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Bajaba LLC v. General Steel Domestic Sales, LLC

United States District Court, W.D. Arkansas, Texarkana Division

October 21, 2014

BAJABA, LLC d/b/a NEW HAVEN GOLF CLUB, Plaintiff,
v.
GENERAL STEEL DOMESTIC SALES, LLC d/b/a GENERAL STEEL CORP.; BUILDING SERVICES GROUP, LLC;, Defendants.

ORDER

SUSAN O. HICKEY, District Judge.

Before the Court is the Motion to Remand and for Costs filed by Bajaba, LLC d/b/a New Haven Golf Club ("Bajaba"). (ECF No. 10). Defendant General Steel Domestic Sales, LLC ("General Steel") has responded and filed a supplement to its response. (ECF No. 13, 17). Bajaba filed a reply to Defendant's Response. (ECF No. 19). Additionally, Defendant Building Services Group, LLC ("Building Services") has moved to Adopt and Join the Response to Plaintiff's Motion to Remand and for Costs. (ECF No. 14). No party has objected to Building Services' Motion.

For the reasons stated herein, Bajaba's Motion to Remand and for Costs (ECF No. 10) is GRANTED in part and DENIED in part. Building Services' Motion to Adopt and Join the Response of General Steel (ECF No. 14) is GRANTED.

I. Background

Bajaba alleges that it bought a steel building from General Steel, using General Steel's authorized dealer and builder, Jared Branscum and Branscum Construction & Erecting, Inc. (collectively, "Branscum Defendants") to erect the building. Bajaba paid $385, 000 prior to delivery of the building. The Branscum Defendants abandoned the job before the building was erected and Bajaba was forced to complete the project with other contractors. Bajaba sued General Steel, Building Services Group, and the Branscum Defendants in Arkansas state court for breach of contract, violation of the Arkansas Deceptive Trade Practices Act, fraud, and negligence. General Steel and Building Services are both Colorado limited liability companies, Jared Branscum is an Arkansas resident, and Branscum Construction and Erecting, Inc. is an Arkansas corporation.

Bajaba alleges that it attempted unsuccessfully to serve the Branscum Defendants. The lawsuit proceeded in state court for two years until, during the final pretrial hearing Bajaba orally moved to nonsuit its claims against the Branscum defendants for lack of service. Because the Branscum Defendants were the only nondiverse defendants, General Steel and Building Services thereafter removed the case to this court. (ECF No. 1).

Bajaba argues the case should be remanded because (1) it is procedurally defective, (2) the joinder of the Branscum defendants was not done in bad faith, and (3) the Defendants have waived any right to remove. Defendants respond that Plaintiff included the nondiverse Branscum Defendants in bad faith, and such bad faith forum manipulation tolls the one year limitation in 28 U.S.C. 1446 (c)(1).

II. Discussion

The burden of establishing that a case is within the federal court's removal jurisdiction is on the removing defendant. Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108 (1941)). In light of the congressional intent to restrict federal court jurisdiction, as well as the importance of preserving the independence of state governments, federal courts construe the removal statute[s] narrowly, resolving any doubts against removability. Id. at 108-09.

A. Procedural Defects

Bajaba first argues that the state court has not entered a written order on its oral motion for nonsuit of its claims against the Branscum Defendants and therefore the Defendants' notice of removal is procedurally defective under 28 U.S.C. § 1446(b)(3).

The requirements of 28 U.S.C. § 1446(b)(3) allows a notice of removal to be filed "within 30 days after receipt by the defendant, through service or otherwise, of a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable." Bajaba argues that, because the motion to nonsuit was oral, there has been no "order or other paper" from which the Defendants can ascertain the removability of the case.

However, many courts have permitted consideration of oral statements which allow certain narrow exceptions to the general writing requirements. First Nat'l Bank in Little Rock v. Johnson & Johnson, 455 F.Supp. 361, 362 & n. 1 (E.D.Ark. 1978); see also King v. Kayak Mfg. Corp., 688 F.Supp. 227, 230 (N.D. W.Va. 1988); Mike Silverman & Assocs. v. Drai, 659 F.Supp. 741, 745-47 (C.D. Cal. 1987); Heniford v. Am. Motors Sales Corp., 471 F.Supp. 328, 332-37 (D.S.C. 1979), dismissed, 622 F.2d 584 (4th Cir. 1980) (unpublished table decision). Because the statement here was made in open court, recorded, and transcribed, it is available for examination without necessitating any complex and potentially troubling dispute over what was actually said. See 14C Fed. Prac. & Proc. Juris. § 3731 (4th ...


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