United States District Court, D. South Carolina, Columbia Division
The Gates at Williams-Brice Condominium Association and Katherine Swinson, individually, and on behalf of all others similarly situated, Plaintiffs,
Quality Built, LLC, and Coast to Coast Engineering Services, Inc. d/b/a/ Criterium Engineers, Defendants.
OPINION AND ORDER GRANTING MOTION TO REMAND (ECF NO.
19) AND DENYING FEES
CAMERON MCGOWAN CURRIE Senior United States District Judge.
matter is before the court on Plaintiffs' motion to
remand and for an award of attorneys' fees. ECF No. 19.
Plaintiffs argue removal was improper for a variety of
procedural reasons including (1) the “consent” to
removal filed by Defendant Quality Built, LLC (“Quality
Built” or “Quality Built, LLC”) is
defective because it includes a reservation of a right to
move for remand, (2) Quality Built's purported consent is
untimely because it was filed more than thirty days after
Defendant Coast to Coast Engineering Services, Inc. d/b/a
Criterium Engineers (“Criterium”) was served with
the Complaint, and (3) removal is time-barred by 18 U.S.C.
§ 1446's one-year limitation on removal of diversity
reasons set forth, below, the court grants the motion to
remand on the first two grounds (inadequate and untimely
consent). The court addresses but reaches no conclusion as to
the third ground (application of Section 1446's one-year
limitation). Finally, because Criterium did not act
unreasonably in removing the action, the court denies
Plaintiffs' request for fees.
this action, Plaintiffs seek recovery for Defendants'
alleged failure to ensure quality control in the construction
of a 158 unit condominium complex. The matter was originally
filed in state court in December 2013. The complaint named a
single Defendant, Quality Built, which entity was served in
January 2014. ECF No. 9-1. The original complaint did not
specifically allege an amount in controversy, though it did
allege widespread damage resulting from water penetration and
“spalling” in the condominium complex and sought
punitive damages under one cause of action. Id.
¶¶ 13-15, 41.
Built did not remove the matter from state court. Its
counsel, instead, wrote Plaintiffs' counsel in late
January 2014 asking Plaintiffs to dismiss the action with
prejudice because the party to the contract at issue was
“Qualitybuilt.com, ” not Quality Built, LLC. ECF
No. 19-2 (letter dated January 28, 2014). Defense counsel
explained that Quality Built, LLC had purchased
“substantially all of the assets of Qualitybuilt.com .
. . free and clear of all Claims (except for specified
Assumed Liabilities)” and described Qualitybuilt.com as
a “California corporation and
declined the invitation to dismiss the action but do not
appear to have taken more than minimal action to advance the
state-court litigation until October 29, 2015. See
ECF No. 19-1 at 2, 3 (discussing background and indicating no
activity other than service of one set of discovery with the
complaint between the time of service and October 29, 2015).
On that date, twenty-two months after the initial complaint
was filed, Plaintiffs' counsel wrote Quality Built's
counsel stating Plaintiffs would move for default judgment if
no answer was filed by November 6, 2015. ECF No. 19-4.
following day, Plaintiffs moved to amend the complaint to add
Criterium as a Defendant and assert a successor liability
theory against Quality Built. ECF No. 19-5 (motion to amend
filed October 30, 2015). The motion to amend remained open for
some time and was ultimately resolved by consent on or about
May 16, 2016. The amended complaint was filed shortly
thereafter, on May 19, 2016, and served on Criterium on May
24, 2016. Thus, the matter had been pending in the state
court for nearly two and a half years at the point Criterium
was brought into the action. ECF No.1 ¶¶ 2, 3. In
the interim, on November 24, 2015, Quality Built, LLC filed
an answer to the original complaint. ECF No. 9-2 (Answer
filed November 24, 2015); ECF No. 19-1 at 3, 4 (discussing
filed a Notice of Removal on June 17, 2016, less than thirty
days after it was first served. ECF No. 1. The notice of
removal relied on diversity as the basis for subject matter
jurisdiction. Criterium filed a motion to dismiss
concurrently with the Notice of Removal. ECF No. 4.
Notice of Removal addressed citizenship by providing places
of “incorporation” and listing principal places
of business for both Defendants despite one being a limited
liability company (“LLC”). ECF No. 1 ¶¶
6, 7. The removal papers did not address whether Quality
Built consented to the removal.
20, 2016, the court entered a docket text order noting
deficiencies in the allegations necessary to support
subject matter jurisdiction. That order read, in
relevant part, as follows:
TEXT ORDER: The jurisdictional allegations of the
removal papers are deficient in that they fail to provide
information necessary to determine the citizenship of Quality
Built, LLC. Citizenship of a limited liability company is
determined by the citizenship of ALL of its members (and, as
necessary, citizenship of each member's upstream members
or partners), not the state of formation and principal place
of business. The removing party shall be allowed until June
24, 2016, to file a supplemental jurisdictional statement
curing this deficiency. Failure to do so will result in
6 (emphasis added). On June 23, 2016, Criterium filed a
supplemental jurisdictional statement addressing the identity
and citizenship of Quality Built's members. ECF No.
24, 2016, Quality Built filed a document stating it
“joins/concurs in the Notice of Removal” filed by
Criterium. ECF No. 9. This document also included the
following statements: “Quality Built, LLC . . .
consents to removal of the above-entitled cause of action . .
. as if [it] had executed the Notice of Removal as a joint
removing party. Defendant, Quality Built, LLC, reserves
the right to move to remand this cause of action if
Defendant, [Criterium] is dismissed from this cause of
action.” ECF No. 9 at 1 (emphasis added).
28, 2016, Plaintiffs filed a Motion to Delay Briefing (ECF
No. 11) on Criterium's Motion to Dismiss. The reason for
the requested delay was Plaintiffs' stated intent to seek
remand. Id. The court granted the Motion to Delay
Briefing. ECF No. 12. Plaintiffs, thereafter, filed the
present Motion to Remand, which has been fully briefed. ECF
No. 19 (motion and memorandum), 22 (response), 23 (reply).
burden of demonstrating jurisdiction resides with “the
party seeking removal.” Dixon v. Coburg Dairy,
Inc., 369 F.3d 811, 816 (4th Cir. 2004) (citing
Mulcahey v. Columbia Organic Chems. Co., 29 F.3d
148, 151 (4th Cir. 1994)). The court is obliged to construe
removal jurisdiction strictly because of the
“significant federalism concerns” implicated.
Id. Courts “should ‘resolve all doubts
about the propriety of removal in favor of retained state
jurisdiction.'” Hartley v. CSX Transp.,
Inc., 187 F.3d 422, 425 (4th Cir. 1999) (holding, in
addressing fraudulent joinder argument, district court erred
by certifying a doubtful claim to the state's supreme
court because court should “resolve all doubts about
the propriety of removal in favor of retained state court
jurisdiction.”); see also Strawn v. AT&T
Mobility, LLC, 530 F.3d 293, 296 (4th Cir. 2008)
(holding Class Action Fairness Act did not change
long-standing rule that “it is the [removing] defendant
who carries the burden of alleging in his notice of removal
and, if challenged, demonstrating the court's
jurisdiction over the matter”).
same rule applies to procedural deficiencies as
jurisdictional deficiencies, so long as the procedural
challenge is timely raised by a party. See Russell Corp.
v. Am. Home Assur. Co., 264 F.3d 1040, 1046-47 (11th
Cir. 2001). As explained in Russell, “[l]ike
all rules governing removal, th[e] unanimity requirement must
be strictly interpreted and enforced because of the
significant federalism concerns arising in the context of
federal removal jurisdiction.” See also Stasio v.
Saxon Mortg. Svcs. Inc., C.A. No. 2:12-cv-2797-DCN, 2013
WL 1787041(D.S.C. April 26, 2013) (applying rule in remanding
based on challenge to timing and adequacy of
co-defendants' consents to removal).
reasons set forth below, the court finds removal procedurally
defective both because Quality Built's consent was
qualified and because the consent was untimely. In reaching
these conclusions, the court has considered Plaintiffs'
argument that uncertainty should be resolved in favor of
remand. Accordingly, the court grants Plaintiffs' motion
it impacts the decision to deny fees, the court also
addresses Plaintiffs' argument that Section 1446(c)(1)
bars removal of this action. This argument rests on the
premise Section 1446(c)(1)'s one-year limitation on
removal applies to all actions removed on the basis of
diversity. Criterium's arguments for a contrary
interpretation are, at the least, reasonable. For this and
additional reasons, the court finds Criterium did not act
unreasonably in removing the action and, therefore, denies
Plaintiffs' request for an award of fees and costs.
Adequacy of Consent
procedure for removal is set out in 28 U.S.C. § 1446,
which was substantially modified in late 2011 and now reads,
in relevant part, as follows:
(b) Requirements; generally. - (1) The notice of removal of a
civil action or proceeding shall be filed within 30 days
after the receipt by the defendant, through service or
otherwise, of a copy of the initial pleading . . .;
(2)(A) When a civil action is removed solely under section
1441(a), all defendants who have been properly joined and
served must join in or consent to the removal of the
(B) Each defendant shall have 30 days after receipt by or
service on that defendant of the initial pleading or summons
described in paragraph (1) to file the notice of removal.
(C) If defendants are served at different times, and a
later-served defendant files a notice of removal, any
earlier-served defendant may consent to the removal even
though that earlier-served defendant did ...