Moran v. Trans States Airlines, LLC

Background

Donald Moran filed state-law tort claims in New York State Supreme Court after an aircraft operated by Trans States Airlines experienced an in-flight emergency. The aircraft made an emergency landing at John F. Kennedy International Airport, and Moran alleged that he was injured during the landing and evacuation.

Moran’s counsel sent the airline a pre-suit demand letter in April 2019 describing the incident and alleged injuries. The letter offered to settle potential claims for $245,000. Moran filed his complaint in New York State Supreme Court on May 26, 2020.

Moran served the complaint on the New York Secretary of State on June 11, 2020, under New York law. The Secretary of State then mailed the papers to the airline’s designated service agent, Corporation Service Company, which received them on June 29, 2020.

The airline removed the case to federal court on August 6, 2020, asserting diversity jurisdiction. The court stated that the removal papers adequately alleged complete diversity and that the amount-in-controversy requirement was met. The court also noted that the airline relied on the demand letter to show that the amount at issue exceeded $75,000.

Issue

The issue was whether the airline’s removal was timely under 28 U.S.C. § 1446(b), which generally requires a defendant to file a notice of removal within 30 days after receiving the initial pleading through service or otherwise.

Moran argued that the 30-day period began when the airline’s designated agent received the complaint on June 29, 2020. The airline agreed that its designated agent received the complaint but argued that the time between the Secretary of State’s receipt and the designated agent’s receipt should not count. It also argued that any delay should be excused under Federal Rule of Civil Procedure 6(b)(1)(B) because of excusable neglect.

Court’s Analysis

The court explained that service on the New York Secretary of State alone did not start the federal removal period. But the court held that service was sufficient to start the period when the airline’s designated agent received the complaint on June 29, 2020.

The airline therefore had 30 days to remove the case. Its August 6 removal was eight days late. The court rejected the airline’s request for an extension based on excusable neglect. In evaluating that request, the court considered prejudice, the length and effect of the delay, the reason for the delay and whether it was within the airline’s control, and whether the airline acted in good faith.

The court found little indication of prejudice or bad faith, but focused on the reason for the delay. It concluded that the airline had the information needed to determine that the case was removable. The airline had received the demand letter before the complaint was filed, and that same letter was later used to establish the amount in controversy.

The court also rejected the change in counsel as a sufficient explanation. New counsel was appointed on July 10, 2020, but did not remove the case until nearly a month later. The court said counsel was responsible for communicating with prior counsel, reviewing the files diligently, and determining whether removal was appropriate. The airline did not provide enough detail about why reviewing pre-suit paperwork caused the delay.

Disposition

Judge Alvin K. Hellerstein granted Moran’s motion to remand. The court ordered that the case be remanded to the Supreme Court of the State of New York, Queens County, and directed the Clerk to terminate the motion. The scheduled telephonic hearing was canceled.