Stetson Real Estate LLC v. Sentinel Insurance Company, Ltd.
- Kenneth Karas
- 7:20-cv-08902
- U.S. District Court · Southern District of New York
- 5
In Stetson Real Estate v. Sentinel, Judge Karas denied remand because removal was timely and the filing error was cured.
Stetson Real Estate LLC’s request to return the case to state court was denied; Sentinel Insurance Company, Ltd. and Hartford Fire Insurance Company were allowed to proceed with the removal based on the court’s finding that it was timely and that the complaint-attachment error was cured.
What happened
Stetson Real Estate LLC sued Sentinel Insurance Company, Ltd. and Hartford Fire Insurance Company over their alleged denial of insurance coverage for business-income losses after the Covid-19 pandemic and related shutdowns. Stetson asked the federal court to send the case back to state court.
Stetson argued that the case did not meet the required amount in controversy, that the defendants removed the case too late, and that they attached the wrong version of the complaint when removing it. Stetson later conceded the amount-in-controversy issue. The court ruled that the removal period began when the defendants waived service on September 23, 2020, making their October 23 removal timely, and that attaching the earlier complaint was a correctable filing mistake.
In Stetson Real Estate LLC v. Sentinel Insurance Company, Ltd., Judge Kenneth M. Karas denied Stetson’s request to submit a motion to remand. The order did not decide whether the insurers owed coverage or damages.
The detailed version
- Stetson Real Estate LLC v. Sentinel Insurance Company, Ltd. · No. 7:20-cv-08902
- Kenneth Karas
- Jan. 11, 2021
Background
Stetson Real Estate LLC sued Sentinel Insurance Company, Ltd. and Hartford Fire Insurance Company in Westchester County Supreme Court. Stetson alleged that the defendants wrongfully denied insurance coverage for business-income losses following the Covid-19 pandemic and related shutdowns in March 2020. Stetson sought a declaration about coverage and money damages.
The defendants removed the case to the U.S. District Court for the Southern District of New York on October 23, 2020, under 28 U.S.C. §
- Before removal, Stetson’s counsel sent Hartford an email requesting a waiver of service and included a link to the filed complaint. The defendants then offered to waive service if Stetson agreed to extend their response deadline to November 6,
- Stetson accepted that offer on September 23,
- No later formal service or delivery of the complaint and summons occurred.
Arguments about remand
Stetson sought permission to file a motion to remand, which would have asked the federal court to return the case to state court. Stetson initially argued that the complaint did not allege more than $75,000 in damages, as required for the court’s diversity jurisdiction. After the court questioned that argument, Stetson conceded the point, and the court treated it as waived.
Stetson also argued that removal was untimely. It first contended that the 30-day removal period began when it emailed the complaint on September 17. Later, Stetson argued that the period began on September 22, when the defendants offered to waive service. The defendants argued that the relevant date was September 23, when Stetson accepted the conditional offer.
Finally, Stetson argued that removal was procedurally defective because the defendants attached a courtesy copy of a May 22, 2020 draft complaint instead of the complaint filed on September 8, 2020.
Court’s analysis
The court explained that the 30-day removal period under 28 U.S.C. § 1446 generally begins when the defendant is properly served or waives service. Merely receiving a complaint without formal service does not start that period. The court found that the September 17 email was not formal service and that the September 22 email was only a conditional offer to waive service. Because Stetson accepted the offer on September 23, the court deemed service waived on that date. The October 23 removal therefore occurred 30 days later and was timely.
The court also concluded that the defendants’ attachment of the earlier complaint was not a fatal defect. It stated that the filing requirements in § 1446(a) are procedural rather than jurisdictional and that missing or incorrect state-court papers can be corrected in federal court. The defendants attached the correct complaint, and Stetson did not claim prejudice from the mistake.
Disposition
The court denied Stetson’s request to submit a motion to remand. The order resolved the remand-related issues and did not decide the underlying insurance-coverage claims.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.