Sands in an hourglass: solving the puzzle of time limits for removal to federal court: 28 U.S.C. section 1446(b) is most unhelpful when multiple defendants seek removal, but the Supreme Court's Murphy Brothers decision points the way to a rule.

• Author: Hagins, C. Todd

WHILE plaintiffs have the initial choice of where to bring an action, in the federal system of the United States, Congress has given defendants a statutory right of removal of civil actions to federal court under 28 U.S.C. [section] 1446 for actions that could have been brought in federal court. The underlying theory of removal is to shield defendants from local prejudices associated with litigating in state courts.

The statute places several limits on the right to remove, a principal one being the 30-day time limit for filing the notice of removal imposed by Section 1446(b). That is a much-litigated point. The U.S. Supreme Court handled such a controversy in 1999 in Murphy Brothers v. Michetti Pipe Stringing Inc., (1) which laid to rest the question of when the 30-day period begins to run for single defendants but left two important questions unanswered. First, when does the 30-day period begin in cases of multiple defendants served on different dates? Second, does the removal period begin with service to a statutory agent or actual service to the defendant? These questions continue to split the lower courts.

MURPHY BROTHERS AND UNRESOLVED ISSUES

The central issue in Murphy Brothers was what event initiated the removal period. Section 1446(b) provides:

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. The Court framed the issue this way:

The question presented is whether the named defendant must be officially summoned to appear in the action before the time to remove begins to run. Or, may the 30-day period start earlier, on the named defendant's receipt, before service of official process, of a "courtesy copy" of the filed complaint faxed by counsel for the plaintiff? In a 6-3 decision, the Court held that the removal period begins only after the plaintiff properly serves the defendant, or, as Justice Ginsburg put it for the majority, the time to remove is not triggered by the "mere receipt of the complaint unattended by any formal service."

Michetti had filed a breach of contract complaint against Murphy Brothers in Alabama state court on January 26, 1996. Michetti faxed a "courtesy copy" of the file-stamped complaint to a vice president of Murphy Brothers on January 29, 1996, but did not formally serve Murphy Brothers until February 12, after settlement discussions broke down.

Since the parties had diversity of citizenship, Murphy Brothers removed the case on March 13 to the federal district court for Northern Alabama, within 30 days of service but 44 days after receiving the faxed "courtesy copy." Michetti moved to remand the case to state court, based on missing the 30-day notice period from the receipt of the courtesy copy. The district court denied the motion to remand, but it was reversed by the 11th Circuit, which held that the removal period started to run on "receipt" of the "filed initial pleading."

The Court grounded its holding on the rationale that "a defendant is not obliged to engage in litigation unless notified of the action, and brought under a court's authority, by formal process." The Court noted that historically the service of process is the cornerstone of jurisdiction over parties, and it concluded that nothing in the statutory history of Section 1446(b) so much as hinted that Congress "intended to dispense with the historic function of service of process as the official trigger for responsive action by an individual or entity."

The words "receipt ... through service or otherwise," on which the 11th Circuit rested its decision, did not have a plain meaning, the Court held. It noted that the identical phrase appears in Rule 81(c) of the Federal Rules of Civil Procedure 81(c) and that the Seventh Circuit had held--"sensibly," as Justice Ginsburg said--that language did not abrogate formal service requirements. (2)

The majority also stressed that allowing a "courtesy copy" to trigger the 30-day removal period would be unfair to individuals and entities in foreign nations. While a plaintiff could instantly transmit a "courtesy copy" through a facsimile machine, it observed, the formal service on the foreign defendant could take longer than 30 days, creating an ability to "trap foreign opponents into keeping their suits in state courts."

The Court noted that its holding adhered to tradition, made sense of the statutory language, and assured defendants adequate time to decide whether to remove an action to federal court. The majority concluded:

In sum, it would take a clearer statement than Congress has made to read its endeavor to extend removal time (by adding receipt of the complaint) to effect so strange a change --to set removal apart from all other responsive acts, to render removal the sole instance in which one's procedural rights slip away before service of a summons, i.e., before one is subject to any court's authority. (3) Ironically, the dissenters thought that Congress had made such a clear statement. Chief Justice Rehnquist wrote that the "receipt" of the fax triggered the 30-day period under the "plain language" of the statute.

The Supreme Court's rationale and holding in Murphy Brothers has several implications. First, the dissent properly notes that the majority's holding departs from the practice of strictly construing removal when faced with an ambiguous statute. (4) Second, a defendant should not be made to comply with procedural requirements or timetables until they are formally served and subjected to a jurisdiction of a court. Third, a court should interpret a removal statute to allow a defendant the time defined in the statute to decide whether to file a notice of removal.

MULTIPLE DEFENDANT PROBLEM

There are two basic scenarios in cases of multiple defendants. The first is that the plaintiff serves the second defendant within 30 days of the first defendant. The second is that the plaintiff serves the second defendant more than 30 days after the first defendant. Courts have a choice of three different rules to decide whether removal is proper in each scenario. The three rules are (1) the first-served defendant rule, (2) the each-served defendant rule and (3) the last-served defendant rule.

Under the first-served defendant rule the 30-day removal clock begins with service on the first defendant. The Fifth Circuit adopted the first-served defendant rule in Brown v. Demco, (5) and reaffirmed its position in Getty Oil Corp. v. Insurance Co. of North America. (6)

The each-served defendant rule gives each defendant 30 days from the date of its own service. The Fourth Circuit adopted the each-served defendant rule in McKinney v. Board of Trustees of Mayland Community College. (7) The Sixth Circuit later adopted and expanded application of this rule in Brierly v. Alusuisse Flexible Packaging. (8)

The last-served defendant rule gives every defendant 30 days from the service of each later-served defendant to file or join in a notice of removal. No court has adapted this rule. The statute clearly limits the right of the first-served defendants to file a notice of removal within 30 days of their own service. To allow a first-served defendant to file for removal after the 30-day period, even if a new defendant is added, is plainly at odds with the language of the statute. Since no court has espoused this rule, and because its application is plainly outside the statute, this article will focus on the first-served and each-served defendant rules.

1. First-served Defendant Rule

   Although a majority of federal district courts follow the first-served defendant rule, (9) the only federal court of appeals to do so is the Fifth Circuit in Brown. Generally, courts espouse the first-served defendant rule for three reasons. First is the normal tendency to construe removal statutes strictly against removal. (10) Second, the rule helps, as the Fifth Circuit put it in Brown, to "ensure that the question of where the case will be litigated be put to rest as soon as possible." Third, also mentioned in Brown, is that because the rule of uniformity that requires all defendants to join in a removal, the later-served defendant is unable to join to defeat removal.

   Brown arose from injuries sustained by Billy Max Brown, a Louisiana citizen, on a land-based oil rig located in Louisiana. He sued Best Industries, Cameron Iron Works, and Cooper Industries Inc., all of whom were domiciled in or citizens of states other than Louisiana. Employers Casualty Co. later intervened, seeking recovery of workers' compensation benefits it had paid as the insurer of Brown's employer. None of the original defendants sought removal, although complete diversity existed.

   A lengthy process of discovery and further pleadings culminated on February 11, 1985, when Brown added FMC Corp. and its WECO Division as defendants. FMC/WECO filed a petition for removal within 30 days of their service, but that was more than four years since Brown served the original defendants. Each of the original defendants concurred in the removal request.

   The federal district court accepted the removed case, but Brown and Employers Casualty sought remand to the state court on the ground that FMC/WECO filed for removal past the 30-day period. The district court denied that request, and Employers Casualty appealed to the Fifth Circuit.

   The Fifth Circuit reversed, relying on the three rationales outlined above to reach its holding that a later-added defendant cannot assert a right of removal when the properly served, original defendants failed to exercise their rights within 30 days. The court first addressed the...