Benham- Dwyer v. The Neiman Marcus Group LLC

Background

Raelynn Benham-Dwyer filed a personal injury lawsuit in San Francisco Superior Court based on a May 19, 2023 accident at a Neiman Marcus store in San Francisco. The complaint sought $3 million in general damages and almost $2 million in special damages, including medical expenses and lost earnings.

The Neiman Marcus Group LLC removed the case to federal court on December 2, 2024, asserting diversity jurisdiction. Removal is the process of moving a case from state court to federal court. Benham-Dwyer moved for remand, which would return the case to state court, arguing that the removal was filed too late. She also asked the court to set aside a stipulation concerning the time for responding to the complaint.

Removal Deadline

For diversity jurisdiction, the removing party must show complete diversity between the properly joined parties and an amount in controversy greater than $75,000. Federal law generally requires a notice of removal to be filed within 30 days after proper service or receipt of the initial pleading under the circumstances specified by the removal statute.

The parties disputed whether the initial service in July 2024 was proper. The court did not decide that issue because it was unclear when the company first understood that it was the entity being sued. The court found, however, that the correct defendant had been properly served no later than October 30, 2024, when it signed a Notice of Acknowledgment and Receipt. The company also conceded at the hearing that by October 29 it knew Benham-Dwyer’s California address and that the amount in controversy exceeded $75,000. The court therefore concluded that the removal deadline began no later than October 30 and expired no later than November 29, 2024.

Stipulation and Estoppel

The company argued that the parties’ agreement extending its deadline to respond to the complaint also extended the deadline for removal. The court rejected that argument. The parties had not expressly discussed or agreed to extend the removal deadline. Under the reasoning the court found persuasive, an agreement extending the time to answer or otherwise respond does not by itself extend the separate statutory time limit for removal.

The court also concluded that the company had not shown the kind of affirmative representation or other conduct by Benham-Dwyer that would prevent her from objecting to the late removal. The court rejected Benham-Dwyer’s request to set aside the stipulation based on mistake, explaining that she cited no authority supporting that request and that the company had reasonably relied on the stipulation when filing its response.

Disposition

The court held that removal was untimely because the deadline was no later than November 29, 2024 and the company removed the case on December 2, 2024. Judge Joseph C. Spero granted Benham-Dwyer’s motion to remand and ordered that the case be remanded to San Francisco Superior Court.