Limitations on Amending a Notice of Removal, by Tom Dunn*

General Removal Rules 

·         Defendant has 30 days from service of process to file a removal petition. 28 U.S.C. § 1446(b).

·         During this 30-day period, a defendant may amend the petition without leave of court. Muhlenbeck v. KI, LLC, 304 F.Supp.2d 797, 799 (E.D. Va. 2004).

·         After the 30-day period, leave of court is required to amend the removal notice. 28 U.S.C. § 1653 (“[d]effective allegations of jurisdiction may be amended, upon terms, in the trial or appellate courts.”)

Are there limitations on a Court’s exercise of § 1653?

Can a Court permit a defendant to amend its notice of removal to add additional substantive grounds for removal?

In A.E.A v. Volvo Penta of the Americas, LLC, et al., Civ. No. 2:14-cv-425 (E.D. Va. 2014) (filed 1/9/2015) (“A.E.A.”), the Court answered the first question “yes” and the second question “no.” 

In A.E.A, a minor was injured while tubing in the Chesapeake Bay off of Virginia Beach. The location of the incident triggered federal maritime jurisdiction.  Defendant's notice of removal asserted original maritime jurisdiction of the federal courts and the removal statute.  After the 30-day period lapsed, Plaintiff filed a motion to remand relying upon a statute that provides a plaintiff the option of asserting his or her in personam lawsuit in state court even if it implicates maritime jurisdiction.  See 28 U.S.C. § 1333 (referred to as the savings to suitors clause). Thereafter, Defendant filed a motion for leave to amend its notice of removal. 

In its proposed amended notice of removal, Defendant added a claim that federal question jurisdiction exists and specifically cited to regulatory federal statutes.  The Court explained the “novel” issue presented was “whether § 1653 permits a party to add statements asserting federal question jurisdiction when its Notice relied on other grounds for removal.” A.E.A. at pp. 5-6 (emphasis added).  Following the Fourth Circuit’s decision, Wood v.Crane Co., 764 F.3d 316 (4th Cir. 2014), the Court held it does not have the discretion to allow the substantive amendment beyond the 30-day window under § 1653.  Noting a split in the Circuit Courts, the harmonized rule expressed by the Fourth Circuit in Wood was:

[A]fter thirty days, district courts have discretion to permit amendments that correct allegations already present in the notice of removal. Courts have no discretion to permit amendments furnishing new allegations of a jurisdictional basis. The trick lies in placing a case within one of those two categories. 

A.E.A. at p. 6, quoting Wood, 764 F.3d at 323 (emphasis added by A.E.A. Court).   

Applying the Wood rule, the A.E.A. Court found that Defendant had completely failed to plead in its initial notice of removal federal question jurisdiction or the specific federal regulatory statutes in the proposed amended notice of removal.  The Court stated that federal maritime jurisdiction and federal question jurisdiction are not separate and distinct.  Moreover, it found mere reference to the removal statute 28 U.S.C. § 1441(a) or citation to a federal statute to be insufficient to trigger federal question jurisdiction.  Accordingly, Defendant’s motion for leave to amend its notice was denied and Plaintiff’s motion to remand in accordance with the savings statute was granted. 

Takeaways

1.       Pay careful attention to the Notice of Removal. If you file your removal notice soon after service, calendar a “fresh look” on the 25^th day to make sure the Notice is complete.

2.       If there are multiple grounds to remove an action, state each one separately in the Notice.  In a footnote, the A.E.A. Court left open “whether citing a substantive, non-jurisdictional statute in a Notice of Removal would allow a defendant to supplant or add another substantive statute to its Notice under § 1653.” 

 

* Tom is a member of the steering committee  for Division 1: Litigation and Dispute Resolution of the ABA Forum on Construction Law.  Tom also helps manage The Dispute Resolver Blog.  In his life away from Division 1, Tom is a Partner at Pierce Atwood, LLP.  He practices construction law and business dispute resolution in Massachusetts and Rhode Island.  If you are interested in submitting an article to The Dispute Resolver or to learn more about FCL or Division 1, feel free to contact Tom at rtdunn@PierceAtwood.com.