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IN THE MATTER OF APPLICATION OF NOVELLO

United States District Court, W.D. New York


IN THE MATTER OF THE APPLICATION OF ANTONIA C. NOVELLO, as Commissioner of Health of the State of New York, Petitioner,
v.
MANOR OAK SKILLED NURSING FACILITIES, INC., and SAFE HARBOUR HEALTH CARE PROPERTIES, LTD., Respondents. UNITED STATES OF AMERICA, Intervenor-plaintiff, v. MANOR OAK SKILLED NURSING FACILITIES, INC., SAFE HARBOUR HEALTH CARE PROPERTIES, LTD., MONH LLC AND/OR HARMOZ MANSOURI, as Caretaker of Manor Oak Skilled Nursing Facilities, Inc., and ANTONIA C. NOVELLO, as Commissioner of Health of the State of New York, Intervenor-defendants.

The opinion of the court was delivered by: JOHN T. ELFVIN, Senior District Judge

MEMORANDUM and ORDER*fn1

This receivership action has been thrice removed from the New York State Supreme Court, County of Erie. This action was first removed by the United States ("IRS") on May 21, 2004 ("First Removal"); this Court remanded sua sponte because the IRS had not been a party to the state court action. The IRS again removed this action on June 2, 2004 ("Second Removal"); this Court partially remanded the action in an Order dated June 3, 2004. The IRS again removed this case on June 24, 2004 ("Third Removal"). MONH, LLC ("MONH") filed a motion on June 30, 2004 seeking remand of this action addressing the Second and Third Removals. The New York State Department of Health ("NYSDOH") filed papers supporting MONH's motion on July 12, 2004. MONH's motion to remand was submitted on the papers on August 6, 2004. For the reasons set forth below, MONH's motion for remand will be denied.

The Third Removal was effected pursuant to 26 U.S.C. § 7424 ("Section 7424") and 28 U.S.C. § 1444 ("Section 1444") because the IRS's motion for intervention had been granted by the state court on June 3, 2004. Section 7424 provides in relevant part:

"If the United States is not a party to a civil action or suit, the United States may intervene in such action or suit to assert any lien arising under this title on the property which is the subject of such action or suit. The provisions of section 2410 of title 28 of the United States Code (except subsection (b)) and of section 1444 of title 28 of the United States Code shall apply in any case in which the United States intervenes as if the United States had originally been named a defendant in such action or suit."
Section 1444 provides in relevant part:
"Any action brought under section 2410 of this title against the United States in any State court may be removed by the United States to the district court of the United States for the district and division in which the action is pending."
  The Third Removal was proper because Sections 7424 and 1444 gave the IRS an affirmative right to remove that arose when the IRS's motion to intervene was granted on June 3, 2004.*fn2 Indeed, Section 7424 expressly provides that Section 1444 and 28 U.S.C. 2410 ("Section 2410") are applicable where the United States has intervened under Section 7424. Consequently, case law applying Section 1444 via Section 2410 is persuasive.*fn3 For example, the Northern District of New York has held that Section 1444 "gives the United States the unqualified option to remove such an action to the district court."*fn4 Accordingly, the Third Removal is proper because the IRS had the right to remove this action pursuant to Sections 7424 and 1444.

  Moreover, in addition to having a substantive right to remove, the Third Removal satisfied any procedural requirements that may apply to a Section 1444 removal. First, the timeliness of the Third Removal is not disputed.*fn5 Second, the IRS did not require the consent of any other party in removing this action.*fn6 Finally, the Third Removal did not violate this Court's Order dated June 3, which partially remanded this action subsequent to the IRS's Second Removal, because the IRS's motion for intervention had been granted after this Court's June 3 Order had been issued.

  Because this Court lacks discretion to remand an action removed pursuant to Sections 7424 and 1444 for any reason other than, perhaps, timeliness, this Court must reject the arguments by MONH and the NYSDOH — which largely fail to address Sections 7424 or 1444.*fn7 Nonetheless, this Court will briefly address several arguments raised by MONH and the NYSDOH. First, this Court has discovered no authority supporting an "important state interests" exception to Section 1444. Second, MONH argues that the IRS has waived its right to remove. Even assuming arguendo that the right to remove under Section 1444 may be waived, no waiver exists here.*fn8 Indeed, the IRS was required to intervene in the state court action pursuant to Section 7424 in order for it to remove this action pursuant to Section 1444. Furthermore, the IRS did not clearly and unequivocally waive its right to remove this action under Section 1444 because its actions in state court were designed to preserve the status quo until the state court addressed the IRS's motion to intervene.*fn9 Third, the Rooker-Feldman doctrine — which prohibits federal courts from reviewing state court judgments*fn10 — is inapplicable to cases removed from state court.*fn11 Fourth, the abstention doctrines cited by MONH and the NYSDOH are inapplicable.*fn12 Younger abstention is inapplicable because there is no ongoing state court action that will be interfered with if this Court exercises jurisdiction in this case.*fn13 Likewise, Colorado River abstention is inapplicable because there is no parallel state court action — indeed, there is only one action and it has been removed to this Court.*fn14 Finally, Burford abstention is only available where "a federal court is asked to provide some form of discretionary relief."*fn15 Burford abstention is therefore inapplicable here because this Court does not have the discretion to remand this action as discussed above. Furthermore, although "federal courts should abstain from interfering with specialized, ongoing state regulatory schemes,"*fn16 the nursing homes in question have been closed and the state scheme concerning nursing home receiverships is thus no longer ongoing.*fn17 Accordingly, MONH's arguments in favor of remand are rejected and its motion for remand will be denied.

  The propriety of the Third Removal — which removed this entire action — makes it unnecessary for this Court to address the propriety of the Second Removal. Moreover, given the fact that MONH's motion for remand will be denied, its request for sanctions and attorneys' fees pursuant to FRCvP 11 will also be denied. It is accordingly ORDERED that MONH's remand motion is denied, that MONH's request for attorneys' fees is denied and that MONH's request for FRCvP 11 sanctions is denied.


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