It is no secret that many, if not most, defendants—particularly corporate defendants—would prefer to litigate in federal court rather than state court, if given the choice. Federal court is perceived to have various advantages over state courts, including more geographically diverse jury pools, a potentially greater chance of winning a motion to dismiss or summary judgment motion, and a more structured discovery format under the Federal Rules of Civil Procedure. For all of these reasons, removal of a state court lawsuit to federal court can be a powerful tactical weapon in any defendant’s arsenal. A bill recently introduced in Congress, however, would effectively eliminate one avenue to federal court removal that has become increasingly favored by corporate defendants—so called “snap” removals. The progress of this bill will, accordingly, merit close monitoring in the months ahead.
Removal Based on Diversity of Citizenship and the ‘Forum Defendant Rule’
To understand the recently introduced bill in its proper context, some basic background on removals—and “snap” removals—is necessary. Pursuant to 28 U.S.C. §1441(a), any civil action brought in a state court, in which the U.S. district courts have original jurisdiction, may be removed to federal court by the defendant or defendants. Most often, removal to federal court is achieved based upon diversity of citizenship jurisdiction, which confers federal jurisdiction over a case where the amount in controversy exceeds $75,000, exclusive of interest and costs, and there is complete diversity of citizenship among the parties. 28 U.S.C. §1332.
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