Judge Ludwig of the USDC, EDPA, was recently faced with the question of when removal from state court to federal court is proper. In the case of Alston v. Wal-Mart, Alston commenced a slip and fall lawsuit in the PA Court of Common Pleas, Philadelphia County, a venue that is consistently rated as one of the worst defense venues in the country. The case was originally filed as an arbitration court case and in its affirmative defenses Walmart alleged that plaintiff could not seek damages in excess of $50,000 (the arbitration court’s jurisdictional limit) or $75,000 (the minimum amount required to remove the case to federal court on diversity grounds). As the case progressed, it quickly became apparent that plaintiff’s demand exceeded $75,000. Wal-Mart thereafter removed the case to federal court. Plaintiff’s counsel objected and argued that the removal was untimely as it took place more than thirty days after service of the complaint. Wal-Mart argued that the removal was, in fact, timely because it was not until the plaintiff made it clear that the demand exceeded $75,000 that Wal-Mart was aware of its right to remove the case.
Judge Ludwig sided with Wal-Mart. He held that the removal was timely as it was not until the value of the demand was made clear that Wal-Mart was on notice of its to remove the case.
So what’s the takeaway from all of this? We suggest that if you have a case in state court which you would otherwise seek to remove to federal court but in which the value of the case does not seem to exceed $75,000, you ask the plaintiff to stipulate to a $75,000 award cap. If the plaintiff refuses, you probably then have the right to remove the case to federal court.
If you have any questions about this post, please contact Bob Cosgrove at firstname.lastname@example.org.