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Regal Stone Limited and Fleet Management Ltd v. Longs Drug Stores California

May 4, 2012

REGAL STONE LIMITED AND FLEET MANAGEMENT LTD, PLAINTIFFS,
v.
LONGS DRUG STORES CALIFORNIA,
L.L.C., A CALIFORNIA LIMITED LIABILITY COMPANY, LONGS DRUG STORES, L.L.C., A MARYLAND LIMITED LIABILITY COMPANY, LONGS DRUG STORES CORPORATION, A CALIFORNIA CORPORATION, CVS CAREMARK CORPORATION, A DELAWARE CORPORATION, LOUIE CHESTER, AN INDIVIDUAL, AND DOES 1--20,
DEFENDANTS.



ORDER GRANTING PLAINTIFFS' MOTION TO CERTIFY ORDER FOR INTERLOCUTORY APPEAL AND DENYING DEFENDANT CVS'S EX PARTE APPLICATION FOR ADMINISTRATIVE RELIEF

I. INTRODUCTION

This Order disposes of two matters currently before the Court.

The first is a motion requesting certification for an interlocutory 24 appeal pursuant to 28 U.S.C. § 1292(b), filed on March 27, 2012 by Plaintiffs Regal Stone Limited and Fleet Management LTD's 26 ("Plaintiffs"). ECF No. 42 ("Pls.' Mot."). The Motion is fully 27 briefed. ECF Nos. 43 ("CVS Opp'n"), 44 ("Pls.' Reply"). 28

Plaintiffs' Motion asks the Court to certify for interlocutory appeal an order entered March 2, 2012, in which the Court denied Plaintiffs' motion to remand this case to the California state 3 court in which Plaintiffs initially filed it. See ECF No. 40 4 ("Order"). 5

The second matter before the Court is an ex parte application 6 for administrative relief pursuant to Civil Local Rule 7-10, filed 7 on May 1, 2012 by Defendant CVS Caremark Corporation ("CVS"). ECF No 45 ("CVS Ex Parte App."). Plaintiffs filed an opposition brief. ECF No. 47 ("Pls.' Opp'n to Ex Parte App."). CVS asks the Court to 10 order Plaintiffs to immediately serve on all defendants a full and unredacted copy of the operative complaint in this case. See Remand Order at 2-3, 10 n.9 (explaining and accepting Plaintiffs' reasons for not yet having effected such service).

For the reasons set forth below, the Court GRANTS Plaintiffs' 15 motion, stays all further district court proceedings in this case pursuant to 28 U.S.C. § 1292(b), and, accordingly, DENIES CVS's ex parte application as moot. 18 19

II. BACKGROUND

As detailed in the Court's March 2, 2012 Order denying Plaintiffs' motion to remand, Plaintiffs in this case are foreign 22 corporations, and the bulk of the named defendants are domestic 23 corporations incorporated outside California. At least one 24 defendant, a natural person, is a California citizen. Plaintiffs 25 make a variety of state law claims, and originally chose to bring 26 those claims in California state court. Because their complaint 27 contained the private medical information of a non-party who had 28 asserted his California state privacy rights, Plaintiffs, following

California rules of court, filed only a heavily redacted version of 2 the complaint. They filed it alongside a motion to seal -- in 3 effect, a motion for a protective order. Plaintiffs never served 4 any of the defendants with the redacted complaint because they were 5 waiting for the state court to rule on the motion to seal. And 6 wait they did. After nearly eight months, several continuances, 7 and at least two amended complaints, defendant CVS specially 8 appeared and removed the case to this Court, notwithstanding 9

Plaintiffs' having joined, but not served, at least one California 10 citizen as defendant. See Order at 2-3. Normally, under the "forum defendant" rule, a case is not removable from state court when a citizen of that state has been "properly joined and served" as a defendant. See 28 U.S.C. 1441(b)(2).

This Court observed that other district courts around the 15 nation have split into two camps over how to apply the forum defendant rule when, as here, a forum defendant has been properly joined but not served. Order at 7. One camp favors removal in 18 such circumstances; the other, remand. Id. The Court noted the 19 absence of any appellate authority on the question. Id. The 20 Court, after reviewing the positions of the two camps, decided to 21 follow the weight of authority in its own district, which favors 22 removal. Id. at 11. Accordingly, the Court denied Plaintiffs' 23 motion to remand and retained jurisdiction over the case. Id. 24

III. DISCUSSION

In civil cases, a district court may certify an order for 27 interlocutory appellate review if (1) the order involves a 28 controlling question of law, (2) an immediate appeal of the order may materially advance the ultimate termination of the litigation, 2 and (3) the order involves a question upon which there are 3 substantial grounds for difference of opinion. 28 U.S.C. ยง Cir. 1981). Assuming these conditions are satisfied, and subject 6 to the ...


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