Federal Removal When Complaint Does Not Appear To Allow Removal

Although not technically a discovery issue, federal removal is a frequent defense to discovery abuse. This is particularly true for defendants in personal injury/mass tort litigation where plaintiffs file suit in jurisdictions known to be hostile to civil defendants.

Often, plaintiffs seek to avoid federal jurisdiction by either; a) suing a local entity (i.e. distributor/ physician) or; b) pleading damages below the jurisdictional threshold of $75,000. Discovery may show that Plaintiff's efforts to defeat diversity are baseless. If that information comes to light within 1 year of service of the Complaint on a defendant, then the defendant(s) may try to remove the case under Section 1446(b).

Here is an excerpt from a September 16, 2005 opinion denying a Plaintiff's Motion to Remand in MDL 1358, MTBE Litigation. The Court provides a thorough overview of removal based on information obtained after receipt of the initial Complaint:


"Section 1446(b) requires a defendant to file a notice of removal thirty days after receiving the initial pleading."
The thirty-day period is strictly construed.40 It is “triggered by formal service” of the summons and complaint.41 However, section 1446(b) also states:

"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."

Thus, section 1446(b) provides that where an initial pleading is not removable as originally filed, a notice of removal may be filed if a later event makes it subject to removal.42 Likewise, when a case is removable, but the grounds in the initial cornplaint are “obscured, omitted, or misstated,” a defendant “has thirty days from the revelation of grounds for removal to file a notice of removal .,,4' The purpose of the thirty-day rule is:

“to deprive the defendant of the undeserved tactical advantage that [it] would have if [it] could wait and see how [it] was faring in state court before deciding whether to remove . . .; and to prevent the delay and waste of resources involved in starting a
initial pleading”) (citing Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344, 354-55 (1999)).

case over in a second court after significant proceedings. . . in the
first court."44

Conversely, the second sentence of section 1446(b) preserves the defendant’s right to remove a case to federal court upon receiving notice that the case is removable.45

In order to satisfy section 1446(b), a defendant must show (1) that the original complaint was not removable on its face at the time it was filed46 and (2) that another “paper” changed the status of the case, making it clear that the complaint was removable.47 In addition, “the ‘amended pleading, motion, order or other paper’ must emanate from either the voluntary act of the plaintiff in the state court, or other acts or events not the product of the removing defendant’s activity .""

Footnotes:
38 In most instances ascertaining whether a particular state court action is removable is a simple task. See 14C Charles Alan Wright, et al., Federal Practice and Procedure § 3733 at 357 (1998) (“Fed. Prac.”) (noting that it is sensible to apply “the same liberal rules [for] testing the sufficiency of a pleading . . . to appraising the sufficiency of a defendant’s notice of removal” because “in most instances the district court can ascertain easily” whether the case is removable). Despite its procedural complexity, this case is no exception; the mythical imagery and literary flourishes of the papers submitted to the court do not obscure the basic procedural rules which must be applied here. See e.g., Pl. Mem. at 7 (“[ExxonMobil] is caught between Scylla and Charybdis”); 12/1/04 Letter from Marshall S. Perkins, Counsel for Koch plaintiffs, to Judge Marvin J. Garbis, U.S. District Judge for the District of Maryland (ExxonMobil's arguments are an “apogee of sophistry” and “Machiavellian”); Surreply to Plaintiffs’ Motion to Remand (“Suweply”), at 3 (plaintiffs “doth protest too late”).
39 The statute 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.” 28 U.S.C. § 1446(b).
40 See Maybruck v. Haim, 290 F. Supp. 721,723 (S.D.N.Y. 1968)
(“the 30-day limit for the filing of the removal petition . . . is mandatory and cannot be extended by this Court”) (citations omitted).
41 Whitaker, 261 F.3d at 202 (“the commencement of the removal period [can] only be triggered by formal service of process, regardless of whether the statutory phrase ‘or otherwise’ hints at some other proper means of receipt of theinitial pleading”) (citing Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344, 354-55 (1999)).

42 See Cottman Transmission Systems LLC v. Bence, No. 03-5467,2004 WL 98594 (E.D. Pa. Jan. 15,2004) (finding that the case became removable on entry of a consolidation order permitting plaintiffs’ claims to be aggregated thereby causing the amount in controversy to reach $75,000).
43 Moore’s ¶ 107.30[3][a][ii]. Accord Lovern v. General Motors Corp., 121 F.3d 160, 162 (4th Cir. 1997) (“the statute does not preclude defendants from removing a case where their discovery of the grounds of federal jurisdiction is belated because facts disclosing those grounds were inadequately or mistakenly stated in the complaint”).
44 Yankee Bank for Fin. & Sav., FSB v. Hanover Square Associates-One Ltd. P’ship, 693 F. Supp. 1400, 141 1 (N.D.N.Y. 1988) (quoting Wilson v. Intercollegiate (Big Ten) Conference Athletic Assoc., 668 F.2d 962, 965 (7th Cir. 1982)).
45See Whitaker, 261 F.3d at 204.
4G See In re Willis, 228 F.3d 896, 897 (5th Cir. 2000) (“thirty-day period begins running on receipt of complaint only when complaint explicitly discloses [basis for federal jurisdiction]").
47 The phrase “other paper" generally refers to “documents generated within the state court litigation.” Zbranek v. Hofheinz, 727 F. Supp. 324, 326 (E.D. Tex. 1989). This includes documents produced in consolidated cases. See Growth Realty Companies v. Burnac Mortgage Investors, Ltd. 474 F. Supp. 99 1 , 996 (D. P.R. 1979) (under 28 U.S.C. § 1446(b), “the phrase ‘other paper’ cannot refer to pleadings filed in a separate, distinct case, in which the parties are not the same and which has not been consolidated as allowed by the local laws of Civil Procedure with the case at the bar"). In addition, the types of document can be anything from a deposition, to an amended pleading, to a letter between the parties. See Fed. Prac. § 3732 at 309-10 (1998) (noting that “depositions, answersto interrogatories, and requests for admissions, amendments to ad damnum clauses of the pleadings, and correspondence between the parties and their attorneys or between the attorneys are usually accepted as ‘other paper’ sources that initiate a new thirty day period of removability” and collecting cases).

FRCP 30(b)(5) and Overbroad Deposition Document Requests

FRCP 30(b)(6) Deposition Notices are frequently accompanied by a FRCP 30(b)(5) request for documents. Often, discovering parties use the document requests to burden the party to be deposed with overbroad document discovery while the party is trying to prepare for the FRCP 30(b)(6) deposition.

There is fairly good authority for the proposition that FRCP 30(b)(5) is meant for narrow, focused document discovery related to the pending FRCP 30(b)(6) deposition and is not intended to substitute for broad FRCP 34 document discovery.

A party faced with an onerous FRCP 30(b)(5) request can object and use the following arguments and authority (taken from a recent Special Master opinion -- PTO 12 -- in MDL 1358):


"Rule 30(b)(5) states in relevant part as follows:

The notice to a party deponent may be accompanied by a request made in compliance with Rule 34 for the production of documents and tangible things at the taking of the deposition. The procedure of Rule 34 shall apply to the request.


The pertinent portion of the Advisory Committee Notes to this subsection states that:

... [a] provision is added to enable a party, through service of notice, to require another party to produce documents or things at the taking of his deposition ... Whether production of documents or things should be obtained directly under Rule 34 or at the deposition under this rule will depend on the nature and volume of the documents or things. Both methods are made available. When the documents are few and simple, and closely related to the oral examination, ability to proceed via this rule will facilitate discovery. If the discovering party insists on examining many and complex documents at the taking of the deposition, thereby causing undue burdens on others, the latter may, under Rule 26(c) or 30(d), apply for a court order that the examining party proceed via Rule 34 alone." (emphasis added). [Emphasis supplied]

Although made in a different context, the Court's comments and citation in Canal Barge Co, v. Commonwealth Edison Co., 2001 U.S. Dist. LEXIS 10097 (N.D. Ill. 2001) are instructive:


Canal Barge's second request is for the Court to strike all of the riders which ask for Canal Barge to produce numerous documents to ComEd at the depositions. ComEd attaches these riders pursuant to Rule 30(b)(5) ... Canal Barge objects to producing these documents on the basis that
written discovery closed on April 30, 2001, and that a Rule 30(b)(5) request for production of documents made after the close of written discovery violates the requirements of Rule 34.

This Court follows the holding of Carter v. United States, 164 F.R.D. 131 (D. Mass, 1995), referred to by both parties in their briefs. In Carter [at 1331, the district court relied on language in the Advisory Committee's Notes to Rule 30(b)(5) in coming to its holding that only the most narrow and relevant documents may be requested pursuant to Rule 30(b)(5): "In essence, a document request under Rule 30(b)(5) is a complement to a Rule 30 deposition, not a substitute for a Rule 34 document request.... Thus, . requests which fall under the rubric of a Rule 30(b)(5) deposition should be `few and simple' and `closely related to the oral examination' sought. Otherwise, the Court may assume that the document request falls under Rule 34 ..." [emphasis supplied]

The riders at issue ask for broad categories of written documents, many of which are unlimited in time and would include documents generated during the entire thirty-year duration of the contract ... The Court finds that these document requests are neither "few and simple" nor "closely related to the oral examination sought." Canal Barge asserts that many of the requested documents have previously been produced to ComEd [fn omitted], and this Court finds that Canal Barge is not required bring any documents to the deposition which it has already produced to ComEd....

Therefore, Canal Barge's motion to strike the riders attached to notices of depositions is granted. However, the Court will require that Canal Barge bring with it to the deposition any documents, not previously produced to CornEd, which the designee relied upon in preparing for the deposition."

The Court in Carter further noted:
Plaintiff has made little secret of the fact that his deposition notices were directed more at the documents enumerated than the testimony sought. Indeed, the Plaintiffs deposition notices appear, at least in
part, to come out of his frustration with the `inadequate and misleading response to our prior request for production of documents.' [citation omitted]. As noted at oral argument, however, Plaintiffs motion to compel does not arise from his previous request for production of documents. Instead, Plaintiffs motion is specifically directed at the three oral deposition notices, to which Defendant objected as not only untimely, but as irrelevant and unduly burdensome as well. Further, by Plaintiffs own admission, one purpose of the depositions was to establish certain negatives with respect to the documents sought, for example, that certain documents did not exist and that certain psychiatric evaluations were not done. [citations omitted]

In the Court's view, the deposition notices, heavily laden with document requests and divorced from any articulated bases for the oral testimony, were ... improper and [plaintiffs'] motion to compel must be denied....

Accordingly, Plaintiff shall have until January 12, 1996, to note the Defendant for deposition under Rule 30(b)(6), describing with reasonable particularity the matter(s) on which the examination is requested. Plaintiff may also request therein the production of documents in accord with Rule 30(b)(5), which shall be few and simple and closely related to the oral examination."

[End of Quote]

Closely related to this issue is the issue of the discoverability of documents reviewed by the FRCP 30(b)(6) witness in preparation for deposition. That issue is addressed in my October 13, 2005 post.

FRCP 30(b)(6) Witnesses and Documents Reviewed in Preparation

FRCP 30(b)(6) requires organizations, to provide a witness to offer testimony on topics designated by the deposing party. The witness provided is typically an employee or agent of the organization. The attorney preparing the FRCP 30(b)(6) witness has an attorney client relationship with the organization, and the witness.

Often, an issue arises as to whether the deposing attorney is entitled to review the specific documents used to prepare the FRCP 30(b)(6) witness. There is good law to refuse to provide this information based on the attorney client privilege and work product doctrine. Here it is:

"In Sporck v. Peil, 759 F.2d 312 (3rd Cir. 1985), the defendant’s attorney selected a large group of documents and reviewed them with the defendant in preparation for the defendant’s deposition. At the defendant’s deposition, plaintiff’s counsel asked for all the documents the defendant reviewed in preparation for the deposition. Defendant’s counsel refused, citing Federal Rule of Civil Procedure 26(b)(3) and Hickman v. Taylor, 329 U.S. 495, 67 S.Ct. 305, 91 L.E.d 451 (1947). The District Court disagreed and ordered production of the documents pursuant to Fed. R. Evid. 612 (document used to refresh a witness’s memory must be shown to opposing counsel). On mandamus, the Third Circuit disagreed.
The Third Circuit concluded that while the documents themselves did not constitute work product, the defendant’s counsel’s selection of these documents (and their organization) was work product. More importantly, the Third Circuit concluded that the selection of the documents was “opinion” work product and thus afforded almost absolute protection from discovery.
The Fourth Circuit adopted the Sporck Court’s reasoning in In re Allen, 106 F.3d 582 (4th Cir. 1997). In Allen, the Attorney General of West Virginia hired outside counsel, who assisted in preparing a witness for a deposition. Outside counsel selected a group of personnel records for a deponent to review in preparation for his deposition. Opposing counsel sought discovery of the records the deponent used for preparation. When counsel refused, the district court held him in contempt. The Fourth Circuit reversed, concluding that while the documents themselves were not work product, outside counsel’s selection of documents constituted legal opinions about which documents were relevant to the case. As such, the Fourth Circuit held that the documents were subject to almost absolute immunity as opinion work product. See also Chaudhry v. Gallerizzo, 174 F.3d 394 (4th Cir. 1999) (holding that work product doctrine precluded discovery of research memorandum prepared in connection with collection of a construction loan). "

There is also contrary law but it is scattered in District Courts and does not address the work product doctrine as well as Sporck and Allen

FRCP 33(d) and Specificity of Indentification of Records

When a party responds to Interrogatories by referring to documents pursuant to FRCP 33(d), a dispute often ensues as to whether the responding party supplied sufficient detail for the discovering party to determine which documents are responsive to specific interrogatory requests.

Here is an extract on the point from a brief we filed in federal court in Maryland:

"Under Fed.R.Civ.P. 33(d), a party has the option to produce business records where the answer to an interrogatory may be derived or ascertained and the burden of deriving or ascertaining the answer is substantially the same for the party serving the interrogatory as for the party served. In that case, "it is a sufficient answer to such interrogatory to specify the records from which the answer may be derived or ascertained and to afford to the party serving the interrogatory reasonable opportunity to examine, audit or inspect such records and to make copies, compilations, abstracts or summaries. A specification shall be in sufficient detail to permit the interrogating party to locate and to identify, as readily as can the party served, the records from which the answer may be entertained." The primary purpose of this Rule is "to shift the time and cost burden, of perusing documents in order to supply answers to discovery requests, from the producing party to the party seeking the information." U.S. Securities and Exchange Commission v. Elfindepan, S.A, 206 F.R.D. 574, 576 (M.D.N.C. 2002) (citing Daiflon, Inc. v. Allied Chem. Corp., 534 F.2d 221, 225-226 (10th Cir.), cert. denied, 429 U.S. 886, 97 S.Ct. 239 (1976). When "voluminous documents are produced under Rule 33(d), they must be accompanied by indices designed to guide the searcher to the documents responsive to the interrogatories". O'Connor v. Boeing North American, Inc., 185 F.R.D. 272, 278 (C.D. Cal. 1999) (emphasis added). See also Capacchione v. Charlotte-Mecklenburg Schools, 182 F.R.D. 486 (W.D.N.C. 1998) (holding that defendant's discovery responses should have identified the particular box containing the responsive documents).
Upon the filing of a motion to compel, the propounding party "must make a prima facie showing that the use of Rule 33(d) is somehow inadequate to the task of answering the discovery, whether because the information is not fully contained in the documents, is too difficult to extract, or other such means." The burden then shifts to the producing party to justify the use of Rule 33(d). Id. "


Ultimately, the Magistrate Judge determined that the indices provided did not supply sufficient detail. See 227 F.R.D. 404 (D. Md. 2005)

FRCP 33(d) and Who Bears Burden of Identifying Documents

FRCP 33(d) allows a party answering interrogatories to refer the discovering party to documents produced with the Answers. Disputes arise as to how much detail is required to identify the documents.

Here is a response by a well-known Plaintiffs' firm to a request by defendants to further specify which documents are responsive to which Interrogatories:

"Specifically, Rule 33(d) requires a determination that the effort necessary for the interrogating party to obtain the information from those records would not be substantially greater then the burden on the responding party to do the same thing. The effort need not be precisely equal and the inquiring party cannot deprive its opponent of the Rule 33(d) option by the simple expedient of pointing out that any party is likely to be more at ease with its own records. See. Sabel v. Mead Johnson & Co. 110 F.R.D. 553, 556 (D.C. Mass 1986) (while an interrogated party will always be more familiar with its own records then the interrogating party, familiarity with the records cannot be the sole test. The inquire is whether ithe relative burdens are substantially the same, not whether they are precisely equal.) See also Compaignie Francaise D'Assurance v. Phillips Petroleum Co. 105 F. R.D. 16, 44 (D.C.NY 1984) (one party's familiarity with the documents does not create a disparity in the ease of discovery that would preclude resort to Rule 33(d) "

Please note, I did not check the cases cited to determine if the summaries were accurate