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RRL Holding Company of Ohio, LLC v. Stewart

United States District Court, S.D. Ohio, Eastern Division

June 7, 2019


          Jolson Magistrate Judge.

          OPINION & ORDER


         This matter comes before the Court on the Magistrate Judge's November 9, 2018, Report and Recommendation (ECF No. 12), which recommended that Plaintiffs' Motion for Remand (ECF No. 4) be GRANTED. The Court hereby ADOPTS the Report and Recommendation in its entirety based on the independent consideration of the analysis therein.

         I. BACKGROUND

         Defendant is a former member of Plaintiff RRL Holding Company of Ohio, LLC (“RRL”) and a former officer of Plaintiff Firefly Agency LLC (f/k/a IHT Insurance Agency Group) (“Firefly”) (collectively, “Plaintiffs”). (ECF No. 2 at 2-3). In 2014, Defendant was removed as president of Plaintiff Firefly and as a member of Plaintiff RRL. (Id. at 2).

         Following the removal of Defendant as President of Plaintiff Firefly and as a member of Plaintiff RRL, the relationship between Plaintiffs and Defendant has been what the Report and Recommendation classified as “contentious and litigious” (ECF No. 12 at 1). One facet of this litigious relationship is the numerous amount of claims and legal actions brought against Plaintiffs by Defendant. Plaintiffs allege these claims and actions are a “bad-faith litigation vendetta.” (ECF No. 2 at 3). As such, Plaintiffs requested this Court declare Defendant to be a “vexatious litigator” under Ohio Revised Code §2323.52. (ECF No. 2). The vexatious litigator request is the only claim brought by Plaintiffs.

         Following Plaintiffs' complaint, Defendant filed a Counterclaim and Third-Party Complaint and Joinder of additional parties. (ECF No. 3). Additionally, Defendant brought several state and federal counterclaims against both Plaintiffs and other third parties. (Id. at 31-52). Defendant then used these counterclaims as the basis for filing a Notice of Removal, explaining that the case involves federal questions: the Civil Rights Act, the Fair Housing Act, and “Federal Antitrust Laws.” (Id. at 3-4.)

         Plaintiffs then filed the instant Motion to Remand, to which Defendants filed a memorandum contra and Plaintiffs filed a reply.


         When objections to a Magistrate Judge's report and recommendation and received on a dispositive matter, the assigned district judge “must determine de novo any part of the magistrate judge's disposition that has been properly objected to.” Fed. R. Civ. P 72(b)(3); see also 28 U.S.C. § 636(b)(1)(C). After review, the district judge “may accept, reject, or modify the recommended disposition; receive further evidence; or return the matter to the magistrate judge with instructions.” Fed.R.Civ.P. 72(b)(3); see also 28 U.S.C. § 636(b)(1)(C). Here, Defendant has filed specific objections to the Report and Recommendation, and thus the Court reviews the properly objected portion of the recommended disposition de novo. Additionally, solely because Defendant is pro se, the Court will review items that Defendant has improperly objected to via her response to the Report and Recommendation. See Haines v. Kerner, 404 U.S. 519, 520 (1972).

         When requesting removal to federal court, “the party seeking removal bears the burden of demonstrating that the district court has original jurisdiction.” Eastman v. Marine Mech. Corp., 438 F.3d 544, 549 (6th Cir. 2006) (citation omitted). When reviewing the appropriateness of removal, all doubts as to whether removal is proper should be resolved in favor of remand to state court. Coyne ex rel. Ohio v. Am. Tobacco Co., 183 F.3d 488, 493 (6th Cir. 1999). Removal based on a “federal question” jurisdiction requires that the cause of action “aris[e] under the Constitution, laws, or treaties of the United States.” 28 U.S.C. § 1331. A cause of action “arises under federal law only when the plaintiff's well-pleaded complaint raises issues of federal law.” Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 63 (1987). It is “now settled law” that a case may not be removed “on the basis of a federal defense, including the defense of pre-emption, even if the defense is anticipated in the plaintiff's complaint, and even if both parties concede that the federal defense is the only question truly at issue.” Caterpillar Inc. v. Williams, 482 U.S. 386, 393 (1987).


         Plaintiffs ask this Court to remand this case to state court based on the well-pleaded complaint rule. Plaintiffs do not object to any of the findings of the Magistrate Judge. Defendant objects to the Magistrate Judge's conclusion that there is no federal question present. Defendant asserts that application of the “artful pleading” doctrine will show that despite Plaintiffs' alleged attempts at concealing federal claims, such questions are present in Plaintiffs' case. Defendant further asserts that Plaintiffs' business actions constitute a violation of anti-trust law, which is a federal matter, thus moving the case into federal question jurisdiction. Defendant argues that federal question jurisdiction is present because Plaintiffs' claim is federal in nature. It appears that these objections to the Report and Recommendation are restatements of the arguments presented to the Magistrate Judge in the first place. Such arguments are unclear and lack merit.

         A. Lack of ...

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