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Title Concept Chaser Co., Inc. v. Pentel of America

October 18, 2011

TITLE CONCEPT CHASER CO., INC.
v.
PENTEL OF AMERICA, LTD; ET AL



The opinion of the court was delivered by: The Honorable Christina A. Snyder

CIVIL MINUTES - GENERAL

Present:

RITA SANCHEZ N/A N/A Deputy Clerk Court Reporter / Recorder Tape No.

Attorneys Present for Plaintiffs: Attorneys Present for Defendants:

N/A N/A

Proceedings: (In Chambers:) PLAINTIFF'S EX PARTE APPLICATION FOR IMMEDIATE REMAND AND FEES UNDER 28 U.S.C. § 1447(c). (Filed October 11, 2011)

INTRODUCTION AND BACKGROUND

On December 31, 2009, plaintiff Concept Chaser Co., Inc ("CCCI") filed the instant action against defendants Pentel of America and Pentel, Ltd (collectively "Pentel") in the Los Angeles Superior Court. The case was assigned to the Hon. Mark. J. Mooney. The essence of plaintiff's claim is that Pentel hired CCCI to create an advertising campaign for a new pen. Third Amended Complaint ("TAC") ¶ 11. Plaintiff alleges that under the contract, CCCI was to retain ownership of all ideas created for Pentel, unless there was a second agreement in which CCCI licensed or sold the ideas. TAC ¶¶ 12--15. According to CCCI, Pentel breached the contract, and had another firm execute CCCI's idea. TAC ¶¶ 24--29.

Pentel demurred to the original complaint and to CCCI's first-amended complaint. Pentel's principal argument was that CCCI's claims were preempted by the California Uniform Trade Secret Act. CCCI withdrew its trade-secret claim in its second-amended complaint. Pentel responded with a demurrer filed on February 7, 2011. Declaration of Jeffrey Ehrlich, Exh. 1. In that demurrer, Pentel argued that the second-amended complaint contained only "scant" changes from the original complaint, and was "virtually the same complaint with each and every one of the same causes of action, with little, if any, amendments thereto." Id. at 17--18 (emphasis in original). Moreover, the demurrer contained an extended argument that all of CCCI's claims were preempted by the Copyright Act, and urged the court to dismiss the action on that basis. Id. at 26--27.

Judge Mooney dismissed some claims as preempted, but overruled the demurrer as to CCCI's claims for breach of contract and fraud, among others. Ehrlich decl., ¶ 7. On December 31, 2009, CCCI filed a third-amended complaint. Pentel demurred unsuccessfully and was ordered to answer. Id. ¶ 8. On May 27, 2011, Pentel filed its answer to the third-amended complaint and asserted copyright preemption as an affirmative defense. Ehrlich Decl., Exh. 2, 38. On June 15, 2011, Pentel filed an unsuccessful motion for summary judgment in which one of its principal arguments was that CCCI's claims were preempted by the Copyright Act. Ehrlich Decl., Exh. 3. On or about August 30, 2011, Pentel filed sixteen motions in limine, including one which sought to exclude all evidence preempted by the Copyright Act. Ehrlich Decl., Exh. 4. On October 3, 2011, Judge Mooney denied most of Pentel's motions in limine including that which sought to exclude evidence preempted by the Copyright Act noting that "we sort of looked at this in the past . . . [b]ut I still think that we're not really dealing with copyright but for the services in conveying the idea." Ehrlich Decl., Exh. 7, 101--102. Judge Mooney advised the parties that the court hoped to start trial that week. Ehrlich decl., ¶ 13. On October 4, 2011, the court advised the parties that trial would commence the next morning. Id. On the morning of October 5, 2011, Pentel's counsel filed a motion to disqualify Judge Mooney for cause, claiming that Judge Mooney was biased against Pentel's counsel and in favor of CCCI's counsel. Declaration of Michael Adler, ¶

3. Shortly thereafter, Pentel's counsel filed notice of removal on the basis of copyright preemption. Id. ¶ 4. At approximately, 11:00 a.m., Judge Mooney took the bench and said that before the case had been removed, he had struck the motion to disqualify. Id. ¶ On October 11, 2011, CCCI filed the instant ex parte application for immediate remand and for fees under 28 U.S.C § 1447(c). On October 13, 2011, Pentel filed an opposition. After carefully considering the parties' arguments, the Court finds and concludes as follows.

LEGAL STANDARD

A motion for remand is the proper procedure for challenging removal. Remand may be ordered either for lack of subject matter jurisdiction or for any defect in removal procedure. See 28 U.S.C. § 1447(c). The Court strictly construes the removal statutes against removal jurisdiction, and jurisdiction must be rejected if there is any doubt as to the right of removal. See Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). The party seeking removal bears the burden of establishing federal jurisdiction. See Prize Frize, Inc. v. Matrix, Inc., 167 F.3d 1261, 1265 (9th Cir. 1999). The defendant also has the burden of showing that it has complied with the procedural requirements for removal. Judge William W. Schwarzer, et al., California Practice Guide: Federal Civil Procedure Before Trial § 2:2225 (The Rutter Group 2011).

The time requirements for filing a petition for removal are set forth in 28 U.S.C. ยง 1446(b). Cantrell v. Great Republic Ins. Co., 873 F.2d 1249, 1254 (9th Cir. 1989). The statute provides two thirty-day windows during which a case may be removed. The first is within the first thirty days after the defendant receives the initial pleading if that pleading discloses a basis for removal. If that pleading does not disclose a basis for removal, then the defendant may remove during the second window, which is the first thirty days after the defendant receives a paper "from which ...


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