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Yates v. Franke

United States District Court, D. Nevada

August 26, 2019

JULIA A. YATES, et al., Plaintiffs,
v.
HANS G. FRANKE, et al., Defendants.

          ORDER

          ROBERT C. JONES UNITED STATES DISTRICT JUDGE

         This case arose by the Plaintiffs bringing breach of contract and unjust enrichment claims against the Defendants in Nevada state court. A few months after the Plaintiffs commenced the case, the Defendants filed another case based on the same dispute in Hawaii federal court. Then, the Defendants removed the Nevada state court case to this Court based on diversity jurisdiction. In an attempt to have all matters resolved in Hawaii, the Defendants filed a motion to transfer venue to Hawaii. Moving for remand, the Plaintiffs contend that the removal was improper. The only thing on which the parties agree is that they should not be here.

         I. DEFENDANTS' MOTION FOR RELIEF FROM LATE FILING

         The Defendants filed their opposition to the Plaintiffs' Motion for Remand four days late. By filing late, the Defendants violated rule LR 7-2(b), so the Plaintiffs argue that the Court should not consider the brief. However, the Court finds that the late filing was exempted under LR 6-1(a), which allows for late filings on a showing of excusable neglect.

         The Ninth Circuit has provided four factors to consider for finding excusable neglect: “the danger of prejudice to the debtor, the length of the delay and its potential impact on judicial proceedings, the reason for the delay, including whether it was within the reasonable control of the movant, and whether the movant acted in good faith.” Iopa v. Saltchuk-Young Bros., Ltd., 916 F.3d 1298, 1301 (9th Cir. 2019) (quoting Pioneer Investment Services Co. v. Brunswick Associates Ltd. Partnership, 507 U.S. 380, 395 (1993)). Cumulatively, these factors support consideration of the filing.

         Three of the four factors favor the Defendants. Turning to the first factor, the Court does not see any prejudice to the Plaintiffs by the Defendants' four-day delay. Likewise, the second factor favors excusable neglect; the four-day delay is short and did not have any impact on the judicial proceedings. Skipping to the fourth factor, the Defendants acted in good faith. The Defendants are represented by out-of-state attorneys who were relying on a software program to manage their deadlines and the program did not incorporate this Court's rules. Accordingly, the program indicated that the deadline was four days later than it was. Relying on this indication, the Defendants filed their brief four days late. These three factors favor leniency for the Defendants.

         Only the third factor cuts against the Defendants position. The Defendants should have known that the opposition was due both from the publication of the Court's rules and the confirmation email provided to them, so it was within the Defendants' control. Nonetheless, the factors on a whole largely favor finding excusable neglect. Thus, the Court declines to strike the Defendants' response against the Plaintiffs' Motion for Remand.

         II. PLAINTIFFS' MOTION FOR REMAND

         As a preliminary issue, the Defendants argue that the Plaintiffs have waived their right to object to the removal since they engaged in discovery by filing a motion to compel a deposition. However, this contention is frivolous.

         The Defendants rely on cases to say that whenever a plaintiff manifests assent to a court's jurisdiction after removal, then they waive their right to challenge removal. However, the cited cases do not stand for such a broad proposition. For example, the Defendants quote the following:

To constitute a waiver or consent to the federal court's assumption of jurisdiction, however, there must be affirmative conduct or unequivocal assent of a sort which would render it offensive to fundamental principles of fairness to remand, as where the party seeking remand has been unsuccessful in litigation of a substantial issue, such as the right to a jury trial or the right to take depositions or has filed an amended complaint seeking further or different relief from the federal court.

Maybruck v. Haim, 290 F.Supp. 721, 723-24 (S.D.N.Y. 1968). However, even the Defendants' quote does not support their position. There, that court required that the plaintiff lose on a substantial issue. Here, the Court has not even ruled on the Plaintiffs' discovery motion but dismissed it without prejudice to be refiled if the Court does not remand.

         The Court finds that the Plaintiffs have in no way waived their rights. Nothing that they did manifested an “unequivocal assent of a sort which would render it offensive to fundamental principles of fairness to remand.” In fact, the first filing in the docket from the Plaintiffs is the Motion to Remand, filed only nine days after the removal when they are allowed thirty. See 28 U.S.C. § 1447(c) (“A motion to remand the case . . . must be made within 30 days after the filing of the notice of removal . . . .”). Accordingly, the Defendants' argument is without merit.

         Turning to the substance of the Plaintiffs' motion, the Court finds that the Defendants' removal was frivolous. The Defendants are citizens of Nevada asserting diversity jurisdiction; therefore, the removal was barred by the forum defendant rule. The rule states, “A civil action otherwise removable solely on the basis of the jurisdiction under section 1332(a) of this title may not be removed if any of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.” 28 U.S.C. § 1441(b)(2); Lincoln Prop. Co. v. Roche, 546 U.S. 81, 84 (2005) (“Defendants may remove an action on the basis of diversity of citizenship if there is complete diversity between all named plaintiffs and all named defendants, and no defendant is a citizen of the forum State.”). The Defendants do not ...


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