Opinion
No. SA-02-CA-1182-RF
June 10, 2003
ORDER GRANTING PLAINTIFF'S MOTION TO REMAND
Before the Court is Plaintiff's Motion to Remand, filed on December 17, 2002. After due consideration of the arguments of the parties and of applicable law, the Court is of the opinion that the Motion to Remand should be GRANTED.
FACTUAL AND PROCEDURAL BACKGROUND
This action was originally filed by Plaintiff David Moreno in County Court at Law No. 5, Bexar County, Texas on January 3, 2002. On November 15, 2002, Plaintiff filed his Second Amended Original Petition in state court, containing a claim for violations of the Federal Fair Credit Reporting Act ("FCRA"). On the basis of federal question jurisdiction over this claim, Defendants removed the case to this Court on December 13, 2002 pursuant to 28 U.S.C. § 1441(b).
On December 17, 2002, Plaintiff contemporaneously filed a Motion to Dismiss and a Motion to Remand. In his Motion to Dismiss, Plaintiff moved to voluntarily dismiss his FCRA claims, stating his belief that "similar relief may be obtained under the Texas Finance Code. . . ." The Court granted this Motion on December 19, 2002. In his Motion to Remand, Plaintiff now seeks to remand the case back to state court on the basis that the dismissal of his FCRA claims deprives this Court of federal jurisdiction. A hearing was held on this matter on June 10, 2003.
Pl.'s Mot. to Dismiss (Dec. 17, 2002),
DISCUSSION
Plaintiff asserts that his FCRA claim is duplicative of his state causes of action and has therefore dismissed that claim. He further argues that the language of the FCRA, which provides that an action "may be brought in any appropriate United States district court . . . or in any other court of competent jurisdiction," precludes removal. Defendants respond first that the "may be brought" language in the FCRA provides only that an action may be filed in state court, not that it must remain there until final judgment. Defendants also argue that the sole reason for Plaintiff's dismissal of his FCRA claims was to defeat removal jurisdiction, and that remand is improper under such circumstances.
See l5 U.S.C. § 1681p.
Defendants' first argument regarding the language of the FCRA is valid. The Fifth Circuit has disavowed the logic of Plaintiff's argument in a similar claim arising out of the Age Discrimination in Employment Act. That statute, like the FCRA, provides that a plaintiff "may bring a civil action in any court of competent jurisdiction. . . ." The Fifth Circuit held that although the language suggests that a plaintiff may institute suit in either state or federal court, "[i]t does not indicate an intent on the pan, of Congress . . . to allow a plaintiff to prosecute the suit to final judgment in that court." The court upheld removal in that case. For the same reason, the argument is rejected as applied to Plaintiff's FCRA claims. Thus, Defendants' initial removal to this Court was proper.
Id.
Baldwin v. Sears, Roebuck Co., 667 F.2d 458, 461 (5th Cir. 1982).
Id.
See Rhea v. Amresco, Inc., 871 F. Supp. 283, 284 (N.D. Tex. 1994).
The more difficult issue to resolve is whether, the case having been properly removed, it should now be remanded after Plaintiff has voluntarily dismissed his FCRA claims. The Fifth Circuit has held that, where removal is proper but "there is a subsequent narrowing of the issues such that the federal claims are eliminated and only pendent state claims remain, federal jurisdiction is not extinguished. Instead, the decision as to whether to retain the pendent claims lies within the sound discretion of the district court." The Supreme Court has provided that, in exercising that discretion, "a federal court should consider and weigh in each case, and at every stage of the litigation, the values of judicial economy, convenience, fairness, and comity. . . ." The court should also consider "whether the plaintiff has `attempted to manipulate the forum' in which his case will be heard `simply by deleting all federal-law claims from the complaint and requesting that the district court remand the case'. . . ." "If the plaintiff has attempted to manipulate the forum, the court should take this behavior into account in determining whether the balance of factors . . . support a remand in the case."
Brown v. Southwestern Bell Telephone Co., 901 F.2d 1250, 1254 (5th Cir. 1990) (citing In re Carter, 618 F.2d 1093, 1101 (5th Cir. 1980), cert. denied, 450 U.S. 949, 101 S.Ct. 1410 (1981)).
Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350, 108 S.Ct. 614, 619 (1988) (citing United Mine Workers of America v. Gibbs, 383 U.S. 715, 726, 86 S.Ct. 1130, 1139 (1966)).
Brown, 901 F.2d at 1255 (quoting Carnegie-Mellon, 484 U.S. at 357, 108 S.Ct. at 622).
Carnegie-Mellon, 484 U.S. at 357, 108 S.Ct. at 622-23.
Defendants insist in this case that Plaintiff's sole reason for dismissing his FCRA claims was to destroy removal jurisdiction. Although Plaintiff's dismissal of his federal claims does evince a desire to return to state court-in light of the contemporaneous filing of his motions-the Court is not convinced that Plaintiff engaged in the type of "forum manipulation" Defendants suggest. This is not a case in which Plaintiff originally filed suit in federal court or even alleged a federal claim in his original petition. Additionally, in seeking to dismiss his FCRA claims, Plaintiff has stated his belief that he is entitled to similar relief under Texas law and that his federal claim may therefore be duplicative.
Defs.' Resp. in Opp'n to Pl.'s Mot. to Remand at 5 (Dec. 23, 2002).
See Hernandez v. Central Power Light, 880 F. Supp. 494, 496 (S.D. Tex. 1994).
See Pl.'s Mot. to Dismiss; Pl.'s Mot. to Remand at 2.
Moreover, even if the Court accepts Defendants' accusations of "forum manipulation," this finding is not determinative, but rather only a factor that the Court must consider among other values relevant to the remand issue. Unlike the Brown case heavily relied on by Defendants, this is not a case in which this Court has presided over extensive discovery, such that "a remand thus would result in a waste of scarce judicial resources." By contrast, in this case, the parties have undertaken, and indeed completed, discovery in state court. The case was pending in state court for ten months before Plaintiff added his federal claim, and the claim was dismissed only one month later. Additionally, although Defendants aver that "no significan judicial resources have been consumed in the state court action," this is only more true for this Court, which has had jurisdiction of the case for only a limited period of time and has not yet entered any substantive rulings. By contrast, Defendants' own statements establish that "all that is left to be done [in the state court] are pre-trial matters and trial on the merits. . . ." After balancing the values stated above, the Court is of the opinion that Plaintiff's remaining claims-breach of contract, defamation, negligence, and violations of the Texas Deceptive Trade Practices Act-are more appropriately resolved in state court.
Brown, 901 F.2d at 1255.
Defs.' Resp. in Opp'n to Pl.'s Mot. to Remand at 6.
Notwithstanding Plaintiff's brief addition and dismissal of a claim under the FCRA, the case should be remanded to the state court of origin. Defendants have raised concern, however, that this Court's prior Order granting Plaintiff's Motion to Dismiss did not specify whether the FCRA claims were dismissed with or without prejudice. The Court recognizes this concern and therefore drew specific attention to the matter during the hearing.
Defendants' counsel, Joe Hinojosa, Esq., acknowledged at the hearing that a dismissal with prejudice would reduce the harm to his client in remanding the case, although Mr. Hinojosa insisted that federal jurisdiction was the preferred course. Plaintiff did not object to a dismissal of his federal claims with prejudice. After considering the positions of all parties on this matter, therefore, the Court is of the opinion that the most appropriate course of action at this point is a dismissal of Plaintiff's federal claims with prejudice. "[A] dismissal with prejudice would foreclose any resurrection of the claim," further mitigating against any potential "forum manipulation" by Plaintiff. The Court therefore clarifies that the prior dismissal of Plaintiff's FCRA claims is WITH PREJUDICE.
Hernandez, 880 F. Supp. at 496.
Mr. Hinojosa additionally argued at the hearing that Defendants were prejudiced by the significant time and expense incurred in first removing the: case to federal court, and later resisting Plaintiff's Motion to Remand. He argued that to grant Plaintiff's Motion would unfairly benefit Plaintiff at Defendants' expense. Although the Court appreciates Mr. Hinojosa's concerns on this matter, he should rest assured that his efforts to represent Defendants' interests have not been an exercise in futility. Plaintiff has not imposed an expense upon Defendants only to return to square one. Rather, Mr. Hinojosa has provided a valuable service to his clients in securing a dismissal of Plaintiff's potentially valuable FCPRA claims with prejudice. This leaves Defendants in a substantially better position than before the claims were included in Plaintiff's Second Amended Original Petition. Having reaped the benefits of Mr. Hinojosa's fine representation on this matter, Defendants may now address the remaining claims in state court.
CONCLUSION
For the reasons stated above, the Court finds that, following dismissal of Plaintiff's claims under the Federal Fair Credit Reporting Act, the remaining claims in this case should be remanded to state court.
It is therefore ORDERED that Plaintiff's Motion to Remand is GRANTED.
It is ORDERED that, in accordance with this Court's Order on December 19, 2002, Plaintiff's claims under the Federal Fair Credit Reporting Act are DISMISSED WITH PREJUDICE to refiling.
It is further ORDERED that this case is REMANDED to County Court at Law No. 5, Bexar County, Texas.