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7 February 2011

Fourth and Ninth Circuits Deepen Split Over Deadline for Removal When Defendants in Multi-Defendant Cases Are Served at Different Times

Under 28 U.S.C. § 1446(b), defendants may remove a civil case from state to federal court if the case originally could have been filed in federal court and if the notice of removal is filed within 30 days after the receipt by the defendant of a copy of the initial pleading or the service of summons. However, courts disagree on how this 30-day deadline applies in multi-defendant cases when different defendants were served on different days.

Most circuits that have considered the issue follow the last-served-defendant rule, under which each defendant gets its own 30-day window to file a notice of removal, with earlier-served defendants permitted to join in any subsequent notice of removal. The Fifth Circuit, by contrast, has adopted a first-served-defendant rule, under which the 30-day clock starts to run for all defendants when the first defendant is served.

Issuing conflicting decisions within one week of each other, the Fourth and Ninth Circuits have deepened this circuit split. The Ninth Circuit adopted the last-served-defendant rule in Destfino v. Reiswig, __ F.3d __, 2011 WL 182241 (Jan. 21, 2011). Shortly thereafter, the en banc Fourth Circuit adopted a variant of the first-served defendant rule in Barbour v. International Union, __ F.3d __, 2011 WL 242131 (Jan. 27, 2011). Under the Fourth Circuit’s so-called “intermediate” approach, a later-served defendant cannot itself file a notice of removal more than 30 days after service on the first defendant; instead, it has 30 days to join any earlier-filed notice of removal. Barbour and Destfino are of interest to businesses that prefer to litigate in federal court when possible. The controversy over Section 1446(b)’s 30-day deadline in multiple-defendant cases affects removals based on federal question or ordinary diversity-jurisdiction principles. Whether the conflict over the 30-day deadline applies to class actions removed under the Class Action Fairness Act (CAFA) is less clear. Defendants will likely argue that, because CAFA allows any defendant to remove a class action to federal court—whereas other multi-defendant cases may be removed only if all defendants consent—the statute categorically precludes applying the first-served-defendant rule. But plaintiffs may argue that, because removal under CAFA is otherwise governed by Section 1446, class actions also must be removed within 30 days of service on the first defendant, at least within the Fourth and Fifth Circuits.

Given the deepening of the circuit split on this important question of civil procedure, it seems likely that litigants will seek US Supreme Court review on the issue, whether in Barbour, Destfino or another case.

For more information on any matter raised in this Legal Update, please contact Evan Tager at +1 202 263 3240, Archis Parasharami +1 202 263 3328, or Kevin Ranlett at +1 202 263 3217.

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