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HMG Benefit Services, LLC v. Fringe Insurance Benefits

November 7, 2007

HMG BENEFIT SERVICES, LLC, PLAINTIFF,
v.
FRINGE INSURANCE BENEFITS, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Hon. Dana M. Sabraw United States District Judge

ORDER DENYING PLAINTIFF'S MOTION TO REMAND MATTER TO STATE COURT

[Docket No. 4]

This matter comes before the Court on Plaintiff's motion to remand this case to San Diego Superior Court. The Court found this motion suitable for decision without oral argument pursuant to Civil Local Rule 7.1(d)(1). For the reasons discussed below, the Court denies Plaintiff's motion.

I. BACKGROUND

On or about June 1, 2002, Plaintiff HMG Benefit Services, LLC ("Plaintiff") and Defendant Fringe Insurance Benefits, Inc. ("Defendant Fringe") entered into a written contract. (Compl. at 2.) Plaintiff alleges it has performed its obligations under the contract, but Defendant Fringe has failed to satisfy its payment obligations, causing Plaintiff to suffer damages in the amount of $287,690.17. (Id.)

Plaintiff also alleges it entered into another contract with Defendants on April 18, 2005. (Id. at 3.) Plaintiff alleges its has performed its obligations under this contract, but Defendants have failed to satisfy their payment obligations, resulting in damage to Plaintiff of $4,000 per month from August 1, 2006, to present. (Id.) Plaintiff alleges this contract was procured through Defendants' fraud. (Id. at 3-4.)

On June 29, 2007, Plaintiff filed the present Complaint against Defendants Fringe, Fringe Benefit Group, L.P., Plan Benefit Services, Inc. and Travis West in San Diego Superior Court. On July 20, 2007, Plaintiff's counsel mailed a copy of the Summons, Complaint and ADR package to Defendant Travis West ("Defendant West"). These documents were sent "first-class postage prepaid of $6.62, Certified Mail, Return Receipt Requested[.]" (Mot. to Remand, Ex. A.) The documents were received by Sara West on July 23, 2007. (Id.) Plaintiff's counsel thereafter filed a Proof of Service in the Superior Court, and on August 23, 2007, Defendants filed their Answer to the Complaint. Five days later, on August 28, 2007, Defendants removed Plaintiff's Complaint to this Court. In response, Plaintiff filed the present motion to remand. Defendants have filed an opposition to the motion, and Plaintiff has filed a reply.

II. DISCUSSION

Plaintiff asserts Defendants' notice of removal was untimely, therefore the case should be remanded to state court. The time for filing a notice of removal is set out in 28 U.S.C. § 1446(b), which states:

The notice of removal of a civil action or proceeding shall be filed within thirty days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based, or within thirty days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant, whichever period is shorter.

28 U.S.C. § 1446(b). The Supreme Court has interpreted this statute to mean "that a named defendant's time to remove is triggered by simultaneous service of the summons and complaint, or receipt of the complaint, 'through service or otherwise,' after and apart from service of the summons, but not by mere receipt of the complaint unattended by any formal service." Murphy Brothers, Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344 347-48 (1999).

There is no dispute that state law determines when formal service of process is effected. Here, Plaintiff served Defendants pursuant to California Code of Civil Procedure Section 415.40, which provides:

A summons may be served on a person outside this state in any manner provided by this article or by sending a copy of the summons and of the complaint to the person to be served by first-class mail, postage prepaid, requiring a return receipt. Service of a summons by ...


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