The federal removal statutes preclude a case from being removed if a local defendant has been “properly joined and served.” 28 USC § 1441(b)(2). When, however, a defendant removes a case to federal court before a local defendant has been served, it is typically referred to as a snap removal. Last month the Fifth Circuit Court of Appeals found that snap removals are a permissible litigation tactic.
In Texas Brine Co. LLC v. AAA, Inc., 955 F.3d 482 (5th Cir. 2020), Texas Brine sued the American Arbitration Association (a New York corporation) and two Louisiana residents in Louisiana state court. Before the two Louisiana residents were served, the AAA removed the case to federal court. Texas Brine challenged the removal, arguing that while snap removals might technically comply with the wording of the statute, it produced an absurd result that defeated the purpose of the statute. This, Texas Brine argued, meant that such removals should not be allowed.
The Fifth Circuit disagreed. The Louisiana defendants had not been “properly joined and served” at the time of the removal, so the procedural bar to removal found in 28 USC § 1441 did not apply. The Fifth Circuit also found that allowing a snap removal did not create an absurd result under 28 USC § 1441(b)(2). In so holding, the Fifth Circuit joined a growing consensus that allows such removals, including the Second, Third, and Sixth Circuit Court of Appeals.
If you need assistance with removing a matter from state court to federal court, then please contact an attorney at Cantey Hanger LLP (www.canteyhanger.com).
David Denny is a partner in the Litigation Section at Cantey Hanger LLP. For more information you can call David at 214-740-4236.