Groesbeck Investments, Inc. v. Smith, 02-70058.
| Decision Date | 30 September 2002 |
| Docket Number | No. 02-70058.,02-70058. |
| Citation | 224 F.Supp.2d 1144 |
| Parties | GROESBECK INVESTMENTS, INC., Plaintiff, v. Alvina L. SMITH, Michigan National Bank, United States of America, State of Michigan, Michigan Employment Security Commission, and Roseville Transmission Parts, Defendants. |
| Court | U.S. District Court — Eastern District of Michigan |
Donald P. Howard, Sterling Heights, MI, for Plaintiff.
ThomasP. Cole, Washington, DC, for U.S.
Kevin T. Smith, Lansing, MI, for Michigan Nat'l Bank.
Charles M. Haddad, for Roseville Transmission.
This matter is presently before the Court on Plaintiff Groesbeck Nine Investment, Inc.'s Motion to Remand. In this Motion, Plaintiff contends that Defendant United States did not timely remove the case to this Court in compliance with 28 U.S.C. § 1446(b) which requires that a notice of removal be filed within thirty days after the defendant receives a copy of the initial pleading setting forth the claim for relief upon which the action is based. The Government has responded to Plaintiff's Motion countering that its removal of this action was timely because it was filed within 30 days of the filing of Plaintiff's amended complaint which it claims was the first pleading that "place[d] the Government under the jurisdiction of a court." Having reviewed and considered Plaintiff's Motion, the Government's Response thereto, and the entire file of this matter, the Court has determined that oral argument is not necessary. Therefore, pursuant to Eastern District of Michigan Local Rule 7.1(e)(2), this matter will be decided on the briefs. This Opinion and Order sets forth the Court's ruling.
Groesbeck Nine Investment, Inc. ("Groesbeck") filed a Complaint to quiet title and for possession of real property in Macomb County Circuit Court on May 2, 2001. The subject property is located at 22755 Groesbeck Highway in Warren, Michigan. In its Complaint, Plaintiff alleged that it has title to the property because it had acquired one or more tax deeds that had been issued with respect to the property and complied with state law provisions for giving interested persons notice that such a deed had been acquired and an opportunity to redeem. Plaintiff named the United States of America and five other persons/entities, Alvina Smith, Michigan National Bank, the State of Michigan, the Michigan Employment Security Commission, and Roseville Transmission Parts, as party-defendants. Plaintiff alleged that each of these Defendants "appear[s] to claim an interest in said property," and that "Defendants' claims to said property constitutes [sic] a cloud upon the Plaintiff's title which diminishes its value and adversely affects its sale." [See Plaintiff's Complaint, ¶¶ 5-6.]
The United States was served with a copy of Plaintiff's Complaint on May 21, 2001.1 Then, after appearing in the state court for a Settlement Conference on August 24, 2001, the Government filed its Answer to the Complaint on September 7, 2001.
In its September 7, 2001 Answer to Plaintiff's Complaint, the Government admitted that it has tax liens on the property that is the subject of this action. [See Answer of the United States of America, First Defense, Second Defense, and Fourth Defense, ¶ 4.] It also asserted an affirmative defense to the suit, i.e., that sovereign immunity had not been waived. [See Answer of the United States of America, Third Defense.]2 Then, a month later, on October 15, 2001, the Government filed a "Motion to Dismiss and Intervene" on this same ground.
In its Motion to Dismiss and Intervene, the United States acknowledged that it had been properly served with a copy of Plaintiff's Complaint, and once again acknowledged that it holds tax liens on the subject property. [See Government Ex. A, p. 4.]3 However, the Government argued for dismissal of the Complaint contending that Plaintiff had not complied with 28 U.S.C. § 2410, which specifies the conditions under which the Government will be deemed to have waived sovereign immunity for purposes of a quiet title action. Specifically, pursuant to Section 2410(b), for a quiet title plaintiff to proceed against the United States, "the complaint or pleading shall set forth with particularity the nature of the interest or lien of the United States," and in actions involving federal tax liens, "the complaint or pleading shall include the name and address of the taxpayer whose liability created the lien and, if a notice of the tax lien is filed, the identity of the internal revenue office which filed the notice, and the date and place such notice of lien was filed." Because Plaintiff's Complaint did not identify the United States' liens with particularity, the Government claimed that Plaintiff could not sue the United States and, therefore, it should be dismissed from the action.
Additionally, the Government argued that once it was dismissed from the action, it should be granted leave to intervene pursuant to 26 U.S.C. § 7424 which provides that the United States may intervene in any action in which it is not already a party to assert a tax lien it holds on the property that is the subject of the suit. [See Government's Ex. A, § B, pp. 8-10.]4 With respect to its purpose for seeking dismissal and then asking that after its dismissal it be allowed to intervene and reenter the action, the Government stated:
Following the entry of an order of dismissal and an entry of an order allowing intervention, a new 30-day period in which to remove to federal court pursuant to 28 U.S.C. § 1444 and 1446 would commence. The United States intends to remove the action upon allowance of its motion to intervene.
In response to the Motion to Dismiss and Intervene, Groesbeck moved for leave to amend its Complaint. The motion to amend was granted and Plaintiff filed its Amended Complaint on December 13, 2001. The United States then withdrew its motion to dismiss and intervene on mootness grounds and, on January 7, 2002, and removed the case to this Court. On January 30, 2002, Groesbeck timely filed the instant motion to remand arguing that the Government's removal of this action was not timely under the provisions of 28 U.S.C. § 1446(b).
28 U.S.C. § 1446(b) sets forth the time limits for removing an action from state court to federal court. It provides in pertinent part:
[A] notice of removal of a civil action or proceeding 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....
If the case stated by the initial pleading is not removable, a notice of removal may be filed within thirty 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....
It is well-settled that the removal statutes are to be construed restrictively and any doubts as to removability are resolved in favor of remanding the case to state court. Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108-109, 61 S.Ct. 868, 872, 85 L.Ed. 1214 (1941); Her Majesty the Queen v. City of Detroit, 874 F.2d 332, 339 (6th Cir.1989); Messick v. Toyota Motor Mfg., Kentucky, Inc., 45 F.Supp.2d 578, 580 (E.D.Ky.1999); Hardy v. Square D Co., 199 F.Supp.2d 676 (N.D.Ohio 2002). A defendant's failure to comply with the thirty-day limitation set forth in Section 1446(b) is an absolute bar to removal regardless of whether the removal would have been proper if timely filed. Green v. Clark Refining & Marketing, Inc., 972 F.Supp. 423, 424 (E.D.Mich.1997); McCraw v. Lyons, 863 F.Supp. 430, 434 (W.D.Ky.1994); Sanborn Plastics v. St. Paul Fire and Marine Ins., 753 F.Supp. 660, 664 (N.D.Ohio 1990). The burden is on the defendant of showing that it has complied with the procedural requirements for removal. Parker v. Brown, 570 F.Supp. 640, 642 (S.D.Ohio 1983); Messick v. Toyota Motor Mfg., 45 F.Supp.2d 578, 580 (E.D.Ky.1999); Schwartz v. FHP International Corp., 947 F.Supp. 1354, 1360 (D.Ariz.1996).
The Court finds that the Government has not carried its burden in this case.
Although the Government argues that its notice of removal was timely filed within 30 days of Plaintiff's filing of his amended complaint, the plain language of Section 1446 makes it clear that a defendant may only rely upon an amended pleading to trigger the 30-day removal period "if the case stated by the initial pleading is not removable." Defendant argues that the initial pleading in this case, Plaintiff's original Complaint, was not removable because Plaintiff failed to set forth the grounds for establishing waiver of sovereign immunity required under 28 U.S.C. § 2410. However, neither § 2410, § 1444, or any other statute requires that sovereign immunity must first be waived in order for a case to become removable by the United States.
28 U.S.C. § 2410 merely sets forth the provisions governing waiver of sovereign immunity in real property actions. In relevant part, Section 2410 provides as follows:
(4) to condemn, or
(5) of interpleader or in the nature of interpleader with respect to
real or personal property in which the United States has or claims a mortgage or other lien.
(b) The complaint or pleading shall set forth with particularity the nature of the interest...
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