447 B.R. 470
E.D. Va.2011Background
- LMRT filed suit January 7, 2011 against MB Airmont Farms, Mitchell, and Mitchell & Best Homebuilders for breach of contract regarding purchase of financial instruments; LMRT seeks damages and declaratory relief on amounts due and obligations.
- MB answered February 2, counterclaims were asserted and later amended February 11; LMRT moved to dismiss the amended counterclaims, both motions pending.
- On March 11, 2011 MB filed a purported Notice of Removal under 28 U.S.C. § 1452 to move the matter to the U.S. Bankruptcy Court for the District of Maryland without prior judicial notice or approval.
- Court analyzes whether § 1452 removal can effect an extrajudicial cross-district transfer; court finds removal improper and argues transfer under § 1404(a) would be more appropriate if transfer is justified.
- Court decides to permit the Maryland bankruptcy court to rule on remand authority and directs comity-based coordination rather than immediate remand by this court.
- Clerk instructed to transmit order to counsel and the Maryland bankruptcy court, and to close the case as to this interlocutory question.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether MB’s § 1452 removal to Maryland bankruptcy court was proper. | LMRT contends removal under §1452 is inappropriate and does not permit cross-district transfer. | MB contends §1452 authorizes removal to the district court, including to a bankruptcy court within another district. | Removal improper; cross-district transfer not permitted under §1452. |
| Whether a bankruptcy court may remand or transfer the case and what court should determine remand. | LMRT argues remand should be determined by the district court. | MB argues remand should be addressed by the Maryland bankruptcy court since the case was removed there. | Bankruptcy court should decide remand issue; this court retains jurisdiction only if remand is improper or need for further proceedings arises. |
| What procedural path should follow given improper removal. | No explicit objection beyond asserting improper removal. | Unilateral removal circumvents transfer statutes; transfer under §1404(a) may be pursued. | Case should be remanded to this district if bankruptcy court finds improper; otherwise, proceed as directed by remand decision. |
Key Cases Cited
- Things Remembered v. Petrarca, 516 U.S. 124 (Supreme Court 1995) (removal principles and jurisdictional considerations in federal court)
- Park 'N Fly, Inc. v. Dollar Park & Fly, Inc., 469 U.S. 189 (Supreme Court 1985) (statutory interpretation of transfer vs. removal and venue considerations)
- United States v. Rodgers, 101 F.3d 247 (2d Cir. 1996) (jurisdictional implications of legislative removals and appeals in multi-court contexts)