The Eleventh Circuit Adopts the “Later-Served Defendant” Rule in Removal Cases
Removal affords a defendant who has been sued in state court the right to substitute the state forum for a federal forum, when the case could have been originally commenced in the federal forum. Generally, the governing law requires the defendant or defendants to file a notice of removal within 30 days of being formally served with the initial pleadings. A split of authority has arisen in multi-defendant cases regarding when the 30-day time clock starts ticking. Does it start when the first defendant is served or when the last defendant is served?
In a case of first impression, the Eleventh Circuit has adopted the “later-served defendant” rule in removal cases, although the court noted that it is more accurately described as the “each defendant” rule.1 In the landmark case of Bailey v. Janssen Pharmaceutica Inc., 2008 WL 2894742 (11th Cir. July 29, 2008), applying 28 U.S.C. § 1446, the Eleventh Circuit held that in multi-defendant cases, an earlier-served defendant in state court cannot waive the later-served defendant’s right to remove the case to federal court, either by not removing at all or by doing so defectively. But the consent of all then-served2 defendants (i.e., those served at the time of the removal notice) is still required.
The Eleventh Circuit, in adopting this rule, sided with the Eighth and Sixth Circuit’s more recent decisions on the same issue in Marano Enters. of Kan. v. Z-Teca Rests., L.P., 254 F.3d 753, 755 (8th Cir. 2001), and Brierly v. Alusuisse Flexible Packaging, Inc., 184 F.3d 527, 533 (6th Cir. 1999), but rejected the Fifth Circuit’s “first-served defendant” rule,3 and the Fourth Circuit’s “middle-ground approach.”4 These are the only Circuit Courts to have ruled on the issue.
Reasons Supporting Adoption of the Last-Served Defendant Rule
The bases for the Eleventh Circuit’s holding were manifold. After noting that 28 U.S.C. § 1446(b) does not appear to address itself to multi-defendant litigation, the Court rejected the “first-served defendant” rule for the following reasons.
First, the Court observed that the trend in recent case law favors the “later-served defendant” rule, citing the recent Eighth and Sixth Circuit decisions, and a slew of recent district court decisions, many in the Eleventh Circuit. Id. at *3. Indeed, the Court noted that the Circuit opinions that have adopted the “first-served defendant” rule from the Fifth and Fourth Circuits are getting a little long in the tooth, whereas the cases adopting the “later-served defendant” rule at both the Circuit and District levels are of recent origin. Id.
Second, the Eleventh Circuit also adopted the “later-served defendant” rule because it was convinced that both common sense and equity favor it. The Court agreed with the Eighth Circuit in Marano, which reasoned that under the “first-served defendant” rule, later-served defendants would not be afforded the opportunity to attempt to persuade their co-defendants to join in a notice of removal if more than 30 days had passed since the first defendant was served. Id. at *3-4.
Third, the Eleventh Circuit also found persuasive the Sixth Circuit’s recognition in Brierly that adoption of the “first-served defendant” rule requires reading the words “first-served defendant” into the statute, whereas the statute, as written, could reasonably be read to permit each defendant a right to remove within 30 days of service on the individual defendant. Id. at *4.
Fourth, the Eleventh Circuit was not persuaded by the rationale held by the courts that support the “first-served defendant” rule. Indeed, the courts that have endorsed it have generally done so for two reasons: (1) it is perceived as more consistent with the unanimity rule for notices of removal; and (2) courts are to narrowly construe the removal statute and federal jurisdiction. Id. at *4. In dismissing these reasons, the Eleventh Circuit noted that adopting the “later-served defendant” rule is not inconsistent with the rule of unanimity because the earlier-served defendants may still choose to join or not join in a later-served defendant’s notice of removal. So the rule that a Notice of Removal must have the unanimous consent of all defendants is still preserved.
But “[t]he unanimity rule alone does not command that a first-served defendant’s failure to seek removal necessarily waives an unserved defendant’s right to seek removal; it only requires that the later-served defendant receive the consent of all then-served defendants at the time he filed his notice of removal.” Id at *4 (emphasis added). The Eleventh Circuit’s use of the emphasized phrase signifies that only those defendants who have been served at the time that the later-served defendant files his notice of removal must officially consent. Defendants who are served after the removal notice is filed need not consent, and the unanimity rule is still preserved because the latter defendant may still either acquiesce to the removal or can instead exercise the right to choose the state forum by making a motion to remand.5
Finally, as for strict construction of the removal statute, the Eleventh Circuit, agreeing with the Eighth Circuit’s Marano decision, noted that the U.S. Supreme Court’s decision in Murphy Brothers, Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344 (1999), supports the “last-served defendant” rule and a relaxation of the historically strict construction allotted to the removal statute. In Murphy Brothers, the Supreme Court held that only service of a summons or other authority-asserting measure started the 30-day clock on a notice of removal. In other words, the plaintiff bar’s then-practice of serving a “courtesy copy” of the complaint on other defendants (but not officially serving them with process) did not start the clock on that defendant’s right to removal.
The Eleventh Circuit found the “later-served defendant” rule more consistent with the Supreme Court’s holding in Murphy Brothers because the rule honored the rights of unserved defendants to remove cases from state to federal court. The Court gave three reasons supporting this position. First, as mentioned above, the Eleventh Circuit felt that Murphy Brothers signaled a slight departure from the historically strict construction of the removal statute. Id. at *5. Second, the adoption of the “first-served defendant” rule would contravene the Supreme Court’s holding in Murphy Brothers because it would obligate a defendant to seek removal prior to his receipt of formal process bringing him under the court’s jurisdiction. Id. at *5. And third, it would be inequitable to permit a first-served defendant to, in effect, bind later-served defendants to a state court forum when these defendants could have sought removal had they been more promptly served by the plaintiffs.
Interestingly, the Eleventh Circuit adopted the “later-served defendant” rule in a case in which the equities seemed to weigh in favor of applying the “first-served defendant” rule. In Bailey, every one of the four defendants were represented by the same law firm. Id. at *1. And the last-served defendant was the parent company of two of the other earlier-served defendants. It would seem that the waiver of a later-served defendant’s rights by an earlier-served defendant was not really an issue because of these two facts. The Eleventh Circuit, of course, mentioned that the parent company was likely aware of the lawsuit. Id. at *3 n.7. But the Eleventh Circuit also noted that the Supreme Court has rejected the notion that simple notice or constructive service could start the 30-day clock for removal. Id.
The bottom line is that now, in the Eleventh Circuit, a later-served defendant has its own 30-day window after service in which to remove the case, regardless of what the earlier-served defendants have done in the way of removal. But the later-served defendant still has to obtain the written consent of all defendants served at the time of the filing of the notice of removal, and may have to successfully oppose a motion to remand by those defendants not yet served at the time of the filing of the notice of removal.
1 Bailey v. Janssen Pharmaceutica Inc., 2008 WL 2894742, *2 n.4 (11th Cir. July 29, 2008). The appendix to the case is the court’s opinion on the
motion to dismiss issues. See id. at *6 n.11.
2 The Eleventh Circuit’s use of the phrase “then-served defendants” indicates that the rule on post-removal-served defendants for “consent” purposes in the Eleventh Circuit is that only those defendants that have been served at the time of the notice of removal need to officially consent in writing to the removal. Id. at *4. On this point, the Eleventh Circuit agrees with the Fifth Circuit. See Getty Oil Corp. v. Ins. Co. of N. Am., 841 F.2d 1254, 1263 (5th Cir. 1988). See also, Lewis v. Rego Co., 757 F.2d 66, 68-69 (3d Cir.1985) (noting exception to the rule requiring that all defendants join in a removal petition where a defendant has not been served at the time the removing defendants file their petition); GMFS, L.L.C. v. Bounds, 275 F.Supp.2d 1350, 1354 (S.D.Ala. 2003); Hooper v. Albany Intern. Corp., 149 F.Supp.2d 1315, 1319 (M.D.Ala. 2001); Katz v. Costa Armatori, S.p.A., 718 F.Supp. 1508, 1509 n.1 (S.D.Fla.1989). The unanimity rule is still preserved despite this, because defendants served after the notice of removal has been filed may still either acquiesce to the removal or they can instead exercise their right to choose the state forum by making a motion to remand. See 28 U.S.C. § 1448 (“This section shall not deprive any defendant upon whom process is served after removal of his right to move to remand the case.”).
3 Id. at *3 (citing Brown v. Demco, Inc., 792 F.2d 478, 481-82 (5th Cir.1986), and Getty Oil Corp. v. Ins. Co. of N. Am., 841 F.2d 1254, 1262-63 (5th Cir.1988)).
4 In dicta, the Fourth Circuit suggests that, although each defendant has 30 days in which to remove the case after it is served, if the first defendant to remove does so untimely or defectively, a later-served defendant may not remove, even if it attempts to do so within 30 days of being served. Id. at *3 & n.6 (citing McKinney v. Bd. of Trustees of Md. Comm. Coll., 955 F.2d 924, 926 & n. 3 (4th Cir.1992)). The Eleventh Circuit therefore calls the Fourth Circuit’s rule a “middle-ground approach.” By contrast, the Eleventh Circuit now holds that, regardless of whether an earlier-served defendant removed the case at all or did so defectively, a later-served defendant can still remove the case (although the consent of all then-served defendants is still required). Id.
5 See supra notes 2 and 4 herein.