Garrett v. Cook
652 F.3d 1249
10th Cir.2011Background
- Garrett Trust filed state-court actions against Cook and others in 2003 in New Mexico state court relating to Cook's officers/director actions at Hydroscope Group, Inc.
- Wells Fargo later joined (2004) and sought foreclosure of its security interests in related entities’ property (HCAN) in the same suit.
- Cook, as debtor-in-possession, filed a separate bankruptcy-related suit against Wells Fargo (2005) that was consolidated with the state action.
- In 2009-2010, Wells Fargo obtained summary judgment in state court and foreclosed its security interests; Garrett and Cook’s claims against Wells Fargo were dismissed with prejudice.
- Cook, while still in state court, filed a new suit in August 2009 against Garrett Group and others; Wells Fargo sought and obtained injunction restricting Cook’s pro se filings in state court.
- Cook attempted to remove the consolidated state-court actions to federal court on January 26–27, 2010, arguing federal subject-matter rights and civil-rights claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Timeliness and reasonableness of removal under 28 U.S.C. §1447(c) | Cook had a potentially timely removal based on events before filing | Removal was untimely and not reasonably based | Untimely and objectively unreasonable; district court did not abuse discretion in awarding fees |
| Effect of automatic stay on fee award | Automatic stay barred post-petition actions resulting in fees | Stay did not bar post-petition fees for unfounded removal | Automatic stay did not bar fee award; fees awarded notwithstanding stay |
| Validity of §1443(1) removal basis | Exhaustion of civil rights claims could trigger removal | §1443(1) not satisfied; law-of-the-case controls | Removal under §1443(1) not established; unsupported by law-of-the-case precedent |
| Triggering event for removal under §1446(b) | Any triggering event within 30 days before removal permits timely removal | No triggering event within 30 days; service of Third Amended Complaint premature | No timely triggering event; removal untimely and unreasonable |
Key Cases Cited
- Porter Trust v. Rural Water Sewer & Solid Waste Mgmt. Dist. No. 1, 607 F.3d 1251 (10th Cir.2010) (standard for reviewing §1447(c) fee awards; reasonableness of removal)
- Things Remembered, Inc. v. Petrarca, 516 U.S. 124 (1995) (timeliness defects contemplated by §1447(c) and impact on fees)
- Durham v. Lockheed Martin Corp., 445 F.3d 1247 (9th Cir.2006) (untimely or otherwise unreasonable removal can justify fees)
- Garrett v. Cook, No. 10-2207 (2010) (law-of-the-case on §1443(1) discrimination claim)
- Grynberg v. Danzig Claimants (In re Grynberg), 143 B.R. 574 (D.Colo.1990) (post-petition fees may be awarded notwithstanding automatic stay)
- Shure v. State of Vermont (In re Sure-Snap Corp.), 983 F.2d 1015 (11th Cir.1993) (post-petition fee awards not discharged when litigation continues)
- Harris v. Bankers Life & Cas. Co., 425 F.3d 689 (9th Cir.2005) (premature removal can lead to sanctions)