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Seabright Insurance Company, As Subrogee of Ebben Masonry, Inc v. Jlg Industries

June 20, 2011

SEABRIGHT INSURANCE COMPANY, AS SUBROGEE OF EBBEN MASONRY, INC., SEABRIGHT INSURANCE COMPANY, AS SUBROGEE OF JONATHAN WASSAM, AND JONATHAN WASSAM, PLAINTIFFS,
v.
JLG INDUSTRIES, INC., BALLUFF, INC., LULL INTERNATIONAL, INC., LULL MANUFACTURING COMPANY, LULL MANUFACTURING CORPORATION AND LULL INDUSTRIES, INC., DEFENDANTS.



The opinion of the court was delivered by: Matthew F. Kennelly, District Judge:

MEMORANDUM OPINION AND ORDER

Plaintiffs Seabright Insurance Company (Seabright), Ebben Masonry, Inc. (Ebben), and Jonathan Wassam (Wassam) filed suit against JLG Industries, Inc. (JLG), Balluff, Inc. (Balluff), Lull International, Inc., Lull Manufacturing Company, and Lull Manufacturing Corporation (collectively, Lull) in the Circuit Court of Cook County, asserting various state law claims. Defendants removed the case to this Court on the basis of diversity jurisdiction. Plaintiffs ask the Court to remand this case to the Circuit Court of Cook County. For the following reasons, the Court denies plaintiffs' motion.

Facts

Plaintiffs filed suit in the Circuit Court of Cook County on March 4, 2011. Seabright is a citizen of Illinois and of Washington, and Ebben and Wassam are citizens of Illinois. The defendants are each citizens of states other than Illinois and Washington.

Balluff was the first defendant to be properly served with summons, on March 9, 2011. Two days later, on March 11, 2011, both JLG and Lull were properly served. On April 11, 2011, defendants removed the case to this Court. Their notice was defective, so the Court ordered them to correct the defects or face remand. They filed an amended notice of removal on April 14, 2011. There is complete diversity of citizenship, and the amount in controversy exceeds $75,000.

Plaintiffs have moved to remand the case to the Circuit Court of Cook County. They argue that defendants' notice of removal was untimely because it was filed after the thirty-day period for removal expired.

Discussion

"As the part[ies]y seeking to invoke federal jurisdiction, [defendants] bear[ ] the burden of demonstrating that removal is proper." Boyd v. Phoenix Funding Corp., 366 F.3d 524, 529 (7th Cir. 2004). A defendant has thirty days from the service of the summons to remove the case to federal court. 28 U.S.C. § 1446(b). "If the suit names multiple defendants, it may not be removed unless all the defendants consent to removal." Save-A-Life Found., Inc. v. Heimlich, 601 F. Supp. 2d 1005, 1007 (N.D. Ill. 2009); see also Phoenix Container, L.P. v. Sokoloff, 235 F.3d 352, 353 (7th Cir. 2000) (joinder by all defendants in a notice of removal is an "essential step").

By the time defendants filed their notice of removal, thirty-three days had passed from the time Balluff was served with summons. Because the time for Balluff to remove had expired, and because Balluff's consent was required for JLG and Lull to remove the case, plaintiffs argue that the notice of removal was untimely.

"Section 1446 does not address whether a later-served defendant can obtain consent for removal from a defendant who was served earlier and for whom the time to remove has already expired." Save-A-Life Found., 601 F. Supp. 2d at 1007-1008 (citing Boyd, 366 F.3d at 529-30). In addition, neither the Supreme Court nor the Seventh Circuit has directly addressed this issue.

Courts that have addressed this issue are split regarding whether the time clock starts from the date the first defendant is properly served or from the date later defendants are properly served. Some courts have chosen to adopt the so-called "first-served defendant" rule. E.g., Barbour v. Int'l Union, United Auto., Aerospace and Agric. Implement Workers of Am., No. 08-1740, 2011 WL 242131, at *7 (4th Cir. Jan. 27, 2011) ("[A] timely notice of removal must be filed within thirty days of service on the first-served defendant."); Brown v. Demco, Inc., 792 F.2d 478, 481-82 (5th Cir. 1986); Phoenix Container, L.P. v. Sokoloff, 83 F. Supp. 2d 928, 933 (N.D. Ill. 2000); Scialo v. Scala Packing Co., 821 F. Supp. 1276, 1278 (N.D. Ill. 1993).

Some courts, however (including the undersigned judge), have rejected the first-served defendant rule and have adopted the what one might call the "later-served defendant" rule to govern the timing of removal when defendants are served on different dates. E.g., Bailey v. Janssen Pharmaceutica, Inc., 536 F.3d 1202, 1203 (11th Cir. 2008); Marano Enters. of Kan. v. Z-Teca Rests., L.P., 254 F.3d 753, 757 (8th Cir. 2001);

Brierly v. Alusuisse Flexible Packaging, Inc., 184 F.3d 527, 533 (6th Cir. 1999); Eltman v. Pioneer Commc'ns of Am., 151 F.R.D. 311, 317 (N.D. Ill. 1993). Under this rule, each defendant is allowed to remove to federal court -- with the consent of the other served defendants -- within thirty days of when it is properly served, irrespective of whether the time for an earlier-served defendant to remove has expired. Save-A-Life Found., 601 F. Supp. 2d at 1009. Defendants contend that the "later-served defendant" rule applies and that as a result, their notice of removal was timely because it was filed within thirty days after service of summons on Lull and JLG.

In Save-A-Life Foundation, this Court adopted the later-served defendant rule. Specifically, the Court concluded that "[e]ach defendant in a case is entitled to removed an action from state to federal court, regardless of whether earlier-served defendants declined to do so, so long as all defendants consent to removal." Id. Having considered plaintiffs' arguments in the present case, the Court is ...


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