The opinion
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TENNESSEE
WESTERN DIVISION
LEASING ANGELS, INC., )
Plaintiff/Counter-Defendant, )
)
v. ) No. 2:24-cv-02001-SHL-cgc
)
DARRELL BROWN, )
Defendant/Counter-Plaintiff. )
ORDER GRANTING MOTION TO REMAND
Before the Court is Plaintiff Leasing Angels, Inc.’s (“LAI”) Amended Motion to Remand
to State Court (“Motion to Remand”), filed on March 7, 2024. (ECF No. 17.) Defendant Darrell
Brown filed his response on March 22, 2024. (ECF No. 18.) For the reasons set forth below,
LAI’s Motion is GRANTED.
BACKGROUND
LAI is a real estate firm in Memphis, Tennessee, specializing in matching renters with
residential properties. (ECF No. 1-1 at PageID 3–4.) LAI hired Brown as Regional Operations
Director for the State of Tennessee on March 16, 2023. (Id. at PageID 5.) Upon accepting the
role, Brown signed a Confidentiality, Non-Competition and Non-Solicitation Employment
Agreement (the “Agreement”), in which he agreed not to work for any of LAI’s competitors for
twelve months after his employment with LAI. (Id. at PageID 5–7, 16–25.) The Agreement also
included a forum selection clause in which the parties agreed that any legal action relating to the
Agreement would take place in state court in Shelby County, Tennessee. (Id. at PageID 4, 24.)
On September 30, 2023, Brown voluntarily terminated his employment with LAI. (Id. at
PageID 6.) On October 6, LAI learned that Brown had accepted a role with a competitor real
estate firm, Cornerstone Residential. (Id.) On November 15, LAI filed its Complaint against
Brown in Shelby County Circuit Court, bringing the following claims: breach of contract,
violation of the Defend Trade Secrets Act, violation of the Tennessee Uniform Trade Secrets
Act, and unjust enrichment/equitable forfeiture. (Id. at PageID 6–11.)
On January 2, 2024, Brown filed a Notice of Filing Notice of Removal (“Notice”),
bringing this case before this Court. (ECF No. 1 at PageID 1.) Attached to that Notice was
Brown’s Answer to the Complaint (ECF No. 1-1 at PageID 31–39), along with a Counter-
Complaint alleging violations of the Fair Labor Standards Act (“FLSA”) (id. at PageID 40–46).
In the Counter-Complaint, Brown alleges that LAI did not compensate him for working through
lunch breaks, at night, and overtime, and that LAI misclassified him as an independent
contractor. (Id. at PageID 40, 42–43.)
Although Brown’s Notice alludes to an Exhibit A, which was to include “[a] true and
correct copy of the Notice of Removal (with exhibits),” it appears that that exhibit was not
actually attached. (ECF No. 1 at PageID 1.) Brown did submit a Civil Cover Sheet indicating
that his basis for removal is the FLSA claim in his Counter-Complaint. (ECF No. 1-3 at PageID
49.)
In turn, LAI filed its Motion to Remand on March 7, 2024, arguing that (1) the FLSA
counterclaim cannot be the basis for this Court’s jurisdiction, and (2) federal question
jurisdiction does not arise when a complaint on its face states alternative federal-law and state-
law theories to support a state-law claim. (ECF No. 17 at PageID 92.)1
1 Although LAI does not argue in its Motion to Remand that the Agreement included a
forum selection clause, the Complaint states that under the terms of the Agreement “Defendant
irrevocably consented and submitted to the jurisdiction and venue of the Shelby County,
Tennessee Courts.” (ECF No. 1-1 at PageID 4.)
In Brown’s response, he first argues that his FLSA counterclaim arises “out of a single
series of interlocking or intertwined action[s]” because Brown allegedly gained knowledge of
LAI’s intellectual property “during the same time period and actions in which Brown’s FLSA
claims accrued.” (ECF No. 18 at PageID 96.) Second, Brown argues that removal was proper
because the Complaint includes a claim under the federal Defend Trade Secrets Act, 18
U.S.C. § 1836, giving the Court original jurisdiction over a federal question. (Id. at PageID 99.)
However, because Brown’s original Notice does not cite any basis other than its FLSA
counterclaim (ECF No. 1-3 at PageID 49), the Court GRANTS LAI’s Motion to Remand.
LEGAL STANDARD
On a motion to remand, the defendant bears the burden of establishing that removal was
proper. Long v. Bando Mfg. of Am., Inc., 201 F.3d 754, 757 (6th Cir. 2000). “The removal
petition is to be strictly construed, with all doubts resolved against removal.” Her Majesty the
Queen in Right of the Province of Ontario v. City of Detroit, 874 F.2d 332, 339 (6th Cir. 1989)
(citing Wilson v. USDA, 584 F.2d 137, 142 (6th Cir. 1978)). To remove a civil action from state
to federal court, a defendant must file “a notice of removal . . . containing a short and plain
statement of the grounds for removal.” 28 U.S.C. § 1446(a). “Section 1446(a) requires only that
the grounds for removal be stated in ‘a short and plain statement’—terms borrowed from the
pleading requirement set forth in Federal Rule of Civil Procedure 8(a).” Dart Cherokee Basin
Operating Co., LLC v. Owens, 574 U.S. 81, 87 (2014) (quoting 14C Wright et al., Federal
Practice and Procedure § 3733, at 639–41 (4th ed. 2009)). Finally, the well-pleaded-complaint
rule does not allow a counterclaim to serve as the basis for a district court’s “arising under”
jurisdiction. Holmes Grp., Inc. v. Vornado Air Circulation Sys., Inc., 535 U.S. 826, 826 (2002).
ANALYSIS
Brown offers two arguments as to why LAI’s Motion to Remand should be denied:
(1) Brown’s FLSA counterclaim is sufficiently “intertwined” to serve as a basis for jurisdiction,
and (2) LAI’s federal Defend Trade Secrets Act claim establishes federal question jurisdiction.
As is explained in more detail below, both arguments fail.
A. FLSA Counterclaim
As a threshold matter, Brown’s Notice does not satisfy the requirements for a notice of
removal because it does not contain “a short and plain statement of the grounds for removal,” 28
U.S.C. § 1446(a). However, even if the Court were to construe the Civil Cover Sheet as that
short and plain statement, that form—which includes space for a party to list multiple alternate
bases for removal—lists only one basis: Brown’s FLSA counterclaim. (ECF No. 1-3 at PageID
49.) But a counterclaim cannot serve as the basis for federal question jurisdiction. See Vornado,
535 U.S. at 826.
Further, Brown’s argument that his FLSA counterclaim can serve as a basis for
jurisdiction because it arises from actions that are “interlocking or intertwined” with LAI’s
claims for breach of contract and breach of trade secrets does not carry the day for two reasons.
First, Brown fails to show that the two sets of facts are “interlocking or intertwined” in the first
place. On the contrary, these claims arise from different sets of facts—the Complaint from an
alleged breach of contract after the termination of Brown’s employment with LAI (ECF No. 1-1
at PageID 5–6) and the Counter-Complaint from LAI’s alleged failure to compensate Brown for
work completed before his termination (id. at PageID 41–43). Second, Brown cites no case law
to support the argument that federal question jurisdiction arises when a federal counterclaim
shares interlocking facts with the original state-court pleading. Even if these claims did arise
from the same set of facts, removal “cannot be based upon the assertion of claims appearing in a
counterclaim, no matter how related to or otherwise intertwined with the matters asserted in the
original complaint.” Duetsche Bank Nat’l Trust Co. v. Taylor, No. 5:11CV0521, 2011 WL
1374988, at *2 (N.D. Ohio Apr. 12, 2011).
B. Federal Jurisdiction Arising from Federal Claim in LAI’s Complaint
For the first time in his response to the Motion to Remand, Brown argues that LAI’s
Defend Trade Secrets Act claim gives the Court original jurisdiction over a federal question.
(ECF No. 18 at PageID 100.) However, that argument is untimely because Brown had the
burden to plead any alternative basis for removal within thirty days of the receipt of the initial
state court pleading. 28 U.S.C. § 1446(b). “A defendant may not amend its notice of removal
after this thirty-day period to remedy a substantive defect in the petition.” Wyant v. Nat’l R.R.
Passenger Corp., 881 F. Supp. 919, 924 (S.D.N.Y. 1995).
However, a court may make an exception to the thirty-day requirement when “the
proposed amendments are technical in nature or merely serve to clarify what was contained in
the original notice for removal,” but a court will not generally make an exception to allow a
defendant to “add a new ground for removal.” Id. (quoting Stuart v. Adelphi Univ., No. 94 Civ.
4698, 1994 WL 455181 (S.D.N.Y. Aug. 19, 1994)). Even if the Court were to construe Brown’s
Notice as a notice of removal (ECF No. 1 at PageID 1), the Defend Trade Secrets Act is not
mentioned either in the Notice or on the Civil Cover Sheet. Months later, Brown may not now
raise that claim as a new ground for removal. (Id.)
Further, Brown has not acknowledged that a clerical error occurred in failing to attach the
promised notice of removal. In Brown’s Response, he does not ask to amend his Notice to
include the notice of removal, but instead raises a separate, alternate basis for removal. (ECF
No. 18 at PageID 100.) The Court can only work with the filings that are before it. Therefore,
because Brown’s Notice fails to state “a short and plain statement of the grounds for removal,”
28 U.S.C. § 1446(a), the Court finds that it lacks jurisdiction to hear this case.
CONCLUSION
For the reasons stated above, the Court GRANTS LAI’s Motion to Remand.
Additionally, Brown’s Counter-Complaint is DISMISSED without prejudice. If Brown still
wishes to bring his Counter-Complaint, he must file it as a separate action.
IT IS SO ORDERED, this 7th day of May, 2024.
s/ Sheryl H. Lipman
SHERYL H. LIPMAN
CHIEF UNITED STATES DISTRICT JUDGE