Ford v. Healthport Techs., LLC, No. 3:08-CV-208, 2008 U.S. Dist. LEXIS 90077 (E.D. Tenn. Aug. 21, 2008).
In this case, the Tennessee District Court remanded the action holding that CAFA’s thirty-day limitations period commenced when the Chancellor orally granted the plaintiffs’ motion to amend the complaint, not when the order memorializing the oral ruling was entered by the court.
A day before CAFA was enacted, Joseph Ford, an attorney, brought a class action in the chancery court of Tennessee, against two medical document reproduction companies, alleging that they over charged for copies of medical records. After the first round of removal, the District Court had remanded the action to chancery court because the defendants had failed to establish the requisite amount in controversy.
On August 16, 2007, the plaintiffs moved the chancery court for leave to file a second amended class action complaint, attaching a copy of the proposed amended pleading. The chancery court granted leave to amend in a ruling from the bench on April 4, 2008, and the Chancellor subsequently entered an order on April 22, 2008.
The defendants again removed this action on May 21, 2008, but the District Court remanded the action finding that the action was removed beyond the thirty day limitations period prescribed by 28 U.S.C. § 1446(b), and that the amendment related back to the original complaint.
In doing so, the District Court noted that under § 1446(b), a notice of removal may be filed within 30 days after receipt by the defendant, of a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable. Given the different stages in the statute, the District Court decided to determine whether the 30-day period began to run upon the receipt of the motion to amend the complaint, the granting of the motion by the chancery court, or the actual filing of the order memorializing the court’s oral ruling. The District Court maintained that the key for determining the date from which the removal clock began to run was when the defendants were able to ‘intelligently ascertain removability.’
The District Court first observed that the mere filing of the motion to amend without any ability to amend as a matter of right did not make the case removable because the possibility remained that the court might deny the motion.
The District Court next found that because the Chancellor’s oral ruling granting plaintiffs’ motion to amend gave the defendants the requisite information for removal, the time for removal under § 1446(b) commenced from that date and not when the order memorializing the oral ruling was entered by the court.
Finally, although the action was commenced pre-CAFA, and that § 1446(b) provides removal within one year if an amended complaint commences a new action after the effective date of CAFA, the District Court declined to extend the advantage of this statutory exception to the defendants. The District Court noted that the second amended complaint merely added two putative class members as named plaintiffs whose claims had been before the court since the action was commenced before CAFA came into force, and that their claims mirrored the claims of all other putative class members, thus it related back to the original complaint. The plaintiffs added no new claims in the second amended complaint and the amended pleading was based entirely on the same set of facts and the same wrong alleged in the original complaint.