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Federal Bar Update: Removal and venue changes now in effect

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Federal Bar UpdateAs noted in this column in December, the Federal Courts Jurisdiction and Venue Clarification Act of 2011 was passed in early December and took effect Jan. 6. The Act amends the removal statutes in several important respects, including:

if defendants are served at different times, and a later-served defendant files a notice of removal, any earlier-served defendant may consent to the removal even though he did not previously initiate or consent to removal;

the act still has a one-year cap on diversity removals unless the District Court finds that the plaintiff acted in bad faith to prevent removal, and if the court finds that plaintiff failed to disclose the amount in controversy to avoid removal, that is bad faith.

The act also amends venue provisions:

The act creates a new provision, 28 U.S.C. 1390 describing venue generally; and 

Section 1391 is rewritten, collapsing (a) (diversity) and (b) (federal question) into a new (b) that has the same three standards.

The act applies to all cases commenced in federal court on or after Jan. 6, and for removed action, to any case that under applicable state law had been commenced on or after Jan. 6. The act has been cited in three federal opinions so far, but only in passing reference and noting that the act did not apply to the pending case. In the coming months, there are certain to be many cases addressing the act.

Where to find the statute – Even with the act now in effect, practitioners may have difficulty finding a clean version of the amended statutes. The act is complicated and technical, deleting some provisions, adding others, and of course, not providing a “clean” final version of the rewritten Code sections. As of Jan. 12, not all online sources of U.S. Code (free or for pay) had updated versions of the affected sections (including, for instance, the Government Printing Office). Lexis does appear to have the amended statutes online now.

Practitioners should be very careful to ensure that the statutory sections referred to from Jan. 6 forward are accurate and up to date. The way to discern this is to check for 28 U.S.C. 1390, which did not exist as of Jan. 5, but came into effect as a new section as part of the act on Jan. 6. In the meantime, anyone desiring a copy of the act can email the undersigned for a PDF copy.

Local rules – In late December, both the S.D. of Indiana and the N.D. of Indiana separately announced that their Local Rule amendments would take effect Jan. 1. The updated versions of each court’s Local Rules – which include the restyling edits – are now posted on the courts’ websites.•

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John Maley – jmaley@btlaw.com – is a partner with Barnes & Thornburg, LLP, practicing federal and state litigation, employment matters, and appeals. The opinions expressed are those of the author.

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