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James Bennett v. United Rentals (North America), Inc.

United States District Court, S.D. Texas, Galveston Division

October 18, 2019

JAMES BENNETT, et al., Plaintiffs,
v.
UNITED RENTALS (NORTH AMERICA, INC.), Defendant.

          MEMORANDUM OPINION AND ORDER

          JEFFERY VINCENT BROWN UNITED STATES DISTRICT JUDGE.

         Pending before the Court is plaintiffs James Bennett and Vera Bennett's Amended Motion to Remand, Dkt. 14. After considering the motion, the response, the reply, the pleadings, and the applicable law, the Court grants the motion.

         I. BACKGROUND

         On July 26, 2017, the Bennetts filed the underlying action in the 23rd Judicial District Court of Brazoria County, Texas, [1] against Vernor Material & Equipment Co., Inc. (a Texas corporation), seeking damages from an accident involving a backhoe front loader at the Olin Freeport B Plant in Freeport which resulted in the death of Darrel Bennett. Dkt. 1-1.

         On August 2, 2018, Plaintiffs filed their First Amended Petition, adding three defendants: CNH Industrial America, LLC (a Delaware company); United Rentals, Inc. (a Delaware corporation); and United Rentals (North America), Inc. (a Delaware corporation with its principal place of business in Connecticut). See Dkt. 1-2. On April 8, 2019, the Bennetts nonsuited United Rentals, Inc. Dkt. 1-3. Then, on August 3, 2019, the Bennetts filed a Second Amended Petition, removing CNH and Vernor as parties to the lawsuit. See Dkt. 1-4.

         On August 9, 2019-over two years after the Bennetts initially filed suit- United Rentals (North America), Inc. (hereafter “Defendant”) removed the case to this Court based on diversity jurisdiction. Dkt. 1; see 28 U.S.C. §§ 1332, 1441. Defendant contends its notice of removal is timely because Defendant removed this case “as soon as practicable and within thirty (30) days of service of Plaintiffs' Second Amended Petition.” Dkt. 1 at 4.

         On August 27, 2019, the Bennetts filed the instant Amended Motion to Remand, [2] arguing Defendant's removal is untimely under 28 U.S.C. § 1446(c). That same day, the Court set an expedited briefing schedule because trial in the state court action is set for November 12, 2019. The Bennetts' argument for remanding this case is relatively straight-forward; removal is not permitted more than one year after the commencement of an action unless the plaintiffs acted in bad faith in order to prevent a defendant from removing the action. Therefore, because the Bennetts did not act in bad faith, and because Defendant removed this action more than one year after the Bennetts initiated the state-court action, removal is untimely. Dkt. 14 at 1-2.

         On the issue of bad faith, the Bennetts contend that they filed their Second Amended Petition the day after receiving CNH's settlement payment. Id. at 3-4. Although not mentioned until their reply briefing, the Bennetts mediated their claims against both CNH and Vernor on June 18, 2019, reaching a settlement agreement that same day. See Dkt. 17 at 5. The Bennetts also point towards the complexity of their settlement process with Vernor, which involved a bench trial on the issue of whether the decedent's son was a dependent at the time of his death and, therefore, entitled to workers' compensation death benefits. Dkt. 14 at 4. According to the Bennetts, “a major part of [their] settlement [with Vernor] was a waiver of both past and future subrogation of workers['] compensation carrier's interest.” Id.

         Defendant's response focuses on when the Bennetts settled their claims against Vernor--the party whose presence defeated complete diversity and prohibited removal. Defendant argues that the Bennetts executed and exchanged settlement documents with Vernor on July 18, 2019, citing in support e-mails between the Bennetts' and Vernor's counsel--both dated July 18, 2019--in which counsel for each party represents that a signed settlement release is attached. Dkt. 16 at 3 (citing Defendant's Exs. 6 and 7). Defendant also directs the Court's attention to a letter from Vernor's counsel to the Bennetts' counsel, also dated July 18, 2019, which states that a settlement check is enclosed. Id. (citing Ex. 1). According to the post office's tracking service, the letter was delivered to the Bennetts' counsel's office on July 22, 2019--twelve days before the Bennetts filed their Second Amended Petition. Id. (citing Defendant's Ex. 3).

         In their reply, the Bennetts elaborate on why they did not dismiss Vernor earlier from the suit. Some of the more salient reasons are: (1) Vernor initially failed to respond to requests for admissions; (2) before amending their petition for the first time, the Bennetts attempted to mediate the dispute with Vernor; (3) the Brazoria County district judge was unavailable for an unspecified amount of time for personal reasons; and (4) the second mediation between with CNH and Vernor (i.e., the successful mediation) did not occur until June 18, 2019--sixteen days before the Bennetts filed their Second Amended Petition. Dkt. 17 at 4-5. Plaintiffs also provide additional information regarding the previously mentioned bench trial concerning whether the decedent's son was a dependent at the time of his death. Notably, the trial occurred months before the Bennetts' second attempt at mediation and resulted in a verdict in the Bennetts' favor that was “still subject to appeal while the [the Bennetts] awaited funding of the settlements from [CNH and Vernor].” Id. at 5.

         II. ANALYSIS

         A. Removal Jurisdiction

         In an action that has been removed to federal court, a district court is required to remand the case to state court if, at any time before final judgment, it determines that it lacks subject matter jurisdiction. See 28 U.S.C. § 1447(c). When considering a motion to remand, “[t]he removing party bears the burden of showing that federal jurisdiction exists and that removal was proper.” Barker v. Hercules Offshore Inc., 713 F.3d 208, 212 (5th Cir. 2013) (quoting Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002)). In evaluating a motion to remand, courts should bear in mind that “removal statutes are to be construed strictly against removal and for remand.” Eastus v. Blue Bell Creameries, L.P., 97 F.3d 100, 106 (5th Cir. 1996).

         B. ...


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