US Court of Appeals Second Circuit Case 21-1575, Doc 6, Pre-Argument Statement on Appeal 07-12-2021

ong>Caseong> 2:20-cv-06291-NGG-SJB ong>Caseong> ong>21ong>-ong>1575ong>, ong>Docong>ument 6, 07/12/20ong>21ong>, 47 Filed 05/27/ong>21ong> 3136178, Page70 24 ong>ofong> ong>ofong> 27 119 PageID #: 4359 filing system. This harassing and burdensome conduct alone supports dismissal ong>ofong> the Federal Actions pursuant to this court’s inherent authority to “achieve the orderly and expeditious disposition ong>ofong> cases.” Link, 370 U.S. at 630-631. This conduct also satisfies the requirements for dismissal under Federal Rule ong>ofong> Civil Procedure 41(b) for failure to comply with a court order. The conditions ong>ofong> Kernan’s conviction and sentencing by the Northern District ong>ofong> New York prohibit him from engaging in the business ong>ofong> insurance in any state unless pre-approved to do so by the relevant state authority. See Oriska Ins. Co. v. Avalon Gardens Rehabilitation & Health Care Ctr., LLC, No. 18- cv-1030 (DNH/DEP), 2018 WL 6074693, at *3 (N.D.N.Y. Nov. ong>21ong>, 2018). In 2013, the NYSDFS entered a final order barring him from engaging in the business ong>ofong> insurance and from holding an interest in Oriska, specifically him from “providing legal or engineering services, or insurance agency services . . . directly or indirectly, to Oriska,” among other conduct. Id. at *4. He then attempted to represent Oriska in insurance litigation in the Northern District ong>ofong> New York and was disqualified from that litigation for violating the terms ong>ofong> the NYSDFS order. Id. at *9. Now, Kernan is again attempting to represent parties involved in litigation related to the business ong>ofong> insurance for the benefit ong>ofong> Oriska in both the Removed and Federal Actions. This conduct violates the terms ong>ofong> Kernan’s felony conviction and the orders ong>ofong> both the Northern District ong>ofong> New York and the NYSDFS. Accordingly, pursuant to this court’s inherent authority and Federal Rule ong>ofong> Civil Procedure 41(b), the Federal Actions are dismissed with prejudice. ATTORNEYS’ FEES AND COSTS A. Legal Standard The Healthcare Employers and individual defendant Ira Lipsius seek attorneys’ fees and costs on the grounds that the removal 24

ong>Caseong> 2:20-cv-06291-NGG-SJB ong>Caseong> ong>21ong>-ong>1575ong>, ong>Docong>ument 6, 07/12/20ong>21ong>, 47 Filed 05/27/ong>21ong> 3136178, Page71 25 ong>ofong> ong>ofong> 27 119 PageID #: 4360 attempts were objectively unreasonable. “An order remanding [a] case may require payment ong>ofong> just costs and any actual expenses, including attorney fees, incurred as a result ong>ofong> the removal.” 28 U.S.C. § 1447(c). “The statute as a whole, particularly the reference that an order remanding the case ‘may require payment’ ong>ofong> costs and fees, affords a great deal ong>ofong> discretion and flexibility to the district courts in fashioning awards ong>ofong> costs and fees.” Morgan Guar. Trust Co. ong>ofong> New York v. Republic ong>ofong> Palau, 971 F.2d 917, 924 (2d Cir. 1992). District courts may exercise this discretion to award attorneys’ fees where “the removing party lacked an objectively reasonable basis for seeking removal.” Martin v. Franklin Capital Corp., 546 U.S. 132, 141 (2005). B. Discussion The Class Defendants did not have an objectively reasonable basis for removal ong>ofong> the Nassau County Action. In Calabro v. Aniqa Halal Live Poultry Corp., 650 F.3d 163(2d Cir. 2011), the ong>Secondong> ong>Circuitong> affirmed an attorneys’ fee award following a removal attempt that was predicated on federal claims raised in a thirdparty complaint in violation ong>ofong> the well-pleaded complaint doctrine. As the basis for its conclusion that the removal attempt was objectively unreasonable, the ong>Secondong> ong>Circuitong> explained, “it is well established that a defendant may not evade [the well-pleaded complaint] rule by raising a federal question in its responsive pleadings and then attempting to remove on that basis.” Id. at 166. Consistent with Calabro, the attempted removal ong>ofong> the Nassau County Action in violation ong>ofong> the well-pleaded complaint rule here supports the conclusion that removal was objectively unreasonable. The Class Defendants’ failure to comply with the rule ong>ofong> unanimity is evidence that their removal attempts ong>ofong> all eighteen Removed Actions were objectively unreasonable. See Sherman v. A.J. Pegno Constr. Corp., 528 F. Supp 2d 320, 331 (S.D.N.Y. 25