Significant Changes To The Federal Jurisdictional Statutes Effective January 6, 2012

The Federal Courts Jurisdiction and Venue Clarification Act of 2011, H.R. 394, P.L. 112-63 (the "JVCA"), took effect with relatively little fanfare on January 6, 2012. Although the JVCA has not garnered much attention, it amended important sections of Title 28 of the United States Code concerning the removal to federal court of lawsuits initially commenced in state court, venue, and diversity jurisdiction.1 The JVCA was passed by unanimous consent in both chambers of Congress and applies to cases commenced on or after its effective date. For removed cases, the JVCA applies if the action was commenced in state court on or after the effective date. This Commentary briefly summarizes certain aspects of the JVCA of particular interest to litigants and litigators, with a prevailing focus on the provisions concerning civil case removal.2

Timing for Removal of Cases Involving Multiple Defendants

One significant element of the JVCA is a provision that resolved a conflict among federal courts concerning the commencement of the statutory 30-day deadline for removal, codified at 28 U.S.C. § 1446, in cases where multiple defendants are served over an extended time period. The previous version of § 1446(b) specified a 30-day period for "the defendant" to remove the lawsuit but did not address cases involving multiple defendants.

New § 1446(b)(2)(B) provides that "[e]ach defendant shall have 30 days after receipt by or service on that defendant of the initial pleading or summons . . . to file the notice of removal." That provision abrogated the "first-served" minority rule pursuant to which the 30-day removal period commenced when the first defendant was served, and the first-served defendant and all then-served defendants were required to join in the notice of removal within 30 days. In Getty Oil Corp. v. Ins. Co. of N. Am., for example, the Fifth Circuit concluded that:

[i]t follows that since all served defendants must join in the petition, and since the petition must be submitted within thirty days of service on the first defendant, all served defendants must join in the petition no later than thirty days from the day on which the first defendant was served.

841 F.2d 1254, 1263 (5th Cir. 1988). The House of Representatives Report of the Committee on the Judiciary, No. 112-10 (the "House Report"), explains that the JVCA rejected the minority "first-served" rule because "[f]airness to later-served defendants, whether they are brought in by the initial complaint or an amended complaint, necessitates that they be given their own opportunity...