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FARACE v. PEREIRA

July 22, 2004.

ANDREA FARACE, Petitioner,
v.
JOHN S. PEREIRA, as Trustee of Trace International Holdings, Inc. and Trace Foam Sub, Inc., Respondent.



The opinion of the court was delivered by: ROBERT SWEET, Senior District Judge

OPINION

Petitioner Andrea Farace ("Farace") has moved for an order remanding this action to the Supreme Court of the State of New York, New York County pursuant to 28 U.S.C. § 1447(c) and alternately requests that this Court abstain from the proceedings pursuant to 28 U.S.C. § 1334(c) or grant an equitable remand pursuant to 28 U.S.C. § 1452(b). For the reasons set forth below, the motion is granted.

Prior Proceedings and Background

  On June 25, 2003, a money judgment was entered in favor of respondent John S. Pereira ("Pereira"), in his capacity as Trustee of Trace International Holdings, Inc. and Trace Foam Sub, Inc., and against Farace and other defendants in the action captioned Pereira v. Cogan, 00 Civ. 619. Approximately two weeks later, on July 11, 2003, the Federal Judgment was docketed by respondent in the New York County Clerk's Office as Judgment No. 1723113. The effect of such docketing was to give the Federal Judgment the force and effect of a state court judgment. See N.Y. CPLR § 5018(b).

  Following entry and docketing of the Federal Judgment, Pereira commenced various enforcement proceedings against Farace under Article 52 of the CPLR. Pereira's actions included attempting to serve restraining notices upon Farace and upon Citigroup, Independence Holdings Partners LLC ("Independence") and Smith Barney under CPLR § 5222, directing the United States Marshals Service ("USMS") to serve executions upon these garnishees under CPLR § 5232, and causing the Sheriff of the City of New York (the "Sheriff") to attempt to serve an income execution upon Farace at Smith Barney and at Citigroup in New York under CPLR § 5231.

  By order to show cause and verified petition, Farace commenced a special proceeding on March 1, 2004 in the Supreme Court, New York County to vacate the restraining notices, executions and income execution under CPLR §§ 5239 and 5240 on the grounds that Pereira, the USMS and the Sheriff failed to comply with the service requirements of Article 52 of the CPLR. The Honorable Rolando T. Acosta granted a temporary restraining order dated March 1, 2004, prohibiting Pereira and all of the garnishees from taking any steps to transfer or deliver any funds or other property under the executions or the income execution. The application was made returnable in the state court for March 10, 2004.

  By Notice of Removal, dated March 9, 2004, Pereira removed the Special Proceeding to this Court under 28 U.S.C. § 1446(d). Farace moved by order to show cause on March 16, 2004 to remand the action to the Supreme Court. The parties then agreed that the temporary restraining order previously issued by Justice Acosta shall remain in place through at least March 26, 2004, pending Farace's presentation of its application to remand On March 25, 2004, Pereira filed an Amended Notice of Removal. On March 31, 2004, argument was heard on the motion and it was marked fully submitted. On April 5, 2004, this Court issued an order extending the temporary restraining order issued by Justice Acosta pending the determination of Farace's motion.

  Discussion

  According to the initial Notice of Removal, Pereira asserts that removal is proper under 28 U.S.C. § 1441 because this Court has "federal question jurisdiction" because "this action arises from and is directly related to the action commenced approximately four years ago in this Court against Farace [which] resulted in the granting of a final judgment" and because "this action arises under Federal Rule of Civil Procedure 69 and federal case law which gives this court jurisdiction to supervise the enforcement of the Federal judgment . . ."

  In its Amended Notice of Removal and opposition brief, two additional grounds are provided for removal: (1) removal is proper under 28 U.S.C. § 1442(a)(3) because Pereira is an officer of the courts of the United States and the order to show cause challenges actions taken by him under color of his office or in the performance of his duties; and (2) removal is proper under 28 U.S.C. § 1452(a) because it relates to a case under Title 11 of the United States Code over which the United States District Court for the Southern District of New York has jurisdiction pursuant to 28 U.S.C. § 1334(b).

  "Removal jurisdiction must be strictly construed, both because the federal courts are courts of limited jurisdiction and because removal of a case implicates significant federalism concerns." In re NASDAQ Market Makers Antitrust Litigation, 929 F. Supp. 174, 178 (S.D.N.Y. 1996) (citing Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 109 (1941)) ("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."); see also Deming v. Nationwide Mutual Ins. Co., No. Civ.A. 3:03CV1225, 2004 WL 332741, at *1 (D. Conn. Feb. 14, 2004) ("federal courts construe the removal statute narrowly, resolving any doubts against removability.") (quoting Somlyo v. J. Lu-Rob Enters., Inc., 932 F.2d 1043, 1045-46 (2d Cir. 1991)).

  "The burden is on the removing party to prove that it has met the requirements for removal." Codapro Corp. v. Wilson, 997 F. Supp. 322, 325 (E.D.N.Y. 1998) (quoting Avon Products, Inc. v. The A/J Partnership, 89 Civ. 3743/8032, 1990 WL 422416, at *1 (S.D.N.Y. March 1, 1990)); see also NASDAQ Market Makers, 929 F. Supp. at 178.

  Section 1441(b) Section 1441(b) provides that a defendant may remove any "civil action of which the district courts have original jurisdiction founded upon a claim or right arising under the Constitution, treaties or laws of the United States . . ." Removal pursuant to 28 U.S.C. § 1441(b) is "improper unless a federal question is an essential element of a plaintiff's cause of action, and is apparent on the face of the plaintiff's well-pleaded complaint without reference to the answer or the removal petition." Hodges v. Demchuk, 866 F. Supp. 730, 732-33 (S.D.N.Y. 1994); see also Rivet v. Regions Bank of Louisiana, 522 U.S. 470, 475 (1998).

  The petition filed by Farace in state court alleges several statutory causes of action under New York law. The order to show cause alleges that "judgment should be entered pursuant to CPLR §§ 5239 and 5240 vacating the Income Execution, the Executions and the Restraining Notices" on the grounds that such notices and executions were not served in accord with CPLR §§ 5222, 5231 and 5232. In addition, Farace alleges that service on him is invalid as a matter of law under the Convention on the Service ...


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