Sphynx R.E.I. LLC v. DACS Grp.

• Decision Date: 04 January 2023
• Docket Number: Civil Action 3:22-CV-00132
• Parties: SPHYNX R.E.I., LLC, et al., Plaintiffs, v. DACS GROUP, LLC, et al., Defendants.
• Court: U.S. District Court — Middle District of Pennsylvania

SPHYNX R.E.I., LLC, et al., Plaintiffs,
v.
DACS GROUP, LLC, et al., Defendants.

Civil Action No. 3:22-CV-00132

United States District Court, M.D. Pennsylvania

January 4, 2023

MARIANI, J.

REPORT AND RECOMMENDATION

KAROLINE MEHALCHICK CHIEF UNITED STATES MAGISTRATE JUDGE

Plaintiffs Sphynx R.E.I., LLC (“Sphynx”), and William Lanzisero (collectively, “Plaintiffs”) initiated this civil action against Defendants DACS Group, LLC (“DACS”), and Jamarr Reid (collectively, “Defendants”) by filing a complaint in the Pennsylvania Court of Common Pleas of Luzerne County on November 24, 2021. (Doc. 1-1, at 9-23). On January 25, 2022, pro se-Plaintiff Reid removed this action to the United States District Court for the Middle District of Pennsylvania based upon federal question jurisdiction pursuant to 28 U.S.C. § 1331 and diversity of citizenship pursuant to 28 U.S.C. § 1332. (Doc. 1). For the following reasons, it is respectfully recommended that the Court sua sponte remand this case to the Pennsylvania Court of Common Pleas of Luzerne County.

I. Background and Procedural History

On November 24, 2021, Plaintiffs initiated this action by filing a complaint in the Pennsylvania Court of Common Pleas of Luzerne County against Defendants, asserting claims for consumer fraud, breach of contract, and quasi-contract. (Doc. 1-1, at 9-23). On January 25, 2022, Reid removed this action to the Middle District of Pennsylvania. (Doc. 1). On March 28, 2022, Plaintiffs filed an answer to the petition for removal, which appears to challenge the removal of this action to federal court. (Doc. 7). On May 3, 2022, Reid filed a

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motion to dismiss the complaint pursuant to Federal Rules of Civil Procedure 12(b)(6) and 9(b). (Doc. 11). On June 3, 2022, Reid filed a brief in support of the motion to dismiss. (Doc. 12). On July 12, 2022, Plaintiffs filed a letter with the Court attaching orders issued in the Court of Common Pleas of Luzerne County, where it appears that initial state court action is still ongoing despite the action being removed to this Court. (Doc. 14). On September 6, 2022, the Court directed Plaintiffs to file a brief in opposition to Reid's motion to dismiss and show cause as to why this action should not be remanded back to the Court of Common Pleas of Luzerne County. (Doc. 11). As of the date of this recommendation, Plaintiffs have not filed a brief in opposition or otherwise responded to the Court's Order.

II. Discussion

Removing this action from the Pennsylvania Court of Common Pleas of Luzerne County, Reid contends that the Court has subject-matter jurisdiction based upon federal question jurisdiction pursuant to 28 U.S.C. § 1331 and complete diversity of citizenship between Plaintiffs and Defendants pursuant to 28 U.S.C. § 1332. (Doc. 1, at 4-5). Plaintiffs challenge Reid's removal of this action to the Middle District of Pennsylvania pursuant to 28 U.S.C. § 1331 stating that this action does not arise “under the Constitution, laws or treaties of the United States.” (Doc. 7, ¶ 4). In addition, Plaintiffs challenge Reid's removal pursuant to 28 U.S.C. § 1332, arguing that the Court lacks subject-matter jurisdiction over this matter because complete diversity does not exist between the parties. (Doc. 7, ¶ 5).

An action may be removed to federal district court if the district court has original jurisdiction over the matter. See 28 U.S.C. § 1441(a). Significantly, a “notice of removal of a civil action or proceeding shall be filed within 30 days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief

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upon which such action or proceeding is based.” 28 U.S.C. § 1446(b)(1); see also Murphy Bros. v. Michetti Pipe Stringing, 526 U.S. 344, 347-48 (1999) (holding that “a named defendant's time to remove is triggered by simultaneous service of the summons and complaint, or receipt of the complaint, ‘through service or otherwise,' after and apart from service of the summons, but not by mere receipt of the complaint unattended by any formal service”).

Consistent with the “independent obligation to determine whether subject-matter jurisdiction exists, even when no party challenges it,” Hertz Corp. v. Friend, 559 U.S. 77, 94 (2010), the Court must remand a case sua sponte for lack of subject matter jurisdiction. 28 U.S.C. § 1447(c) (“If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.”). Federal removal statutes “are to be strictly construed against removal and all doubts are to be resolved in favor of remand.” Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990).

At the onset, Reid's notice of removal was timely filed as it was served on January 5, 2022, and removed this action on January 25, 2022. (Doc. 1). Thus, Reid's removal of this matter was timely pursuant to 28 U.S.C. § 1446(b). However, the undersigned notes that there is a defect in the removal procedure. When there is more than one defendant and a civil action is removed solely under section 1441(a), as is the case here, “all defendants who have been...