Various Plaintiffs v. Various Defendants
| Decision Date | 10 December 2009 |
| Docket Number | Civil Action No. 09-MC-103. |
| Citation | 673 F.Supp.2d 358 |
| Parties | VARIOUS PLAINTIFFS v. VARIOUS DEFENDANTS ("OIL FIELD CASES"). |
| Court | U.S. District Court — Eastern District of Pennsylvania |
Ryan A. Foster, Houston, TX, pro se.
The instant motion to remand was filed on behalf of 444 plaintiffs ("plaintiffs") arguing that this Court must remand their actions to Mississippi state court for lack of subject matter jurisdiction. Defendants1 have filed timely responses. For the reasons set forth herein, plaintiffs' motion to remand will be granted in part and denied in part.
These cases originated in Mississippi state court and were removed to federal court by defendants Union Carbide and ConocoPhillips. The basis for removal was the allegedly fraudulent joinder of two non-diverse defendants, Oilfield Service & Supply, Inc. ("Oilfield Service") and Mississippi Mud., Inc. ("Mississippi Mud"). In addition, twenty-five of these cases were removed under the theory that plaintiffs were entitled to assert federal jurisdiction under the Outer Continental Shelf Lands Act ("OCSLA").
After removal, plaintiffs filed motions to remand, on the same grounds considered here, in the Southern District of Mississippi. After considering these motions, United States District Judge Walter Gex remanded five of these cases to Mississippi state court. Before Judge Gex was able to rule on the remaining motions, the cases were transferred to the Eastern District of Pennsylvania and consolidated as part of MDL-875 by the Judicial Panel on Multidistrict Litigation. The remand motions remaining on the docket at the time of the consolidation with MDL-875 were denied by the MDL court without prejudice. (MDL-875 Administrative Order no. 11 at 3, doc no. 5936, 01-md-875.) Plaintiffs have renewed their request for remand in the 444 cases and this renewed motions is now before the Court.
Based on their procedural histories, these cases fall into three categories. Plaintiffs' motion to remand will be considered under the facts of each category individually.
a.) Category 1: This category consists of 354 plaintiffs whose cases were initiated in 2004. Originally filed as a multi-plaintiff action, these plaintiffs had their cases severed into individual actions in Mississippi state court in 2006. After severance, each plaintiff filed an individual amended complaint. Defendants subsequently removed these cases as a group to federal court on Sept. 26, 2008. (Defs.' Notice of Removal Ex. "D", doc. no. 58, 09-mc-103.) The basis for removal in these cases is the alleged fraudulent joinder of non-diverse parties Oilfield Service and Mississippi Mud.
b.) Category II: This category consists of 65 cases which were filed in 2004, but were dismissed in Mississippi state court because they were filed in an improper venue. Plaintiffs re-filed these cases on Sept. 28, 2007, and defendants removed these cases as a group to federal court on Sept. 26, 2008, within one year of the date of re-filing. (Defs.' Notice of Removal Ex. "D", doc. no. 58, 09-mc-103.) As in Category I, the basis for removal in these cases is the alleged fraudulent joinder of non-diverse parties Oilfield Service and Mississippi Mud c.) Category III: This category consists of 25 cases which were removed based on federal question jurisdiction. The defendants aver that plaintiffs' claims are governed by OCSLA. As an alternative basis of federal jurisdiction, defendants also assert the fraudulent joinder of Oilfield Service and Mississippi Mud.
After removal, the cases in all three categories were grouped by the Court for settlement purposes, pursuant to MDL-875 procedures.2 See MDL-875 Website, Settlement Conference Procedures, available at www.paed.uscourts.gov/mdl875.asp. After attending several settlement conferences with defendants and Magistrate Judge Strawbridge, plaintiffs filed the instant motion to remand.
A district court considering a motion to remand "must focus on the plaintiff's complaint at the time the petition for removal was filed . . . [and] must assume as true all factual allegations of the complaint." In re Briscoe, 448 F.3d 201, 218 (3d Cir.2006). The "party who urges jurisdiction on a federal court bears the burden of proving that jurisdiction exists . . ." Boyer v. Snap-on Tools Corp., 913 F.2d 108, 111 (3d Cir.1990); see also Steel Valley Auth. v. Union Switch & Signal Div., 809 F.2d 1006, 1010 (3d Cir.1987), cert. dismissed sub nom. American Standard v. Steel Valley Auth., 484 U.S. 1021, 108 S.Ct. 739, 98 L.Ed.2d 756 (1988) (). Because the removal of an action from the state court to a federal forum implicates comity and federalism, it is said that "removal statutes are to be strictly construed against removal and all doubts should be resolved in favor of remand." Steel Valley Auth., 809 F.2d at 1010 (citing Abels v. State Farm Fire & Cas. Co., 770 F.2d 26, 29 (3d Cir.1985)); accord Brown v. Francis, 75 F.3d 860, 865 (3d Cir.1996); Boyer, 913 F.2d at 111.
The practical application of this "all doubts" standard is to place upon a defendant "a heavy burden of persuasion" when contending that a non-diverse party has been fraudulently joined. Boyer, 913 F.2d at 111. To prevail, the removing party must show that there is "no reasonable basis in fact or colorable ground supporting the claim against the joined defendant, or no real intention in good faith to prosecute the action against the defendants . . ." In re Briscoe, 448 F.3d at 218.
Title 28 U.S.C. § 1446(b) governs the timing of removal, specifying 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." Additionally, "notice of removal of a civil action . . . shall be filed within thirty days after the receipt by the defendant . . . of the initial pleading setting forth the claim for relief. . . ." 28 U.S.C. § 1446(b). Where it is not evident from the initial pleading whether the case is removable, "a notice of removal may be filed within thirty days after receipt by the defendant . . . 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 . . ." Id.
As the MDL transferee court, the Court must first determine which jurisdiction's law to apply to the substantive and procedural issues in these cases.
On matters of procedure, the transferee court must apply federal law as interpreted by the court of the district where the transferee court sits. See In re Diet Drugs Prods. Liab. Litig., 294 F.Supp.2d 667, 672 (E.D.Pa.2003). Issues involving the timeliness of remand implicate federal procedural law. See In re Avandia Mktg., Sales Practices and Prods. Liab. Litig., 624 F.Supp.2d 396, 408-9 n. 15 (E.D.Pa.2009).
As noted above, after the cases were removed to federal court but before they were consolidated into MDL-875, the plaintiffs filed motions to remand in 449 individual cases. Judge Gex of the Southern District of Mississippi, in the only rulings that were made prior to the transfer to MDL-875, granted five of these motions. The remaining motions were pending upon transfer to the Eastern District of Pennsylvania and consolidation under MDL-875. As to the five motions ruled on by Judge Gex, "there is nothing in the text [of § 1407] that authorizes a transferee judge to vacate or modify an order of a transferor judge," In re Pharmacy Benefit Managers Antitrust Litig., 582 F.3d 432, 440 (3d Cir.2009), unless it is warranted after application of law of the case principles. Id. at 441-42 see also, In re Ford Motor Co., 580 F.3d 308, 312 (5th Cir. 2009). Under the circumstances of this case, the orders entered by Judge Gex on any motions to remand are binding on this Court.
There were, however, 444 motions to remand pending, but not yet acted upon by Judge Gex at the time the cases were transferred and consolidated under MDL-875. As described above, these motions were denied without prejudice after being transferred to the Eastern District of Pennsylvania, but have been renewed and are now before the Court. As to these cases, the Court will "adjudicate [these] transferred cases no differently than cases originally filed before it." In re Korean Air Lines Disaster, 829 F.2d 1171, 1178 (D.C.Cir.1987). Therefore, as to the pending motion to remand, the Court will apply federal procedural law, as interpreted by the Third Circuit, the circuit where the transferee court sits.
In applying substantive law, the transferee court must distinguish between matters of federal and state law. In matters requiring the interpretation of the Constitution, a federal law or a federal rule of procedure, a transferee court applies the law of the circuit where it sits. Therefore, in cases where jurisdiction is based on federal question, this Court, as the transferee court, will apply federal law as interpreted by the Third Circuit.3
In matters where the Court has jurisdiction under 28 U.S.C. § 1332 based upon diversity of citizenship, the transferee court applies state substantive law as determined by the choice of law analysis required by the state in which the action was filed. Therefore, in the instant cases, this Court will apply the state substantive law as determined by the choice of law rules of Mississippi, the state in which the cases were filed.4
The Category I cases refer to the 354 plaintiffs who originally filed their cases in Mississippi state court in 2004, yet removal was not effected until 2008. (Pls.' Mot. Remand 1-2, doc. no. 44, 09-mc-103.)
Plaintiffs argue that the Category I cases should be remanded for two reasons. First, because they...
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