Thursday, November 3, 2011

Third Circuit Adopts "Later Served" Removal Rule

Under certain circumstances, a defendant who gets sued in state court can "remove" the case to federal court. Under federal law, defendants have 30 days from the date the plaintiff serves "the defendant" to file the notice of removal.  28 U.S.C. §§ 1441, 1446. But what happens when there are multiple defendants? When does the 30-day timer start?

In Delalla v. Hanover Ins., 100 U.S.P.Q.2d 1392 (3d Cir. Oct. 12, 2011), the Third Circuit answered that very question. Per the Court's opinion:
We conclude that the later-served rule represents a better reading of the language § 1446(b) and results in more equitable treatment to later-served defendants. We join the Sixth, Eighth, Ninth, and Eleventh Circuits in adopting the later-served rule.
And what's the later-served rule? "[E]ach defendant has a thirty day period to file a notice of removal that ends thirty days after that defendant is served" (emphasis added).

The alternative, is the "first-served" rule, adopted by the Fourth and Fifth Circuits: "[T]he thirty day period ends thirty days after the first defendant is served" (emphasis added). Yup folks, it's a good 'ol fashioned circuit split! I suspect the Supreme Court will take a look at this issue one of these days. For now, parties just need to know their circuit.

Image: Third Circuit seal used in commentary - Not Official Use.

Posted by Philip Miles, an attorney with McQuaide Blasko in State College, Pennsylvania in the firm's civil litigation and labor and employment law practice groups.