Snap Removal: Not Just for Thanos

A recent decision by the United States District Court for the Eastern District of Virginia (Richmond Division) has provided Virginia “forum defendants,” who may have thought that they were unable to avoid being “home cooked” in Virginia state courts, a way to have their cases adjudicated in the federal court. In its decision, the District Court added its weight to the growing body of case law acknowledging and accepting a procedural device known as “snap removal.”

Before discussing “snap removal,” however, a brief note about removal may be helpful. Removal is the process by which an action originally filed in state court can be removed to a corresponding federal court. This process is primarily governed by 28 U.S.C. §§ 1441 and 1446. Under these statutes, actions are removable if the requirements for federal question jurisdiction or diversity of citizenship jurisdiction are met. Stated differently, a federal court may assert jurisdiction over a matter originally filed in state court if the controversy involves an issue of federal law or involves citizens of different states with an amount in controversy of more than $75,000. However, if a defendant is a citizen of the state in which the plaintiff filed the state court action, then the home “forum defendant” cannot remove the case to federal court under diversity of citizenship jurisdiction.

For example, if the fictional company Insurers-R-Us, a citizen of Virginia, is sued by Petey Plaintiff, a citizen of West Virginia, for $100,000 in the Circuit Court for Henrico County, Virginia, then Insurers-R-Us may not be able to remove the case to federal court based on diversity of citizenship jurisdiction. This is because of 28 U.S.C. § 1441(b)(2), which provides:”

A civil action otherwise removable solely on the basis of [diversity of citizenship jurisdiction] may not be removed if any of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.

This rule is commonly referred to as the “forum defendant rule.” See Spigner v. Apple Hospitality REIT, Inc., No. 3:21-cv-00758, *3 (E.D. Va. Mar. 1, 2022).

In recent years, “snap removal” has emerged as a viable interpretation of 28 U.S.C § 1441(b)(2), which acts as a sort of loophole to the forum defendant rule and expands the types of the cases that can be removed from state court to federal court.

“Snap removal” allows a forum defendant to remove a case but only before that defendant has been properly served with process, regardless of whether that defendant is a “forum defendant.” Spigner, No. 3:21-cv-00758, *3 (E.D. Va. Mar. 1, 2022). Snap removal relies on the plain language of 28 U.S.C. § 1441(b)(2) in that the parties must be “properly joined and served as defendants” for the forum defendant rule to apply.

In Spigner, the Eastern District of Virginia answered the question of whether “[t]his Court should follow the plain meaning of § 1441(b)(2) and permit the Defendants’ removal to this Court before service of process.” Id. at *4.

Although the plaintiff argued that enforcement of snap removal can lead to an absurd result, creating a situation in which a forum defendant appears and seeks federal jurisdiction despite simultaneously asserting that it cannot be barred from removing because it has not been properly made a party to the action, the Court ultimately agreed with the defendant and found that snap removal allows a forum defendant to remove a case to federal court on diversity jurisdiction grounds when it has not yet been served in the state court action. Id. at 8 of 11; see also Campbell v. Hampton Roads Bankshares, Inc., 925 F. Supp. 2d 800, 809-10 (E.D. Va. 2013) (finding that “served” has an alternative meaning of “actual notice and involvement in the case,” which avoids the absurd result of permitting a forum defendant to appear and seek removal despite asserting that it has not been properly made a party to the action).

The Court found that if “Congress intended to preclude any forum defendant from removing, it could have omitted the phrase ‘properly joined and served.’ However, by inclusion of this language, Congress conditioned the rule’s applicability on whether the defendant had yet been properly joined and served.” Id. at 7*-8. Further, the Court found that “one of the three defendants here, Marriott, is a non-forum defendant,” which means that “it would not contravene common sense to allow Marriott to seek that protection.” Id. at *9.

Ultimately, snap removal may not be as powerful as Thanos’s snap in Avengers: Infinity War, but it represents a procedural tool that allows an unserved forum defendant to remove a Virginia state court action to the corresponding federal court despite the so-called “forum defendant rule.” Although Virginia has not wholeheartedly adopted snap removal, and Campbell is still good law, Virginia federal courts may allow snap removal if one of the named defendants is not a citizen of Virginia. In the insurance context, given the size and ease of service of process on insurance companies, it is rare for a plaintiff to file an action but leave it unserved for any meaningful period of time. However, it may be worthwhile for insurers who are citizens of Virginia to monitor local circuit court filings and ascertain whether a state court action can be removed to federal court via snap removal.

For more information about this and other similar cases, please contact Robert Tayloe Ross, Esq., Robert Wm. Best, Esq., or Daniel J. Laws, Esq. of MMR.