Little v. New England Mutual Life Insurance Company, Civil Action No. 1:98cv173-D-D (N.D. Miss. 7/__/1998), Civil Action No. 1:98cv173-D-D.

• Decision Date: 01 July 1998
• Docket Number: Civil Action No. 1:98cv173-D-D.
• Parties: BRUCE D. LITTLE, PLAINTIFF, v. NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY, et al., DEFENDANTS.
• Court: U.S. District Court — Northern District of Mississippi

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BRUCE D. LITTLE, PLAINTIFF, v. NEW ENGLAND MUTUAL LIFE INSURANCE COMPANY, et al., DEFENDANTS.

Civil Action No. 1:98cv173-D-D.

United States District Court, N.D. Mississippi, Eastern Division.

July __, 1998.

MEMORANDUM OPINION

Presently before the court is the motion of the plaintiff to remand this cause to the Circuit Court of Prentiss County, Mississippi. Finding that the motion is well taken, the court shall grant the motion to remand and return this matter to state court.

I. Factual and Procedural Background

The plaintiff originally filed this action on March 1, 1996, in the Circuit Court of Prentiss County, Mississippi. The defendant New England Mutual Life Insurance Company ("New England") removed this action to this court on June 4, 1998. The plaintiff has moved to remand this action to state court, and the defendant New England has responded to the motion.

The court declines to detail all of the facts underlying the action at bar. It is sufficient to note that this cause involves the sale of a "vanishing premium" life insurance policy¹ by the defendants to the plaintiff, and the defendants are the insurance company who provided coverage to the plaintiff under the "vanishing premium" policy ("New England) and the independent insurance company (Bill Barham Insurance, Inc., hereinafter "Barham") and agent (Fulton A. Jordan, Jr.) who sold him the policy. The plaintiff charges that the defendants are liable to him under various causes of action including negligent and fraudulent misrepresentation and fraudulent concealment. If further facts are required to complete this court's analysis of the motion presently before the court, they shall be mentioned as necessary.

II. Discussion

A. Standard for a Motion to Remand

This court is required to remand any action over which it has no subject matter jurisdiction at any time before final judgment. Buchner v. F.D.I.C., 981 F.2d 816, 819 (5th Cir.1993); 28 U.S.C. § 1447. An objection to the subject matter jurisdiction of this court may be raised by any party at any time in the course of these proceedings, and may even be raised by the court sua sponte. See Mall v. Atlantic Fin. Fed., 127 F.R.D. 107 (W.D. Pa.1989); Glaziers, Glass Workers of Jacksonville v. Florida Glass and Mirror of Jacksonville, 409 F. Supp. 225, 226 (M.D. Fla.1976); 28 U.S.C. § 1447. Nevertheless, this court has no discretionary authority to remand federal-law actions to a state court. Burks v. Amerada Hess Corp., 8 F.3d 301, 304 (5th Cir.1993); Buchner, 981 F.2d at 817; In re Wilson Indus., 886 F.2d 93, 96 (5th Cir.1989). The court in Buchner noted that there are only three situations under statute in which a federal trial court may remand a claim to state court. Buchner, 981 F.2d at 819. Those circumstances are: (1) a trial court has discretion to remand state law claims that were removed along with one or more federal question claims; (2) it must act on a timely motion to remand based on a defect in removal procedure; and (3) it must remand a case over which it has no subject matter jurisdiction. Id. A district court exceeds its authority when it remands a case on grounds not permitted by statute. Thermtron Prods., Inc. v. Hermansdorfer, 423 U.S. 336, 351, 96 S.Ct. 584, 593, 46 L.Ed.2d 542 (1976); Buchner, 981 F.2d at 820. There is a single exception to the Thermtron rule, and that exception is "a district court has discretion to remand to state court a removed case involving pendent claims upon a proper determination that retaining jurisdiction over the case would be inappropriate." Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 357, 108 S.Ct. 614, 623, 98 L.Ed.2d 720 (1988). In Carnegie-Mellon, the court determined that retaining jurisdiction was inappropriate where only pendent state law claims remained to be decided after all federal claims had been dropped. Carnegie-Mellon, 484 U.S. at 354-56, 108 S.Ct. at 621-22.

When making determinations of whether remand is necessary, the defendant is the party who bears the burden of establishing that the removal to federal court is proper. Jernigan v. Ashland Oil Co., 989 F.2d 812, 815 (5th Cir.1993); LeJuene v. Shell Oil Co., 950 F.2d 267, 271 (5th Cir.1992); B., Inc. v. Miller Brewing Company, 663 F.2d 545, 549 (5th Cir.1981). Further, the removal statutes are strictly construed, and all doubts will be resolved against a finding of proper removal. Dodson v. Spiliada Maritime Corp., 951 F.2d 40, 42 (5th Cir.1992); Butler v. Polk, 592 F.2d 1293, 1296 (5th Cir.1979). In the case at bar, the defendant contends that this court has jurisdiction over the present action based upon diversity jurisdiction. Therefore, the defendant carries the burden of establishing federal jurisdiction in this action.

In determining if removal is proper, generally the determination that must be made is whether this court would have had original jurisdiction to hear this action if the case had been filed here instead of state court. Caterpillar v. Williams, 482 U.S. 386, 391-92, 107 S.Ct. 2425, 2429, 96 L.Ed.2d 318 (1987); Grubbs v. General Electric Credit Corp., 405 U.S. 699, 702, 92 S.Ct. 1344, 1347, 31 L.Ed.2d 612 (1972); 28 U.S.C. § 1332. However, in this case, the plaintiff bases his motion to remand upon an alleged defect in removal procedure. More particularly, the plaintiff charges that the defendant removed this action outside of the one-year limitation imposed by statute. In response, the defendant states that the one-year limitation should not be applied in this instance and that this court possesses diversity jurisdiction over the case at bar pursuant to the "fraudulent joinder" doctrine.

B. The One-Year Limitation on Removal

A relevant statute on removal provides:

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, except that a case may not be removed on the basis of jurisdiction conferred by section 1332 of this title more than 1 year after commencement of the action.

28 U.S.C. § 1446(b) (emphasis added). This action was originally filed in the Circuit Court of Prentiss County, Mississippi on March 1, 1996. The defendant did not file its notice of removal to this court until June 4, 1998 — more than two years after the filing of the original state court complaint. A plain reading of §1446(b) would appear to require remand of this action

The defendant charges, however, that the one year limitation contained in 1446(b) is subject to equitable considerations and therefore the plaintiff in this case should be precluded from its benefit because of the application of equitable estoppel. Defendant's Brief, pp. 7-10. As the parties recognize, this court has once before tackled this problem. Jenkins v. Sandoz Pharmaceuticals Corp., 965 F. Supp. 861, 866 (N.D. Miss.1997). In Jenkins, this court stated:

The statutory language is unambiguous in providing that no diversity case may be removed more than one year after commencement of the lawsuit. 28 U.S.C. § 1446(b). Although the Fifth Circuit has recognized an exception to this limitation by way of waiver, the exception is narrowly tailored and based on statutory construction. Section 1447(c) provides that a motion to remand must be made within thirty days after the filing of the notice of removal if the basis for remand is any defect in the removal procedure. The Fifth Circuit has enlarged upon that restriction by noting that the failure to comply with the thirty-day limit constitutes a waiver of any procedural defect. That has been the limit of the appellate court's expansion and this court declines the defendants' invitation to proceed any further outside the statutory language.

Jenkins, 965 F. Supp. at 869.

Numerous other courts have agreed with similar reasoning and have reached the same result. See, e.g., Burns v. Windsor Ins. Co., 31 F.3d 1092, 1097 (11th Cir.1994); Rogers v. All American Life Ins. Co., 1998 WL 401599, * 4 (N.D. Tex.) ("[T]he Court concludes that the statute does not subject the one year limitation to equitable considerations when removal is made outside the one year period, is based on diversity jurisdiction, and where the plaintiff timely files a motion to remand pursuant to § 1447(c)."); Martine v. National Tea Co., 841 F. Supp. 1421, 1422 (M.D. La.1993) (noting "it is for the Congress and not this Court to rewrite the provisions of section 1446(b) to curb . . . abuses."); Royer v. Harris Well Serv., 741 F. Supp. 1247, 1248 (M.D. La.1990)(stating that Congress did not make any explicit exceptions to the one year limitation found in § 1446(b).); Russaw v. Voyager Life Ins. Co., 921 F. Supp. 723, 724-25 (M.D. Ala. 1996); Brock v. Syntex Laboratories, Inc., 791 F. Supp. 721, 722 (E.D. Tenn.1992); see also Village Imp. Ass'n of Doylestown, Pa. v. Dow Chemical Co., 655 F. Supp. 311, 314 (E.D. Pa. 1987) ("The removal statute was drafted by Congress, not the federal courts. If Congress had wanted to allow the courts to examine such considerations, it could easily have done so by drafting appropriate legislation."). Other courts, however, disagree and have determined that the one year limitations period is subject to equitable considerations which are not specifically listed in the statutory scheme for removal. See, e.g., Hattaway v. Engelhard Corp., 998 F. Supp. 1479, 1480 n.2 (M.D. Ga. 1998); Barnett v. Sylacauga Autoplex, 973 F. Supp. 1358, 1366 (N.D. Ala.1997); Kinabrew v. Emco-Wheaton, Inc., 936 F. Supp. 351, 352 nn. 1, 2 (M.D. La.1996); Morrison v. National Ben. Life Ins. Co., 889 F. Supp. 945, 948 & n. 2 (S.D. Miss.1995). The Fifth Circuit has not yet addressed the matter² and therefore the question remains open in this circuit regarding whether equitable considerations beyond those attendant...