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Keller Logistics, Inc. v. Navistar, Inc.

United States District Court, N.D. Ohio, Western Division

August 6, 2019

Keller Logistics Group, Inc., et al., Plaintiffs,
Navistar, Inc., Defendant.




         In April 2019, Defendant Navistar, Inc., removed this case from Ohio state court, following dismissal of the only non-diverse defendant (Doc. 1). Plaintiffs Keller Logistics Group, Inc., Thomas Keller Leasing Company, Inc., and Thomas Keller Trucking, Inc., move to remand (Doc. 4), citing the one-year limit for removal under 28 U.S.C. § 1446(c). Navistar opposes (Doc. 11). This Court heard argument at a Record Hearing (Doc. 16) and denied the Motion to Remand in an earlier Order (Doc. 17). This Opinion follows.


         Plaintiffs are Ohio corporations that own, operate, and lease a fleet of commercial trucks (Doc. 1-3 at 2-3). Navistar -- a Delaware corporation with its principal place of business in Illinois -- manufactures commercial trucks (Docs. 1 at 2; 1-3 at 3). Navistar distributes its trucks through authorized dealers like Defiance Truck Sales & Service, Inc. (the Dealer), which is based in Ohio (Doc. 1-3 at 2-3).

         In 2011 and 2012, Plaintiffs purchased or leased sixty-five Navistar trucks from the Dealer (id. at 4-5). The trucks allegedly began to break down shortly afterward (id. at 5). In 2015, Plaintiffs sued Navistar and the Dealer in Ohio state court (Doc. 11 at 7). Plaintiffs voluntarily dismissed the suit later in 2015 and refiled against the same defendants in 2016 (id.). Over the next two years and four months in state court, the case endured a motion for judgment on the pleadings, discovery, and a motion for summary judgment (Docs. 1 at 1-2; 4-1 at 5-7).

         In March 2019, as the summary judgment motion was pending in state court, Plaintiffs voluntarily dismissed the Dealer, leaving Navistar as the only defendant (Docs. 1 at 2; 11 at 7). Navistar removed, citing this Court's diversity jurisdiction (Doc. 1 at 2). Plaintiffs move to remand (Doc. 4).


         “Federal courts are courts of limited jurisdiction.” Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Under 28 U.S.C. § 1332(a), federal courts have jurisdiction over civil cases in which the amount in controversy exceeds $75, 000 and the parties are completely diverse. This diversity jurisdiction is designed “to protect out-of-state parties from the potential risk that local juries (or judges) would favor in-state parties.” Roberts v. Mars Petcare US, Inc., 874 F.3d 953, 956 (6th Cir. 2017).

         “While § 1332 allows plaintiffs to invoke the federal courts' diversity jurisdiction, § 1441 gives defendants a corresponding opportunity.” Lincoln Prop. Co. v. Roche, 546 U.S. 81, 89 (2005). So long as the federal court has jurisdiction, 28 U.S.C. § 1441(a) allows civil defendants to remove actions from state court to federal court. Where a defendant seeks to remove a case on the basis of diversity jurisdiction, the amount-in-controversy and complete-diversity conditions must exist at the time of removal. Williamson v. Aetna Life Ins. Co., 481 F.3d 369, 375 (6th Cir. 2007). If these conditions are not initially met but are later satisfied, a defendant may remove “within 30 days” of receiving notice that the case “has become removable.” 28 U.S.C. § 1446(b)(3). Such removal, however, typically cannot occur “more than 1 year after commencement of the action.” Id. § 1446(c)(1).

         Here, this case was not removable until March 2019, when Plaintiffs dismissed the Ohio-based Dealer. Navistar removed within thirty days. But because the case began in 2016 and removal did not occur until 2019, Navistar was far past the one-year limit for removal.

         The removal statute, however, contains an exception to the one-year limit. A defendant may remove a case beyond one year if “the district court finds that the plaintiff has acted in bad faith in order to prevent a defendant from removing the action.” 28 U.S.C. § 1446(c)(1). Navistar argues this exception applies here. Navistar specifically contends Plaintiffs joined the Dealer and kept it in the case beyond one year “for the sole and express purpose of avoiding federal jurisdiction” (Doc. 11 at 5).

         Bad-Faith Standard

         Congress added the bad-faith exception to the removal statute in 2011 as part of the Jurisdiction and Venue Clarification Act. Pub. L. No. 112-63, 125 Stat 758 (2011). District courts within the Sixth Circuit agree the bad-faith inquiry is “whether the plaintiff engaged in intentional conduct to deny the defendant the chance to remove the case to federal court.” Comer v. Schmitt, 2015 WL 5954589, at *2 (S.D. Ohio 2015), report and recommendation adopted, 2015 WL 7076634 (S.D. Ohio 2015). See also Williams v. 3M Co., 2018 WL 3084710, at *3 (E.D. Ky. 2018); Dutchmaid Logistics, Inc. v. Navistar, Inc., 2017 WL 1324610, at *2 (S.D. Ohio 2017), report and recommendation adopted, 2017 WL ...

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