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Brown & Root Industrial Services, LLC v. Nelson

United States District Court, M.D. Louisiana

November 30, 2017




         Before the Court is the United States Magistrate Judge's Report and Recommendation (Doc. 23), issued pursuant to 28 U.S.C. § 636(b)(1), addressing Plaintiff Brown & Root Industrial Services, LLC's Motion to Remand (Doc. 6). The Magistrate Judge recommended that the motion be denied. (Doc. 23 at p. 18). Under 28 U.S.C. § 636(b)(1)(C) and Federal Rule of Civil Procedure 72, the parties had fourteen days from the date they received the Report and Recommendation to file written objections to the proposed findings of fact, conclusions of law, and recommendations therein. Plaintiff timely objected to the Report and Recommendation. (Doc. 24). Although the Court follows a slightly different path than the Magistrate Judge, it reaches the same destination, and Plaintiffs Motion to Remand (Doc. 6) is DENIED.

         I. BACKGROUND

         On March 27, 2017, Plaintiff Brown & Root sued Defendant Gregory Nelson for $3, 264, 965.00 in the 19th Judicial District Court, Parish of East Baton Rouge, Louisiana stemming from a construction contract. (Doc. 1-2). Plaintiffs Chief Operating Officer ("COO") alleges that Defendant told him that he had several homes, including ones in New York City, Miami and New Orleans. (Doc. 6-2 at ¶ 4). Defendant also allegedly told the COO that he grew up in New York and "always considered it to be his home." Id. at ¶ 5. After Plaintiff filed suit, the COO allegedly "did some research and found that" Defendant and his wife owned an apartment located at 38 W 26th Street, New York, NY. Id. at ¶ 7.

         Counsel for the Plaintiff attempted to mail a copy of the petition and citation[1]to Defendant at his New York apartment by certified mail. (Doc. 6-1 at p. 1). A United States Postal Service receipt reflects that it was delivered on March 31, 2017, but the signature on the receipt is illegible. Id. at p. 4, 6. Counsel for the Plaintiff also sent a copy of the petition and citation to the same address on March 28, 2017, by FedEx. Id. at p. 2. It was delivered on March 31, 2017 and signed for by an unknown individual named "T. Trevor." Id. at p. 10.

         On May 10, 2017, after Defendant had failed to respond to the suit, the state court entered a default judgment in the amount of $3, 264, 965.00. (Doc. 1-2 at p. 20). On June 2, 2017, Defendant visited his New York apartment for the first time in several months. (Doc. 1-3 at p. 3). When he arrived, he allegedly found the FedEx envelope with a copy of the petition and citation, and he learned that he had been sued by Brown & Root. Id. The next day, he claims that he checked his mailbox and learned that a default judgment had been entered against him. Id.[2]

         Defendant claims that he has lived in Miami Beach, Florida since 2012. (Doc. 1-3 at ¶ 2). His children attend school there, he is registered to vote there, and he has a Florida driver's license. Id. at ¶ 3-5. Defendant alleges that although he owns the New York apartment where Plaintiff sent the petition and citation, he only spends three to six weeks there each year for holidays, business trips, and to visit his mother who also lives in New York. Id. at ¶ 11.

         On June 9, 2017, a week after learning of the lawsuit, Nelson removed the case to this Court, invoking the Court's diversity jurisdiction under 28 U.S.C. § 1332 and related-to bankruptcy jurisdiction under 28 U.S.C. § 1334(b).[3] (Doc. 1). Plaintiff then filed the pending Motion to Remand, arguing that Defendant's Notice of Removal is untimely because Defendant filed it more than thirty days after it served Defendant with the petition and citation. (Doc. 6-3 at p. 3). Plaintiff also filed a Motion for Relief from Judgment under Federal Rule of Civil Procedure 60(b)(4). (Doc. 4). Plaintiff argues that the default judgment entered against him should be vacated because Plaintiff failed to properly serve him with the state court petition and, as a result, the Court lacks personal jurisdiction. (Doc. 4-1 at p. 1). The Court also permitted Defendant to delay filing its opposition to the Motion for Relief from Judgment until twenty-one days after the Court's ruling on the pending Motion to Remand. (Doc. 10).


         A party may remove an action from state court to federal court if the action is one over which the federal court possesses subject matter jurisdiction. 28 U.S.C. § 1441(a). Defendant, the removing party, bears the burden of establishing that federal jurisdiction exists and that removal was proper. De Aguilar v. Boeing Co., 47 F.3d 1404, 1408 (5th Cir. 1995). In considering a challenge to subject matter jurisdiction, the district court is "free to weigh the evidence and resolve factual disputes in order to satisfy itself that it has the power to hear the case." Smith v. Reg'l Transit Auth., 756 F.3d 340, 347 (5th Cir. 2014) (internal citation omitted).


         Plaintiff argues that this action should be remanded because mailing the petition and citation to Defendant's New York apartment triggered the 30-day period for Defendant to file a notice of removal, and that time had expired when Defendant filed his notice of removal. (Doc. 6-3 at p. 3). Defendant claims that he was never properly served with process under Louisiana's long-arm statute, and therefore his notice of removal was timely. (Doc. 15 at p. 4).

         28 U.S.C. § 1446(b)(1), which governs the timeliness of a notice of removal, provides:

The notice of removal of a civil action or proceeding shall be filed within 30 days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief ...

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