Tuesday, February 8, 2011
In its recent decision Barbour v. International Union (2011 WL 242131, 2011 U.S. App. LEXIS 1695), the en banc Fourth Circuit splits 7-5 over how to apply federal removal requirements when faced with “the defendants-served-on-different-days dilemma.” At issue in Barbour are 28 U.S.C. § 1446(b)'s 30-day deadline for removing a state-court case to federal court, and the “rule of unanimity,” which requires that all defendants join in the removal.
The en banc majority in Barbour adopts what it calls the “McKinney Intermediate Rule” (named for an earlier Fourth Circuit decision). From Judge Hamilton's opinion:
“[T]he McKinney Intermediate Rule requires a notice of removal to be filed within the first-served defendant's thirty-day window, but gives later-served defendants thirty days from the date they were served to join the notice of removal.” (emphasis added)
As the Barbour majority acknowledges, this approach conflicts with decisions from several other circuits that use the “Last-Served Defendant Rule,” which allows “each defendant, upon formal service of process, thirty days to file a notice of removal pursuant to § 1446(b).” E.g., Bailey v. Janssen Phramaceutica, Inc., 536 F.3d 1202, 1209 (11th Cir. 2008) (emphasis added). In Barbour, five Fourth Circuit judges (in an opinion authored by Judge Agee) would have followed the Last-Served Defendant Rule.
The Barbour majority recognizes that its rejection of the Last-Served Defendant Rule could deprive later-served defendants of any opportunity to remove a case when an earlier-served defendant misses its 30-day deadline. But it reasons that an earlier-served defendant who fails to remove within the 30-day deadline has, essentially, consented to remain in state court. That consent forecloses removal. As the majority explains: “If the first-served defendant decides not to remove, later-served defendants are not deprived of any rights under § 1446(b), because § 1446(b) does not prevent them from removing the case; rather, it is the rule of unanimity that does.”
So viewed, what later-served defendants are actually losing under the Fourth Circuit approach is “an opportunity to persuade earlier-served defendants to join a notice of removal.” To this point, the majority responds that “it is difficult to believe that Congress intended to protect this power of persuasion when it enacted § 1446(b).”
(Hat Tips: Tom Rowe & Shaun Shaughnessy)