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Smallwood v. Allied Pickfords

September 29, 2009


The opinion of the court was delivered by: Honorable Barry Ted Moskowitz United States District Judge


The Court has before it four motions filed in this case. First, Plaintiff Gary Smallwood ("Smallwood" or "Plaintiff") moves to remand the case to California Superior Court. Second, Defendant Atlas Transfer and Storage Co. ("Atlas") moves for an extension of time to respond to Plaintiff's Complaint. Third, Defendants Allied Van Lines, Inc. ("Allied Van") and SIRVA, Inc. ("SIRVA") move to dismiss Plaintiff's Complaint. Fourth, Allied Pickfords, LLC, ("Allied Pickfords") also separately moves to dismiss Plaintiff's Complaint. For the reasons explained below, the Court DENIES Plaintiff's Motion to Remand and GRANTS Defendant Atlas's Motion to Extend Time to Respond. The Court GRANTS in part and DENIES in part Defendant Allied Pickfords's Motion to Dismiss and GRANTS in part and DENIES in part Defendants Allied Van's and SIRVA's Motion to Dismiss.


A. Factual Background

The following facts are taken from Plaintiff's Complaint and other documents of which the Court has taken judicial notice. The Court makes no finding as to the truthfulness of the allegations of the Complaint.

Plaintiff Gary Smallwood is a citizen of the United States. (Compl. ¶ 11.) Plaintiff resided in San Diego, California until September 2007, when he accepted a teaching position with Mosaica Education Abu Dhabi, LLC ("Mosaica"). (Id.) The position required Smallwood to relocate to Abu Dhabi, the United Arab Emirates (the "UAE"). (Id.)

Mosaica allegedly referred Plaintiff to Defendant Allied Pickfords to handle the shipment and storage of his belongings in connection with his move. (Compl. ¶ 12.) Plaintiff intended to store some of his items in San Diego and to ship other items to the UAE. (Compl. ¶ 14.) On September 17, 2007, an Allied Pickfords representative contacted Plaintiff via email to arrange for the storage and shipment of his goods. (Compl. ¶ 13.) Plaintiff claims that he believed that Allied Pickfords was associated with an "Allied Movers" company in the United States. (Smallwood Decl. ¶ 9.) Allied Pickfords initially quoted Plaintiff a price of $2,000 to ship approximately 800 lbs. of his belongings to the UAE via air freight and an additional $5,000--$6,000 to ship his car. (Compl.¶ 15.)

On September 25, 2007, an agent for "Allied International"*fn1 visited Smallwood's home and took notes regarding which belongings Smallwood wished for the company to store and which items he wanted to ship to the UAE. (Compl. ¶ 17.)

On September 26, 2007, Allied International representatives returned to pack and remove Smallwood's possessions from his apartment. (Compl. ¶ 19.) The representatives allegedly created two lists of his possessions: (1) the "Local Household Goods Descriptive Inventory," which included Plaintiff's items to be stored, and (2) the "Descriptive Inventory," which listed the items Plaintiff wanted to ship to the UAE. (Compl. ¶ 20.) Plaintiff owned several weapons that he allegedly intended to store and which he claims were listed with along with the other storage items. (Compl. ¶ 22.)The weapons were packed in a large box labeled "Firearms." (Compl. ¶ 23.)

Sometime in or around late September to early October, Smallwood traveled to Abu Dhabi and assumed his teaching position with Mosaica. (Compl. ¶ 29.) Plaintiff then communicated with Allied International several times during the months of October and November, 2007. (Compl. ¶¶ 32--25.) Once Plaintiff was living in the UAE, Allied International allegedly used "bait and switch" tactics, providing Plaintiff with more expensive quotes and informing him that they needed to ship his items via sea in a larger, more expensive container. (Id.) When told he would have to pay for the larger container, Plaintiff instructed Allied International to ship additional items from storage, namely, boxes labeled "books" and "study materials." (Compl. ¶ 36.)

On February 12, 2008, an Allied International representative contacted Plaintiff to inform him that his shipment had arrived in Abu Dhabi. (Compl. ¶ 39.) Plaintiff subsequently paid Allied International invoices totaling $11,874.31 for shipping costs and $5,062.84 for insurance. (Compl. ¶ 38, 40.)

On February 25, 2008, an Allied International representative allegedly called Plaintiff and informed him that UAE customs officials had discovered a pistol in his car. Plaintiff claims that the Allied International representative told him that he should come to the port to "straighten things out." (Compl. ¶ 41.) When Plaintiff arrived at the port, boxes containing his belongings, including the box labeled "Firearms," were strewn about the pier. (Compl. ¶ 42.) Although an Allied International representative was present at the pier when Plaintiff arrived, the representative soon left. (Compl. ¶¶ 42--43.) Plaintiff alleges that the representative told UAE customs officials that Smallwood directed Allied International to ship the weapons to the UAE. (Compl. ¶ 43.)

UAE customs officials held Plaintiff for questioning for approximately one to two hours. (Compl. ¶ 44.) Officials then transferred Plaintiff to the Abu Dhabi Police Station where officers interrogated him for an additional five to six hours. (Compl. ¶ 45.) Later that evening, officials transferred Plaintiff again to the New Khalidiya Police Station where officers questioned him for nine to ten more hours. (Compl. ¶ 46.)

On February 26, 2008, Plaintiff allegedly signed a statement, written in Arabic, based on the promise that he would be released the next day. (Compl. ¶ 49.)

On February 27, 2008, police transferred Plaintiff to the Al Wathba prison, where he was held for eleven days. (Compl. ¶ 50.) Plaintiff claims that he suffered taunts from other prisoners and became very ill during his incarceration. (Compl. ¶¶ 52--53.)

On Sunday, March 9, 2008, Smallwood went to court and met with a criminal attorney retained by Mosaica. The judge fined Plaintiff and he returned to jail, although a colleague later secured his release on the same day. (Compl. ¶¶ 55, 59.) Plaintiff alleges that legal counsel for Allied International, Eric Baker, may have faxed a letter to the Abu Dahbi Public Prosecutor's Office on March 9, 2008. (Compl. ¶ 56.) Plaintiff claims that the letter admitted, "Our organisation [sic] in the United States, through its agents, was responsible for the shipment. We confirm that the guns and weapons that were found in the consignment were sent to Abu Dhabi in error." (Compl. ¶ 57.)

Smallwood later learned that he had been convicted of importing firearms and ammunition without a permit. (Compl. ¶ 60.) Consequently, Plaintiff claims that the UAE authorities subsequently withheld his passport, forcing him to miss his sons' graduations in the United States. (Compl. ¶ 63.) Smallwood also alleges that he now faces deportation from the UAE as a result of his conviction. (Compl. ¶ 62.)

B. Procedural Background

On October 9, 2008, Plaintiff filed a Complaint against Defendants SIRVA, Allied Van, Allied Pickfords, and Atlas in San Diego County Superior Court. Plaintiff alleged six causes of action including: (1) negligence and negligent infliction of emotional distress, (2) intentional infliction of emotional distress, (3) defamation, (4) breach of fiduciary duty, (5) fraudulent deceit, and (6) breach of contract.

On October 31, 2008, Plaintiff served SIRVA.On November 3, 2008, service was accomplished on Allied Van. Plaintiff and Allied Pickfords dispute whether or not Plaintiff accomplished service on Allied Pickfords on November 10, 2008. On November 12, 2008, Plaintiff served Atlas.

On November 26, 2008, Defendants Allied Van and SIRVA filed a Notice of Removal in this Court [Docket No. 1].

On December 2, 2008, Defendants Allied Van and SIRVA filed a Motion to Dismiss or Compel Arbitration [Docket No. 2]. On December 22, 2008, Plaintiff filed a Motion to Remand [Docket No. 5].

On December 30, 2008, Atlas filed a Motion to Extend Time to Respond to Plaintiff's Complaint [Docket No. 6].

On January 16, 2009, Allied Pickfords filed its own Notice of Removal [Docket No. 13]. Allied Van, SIRVA, and Atlas joined in Allied Pickfords's Notice of Removal on the same day [Docket Nos. 12, 14].

On January 23, 2009, Allied Pickfords filed a Motion to Dismiss or Compel Arbitration [Docket No. 18].


The Court first considers Plaintiff's Motion to Remand. Next, the Court evaluates Atlas's Motion to Extend Time to Respond to Plaintiff's Complaint. Finally, the Court considers together the two Motions to Dismiss filed by Allied Pickfords and Allied Van and SIRVA.

A. Motion to Remand

Plaintiff makes two alternative arguments for remand. First, Plaintiff contends that removal was improper because the removing Defendants failed to timely remove or obtain consent of all served Defendants prior to filing their notice of removal. Second, Plaintiff argues that even if removal was procedurally proper, the removing Defendants have not established federal question jurisdiction.

1. Procedural Requirements for Removal

Plaintiff initially contends that the Court should remand this case because both removal notices filed by Defendants failed to meet the procedural requirements of 28 U.S.C. § 1446(b). First, Plaintiff argues that the Notice of Removal filed by Allied Van and SIRVA ("Removal Notice I") was procedurally defective under the "unanimity rule." Second, Plaintiff alleges that the Notice of Removal filed by Allied Pickfords ("Removal Notice II") was untimely. The Court agrees with Plaintiff that Removal Notice I was procedurally defective for failure to meet the unanimity requirement. Because the Court adopts the "last served defendant rule," however, Removal Notice II timely met the procedural requirements necessary under Section 1446(b).

a. Removal Notice I

Any notice of removal to federal court must be filed within thirty days of service of the initial pleading on the defendant. 28 U.S.C. § 1446(b). In a multi-defendant case, all defendants other than nominal parties must join in a removal petition or file written consent to removal within the same thirty day period following service of the initial pleading. See Hewitt v. City of Stanton, 798 F.2d 1230, 1232 (9th Cir. 1986). Courts refer to the statutory mandate that all defendants timely consent to removal as the "unanimity rule." See Prize Frize, Inc. v. Matrix (U.S.), Inc., 167 F.3d 1261, 1266 (9th Cir. 1999), superseded by statute on other grounds, Class Action Fairness Act of 2005, Pub. L. No. 109-2, 119 Stat. 4, as recognized in Abrego Abrego v. The Dow Chemical Co., 443 F.3d 676 (9th Cir. 2006). Because courts construe the removal statute strictly, the removing defendant has the burden of affirmatively explaining the absence of any co-defendants in a notice of removal. Id. It is not necessary for the removing defendant to obtain the written consent of another defendant who has not yet been served with process in the state action. Community Bldg. Co. v. Maryland Cas. Co., 8 F.2d 678, 678--679 (9th Cir. 1926), cert. denied, 270 U.S. 652 (1926). A court may remand a case to state court upon a plaintiff's timely motion if a defendant's removal notice fails to satisfy the procedural mandates of Section 1446(b). See 28 U.S.C. § 1447(c).

Although SIRVA and Allied Van filed Removal Notice I on November 26, 2008, within thirty days of service of the initial pleading, Atlas did not file written joinder within the statutorily prescribed period.*fn2 SIRVA and Allied Vans attempt to affirmatively explain Atlas's absence by claiming that Plaintiff had not yet validly served Atlas. (Removal Notice I ¶ 12.) In fact, Plaintiff served Atlas on November 12, 2008. (Mazella Decl. ¶ 7.) Courts strictly construe the removal statute against removal jurisdiction. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). Although a defendant need not sign the notice of removal, he must show affirmative written consent. Myer v. Nitetrain Coach Co., Inc., 459 F. Supp. 2d 1074, 1078 (W.D. Wash. 2006). Therefore, because Atlas did not timely join in or provide written consent to Removal Notice I, it failed to meet the procedural requirements of Section 1446(b).

b. Removal Notice II

Although Removal Notice I was procedurally defective, this case should remain in federal court if the subsequent notice filed by Allied Pickfords on January 16, 2009 ("Removal Notice II") properly effectuated removal. To determine whether Removal Notice II satisfied the procedural requirements of Section 1446(b), the Court first must ascertain whether Plaintiff succeeded in his initial attempt to serve Allied Pickfords on October 31, 2008. If Plaintiff's first service attempt succeeded, then Allied Pickfords certainly filed Removal Notice II outside the thirty day time limit prescribed by Section 1446(b). For the reasons explained below, however, the Court concludes that Plaintiff did not properly serve Allied Pickfords on October 31, 2008. The Court next evaluates whether to apply the "first-served" or "last-served" defendant rule. Because the Court finds that the "last-served" rule should apply, Removal Notice II properly removed this case to federal court.

i. Plaintiff's Service On Allied Pickfords

Plaintiff twice attempted to serve Allied Pickfords. First, Plaintiff mailed the summons and complaint pursuant to California Civil Procedure Code § 415.40 to Allied Pickfords on October 31, 2008. Section 415.40 permits service on an out-of-state defendant by sending a copy of the summons and complaint to the person to be served by first-class mail, postage prepaid, requiring a return receipt.

Where the defendant is a corporate entity, however, the serving party must also comply with California Civil Procedure Code § 416.10. Cruz v. Fagor America, Inc., 146 Cal. App. 4th 488, 496 (2007). Section 416.10 requires that the summons and complaint be delivered to "the person designated as agent for service of process . . .[or] the president or other head of the corporation, a vice president, a secretary or assistant secretary, a treasurer or assistant treasurer, a general manager, or a person authorized by the corporation to receive service of process." Cal. Civ. Proc. Code § 416.10(a)--(b). Furthermore, when serving a nonresident pursuant to Section 415.40, the plaintiff must provide proof of service including evidence satisfactory to the court establishing actual delivery to the person served, by a signed return receipt or other evidence. Cal. Civ. Proc. Code § 417.20(a).

Here, Plaintiff provides no evidence that his initial service on Allied Pickfords was proper. Plaintiff only states that he mailed the summons and complaint via first class mail, return receipt requested, to an address identified on Allied Pickfords's website as one of two offices in the UAE. (Pl.'s Mem. of P. & A. in Opp. to Def. Allied Pickfords's Mot. to Dismiss 4.) Plaintiff does not contend that he served Allied Pickfords's designated agent or any other individual authorized to receive service under Section 416.10. Moreover, Plaintiff admits that the summons and Complaint were returned "undeliverable" to him in early December. (Id. at 5.) Thus, the Court concludes that ...

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