United States District Court, D. Massachusetts
THE BANK OF NEW YORK MELLON f/k/a The Bank of New York, as successor trustee to JPMorgan Chase Bank, N.A., as trustee for the certificate holders of CWABS Master Trust, Revolving Home Equity Loan Asset Backed Note, 2004-C, Plaintiff,
GERARD CIOFFI, Defendant/Counterclaim Plaintiff,
BANK OF AMERICA, N.A. Counterclaim Defendant.
MEMORANDUM AND ORDER ON MOTION TO REMAND
Dennis Saylor IV United States District Judge.
an action arising out of the foreclosure and sale of a
residential property owned by defendant Gerard Cioffi. It
presents a somewhat unusual procedural question: whether a
party who is newly added to a case as an additional
counterclaim defendant-and who is thus neither an original
defendant; an additional defendant added by the plaintiff;
nor a third-party defendant-can then remove the case from
state to federal court. The majority view is that such a
party cannot remove the case. For the reasons set forth
below, although the majority view is arguably at odds with
the purpose and even the language of the removal statute, the
Court will nonetheless follow those rulings, and the motion
to remand will be granted.
September 2011, Bank of America, N.A. ("BANA")
foreclosed on a property located at 11 Frances Drive,
Newburyport, Massachusetts, owned by Gerard Cioffi. It then
sold the property to plaintiff Bank of New York Mellon
January 2012, BNYM commenced a summary process action in the
Massachusetts Northeast Housing Court against Gerard Cioffi
seeking possession of the property. Almost three and a half
years later, Cioffi filed a motion "for leave of court
to implead" BANA as a defendant under Massachusetts Rule
of Civil Procedure 14. (Greaney Aff. Ex. B). In his motion,
Cioffi stated that he intended to bring claims against BANA
for, among other things, breach of contract, unfair and
deceptive trade practices, and wrongful
foreclosure. The claims against BANA alleged, in
substance, that the bank did not properly foreclose on the
property prior to the sale. The Housing Court granted that
motion on November 9, 2015, by means of a handwritten margin
order. In full, the order stated as follows: "Aft.
Hearing, allowed. See MRCP Rules 14(a), 17(a), 18,
19(a), 20(a), 25(c)." (Greaney Aff. Ex. B).
removed the case to federal court on November 24, 2015,
fifteen days later. The jurisdictional basis for removal was
diversity of citizenship. According to the notice of removal,
Cioffi is a citizen of Massachusetts; BNYM is a Delaware
corporation with a principal place of business in New York;
and BANA is a national banking association with a principal
place of business in North Carolina.
Cioffi's motion for leave "to implead" BANA
included a draft complaint, no complaint was served on BANA
prior to November 24. Cioffi timely filed a motion to remand
on December 3, 2015.
28 U.S.C. § 1441(a), "any civil action brought in a
State court of which the district courts of the United States
have original jurisdiction, may be removed by the
defendant or the defendants, to the district court of
the United States for the district and division embracing the
place where such action is pending." (emphasis added).
There are many different types of "defendants, "
however, not all of whom are entitled to remove an action
under the statute. Accordingly, the first issue before the
Court is how to characterize BANA's position in this
BANA is an Additional Counterclaim Defendant
contends that BANA is a "third-party defendant"
based on the housing court's granting of his motion for
leave to "implead" BANA pursuant to Mass. R. Civ.
P. 14. However, the housing court's margin order
purported to allow the motion pursuant to Rules 14, 17, 18,
19, 20, and 25.
R. Civ. P 14(a) provides that "a defending party, as a
third-party plaintiff, may . . . cause a summons and
complaint to be served upon a person who is or may be liable
to him for all or part of the plaintiff's claim against
him." Here, Cioffi is the "defending party" in
the summary process action. But the claims Cioffi makes
against BANA assert that it is directly liable to Cioffi for
its separate misconduct; BANA's liability to Cioffi is
not dependent on, and does not flow from, any liability
Cioffi may have to BNYM for possession of the property. Thus,
BANA is not a party "who is or may be liable to"
Cioffi "for all or part of" BNYM's claim
against Cioffi for possession. Accordingly, BANA cannot be a
third-party defendant under Mass. R. Civ. P. 14 or its
R. Civ. P. 17 addresses the requirement that an action be
brought by the "real party in interest." That rule
is clearly inapplicable to the joinder of BANA to the
original summary process action. Mass. R. Civ. P. 18
addresses the joinder of claims and remedies, and is likewise
clearly inapplicable. Mass. R. Civ. P. 19 addresses the
joinder of necessary parties; as BANA notes, "there is
no basis for any suggestion by Cioffi that BANA is necessary
to the summary process eviction." (BANA Suppl. Opp. 4).
Mass. R. Civ. P. 25 addresses the substitution of parties due
to death, incapacity, incompetency, or a transfer of
interest, and is also clearly inapplicable.
leaves Rule 20 as the only potential appropriate basis for
joinder. Rule 20 allows for the permissive joinder of parties
for claims involving the same "transaction, occurrence,
or series of transactions or occurrences and if any question
of law or fact common to all these [parties] will arise in
the action." Mass. R. Civ. P. 20; see also Fed.
R. Civ. P. 20 (same, with minor stylistic differences).
Although Mass. R. Civ. P. 20 does not speak directly to the
addition of new parties, Rule 13(h) provides that
"[p]ersons other than those made parties to the original
action may be made parties to a counterclaim or cross-claim
in accordance with the provisions of Rules 19 and 20."
Mass. R. Civ. P. 13(h).
BANA was not a party to an original action, and was made a
party only as a result of Cioffi's counterclaim. BANA has
not asserted any claims against either BNYM or Cioffi, and it
is not a plaintiff either in form or in substance.
Accordingly, BANA is only a counterclaim defendant in this
action. In order to distinguish BANA from a plaintiff that is
already party to an action when a counterclaim is asserted
against it, the Court will use the phrase "additional
counterclaim defendant" to describe BANA's status.
See Westwood Apex v. Contreras, 644 F.3d 799, 801
(9th Cir. 2011) (labeling "a party joined to an action
as a defendant to a counterclaim" as an "additional
Is BANA a "Defendant" under 28 U.S.C. §
question presented in this case is whether BANA-as an
additional counterclaim defendant-falls within the meaning of
"defendant" as used in 28 U.S.C. § 1441, and
therefore is within the class of parties entitled to remove
an action to federal court.
starting point for any discussion of the meaning of
"defendant" under § 1441(a) is the Supreme
Court's decision in Shamrock Oil & Gas Corp. v.
Sheets, 313 U.S. 100 (1941). In that case, Shamrock
filed suit in Texas state court against defendant Sheets.
Id. at 102. After Sheets filed a counterclaim
against Shamrock for breach of contract, Shamrock removed the
case to federal court. Id. at 102-03. Shamrock
argued that removal was proper because it had become a
defendant upon the assertion of the counterclaim.
Id. at 104.
Supreme Court reviewed the statutory history of §
1441(a) and concluded that that the term
"defendant" did not include an original plaintiff
who later became a counterclaim defendant after the defendant
asserted a counterclaim. Id. at 107-09. The court
"emphasized that, at different times, removal was either
afforded to ‘defendants' or, alternatively, to
‘either party.' Because Congress was presumed to be
aware of this statutory history, [the court found that] the
choice of ‘defendant' was a deliberate exclusion of
other classes of parties." Westwood
Apex, 644 F.3d at 805 (citing Shamrock Oil,
313 U.S. at 105-08). The Shamrock Oil court also
[T]he policy of the successive acts of Congress regulating
the jurisdiction of federal courts is one calling for the
strict construction of such legislation. The power reserved
to the states under the Constitution to provide for the
determination of controversies in their courts, may be
restricted only by the action of Congress in conformity to
the Judiciary Articles of the Constitution. "Due regard
for the rightful independence of state governments, which
should actuate federal courts, requires that they
scrupulously confine their own jurisdiction to the precise
limits which the statute has defined."
Shamrock Oil, 313 U.S. at 108-09 (quoting Healy
v. Ratta, 292 U.S. 263, 270 (1934)). Thus, "[s]ince
Shamrock Oil, the law has been settled that a
counterclaim defendant who is also a plaintiff to the
original state action may not remove the case to federal
court." Westwood Apex, 644 F.3d at 805 (listing
"Original Defendant" Rule
time, the holding of Shamrock Oil evolved into what
has been termed the "original defendant rule."
Under the original defendant rule, only an "original
defendant"-that is, a defendant named in the pleading
that commenced the action-may remove a case to federal court.