United States District Court, D. Arizona
HONORABLE JOHN J. TUCHI UNITED STATES DISTRICT JUDGE.
issue is Plaintiff Sherman & Howard LLC's Motion to
Remand to State Court and Motion for Sanctions Pursuant to 28
U.S.C. § 1927 (Doc. 10, Mot. to Remand), to which
Defendant Paul Leonard Bruno filed a Response (Doc. 36,
Resp.), and to which Plaintiff filed a Reply (Doc. 38,
Reply). Also at issue is Defendant's Cross-Motion for
Sanctions Pursuant to 28 U.S.C. § 1927 (Doc. 37,
Def's Mot. for Sanctions), which, the Court resolves
without the benefit of Plaintiff's Response. The Court
will grant Plaintiff's Motion to Remand; however, the
Court denies both Motions for Sanctions.
filed this action in Maricopa County Superior Court to
recover attorney's fees incurred by Bruno and PB Co.,
Inc., of which Bruno is the sole shareholder and President.
(Doc. 1-1, Compl. ¶¶ 1-32.) The fees at issue in
the Complaint include those charged to Bruno during his
Chapter 13 and Chapter 11 bankruptcy proceedings, which the
Bankruptcy Court dismissed on September 7, 2017. See
Order, Doc. 334, In re Bruno, No. 16-bk-11826-PS
(Bankr. D. Ariz. Sept. 7, 2017). On November 8, 2017, Bruno
timely removed the case to federal court. See Notice
of Removal, Doc. 1, Sherman & Howard LLC v.
Bruno, 17-cv-04128-DJH, (D. Ariz. Nov. 8, 2017).
Plaintiff subsequently filed a Motion to Remand, which United
States District Court Judge Diane J. Humetewa granted after
Bruno failed to file a responsive pleading. In the Order
granting the Motion, Judge Humetewa agreed with
Plaintiff's contention that the District Court was
“without subject matter jurisdiction.” Order at
1, Doc. 20, No. 17-cv-04128-DJH (D. Ariz. Dec. 19, 2017).
After Judge Humetewa remanded the case, however, Bruno filed
a Motion to Vacate the Order due to excusable neglect, which
Judge Humetewa denied.
March 12, 2018, Judge Christopher Whitten of the Maricopa
County Superior Court entered Final Judgment against Bruno
and PB Co., Inc. (Doc. 1-2 at 72-73.) Two weeks later, on
March 28, 2018, Bruno removed the action to this Court for a
second time. Once again, Plaintiff moves to remand the case
to the Superior Court.
courts may exercise removal jurisdiction over a case only if
subject matter jurisdiction exists. 28 U.S.C. § 1441(a);
Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1116
(9th Cir. 2004). The removing party is required to provide a
signed notice of removal that contains “a short and
plain statement of the grounds for removal.” 28 U.S.C.
§ 1446(a). “By design, § 1446(a) tracks the
general pleading requirement stated in Rule 8(a) of the
Federal Rules of Civil Procedure.” Dart Cherokee
Basin Operating Co. v. Owens, 135 S.Ct. 547, 553 (2014).
“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 setting forth the claim for relief upon
which such action or proceeding is based.” 28 U.S.C.
§ 1446(b). A plaintiff may seek to have a case remanded
to the state court from which it was removed if the district
court lacks jurisdiction or if there is a defect in the
removal procedure. 28 U.S.C. § 1447(c). Generally,
removal statutes are strictly construed against removal
jurisdiction. See Boggs v. Lewis, 863 F.2d 662, 663
(9th Cir. 1988).
Defendant attempts to remove a case after a previous remand,
“removal . . . is permitted only upon a ‘relevant
change of circumstances'-that is, ‘when subsequent
pleadings or events reveal a new and
different ground for removal.'” Reyes
v. Dollar Tree Stores, Inc., 781 F.3d 1185, 1188 (9th
Cir. 2015) (quoting Kirkbride v. Cont'l Cas.
Co., 933 F.2d 729, 732 (9th Cir. 1991)). As such, a
successive attempt to remove may be proper when “an
intervening change of law gives rise to a new basis for
subject-matter jurisdiction” or “when the
pleadings are amended to create federal subject-matter
jurisdiction for the first time.” Id.
Court first addresses Plaintiff's Motion to Remand before
turning to the cross-Motions for Sanctions.
Plaintiff's Motion to Remand
asserts in the Notice of Removal that this Court has
jurisdiction because Plaintiff “has made a claim for
services connected to Defendant Bruno's Chapter 11
bankruptcy proceedings.” (Notice of Removal at 2.)
Bruno reiterates this basis for removal in his Response,
arguing that this Court not only has jurisdiction, but that
it has exclusive jurisdiction over the matter. (Resp. at
6-9.) This argument conflicts with Ninth Circuit precedent on
the point. “A post-dismissal motion to enforce a fee
agreement between a debtor and [his] attorney is ancillary to
the bankruptcy court's core function of adjudicating the
estate.” In re Elias, 188 F.3d 1160, 1162 (9th
Cir. 1999) (per curiam). Thus, in a case such as the one
currently before this Court, a “state court is fully
capable of resolving the fee dispute.” See id.
the Maricopa County Superior Court's ability to exercise
jurisdiction over this matter, this Court need not reach the
question of whether jurisdiction would have ever been proper
in federal court because removal at this point is both
untimely and improper. As recounted above, Plaintiff filed
this matter in Maricopa County Superior Court on October 23,
2017, and served Defendant on November 2, 2017. (Doc. 1-1 at
85.) Bruno's removal would have been timely on or before
December 2, 2017. See 28 U.S.C. § 1446(b).
Because Bruno removed this matter on March 28, 2018, his
attempt is untimely on its face. However, Bruno offers
several reasons why this attempt should be considered timely,
each of which lacks legal merit.
Bruno asserts that his attempt to remove is timely because
“[o]n March 12, 201 Sherman & Howard added
defendants, GP Meetings & Events, Inc. and PB Co Property
Management, LLC.” (Notice of Removal at 1-2.) Despite
this assertion, the record demonstrates that those parties
were not in fact added as Defendants to the action. Instead,
on March 12, 2018, Sherman & Howard filed a post-judgment
Application for Writ of Garnishment against GP Meetings &
Events, Inc., among others. (Doc. 1-2 at 104.) Thus,
Plaintiff did not join any additional party on March 12.
Moreover, even if Bruno was correct, that fact would not make
his removal timely. Certainly, removal by a party
that had been joined on March 12 might have been timely.
However, the mere ...