eNotes: Liability – December 2024 – Virginia

SIGNIFICANT CASE SUMMARIES

Virginia Case Summary

Hanson v. Depot LBX, Inc.
United States District Court for the Western District of Virginia
No. 6:24-cv-00026

Decided: November 8, 2024

A defendant who removes a case from state to federal court before being served does not violate the federal “Forum Defendant Rule.”

Background

Plaintiff filed a personal injury lawsuit against Defendant LBX, Inc. in the Lynchburg Circuit Court. Prior to filing, Plaintiff’s counsel informed the Defendant of their intention to file and sent the Defendant a courtesy copy of the Complaint. Two days later, before Defendant was serve, Defendant filed a notice of removal pursuant to 28 U.S.C. § 1441(b). Plaintiff subsequently filed a Motion to remand the case, arguing that the “Forum Defendant Rule” should prohibit Defendant’s removal because Plaintiff is a Tennessee citizen, and Defendant is a Virginia citizen. The Forum Defendant Rule dictates that, when removal would be based on diversity jurisdiction, 28 U.S.C. § 1441(b)(2) provides that such an action “may not be removed if any of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.” Pre-service removal is referred to as “snap removal.”

Plaintiff contended that removal is improper because Congress would not have intended for an in-state defendant to remove a diversity case prior to service as removal would be at odds with the rule’s purpose: to protect out-of-state defendants from prejudice in state courts. Plaintiff also argued that it would discourage pre-suit communication between parties. Defendant argued that the plain language of 28 U.S.C. § 1441(b)(2) disallows removal when the defendant is ”properly joined and served.” For this Court, this was a case of first impression, and there is no binding authority in the Fourth Circuit. The District Court for the Eastern District of Virginia approved of pre-service removal in one instance and disapproved of it in another, creating conflicting district court case law in Virginia.

Holding

The Court examined district court cases in the Fourth Circuit, as well as persuasive authority from other circuits. In the end, however, the Court relied on the Fourth Circuit’s approach to statutory interpretation. The Court concluded that the plain, unambiguous language of 28 U.S.C. § 1441(b)(2) allows for snap removal. While Plaintiff argued that the plain language should be discarded in favor of Congressional intent, the Court concluded that there is no clearly expressed congressional intent of that phrase of the Forum Defendant Rule. Ultimately the Court found that allowing the Defendant to remove the case to federal court was “neither absurd nor in conflict with clearly expressed congressional intent.”

Questions about this case can be directed to Nicolette DeFrank at (571) 470-0395 or ndefrank@tthlaw.com, or to Pete Schurig (who handled this matter on behalf of the Defendant) at (804) 533-5292 or pschurig@tthlaw.com.