Archive | April, 2015

Maurice Fontenot and Susan Melton Fontenot v. Jarred Levar Stevens, Carl’s Rentals, and Republic Fire and Casualty Insurance Company

Maurice Fontenot and Susan Melton Fontenot v. Jarred Levar Stevens, Carl’s Rentals, and Republic Fire and Casualty Insurance Company
(April 2015)

Mike Sistrunk succeeded on a Motion to Set Aside a JNOV as absolutely null on behalf of The Republic Group and its insureds. In May, 2013, a jury in the 14th Judicial District Court in Lake Charles returned a verdict in favor of plaintiff for $500,500.00. Plaintiff quickly filed a Motion for JNOV, the trial judge having pre-judged the case, opining in pre-trial conference that the case was valued at close to the $1 million insurance limits based solely on plaintiff’s $275,000.00 in past medical expenses. The Motion for JNOV was granted, and the jury’s award was raised to $1,075,417.90, resulting in an excess judgment against the insureds. Once the defendants’ Motion for New Trial on the JNOV and Motion to Recuse were denied, the trial judge then denied defendants’ appeal, concluding that appeal delays had run. The judge then abruptly resigned from the bench, and a judge pro tempore was appointed. McCranie, Sistrunk was then retained by The Republic Group as appellate counsel for all defendants.

 A thorough review of the record revealed that although a judgment had been signed granting the JNOV, the trial court had failed to sign and issue notice of a judgment on the jury’s verdict. Defendants filed a Motion to Set Aside the JNOV as absolutely null, arguing that the court had no jurisdiction to consider the Motion for JNOV as it was premature until the court issued notice of judgment on the jury’s verdict.

 The trial judge, pro tempore, denied the Motion to Set Aside, concluding that the judgment granting the Motion for JNOV contained sufficient language to constitute a judgment on the jury’s verdict, thus satisfying the requirements of La. C.C.P. arts. 1911, 1913 and 1916.

 The Louisiana Third Circuit Court of Appeal granted and docketed defendants’ application for supervisory writ. After oral argument, the Third Circuit reversed and remanded, agreeing with defendants that the trial court lacked jurisdiction to consider the Motion for JNOV as no judgment had been signed on the jury’s verdict. As, “the judgment granting the JNOV is null on its face,” no appeal delays had begun, and the trial court was ordered to enter judgment in conformity with the jury’s verdict. The JNOV was set aside and the jury’s verdict reinstated. It is paramount that the jury’s verdict be reduced to a signed judgment to start the delays for all post-trial motions and appeals. Thus, delays for post-trial motions and appeals will begin once the trial court issues notice of judgment on the jury’s verdict. In April, 2015, the Louisiana Supreme Court unanimously denied plaintiff’s writ application.

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Shannon Howard-Eldridge to Speak on a Panel at the USLAW Network Client Conference in San Antonio, TX

Shannon Howard-EldridgeMcCranie Sistrunk Anzelmo Hardy McDaniel & Welch LLC Advisory Member Shannon Howard-Eldridge will speak on a panel at the USLAW Network Client Conference on Saturday, April 11th regarding “First Party Property Claims and Bad Faith Arising From Major Storm Events” The conference is being held April 9th-11th 2015 in San Antonio, TX. For more information: USLAW Network Client Conference

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Removal to Federal District Court Despite the Presence of a Forum Defendant

Devin Fadaol, Attorney

The term “race to the courthouse” may invoke notions of an attorney rushing to meet some court-imposed deadline or record a lien before another creditor. Rarely do we think of removal to federal district court in this context, but there is another type of “race to the courthouse” that can take place when an out-of-state defendant is served before a local in-state defendant is served.

Under 28 USC 1441(b):

Any civil action of which the district courts have original jurisdiction founded on a claim or right arising under the Constitution, treaties or laws of the United States shall be removable without regard to the citizenship or residence of the parties. Any other such action shall be removable only if none of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought. (Emphasis added).

The so-called forum defendant rule prevents removal to federal district court based on diversity jurisdiction when there is a local in-state defendant in the lawsuit.   The majority of cases involve disputes over whether the local in-state defendant is improperly (some prefer “fraudulently”) joined. Defendants will often argue gamesmanship on the part of the plaintiff in joining a local defendant just to defeat diversity jurisdiction. However, a literal interpretation of the phrase “joined and served” allows for removal to federal court, despite the presence of a forum defendant, if the forum defendant has not yet been served.

smiley running businessman and big white clock in dark room

For example, assume that Acme, Inc. is sued in an unfavorable state court venue along with a local defendant named John Doe.   The plaintiff is not a local or forum plaintiff. Also assume that there is no question regarding the amount in controversy exceeding $75,000.00, or that Acme, Inc. is completely diverse from the plaintiff. Acme, Inc. believes that the plaintiff named John Doe as a local forum defendant solely to prevent removal based on diversity jurisdiction. Acme, Inc. prefers to litigate in federal district court and discovers that plaintiff served Acme, Inc. but has not yet perfected service upon John Doe.   Acme, Inc. immediately files a Notice of Removal on the basis that John Doe has not been served in the case. Under a textual interpretation of 28 USC 1441, removal is prohibited only when the local in-state defendant has been joined “and served.” Since the propriety of removal is evaluated at the time the removal petition is filed, Acme, Inc. is permitted to remove the case to federal district court since the forum defendant, John Doe, has not been served. Even if John Doe is served one day after removal, that fact will not divest the court of jurisdiction, nor will John Doe’s consent for removal be needed. Whether Acme, Inc. survives the forthcoming motion to remand depends upon the jurisdiction.

There is a split amongst the federal district courts regarding the interpretation of the language “and served.” Some courts strictly construe the removal statutes in favor of remand and rely on congressional intent rather than a textual interpretation of the statute. Generally, these cases stand for the position that removability cannot be based on the timing or sequence of service of process: Oxendine v. Merck and Co., Inc., 236 F.Supp.2d 517 (D.Md.2002); Sullivan v. Novartis Pharmaceuticals Corp. 575 F.Supp.2d 640 (D.N.J. 2008); and Vivas v. Boeing Co., 486 F.Supp.2d 726 (N.D. Ill. 2007).

Other jurisdictions allow a defendant to remove a case with complete diversity regardless of the presence of an un-served forum defendant.   Removal is proper even if the forum defendant is served the day after Notice of Removal is filed:  McCall v. Scott, 239 F.3d 808 (6th Cir. 2001) (a forum defendant that has not been served at the time of removal cannot defeat removal); Harvey v. Shelter, 2013 WL 1768658 (EDLA, 2013); Evans v. Rare Coin Wholesalers, Inc., 2010 WL 595653 (ED Texas, 2010); Brown v. Kyle, No. 3:01CV660BN (S.D.Miss. 2002); and, In re Bridgestone/Firestone, Inc., 184 F.Supp.2d 826, (S.D.Ind.2002)

There are not many cases available on the issue because the denial or grant of a motion to remand is not appealable. The best advice is to research your jurisdiction thoroughly to determine which side of the fence the courts fall on with this issue.

Devin Fadaol
April 6, 2015

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