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US Judge Remands Asbestos Case to NY State Court Over Flawed Removal Process

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A New York federal judge on Wednesday blocked Johnson & Johnson’s attempt to remove an asbestos-injury lawsuit from state court because the defendants had not followed the necessary steps under federal law.

In a seven-page opinion, U.S. District Judge Andrew Carter Jr. of the Southern District of New York said that removal could only take effect after defendants meet "three distinct procedural requirements," including filing a notice of removal with the federal court, giving notice to the opposing parties and filing a copy of the removal notice with the appropriate state court.

Carter's ruling came in the midst of an ongoing debate over "snap removals," where defendants remove cases to federal court before they can be served with a complaint.

The practice, which involves defendants removing the cases to federal court before they can be served, has drawn the ire of plaintiffs attorneys, who call it an act of "gamesmanship" on the part of big companies with the resources to monitor court dockets in the age of electronic filing.

Earlier this year, the U.S. Court of Appeals for the Second Circuit resolved a split among district courts in favor of defendants, ruling in the case Gibbons v. Bristol-Myers Squibb that the removals are allowed once the home-state defendant has been properly served. However, the appeals court did not address the procedural requirements that must be met before service in order for removal to be effective.

On Wednesday, Carter definitively laid out those three steps and held that each must be completed before service is effected.

The ruling came as a setback for Johnson & Johnson, the New Jersey-based medical-devices company, which tried to remove from state court a lawsuit accusing it and New York firms of selling asbestos-laden products that caused a woman's cancer.

According to Carter's opinion, Johnson & Johnson filed its notice of removal in the Southern District at 2:24 p.m. Dec. 3, roughly 90 minutes before New York defendants Bristol-Myers and Colgate-Palmolive Co. were served. The notice of removal was filed with the federal court at about 7 p.m. that same night, according to court papers.

Johnson & Johnson argued that the removal took effect once it filed its notice with the federal court and before Bristol-Meyers and Colgate had been served. The plaintiffs, a married New York couple, on the other hand, said that removal was not effective until the notice was lodged with the state court, rendering it incomplete prior to the service of the New York defendants.

Carter, however, said his analysis ended with the fact that Bristol-Myers and Colgate were served before Johnson & Johnson completed "all three statutory requirements," and granted the plaintiffs' motion for remand.

"Although a non-New York-residing defendant filed, in federal court, a notice of removal before the plaintiff served the New Yorkers, the defendant attempting to remove the case did not complete the process of removal before the plaintiff served the New Yorkers," Carter said. "The case is remanded to state court."

An attorney for Johnson & Johnson did not immediately respond Thursday to a call seeking comment on the ruling.

Darron Berquist, an attorney for plaintiffs Betsey and Jody Hardman, welcomed the ruling on Thursday but said that, under Gibbons, the decision likely would have worked against his clients if it weren't for the "unique timing history" of the case. He said that Gibbons—and decisions like it in other circuits—have resulted in a "race to the courthouse" that favors large companies with ample resources at their disposal.

The plaintiffs attorneys, he said, now need to be "aggressive" in their response, either by having a process server waiting at the courthouse or by not initially naming defendants that are known to monitor dockets, with the intention to add them later to the complaint. Ultimately, though, Berquist said Congress would need to step in to resolve the issue.

"It already has become a focus of the plaintiffs bar," he said. "If it continues to be this procedural race, it's something that's going to have to be addressed legislatively."

Johnson & Johnson is represented by Thomas P. Kurland and John D. Winter of Patterson Belknap Webb & Tyler.

The other named defendants in the suit are Cyprus Amax Mineral Co., Cyprus Mines Corp., Imerys Talc America Inc., Imerys USA Inc., Revlon and Whittaker, Clark & Daniels Inc.

The case is captioned Hardman v. Bristol-Myers Squibb.