiffs thus concede that Eon's thirty-day period for removal, if indeed the Court finds that Eon is entitled to thirty days, did not begin at that time.

Eon then received a copy of the summons and complaint by certified mail on November 15, 1999. If Eon's receipt of the summons and complaint effected service, then Eon's December 16 notice of removal was filed thirty-one days after service, making it untimely under § 1446(b).

However, Eon correctly argues that it was under no obligation to accept service by certified mail since service by mail is only adequate when authorized by court order pursuant to a finding that such service is equally as likely to be effective as service by publication. See Wash.Sup. Ct.Civ.R. 4(d)(4); In re Marriage of Logg, 74 Wash.App. 781, 784-85, 875 P.2d 647, 649 (1994). There is nothing in the record to indicate that the plaintiffs had permission from the state court to serve Eon by certified mail. Eon waived formal service and accepted service by mail on November 17, 1999, when it signed a statement to that effect. Eon's notice of removal was filed twenty-nine days after it was served; thus, if the Court finds that Eon is entitled to its own thirty-day period and if it finds that AHP and the other defendants to this action had the ability to consent to removal, then Eon's notice of removal was timely filed.

2. Removal was Proper.

The right of later-served defendants to remove an action to federal court is an issue that has divided courts and legal scholars alike.¹ The majority of courts addressing the issue have held that § 1446(b) creates a single thirty-day period in which to remove an action to federal court, which begins to run when the first defendant is served, a principle known as the "first-served defendant rule." A minority of courts representing the modern trend have disagreed, finding that each defendant to an action is entitled to thirty days after service to remove an otherwise removable action and that all defendants can consent to that removal, even if their own thirty-day periods have expired.

a. Ninth Circuit Precedent.

The plaintiffs contend that the Ninth Circuit adopted the first-served defendant rule in Cantrell v. Great Republic Insurance Co., 873 F.2d 1249 (9th Cir.1989). If the plaintiffs are correct, then Cantrell is controlling. However, the Court disagrees with the plaintiffs' broad interpretation of Cantrell.

In Cantrell, the plaintiff filed a claim in state court against Great Republic Insurance Company ("GRIC"); however, the complaint was answered by Great Republic Life Insurance Company ("GRLIC"). The plaintiff and GRLIC then actively proceeded with discovery. Two years after filing the original complaint, the plaintiff filed an amended complaint, formally adding GRLIC as a defendant. Thirty days later, GRIC and GRLIC, who were represented by the same counsel, jointly removed the action to federal court. The district court denied the plaintiff's motion to remand the action back to state court, finding that removal was timely since GRLIC filed the petition for removal within thirty days after it was added to the action. See Cantrell, 873 F.2d at 1254.

The Ninth Circuit reversed. The court found important "the fact that GRLIC has acted as a `party' to the action long before the filing of the amended complaint, by answering and cross-complaining in response to Cantrell's original complaint and by responding to Cantrell's requests for Admission." Id. at 1254.

In conclusion, then, Cantrell's original complaint gave both of the appellees notice of the federal question raised by Cantrell's complaint and gave them notice that they were both exposed to liability. GRLIC's active participation in the litigation, including its filing of an answer and a cross-complaint in response to Cantrell's original complaint, precludes it from arguing that the time for removal began to run as to GRLIC only from the time of its formal addition as a defendant in Cantrell's amended complaint. Accordingly, appellees lost their opportunity to remove the case when they failed to file a petition for removal within thirty days of...