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Dunlap v. General Motors LLC

United States District Court, W.D. Missouri, Western Division

December 21, 2016

TERRI DUNLAP, et al., Plaintiffs,
v.
GENERAL MOTORS LLC, Defendant.

          ORDER (1) DENYING DEFENDANT'S MOTION TO TO STAY, (2) DENYING PLAINTIFFS' MOTON TO REMAND, AND (3) DIRECTING THE PARTIES TO BRIEF ISSUES RELATED TO THE COURT'S JURISDICTION

          ROSEANN A. KETCHMARK, JUDGE

         This case was removed from state court in September 2016. Thereafter, Plaintiffs filed a Motion to Remand. (Doc. 7.) Defendant (also referred to as “New GM”) responded to the Motion to Remand (doc. 15) and separately filed a Motion to Stay (doc. 13). Both motions are fully briefed. The Court now DENIES the Motion to Stay, and further DENIES the Motion to Remand. The Court also directs the parties to brief issues related to the Court's jurisdiction.

         Background

         In June 2009, Motors Liquidation Corporation, f/k/a General Motors Corporation, (“Old GM”), filed a petition for bankruptcy relief in the United States Bankruptcy Court for the Southern District of New York. The following month, the Bankruptcy Court approved the sale of substantially all of Old GM's assets to Defendant.[1] According to Defendant, “[t]he sale of assets was free and clear of all liens, claims, and encumbrances, except for certain limited exceptions.” (Doc. 1, ¶ 10.) Nonetheless, many suits were filed against Defendant, alleging injuries caused by defective ignition switches on vehicles sold by both Old GM and Defendant. Accordingly, in June 2014, the Judicial Panel on Multidistrict Litigation, (“the Panel”), issued a transfer order creating Multidistrict Litigation 2543, In re General Motors LLC Ignition Switch Litigation (“the MDL”).

         Plaintiffs filed this suit in the Circuit Court of Jackson County, Missouri, on August 25, 2016. The suit consists of approximately eighty-five plaintiffs. The details of Plaintiffs' claims are not important for purposes of considering the pending motions. In summary, Plaintiffs purchased various vehicles sold by either Old GM or Defendant, and they assert personal injury claims caused by allegedly faulty ignition switches.

         Defendant was served on August 30. On September 6, Plaintiffs filed an Amended Petition in state court; however, Plaintiffs did not serve the Amended Petition on Defendant. Apparently unaware of the Amended Petition, Defendant filed a Notice of Removal on September 29 that purported to remove the original Petition. The Notice of Removal alleges that jurisdiction exists pursuant to 28 U.S.C. § 1334, because Plaintiffs' claims are related to Old GM's bankruptcy. (Doc. 1, ¶ 8.)[2]

         On October 4, Defendant filed a Notice with the Panel, advising that this case appeared to be related to the MDL. The next day, the Panel issued a Conditional Transfer Order, (“CTO”), conditionally transferring this case to the MDL. Plaintiffs objected to the CTO, which stayed the transfer until the Panel rules on Plaintiffs' objections. The Panel is scheduled to entertain argument on Plaintiffs' objection at its hearing session on January 26, 2017.[3]

         Plaintiffs filed their Motion to Remand on October 20; as discussed below in Part I.A.1, Plaintiffs primarily contend that Defendant's attempted removal is defective because it did not purport to remove the Amended Petition. Defendant's response addresses this argument, and also suggests the Court should refrain from ruling on Plaintiffs' motion until the Panel rules on the Plaintiffs' objection to the CTO because the matter might be best decided by the MDL. Defendant's separate Motion to Stay presents the same argument in greater detail. As discussed more fully below, the Court denies both motions.

         Discussion

         I. Defendant's Motion to Stay

         A. The Appropriate Standard

         The Court has the inherent discretion to stay proceedings, particularly when necessary to manage its docket and coordinate with litigation pending in other forums. E.g., Lunde v. Helms, 898 F.2d 1343, 1345 (8th Cir. 1990). The Panel's Rules are designed to maintain this flexibility. For instance, Rule 2.1 (formerly Rule 1.5) provides that “[t]he pendency of a . . . conditional transfer order . . . does not affect or suspend orders and pretrial proceedings in any pending federal district court action and does not limit the pretrial jurisdiction of that court.” Thus, although the Court has the power to issue rulings while objections to the CTO are pending, the Court also is not obligated to do so. And, there is no doubt that this flexibility applies specifically to motions to remand that are filed before the case is transferred. As the Panel noted when discussing Rule 2.1's predecessor, “those courts wishing to address such motions [to remand] have adequate time in which to do so, those courts concluding that such issues should be addressed by the transferee judge need not rule on them, and the process of . . . transfer . . . can continue without any unnecessary interruption or delay.” In re Prudential Ins. Co. of Am. Sales Practice Litig., 170 F.Supp.2d 1346, 1347-48 (J.P.M.L. 2001).

         In deciding whether to grant Defendant's motion, the Court must first ascertain exactly what Defendant seeks to have stayed. Defendant's argument focuses on the Motion to Remand, contending that it raises issues that are likely to be presented to the MDL. Defendant mentions, but does not focus on, the wisdom of staying all proceedings (including discovery) pending the Panel's decision. In addition, the parties have already reached certain agreements regarding the processing of this case. (See Doc. 18.) For these reasons, the Court construes Defendant's request as asking the Court to stay its consideration of the Motion to Remand and allow it to be decided by the MDL (assuming, of course, that the Panel overrules Plaintiffs' objections to the CTO).

         With that understanding in place, the Court next considers whether the Motion to Remand should be resolved now or if it should be reserved for possible resolution by the MDL. The parties have provided a multitude of decisions from other courts, some of which have resolved pending motions to remand and some of which have stayed the motion for resolution by the MDL. The Court does not find the outcome of these cases particularly helpful: as should be expected, district courts have not been unanimous in the exercise of their discretion, and the exercise of discretion depends greatly on the particulars of the case. Of more assistance has been the factors other courts consider in deciding whether to stay the matter. The majority of courts apply the analysis set forth in Meyers v. Bayer AG, 143 F.Supp.2d 1044 (E.D. Wis. 2001), and the Court finds that court's analytical framework to be persuasive because it appropriately balances (1) the judicial economies that underlie the MDL and (2) appropriate consideration of matters related to jurisdiction and removal.[4] Under the Meyers test, the Court first makes a preliminary assessment to determine whether the issue presented in the Motion to Remand is easily resolved. The Court then considers whether the issues ...


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