PAPADOPOULOUS v. MYLONAS et al
Filing
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MEMORANDUM AND/OR OPINION RE: MOTION FOR RECONSIDERATION.. SIGNED BY HONORABLE JOEL H. SLOMSKY ON 10/31/2011. (Attachments: # 1 Exhibit A) 10/31/2011 ENTERED AND COPIES E-MAILED.(tomg, )
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IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
ANASTASIOS PAPADOPOULOUS,
Plaintiff,
v.
PETER G. MYLONAS, et al.,
Defendants.
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CIVIL ACTION
NO. 11-4163
OPINION
Slomsky, J.
I.
October 31, 2011
INTRODUCTION
By Order of October 13, 2011, counsel for Plaintiff and Defendants were directed to file
memoranda of law on the issue of whether this Court had jurisdiction to decide the Motion for
Reconsideration. (Doc. No. 23.) Before the Court are the memoranda of law from counsel for
all parties. (Doc. Nos. 24 & 25.) For reasons that follow, the Court will vacate the October 11,
2011 Order granting Defendants’ Motion to Reconsider (Doc. No. 22), which will allow this case
to remain in state court where it has been since a certified copy of the September 6, 2011 Order
granting remand was mailed to state court by the Clerk of Court (Doc. No. 18).
II.
BACKGROUND1
This case involves a claim of legal malpractice. On May 19, 2011, Plaintiff Anastasios
Papadopoulous filed his original Complaint in the Court of Common Pleas of Philadelphia
County against Defendants Peter G. Mylonas, Esquire, and Peter G. Mylonas, P.C. On June 27,
1
The factual information in the “Background” section of this Opinion, save for several
updates, is also contained in the Opinion dated October 11, 2011 granting the Motion for
Reconsideration.
1
2011, Defendants removed the case to this Court based on diversity of citizenship jurisdiction
pursuant to 28 U.S.C. § 1332. (Doc. No. 1.) Thereafter, Plaintiff filed an untimely Motion to
Remand and requested that the Court not deny the Motion for being filed untimely but to
consider it on the merits. (Doc. No. 11.) Plaintiff also filed a Second Motion to Remand
requesting that the Court rule on the outstanding Motion for Remand prior to determining the
citizenship of Plaintiff.2 (Doc. No. 13.)
Plaintiff sought remand based on the “forum defendant rule.” The forum defendant rule
is codified in 28 U.S.C. § 1441(b), which provides that where the basis for removal is diversity
of citizenship jurisdiction, a defendant may not remove the case from a state court to a federal
court where the defendant is a citizen. A motion to remand must be filed within 30 days of
removal. 28 U.S.C. § 1447(c). Plaintiff did not file the motion within the 30-day time period.
As noted, despite the Motion to Remand being untimely filed, Plaintiff asked the Court to extend
the 30-day requirement because of “excusable neglect” under Rule 6(b)(1)(B) of the Federal
Rules of Civil Procedure. In the Second Motion to Remand, Plaintiff asked the Court again to
remand the case to state court, and to delay ruling on the citizenship of Plaintiff until deciding
whether the “forum defendant rule” precludes removal here.
2
On August 2, 2011, the Court held a hearing to determine the citizenship of Plaintiff.
The Amended Complaint alleges only that Plaintiff “resides” in Pennsylvania, without indicating
whether Plaintiff is a United States citizen. Defendants challenged this residency by attaching as
exhibits to the Notice of Removal transcripts of prior court proceedings in which Plaintiff was a
party. (See Doc. No. 1, Exs. 3-5.) These exhibits show that Plaintiff is a citizen of Greece. At
the hearing to determine the citizenship of Plaintiff, counsel for Plaintiff failed to present any
evidence to refute Defendants’ contention that Plaintiff is a citizen of Greece. Based on this
evidence and for reasons stated in the September 6, 2011 Opinion, this Court held that Plaintiff is
a citizen of Greece. Moreover, at this hearing, Plaintiff’s counsel raised for the first time the
issue that Defendants, as residents of Pennsylvania, improperly removed this case to this Court
under 28 U.S.C. 1441(b).
2
Plaintiff Anastasios Papadopolous is a Greek citizen residing in King of Prussia,
Pennsylvania. (Am. Compl., Doc. No. 10 ¶ 2.) Plaintiff was an officer, director, and stockholder
of Corinthian Marble and Tile, Inc. (“Corinthian”). (Id. ¶¶ 4-6.) Plaintiff, Corinthian, and the
remaining Corinthian shareholders retained Defendant Peter Mylonas to draft a Stockholders’
Agreement. (Doc. No. 3, Ex. 2) (“the Agreement”); (Doc. No. 10, ¶¶ 11-12, 15-16.)
In the Amended Complaint, Plaintiff alleges that at some point after the Agreement was
executed, Defendant Mylonas transferred Corinthian stock to two other shareholders without his
consent. Plaintiff claims that this stock transfer violated a restrictive covenant in the Agreement,
which provides, in pertinent part, as follows:
No stockholder shall sell, assign, mortgage, pledge or otherwise transfer or
encumber the shares of the stock of the COMPANY now owned or hereafter
acquired by him without the prior written UNANIMOUS consent of all the
other STOCKHOLDERS.
(Id. ¶ 16.) As a result of the stock transfer, Plaintiff alleges he “was constructively and explicitly
removed from his role as director and secretary of the corporation and his interest and control of
the corporation was extinguished.” (Id. ¶ 31.)
On March 21, 2011, Plaintiff filed a Writ of Summons in the Philadelphia County Court
of Common Pleas. On May 19, 2011, Plaintiff filed his initial Complaint in state court, alleging
one count of professional negligence against Defendant Mylonas and his law firm Peter G.
Mylonas, P.C. On June 27, 2011, Defendants filed the Notice of Removal to this Court pursuant
to 28 U.S.C. § 1441. (Doc. No. 1.) Defendants asserted diversity of citizenship jurisdiction
pursuant to 28 U.S.C. § 1332 as the basis for the Court’s subject matter jurisdiction. (Id. ¶ 5.)
On July 1, 2011, Defendants filed a Motion to Dismiss, arguing that the Complaint failed
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to state a claim upon which relief can be granted. (Doc. No. 3.) On July 22, 2011, Plaintiff filed
an Amended Complaint (Doc. No. 4)3 and a Response in Opposition to the Motion to Dismiss
(Doc. No. 5). On July 25, 2011, the Motion to Dismiss was denied as moot in light of the filing
of the Amended Complaint. (Doc. No. 6.) That same day, the Court granted Plaintiff’s Request
for Leave to File of Record the revised Amended Complaint and additional exhibits (Doc. No. 7),
which were filed on August 1, 2011. (Doc. No. 10.)
Because the citizenship of Plaintiff was not evident in the Amended Complaint, the Court
ordered the parties to appear for a hearing to determine the citizenship of Plaintiff and the subject
matter jurisdiction of the Court. (Doc. No. 8.) On August 2, 2011, the Court held a hearing,
where Defendants presented evidence that Plaintiff is a citizen of Greece. Plaintiff failed to
present any evidence to the contrary. At the hearing, Plaintiff also made the oral Motion to
Remand, arguing for the first time that the “forum defendant rule” of 28 U.S.C. § 1441(b)
prohibits removal to this Court sitting in the Eastern District of Pennsylvania because Defendants
are citizens of the forum state, which is Pennsylvania, the state in which Plaintiff filed the
Complaint. Under these circumstances, Defendants would be barred from removing the case
based on diversity of citizenship jurisdiction. On August 3, 2011, Plaintiff filed a written Motion
to Remand based on the “forum defendant rule.” (Doc. No. 11.) One week later, Plaintiff filed a
Second Motion to Remand requesting that the Court decide the outstanding Motion to Remand
prior to determining the citizenship of Plaintiff. (Doc. No. 13.)
3
Plaintiff initially filed an Amended Complaint on July 22, 2011. (Doc. No. 4.)
Plaintiff then requested leave to file a revised Amended Complaint with exhibits, which the
Court granted. On August 1, 2011, Plaintiff filed the revised Amended Complaint with exhibits.
(Doc. No. 10.) The Court is referring to the revised Amended Complaint in this Opinion.
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On August 17, 2011, Defendants filed Responses in Opposition to both Motions to
Remand. (Doc. Nos. 14 & 15.) Defendants asserted that the “forum defendant rule” is
procedural in nature and does not concern the subject matter jurisdiction of the Court. Therefore,
according to Defendants, a Motion to Remand based on this rule must be made by motion no
later than 30 days after the filing of the Notice of Removal. In this case, the date of removal was
June 27, 2011. Plaintiff first made the Motion to Remand at the hearing on August 2, 2011,
more than 30 days after the filing of the Notice of Removal. On August 3, 2011, Plaintiff filed
the written Motion to Remand. Thus, as Defendants have argued, the Motion to Remand was
untimely filed. With respect to Plaintiff’s request that the Court decide the Motion to Remand
prior to determining the citizenship of Plaintiff, Defendants asserted that because the citizenship
of Plaintiff is critical to the Court’s diversity of citizenship jurisdiction, the citizenship of
Plaintiff must be determined initially.
In the September 6, 2011 Opinion, this Court agreed with Defendants that it must
determine the citizenship of Plaintiff to establish subject matter jurisdiction. Thus, the Court in
effect denied Plaintiff’s request that the Court consider the Motion to Remand prior to
determining the citizenship of Plaintiff. Further, the Court agreed with Defendants that the
“forum defendant rule” is procedural in nature and does not concern the subject matter
jurisdiction of the Court. The Court found that a Motion to Remand was not filed within 30 days
after the filing of the Notice of Removal and was therefore untimely.
Although the Motion was untimely, the Court determined that Plaintiff made a showing
of “excusable neglect” pursuant to Rule 6(b)(1)(B) of the Federal Rules of Civil Procedure,
which provides:
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(1) When an act may or must be done within a specified time, the court may, for good
cause, extend the time:
***
(B) on motion made after the time has expired if the party failed to act because of
excusable neglect.
Specifically, Plaintiff’s counsel represented that he missed the 30-day filing deadline because his
offices were “in a state of flux” during an office move. (Doc. No. 17.) Because of this showing
by Plaintiff’s counsel, the Court found “excusable neglect” and granted Plaintiff’s Motion to
Remand. (Doc. Nos. 17 & 18.)
Thereafter, Defendants filed the Motion for Reconsideration. (Doc. No. 19.) Defendants
made two arguments in support of the Motion. First, they argued that no legal authority allows
the extension of the 30-day filing deadline set forth in 28 U.S.C. § 1447(c). Second, they
contended that “Plaintiff’s representation to this Court that his counsel was unable to file a
Motion for Remand due to an offices [sic] move is . . . contradicted by counsel’s filings in other
lawsuits.” (Doc. No. 19 at 5.) In a Response made on September 26, 2011 to the latter
contention, Plaintiff’s counsel asserted that his offices were “still in a state of flux.” (Doc. No.
20 at 3.) On October 11, 2011, the Court granted Defendants’ Motion for Reconsideration.
(Doc. Nos. 21 & 22.)
However, on October 13, 2011, upon becoming aware that a certified copy of the Court’s
September 6, 2011 Order granting remand was sent by the Clerk of Court to the Court of
Common Pleas of Philadelphia County, the Court directed counsel for all parties to submit
memoranda of law regarding whether this Court had jurisdiction to decide the motion for
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reconsideration once the certified copy of the September 6, 2011 Order was sent to the clerk of
state court. (Doc. No. 23.) Defendants maintain that this Court possessed legal authority to
reconsider the Order remanding the case to state court and that the reconsideration Order
reversing the remand Order should be allowed to stand. (Doc. No. 24 at 2.) Plaintiff, on the
other hand, argues that the Court did not have jurisdiction to decide the Motion for
Reconsideration once a certified copy of the Order remanding the case had been sent by the Clerk
of Court to the Court of Common Pleas of Philadelphia County. (Doc. No. 25 at 2.) Considering
the arguments of both parties, as well as clear Third Circuit precedent, the Court is persuaded
that it had no jurisdiction to grant Defendants’ Motion for Reconsideration and therefore the
Order of October 11, 2011 will be vacated.
III.
DISCUSSION
“The mailing of a remand order divests the district court of jurisdiction when the remand
is authorized by [28 U.S.C. §] 1447(c).” Hudson United Bank v. LiTenda Mortgage Corp., 142
F.3d 151, 159 (3d Cir. 1998). As the Third Circuit noted in Trans Penn Wax Corp. v.
McCandless:
The general rule is that a district court loses jurisdiction over a case once it has
completed the remand by sending a certified copy of the remand order to the state
court. See Hunt v. Acromed Corp, 961 F.2d 1079, 1081 (3d Cir. 1992). This view
is premised on both the language of § 1447(c) and (d) and the need to establish a
determinable jurisdictional event after which the state court can exercise control over
the case without fear of further federal interference. The district court is also barred
from reconsidering its decision if the remand was under § 1447(c) and the case
thereby falls under the bar of § 1447(d). See, e.g., New Orleans Public Serv., Inc. v.
Majoue, 802 F.2d 166, 167 (5th Cir. 1986) (per curiam); FDIC v. Santiago Plaza, 598
F.2d 634, 636 (1st Cir. 1979) (per curiam). But the physical mailing of the certified
copy is the key jurisdictional event to divest the district court of jurisdiction, because
a remand order is not self-executing. Hunt, 961 F.2d at 1081 (citing Bucy v. Nevada
Constr. Co., 125 F.2d 213 (9th Cir. 1942).
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50 F.3d 217, 225 (3d Cir. 1995). Here, the Court remanded this case to the Court of Common Pleas
of Philadelphia County pursuant to 28 U.S.C. § 1447(c). This section provides in pertinent part:
A motion to remand the case on the basis of any defect other than lack of subject
matter jurisdiction must be made within 30 days after the filing of the notice of
removal under section 1446(a). . . . A certified copy of the order of remand shall be
mailed by the clerk to the clerk of the State court. The State court may thereupon
proceed with such case.
Although the Motion to Remand in this case was untimely because it was first made
orally at a hearing on August 2, 2011, which was about a week after the 30-day period had
expired, the Court in its initial Opinion dated September 6, 2011 extended that period pursuant to
Rule 6(b)(1)(B) of the Federal Rules of Civil Procedure for “excusable neglect.” This extension
did not change the fact that the Court was still remanding pursuant to § 1447(c). On September
7, 2011, the Clerk of this Court sent a certified copy of the remand Order to state court.
Accordingly, this Court did not have jurisdiction to reconsider the Order remanding the case to
state court once a certified copy of the Order was mailed, and the reconsideration Order must be
vacated.
This decision may seem discomforting to Defendants because they desire to litigate their
case in federal court and especially because the Court reconsidered and found no “excusable
neglect ” in the Opinion granting reconsideration. Defendants, however, will still have their day
in court because they may defend this case in state court, as they have been doing since the
certified copy of the September 6, 2011 Order granting remand was sent from the Clerk of this
Court to the Court of Common Pleas of Philadelphia County. Attached to this Opinion as
Exhibit “A” is a copy of the state court docket in this case. It shows that after September 9,
2011, when the Remand Order was received in state court, considerable case management was
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undertaken. Moreover, the claim of legal malpractice asserted in this case is a state cause of
action, which the state court may appropriately resolve.
As implicitly noted above in Trans Penn Wax Corp., no case should be bounced between
state and federal court. 50 F.3d 217, 225. A determinable jurisdictional event is necessary so
that “the state court can exercise control over the case without fear of further federal
interference.” Id. As noted, that event is the mailing of the certified copy of the remand Order to
the clerk of the State court.
IV.
CONCLUSION
For the above reasons, the Court will vacate its Order granting the Motion for
Reconsideration.
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