[PUBLIS H]

IN THE UN ITED STATES COURT OF APPEALS FOR THE ELE VENTH CIRCUIT

__ __ __ __ __ __ __ __ __ __ __ __ Nos . 10 -1 07 11 ; 1 0- 10 71 8

__ __ __ __ __ __ __ __ __ __ __ __ D.C. Dock etNos . 1: 95 -cv -0 25 50 -TW T; 1 :9 8- cv -0 19 56 -TW T UPPER CHATTAHOOCHEE RIVERKEEPER FUND, INC., etal., ll ll ll ll ll ll ll ll ll ll l Pl ai nt iff

s, ve rs us CITY OF ATLANTA , ll ll ll ll ll ll ll ll ll ll l Defen da nt -Thi rd -Party-Plai nt iff -Ap pe ll ee, ve rs us CITY OF SANDY SPRINGS, ll ll ll ll ll ll ll ll ll ll ll Thi rd -Party-Defen da nt -Ap pe ll an t.

__ __ __ __ __ __ __ __ __ __ __ __ App eal s fr om

th e Uni te d S ta te s Di st ric t Co urt forth e North ern Dis tri ctof Ge or gi a

__ __ __ __ __ __ __ __ __ __ __ __ (No ve m be r 19 , 20 12 ) Case: 10-10711 Date Filed: 11/19/2012 Page: 1 of 24Befo re CARNES, KRAVITCH, an d F ARRIS , Cir cu itJu dg es . * PER CURI AM: A fed eral Cle anW at er Actlaws ui t fi le d a ga in stth e Ci ty of Atl an tain 19 95 res ul te d i n t wo co ns en t d ecre es requi rin g At la nt a to cle anup it s s ewer s y st em . Teny ears lat er Sa nd y

Sp rin gs in co rp or at ed , whi ch ledto st at e co urt p ro ceed in gs to de te rm in e whe th er At la nt a wou ldbe all owe d t o c on ti nu e to supp ly Sandy Sp rin gs with wat er. Atl an taha d p le dg edit s wat er s erv ic e rev enue as p artof t he co ll at eral forbo nd s t ha t wer e is su edto fin an ce i ts co m pl ia nc e with t he sewe r syste m co ns en t d ecre es . Atla nt a p ers ua de d t he same dis tri ctco urt tha t h adis su ed th e se wer s y st em

co ns en t d ecre es to en

joi n t he pa rti es fro m

pu rs ui ng th e st at e la w pr oc eed in gs an d t o t ak e o ve r supe rv is io n o f th os e p ro ceed in gs . The que st io n i s whe th er the di st ric t co urt h adjuri sd ic ti on to do th at . I. Fo r m or e th ana de cad e th e Uni te d S ta te s Di st ric t Co urt fo r th e North ern Dis tri ctof Ge or gi a h as be enm on it or in g the Cit y of At la nt a’s co m

pl ia nc e with t wo co ns en t d ecre es th atth e co urt i ss ue d i n S ep te m be r 19 98 an d Dec em

be r 19 99 . Tho se co ns en t d ecre es res ol ve d c om pl ex , m ul ti -p arty li ti ga ti on ari si ng fro m

Honora ble J erome Fa

rris, United States Circuit J udg e for the Ninth Circuit, sitt ing by * designation. 2

Case: 10-10711 Date Filed: 11/19/2012 Page: 2 of 24Atl an ta ’s vi ol at io n o f th e Cl ean W at er Act , 33 U.S.C. §§ 12 51 et s eq ., and

requi redAtl an tato bri ng it s s ewer s y st em in to co m pl ia nc e wit h fe de ral en vi ro nm en ta l l aws . See Up pe r Ch at ta ho oc he e Ri ve rk eep er Fu nd , Inc . et al . v. Ci ty of Atl an ta , 1: 95 -cv -2 55 0- TW T; Un it edSta te s etal. v . Cit y of At lant a, 1: 98 -cv -1 95 6- TW T. The d ecre es , ho wev er, d idno t s pe ci fy ho w com pl ia nc e wit h th em is to be fin an ced . Atl an tade ci de d t o fu ndit s co m pl ia nc e eff

orts by iss ui ng bo nd s, p le dg in g a s co ll at eral forth em th e as se ts an d re ve nu es fro m it s wat er an d se wer s y st em . 1 The co ns en t d ecre es sp eci fic al ly stat e th atth e d is tri ctco urt “ sh al l re ta in juri sd ic ti on of t hi s m at te r fo r th e p ur po se s o f im

pl em en ti ng an d e nf

or ci ng th e te rm s an d c on di ti on s” of t he de cree s. Cf. Kokko ne n v . Guar di anLife I ns . Co. o f Am ., 51 1 U.S. 3 75 , 38 1– 82 , 11 4 S .Ct. 1 67 3, 1 67 7 (1 99 4) (ex pl ai ni ng th ata di st ric t co urt m ay

“ret ai n juris di ct io n” ov er a “ di sm is sa l-p ro du ci ng set tl em en t ag reem en t” at t he parti es ’ reque st ). Andth e co urt h as do ne so . The co urt’s tra di ti on al equi tabl e p owe rs als o g iv e iton go in g ju ris di ct io n t o s up erv is e Atl an ta ’s co m pl ianc e, to en fo rce t he term s o f th e co ns en t d ecre es , andto pro te ctit s Atlanta has spe nt approxim ately $1.3 billion on capital improvements require d by the 1 consent de cre es. Almost all of this amount was finance d by water and sew er r evenue bonds, under which Atlanta pledg ed the va lue of its drinkingand wa stewate r sy stem, as well as c urre nt and future reve nues from opera ting that sy stem. Atlanta’s indebte dness under these bonds wa s $3.2 billion at the tim e the district cour t’s order was e ntere d in the prese nt case . 3 Case: 10-10711 Date Filed: 11/19/2012 Page: 3 of 24juri sd ic ti on ov er the de cree s fr om co ll at eral th reat s. See , e.g., Un it edSta te s v . Swif t & Co ., 28 6 U.S. 1 06 , 11 4, 5 2 S .Ct. 4 60 , 46 2 (1 93 2) ; Wesch v. Fo ls om , 6 F.3 d 1 46 5, 1 47 0 (1 1t h C ir. 1 99 3) . InDecem be r 20 05 , whi le Atl an ta ’s com pl ia nc e eff

orts an d t he di st ric t co urt’s m on it or in g o f th em co nt in ue d, Sa nd y

Sp rin gs , whi ch is lo cat edin Fu lt on Co un ty, Geo rg ia , was i nc or po rat edas am

un ic ip al it y . Bo th be fo re an d a fte r San dy Sp rin gs was i nc or

po rat ed , Ful to n C ou nt y

pro vi de d i ts sewe r se rv ic e an d At la nt a pr ov id edit s wat er s erv ic e. 2
Atlanta desc ribes its water and sew er sy stem as func tionally and fina ncially unified: 2 For over a centur y , drinkingwater

and wa stewate r treatment have be en deve loped as compleme ntary

components of Atlanta ’s re g ional utilit y , in rec ognition of the fac t that the provision of potable water must be ac companied by treatment of wastew ater

prior to its return to the a rea ’s river s and strea

ms. One compone nt cannot f unction without the other, as the se rvice s are inext rica bly linked. In addition to their functional and e nvironmental linkag e, drinkingwater and wastew ater

are linked financ ially , as both components havebeen ple dg ed by Atlanta to sec ure the fundingneede d to meet its obligations under the Consent Dec ree s. Br . of Appe llee at 8–9 ( rec ord citations omitted). Robert Hunter , Atlanta’s Commissioner for the Depa rtment of Watershe d Manag ement, testified a t the motion hearingbefor e the district cour t that Atlanta’s water a

nd sewe r sy stems are bound toge ther by bonds: “[T] his is one sy stem, water and wa stewate r. It’s one fund. We only issue bonds for water a

nd wastew ater . We don’t have a separ ate wa

ter fund a nd a sepa rate wastew ater

fund, and this is very

common in combined utilit ies.” Doc . 241 at 58. We note for pur

poses of this appea l, however , it is undi sputed that Atlanta provide s Sandy Springs’ water

service , and F ulton County provides its sewer

service . Fulton County

and Sandy Springs have alr eady

agree d to continue that ar rang ement. Atlanta does not c ontend that it is in dange r of losingsewe r re venues f rom Sandy 4 Case: 10-10711 Date Filed: 11/19/2012 Page: 4 of 24Geo rg ia ’s Serv ic e Del iv ery Strat eg y Act, Ga. Co de Ann . §§ 36 -7 0- 20 et se q., re qu ire s ev ery Geo rg iaco un ty andeach of t he m un ic ip al it ie s wi th in itto ad op t a s erv ic e d el iv ery ag reem en t tha t i de nt ifi es th e se rv ic e p ro vi de r, se rv ic e area s, an d a ll fun di ng so ur ces forgo ve rn m en ta l s erv ic es pro vi de d i n the co un ty. Id . §§ 36 -7 0- 20 , 36 -7 0- 23 , 36 -7 0- 26 . The Actals o p res cri be s a p ro ces s fo r reac hi ng th atag reem en t an d re so lv in g a ny dis ag reem en t, wh ic h “ is in te nd edto m in im iz e in effi ci en ci es res ul ti ng fro m dupl ic at io n o f se rv ic es an d c om pe ti ti on be twee n l oc al go ve rn m en ts an d t o p ro vi de a m ech an is m to res ol ve di sp ut es ov er lo cal go ve rn m en t s erv ic e d el iv ery, fun di ng equi ty, an d l an d u se .” Id . § 3 6- 70 -2 0. As o ne co urt h as ex pl ai ne d i t, the Act “ m an da te s a d is pu te res ol ut io n p ro cedur e
Springs. Commissioner Hunter te stified at the motion hearing that Atlanta indirec tly rec eives reve nue fr om the sewe r ser vice that F ulton County

provides to Sandy

Springs: Q. And as to the se wer

sy stem, the entire se wer

sy stem within the Cit y

of Sandy Springs is supplied as fa

r as the rates, c harg es, ser vicingof it by

Fulton County ; is that corr ect? A. It is suppli ed by

Fulton County . It is bil led through the City of Atlanta. And the flow that c omes from Sandy Springs into the City

of Atlanta, Atlanta is paid for those f

lows. Q. And you have g overnme ntal agree ments with Fulton County that addre ss those rate s, the requir ements of F ulton County to cover the cost for

the City of Atlanta; is that also corre ct? A. We have a

n agree ment for the f

lows comingfrom their pipe s to our pipes. Doc. 241 at 89–90. 5

Case: 10-10711 Date Filed: 11/19/2012 Page: 5 of 24fo r th e aff

ect edco un ty andm

un ic ip al it y

to fol lo w if the y

can no t ag ree o n aservi ce de li ve ry st rat eg y .” Co bb Cn ty. v. Ci ty of Sm yrn a, 60 6 S .E.2d66 7, 6 71 (Ga. Ct . App . 20 04 ); s ee al so Ga. Cod e Ann . § 3 6- 70 -2 5.1 . An Oct ob er 2 00 5 s erv ic e d el iv ery ag reem en t d es ig na te d At la nt a as th e di rectret ai l wat er s erv ic e p ro vi de r fo r al l o f un in co rp or at edFu lt on Co un ty, whi ch in cl ud edth e are a th atwas— jus t two m on th s l at er— in co rp or at edas t he Cit y of San dy Spri ng s. Its in co rp or at io n t rig ge redso m e p ro vi si on s o f th e Servi ce Deli ve ry Act. Th e Actpro vi de s t ha t wh enne w m un ic ip al it ie s ar e in co rp or at ed ,“ [e]achco un ty andaffe ct edm un ic ip al it y

sh al l re vi ew, an d re vi se if ne ces sa ry , th e ap pr ov ed ” se rv ic e d el iv ery ag reem en t. Id . § 3 6- 70 -2 8( b) (4 ). After San dy Spri ng s was in co rp or at ed , th e p ro ces s o f rev ie win g a ndrev is in g F ul to n Co un ty’ s s erv ic e d el iv ery ag reem en t b eg an , andSan dy Spri ng s p ro po se d am en dm en ts to th e ret ai l wat er s erv ic e p ro vi de r pa rt o f th atag reem en t. So m e o f th os e am en dm en ts , if ad op te d, wo ul d a ffec t the supp ly of wat er t o S an dy Spri ng s an d c ou ldreduc e th e am ou ntor p ric e o f th e wat er tha t i t p ur ch as es fro m Atl an ta . Neg ot ia ti on s among Fu lt on Co un ty andsev eral of i ts m un ic ip al it ie s t o a do pt ne w servi ce d el iv ery ag reem en ts st al le d i n Oct ob er 2 00 9, an d F ul to n C ou nty fo ll owe d t he di sp ut e res ol ut io n p ro cedur e p res cri be d b y Geor gi a’s Serv ic e Deli ve ry Str at eg y Act: itfil eda pe ti ti on in Fu lt on Co un ty Sup eri or Co urt 6 Case: 10-10711 Date Filed: 11/19/2012 Page: 6 of 24“ se ek in g m an da to ry m ed ia ti on .” See Ga. Co de Ann . § 3 6- 70 -2 5.1 (d )(1 )(A). The st at e co urt ap po in te d am ed ia to r. Atl an tareturne d t o t he fed eral di st ric t co urt, wh ic h h adret ai ne d ju ris di ct io n to en fo rce t he Cle anW at er Actco ns en t d ecre es , andso ug htto en joi n t he servi ce de li ve ry pro ceed in gs th atwere o ng oi ng in st at e co urt. The di st ric t co urt g ran te d Atl an ta ’s m ot io n, en

joi ne d t he pa rti es fro m

co nt in ui ng to pu rs ue th e se rv ic e de li ve ry pro ceed in gs in st at e co urt, an d b ro ug htSan dy Spri ng s an d F ul to n C ou nt y in to th e Cl ean W at er Actli ti ga ti on in fed eral co urt as th irdpa rty defe nd an ts . Whi le th atact io n m ay

ha ve be enpra gm at ic , we con cl ud e th atitwentbe y on d t he co urt’s jur is di ct io na l au th or it y . II. Init s o rd er the di st ric t co urt re co un te d h ow d is pu te s “ rel at in g t o wat er an d se wer s erv ic e” h adari se n b etweenFu lt on Co un ty andso m e ci ti es lo cat edwithi n it—At la nt a, Co ll eg e Park, Fa irb urn, Pa lm et to , San dy Spri ng s, an d Un io n C it y . 3 Doc . 24 2 a t 2 . The co urt d et erm in edth atth os e d is pu te s h ad“ crea te d c on si de rab le un cert ai nty ” ab ou t At la nt a’s ab il it y “ to fin an ce i m

pr ov em en ts to th e se wer s y st em The South Fulton Municipal Water a nd Sewer Authority , the City

of F airburn, the City 3 of Palmetto, and the City

of Union City

wer e orig inally

parties to this appea l, but they have settled their disputes with Atlanta and dismissed their a ppeals. See City

of Atlanta v. South Fulton Mun. Reg ’l Water and Sew er Auth., Nos. 10-10710 & 10-10721. In the district court, Atlanta dismissed its claims ag ainst the City of Colleg e Park. 7 Case: 10-10711 Date Filed: 11/19/2012 Page: 7 of 24th atare n eces sa ry to co m pl y with t he Co ns en t Dec rees .” Id . It b el ie ve d tha t Fed eral Ru le s o f Ci vi l Pr oc edur e 1 9 a nd21 ga ve itth e “ au th or it y to joi n t he Thi rd
Part y Defen da nt s,” i nc lu di ng th e Ci ty of San dy Spri ng s an d F ul to n C ou nty , in or de r “ to av oi d t he un cert ai nt y , andsubs ta nt ia l an d i m m ed ia te th reat s” to Atl an ta ’s ab il it y to co m pl y with the co ns en t d ecre es . Id. at3. The co urt al so co nc lu de d t ha t th e co ns en t d ecre es alo ng with “ th e Cl eanW at er Act , andth e Co urt’s p owe rs un de r th e All Writ s Actan d i ts Supp le m en ta l Jur is di ct io n u nd er 2 8 U.S.C. § 13 67 ” ga ve itth e “ au th or it y

to tak e act io ns to pre ve ntin te rfer en ce wi thth e Ci ty of Atl an ta ’s con ti nu edab il it y to co m pl y with t he Co ns en t Dec rees .” Id . at 3 –4 . The di stric t co urt’s o rd er wen t o n t o p ro hi bi t Geo rg ia , Ful to n C ou nt y , and San dy Spri ng s fr om

us in g t he pro ces s tha t Geo rg ialaw p res cri be d fo r de te rm in in g ho w waterwou ldbe de li ve redto cit iz en s i n the st at e. The o rd er s ta te d t ha t:

“ [The ] St at e o f Geo rg iaan d . . . Fu lt on Co un ty [are] enjoi ne d fr om ap pl y in g t he Geo rg iaServ ic e Del iv ery Act p ro cedur es un de r O.C.G.A. § 36 -7 0- 20 et s eq . to th e Ci ty of Atl an ta. . . wit h re sp ectto th e p ro vi si on of wa te r an d s ewer s erv ic es .” Id . at4. The co urt’s o rd er al so “ he ldin ab ey an ce” t he san ct io ns th atGeor gi a law au to m at ic al ly im

po se s o n l oc al go ve rn m en ts th atdo no t ex ecu te a se rv ic e d el iv ery ag reem en t, s ee Ga. Co de Ann . § 3 6- 70 -2 7( a)(1 ). Doc. 2 42 at 4 . It en joi ne d F ul to n Co un ty from

pro ceed in g a ny furt he r wit h the st at e la w-p res cri be d m an da to ry 8 Case: 10-10711 Date Filed: 11/19/2012 Page: 8 of 24m ed ia ti on in Fu lt onCo un ty Sup eri orCo urt “ wit h re ga rdto an y m at te r rel at edto th e wat er an d s ewer s erv ic e p orti on s” of t he co un ty’ s s erv ic e d el iv ery ag reem en t. Id . at 5 . Afte r pr oh ib it in g t he st at e, th e co un ty, an d the affe ct edm un ic ip al it ie s fr om us in g t he st at e’s own pro ces s o r co urt s y st em to res ol ve th e lo cal servi ce d el iv ery di sp ut e, th e d is tri ctco urt co m pe ll edth e st at e, th e co un ty, an d t he m un ic ip al it ie s t o subm itth e d is pu te to itforsupe rv is io n a nda de ci si on . The co urt o rd er re qu ire d th at : The Cit y

of At la nt a, Fu lt on Co un ty, an d t he Thi rd -Party D efen da nt s [s ha ll ] co nduc t an y

an d a ll ne go ti at io ns , m ed ia ti on an d o th er d is pu te res ol ut io n e ffo rts , in cl ud in g t ho se di sp ut e res ol ut io n p ro cedur es refe ren cedun de r O.C.G.A. § 36 -7 0- 25 .1, an d i f th os e d is pu te res ol ut io n e ffo rts are u ns uc ces sf ul , any lit ig at io n re qu ire d t o de te rm in e th e Servi ce Del iv ery Strat eg y forFu lt on Co un ty, as it rel at es to th e wat er an d s ewer s erv ic e p orti on s o f th e Servi ce Del iv ery Strat eg y , un de r th e ex cl us iv e supe rv is io n o f th is Co urt. . . . [T] he Serv ic e Del iv ery Act m ed ia ti onas r el at edto th e se wer an d wate r is su es . . . sh al l o ccu r ex cl us iv el y un de r th is Co urt’s supe rv is io n. Id . The d is tri ctco urt ap po in te d am ed ia to r who wou ldbe supe rv is edby and acco un tabl e to th e d is tri ctco urt, i ns te adof b y an d t o a ny sta te co urt o r jud ge . (The m ed ia to r th e d is tri ctco urt ap po in te d was form er Geo rg iaSupr em e Co urt Ju st ic e Norm anFle tc he r, who ha d a ls o b een ap po in te d b y an d h adbe enservi ng

9 Case: 10-10711 Date Filed: 11/19/2012 Page: 9 of 24un de r th e supe rv is io n o f th e st at e co urt wh enth e d is pu te was b ei ng ha nd le d t he re.)

Id. Thi s i s Sand y

Sp rin gs ’ ap pe al of t he di st ric t co urt’s o rd er. W e h av e juri sd ic ti on ov er i t u nd er 2 8 U.S.C. § 12 92 (a)( 1) , whi ch pro vi de s t ha t “ th e co urts of ap pe al s s ha ll have juri sd ic ti on of app eal s fr om . . . [i]nt erl oc ut ory

ord ers of t he di st ric t co urts . . . gr an ti ng . . . in jun ct io ns .” III. Inass ert in g aut ho rit y

to en joi n t he pa rti es fro m

pu rs ui ng th e se rv ic e de li ve ry pro ceed in gs in st at e co urt, the di stric t co urt re li edon it s co nt in ui ng juri sd ic ti on to en fo rce At la nt a’s co m pl ia nc e wit h t he co ns en t d ecre es co up le d wi th it s p owe r un de r th e All Writ s Act . ThatAct p ro vi de s t ha t fe de ral co urts “ m ay is su e al l wri ts ne ces sa ry

or app ro pr ia te in aidof t he ir r es pe ct iv e juri sd ic ti on s an d ag reeabl e to th e u sa ge s an d p rin ci pl es of l aw.” 28 U.S.C. § 1 65 1( a). The po wer g ran te d fe de ral co urts by the All Writ s Actis , ho wev er, l im it ed by the Ant i-I nju nc ti on Act, wh ic h p ro hi bi ts a fed eral co urt fr om “ gr an t[i ng ] an in jun ct io n t o s ta y

pro ceed in gs ina St at e co urt ex cep t as ex pr es sl y au th or iz edby Act o f Co ng res s, o r whe re n eces sa ry inaidof i ts juri sd ic ti on , or t o p ro te ctor

1 0 Case: 10-10711 Date Filed: 11/19/2012 Page: 10 of 24effe ctua te it s ju dg m en ts .” 28 U.S.C. § 2 28 3. If on e o f th e th ree s pe ci fic 4 ex cep ti on s co nt ai ne d i n the Ant i-I nju nc ti onAct p erm it s an in jun ct io n, t he All Writ s Actgra nt s a f

ed eral co urt the po wer t o i ss ue it . Burr & Fo rm anv. Bl ai r, 47 0 F.3 d 1 01 9, 1 02 7– 28 (11 th Cir . 20 06 ).

“ [I]n as se ss in g t he pro pr ie ty of anin jun ct io n e nt eredto st op a st at e co urt pr oc eed in g, t he so le rel ev an t i nqui ry is whet he r th e in

jun ct io n qua li fie s fo r on e o f th e ex cep ti on s t o the Ant i-I nju nc ti on Act.” Id . at 1 02 8; see als o At l. Co as t Li ne R.R. Co . v. Bh d. o f Loc om ot iv e Eng ’rs, 39 8 U.S. 2 81 , 28 6, 9 0 S .Ct. 1 73 9, 1 74 3 (1 97 0) (em

ph as iz in g t ha t the Ant i-I nju nc ti on Act i s “ anab so lu te pro hi bi ti on ag ai ns t en joi ni ng st at e co urt p ro ceed in gs , un le ss th e in jun ct io n fa ll s wi th in on e o f [th e Act ’s] th ree s pe ci fic al ly defi ne d e xc ep ti on s.”) . W e rev ie w de n ov o adi st ric t co urt’s l eg al co nc lu si on th atitha s t he au th or it y to en joi n ast at e co urt ac ti on ba se d on anex cep ti on to th e Ant i-I nju nc ti on Act. Est at e o f Bre nn anv. Ch ur ch of Sci en to lo gy Flag Serv . Org., 6 45 F.3d12 67 , 12 72 (11 th Cir . 20 11 ). The Supr em e Co urt h as reco gn iz edth atth e Ant i-I nju nc ti on Act “ is de si gn ed Although on its fa ce the Anti-Injunction Act could be r ead to a pply only to injunctions 4 issued ag ainst state cour

ts, and not those issued ag ainst individual parties, it has not been interpre ted that way . See Atl. Coast L ine R.R. Co. v. Bhd. of L ocomotive Eng ’rs, 398 U.S. 281, 287, 90 S.Ct . 1739, 1743 (1970). Instead, “ we tre at injunctions entere d for the pur pose of ha lting a state c ourt proce edingthe same r eg ardle ss of whethe r issued ag ainst the parties to the state court proc eeding

or direc tly

ag ainst the state cour

t.” B urr & For

man v. B lair, 470 F .3d 1019, 1028 n.28 (11th Cir. 2006). 1 1 Case: 10-10711 Date Filed: 11/19/2012 Page: 11 of 24to pre ve ntco nf li ctbe twee n fe de ral an d s ta te co urts .” Leit er Mi ne ral s, In c. v. Uni te d S ta te s, 3 52 U.S. 22 0, 2 25 , 77 S.Ct . 28 7, 2 90 –9 1 (1 95 7) . The Act ’s “ co re m es sa ge is on e o f res pe ctforst at e co urts ,” an d i t “ br oa dl y co m m an ds th atth os e tri bu na ls sh al l re m ai n fr ee fr om in te rfer en ce b y

fed eral co urts ” u nl es s o ne of the Act’s t hr ee s pe ci fic ex cep ti on s i s m et . Smit h v . Bay er Co rp ., — U.S. —, 13 1 S .Ct. 23 68 , 23 75 (20 11 ) (quo ta ti onm ark s o m it te d) . The di stric t co urt n ev er i nd ic at edwhi ch of the th ree e xc ep ti on s t o t he Ant iIn jun ct io n Act , if an y , itwas re lying on . The o nl y on e th atAtl an taco nt en ds ap pl ie s i s t he “ in aidof i ts juri sd ic ti on ” ex cep ti on . Tha t ex cep ti on , li ke th e o th er two , m us t b e co ns tru edna rro wly. See i d. (c au ti on in g t ha t the th ree e xc ep ti on s i n th e Ant i-I nju nc ti on Act “ are n arro w andare n otto be en la rg edby loo se st atut ory co ns tru ct io n” (qu ot at io n m ark s an d a lt erat io n o m it te d) ); s ee al so In r e Baysh or e Fo rdTruc ks Sal es , Inc ., 47 1 F .3d12 33 , 12 50 (11 th Cir . 20 06 ) (“ The Supr em e Co urt h as rep eat ed ly em

ph as iz edth atth e lo wer co urts are t o i nt erp retth es e ex cep ti on s s tri ct ly.”); Del taAir Li ne s, In c. v. M cCo y Res ts ., Inc ., 70 8 F .2d58 2, 58 5 (1 1th C ir. 1 98 3) (“ Bec au se of t he sen si ti ve na tu re o f fed eral in te rfer en ce wi th st at e co urt l it ig at io n, the ex cep ti on s t o t he rul e ag ai ns t i nju nc ti on s . . . m us t b e na rro wly co ns tru ed .”); T. Sm it h & So n, In c. v. Will ia m s, 2 75 F.2d39 7, 4 07 (5t h Ci r. 19 60 ) (“ The ph ras e, ‘whe re n eces sa ry in aidof i ts juri sd ic ti on ’, . . . sh ou ldbe 1 2 Case: 10-10711 Date Filed: 11/19/2012 Page: 12 of 24in te rp ret edna rro wly, inth e d ire ct io n o f fed eral no n- in te rfer en ce wi thord erl y st at e pr oc eed in gs .”); cf. id . (di sc us si ng th e “ ha nd s- of f do ctrin e” ex pr es se d i n the Ant iIn jun ct io n Actan d d es cri bi ng th e st atut e as “ a p il la r of fed eral is m ”). As t he Supr em e Co urt h as pu t i t: “ Any doubt s as to th e p ro pr ie ty of a fed eral in jun ct io n ag ai ns t s ta te co urt p ro ceed in gs sh ou ldbe res ol ve d i n fa vo r of pe rm it ti ng th e st at e co urts to pro ceed . . . . ” Atl . Coa stLin e R.R., 3 98 U.S. at 2 97 , 90 S.Ct . at 1 74 8; se e al so RedRo ck

Co laCo . v. RedRo ckBo tt le rs , Inc ., 19 5 F .2d40 6, 4 09 (5t h Ci r. 19 52 ) (“ Fed eral Co urts wil l en joi n p ro ceed in gs inSta te Co urts with rel uc ta nc e. . . .”); cf

. Sm it h, —

U.S. at — , 13 1 S .Ct. at23 75 –7 6 (s ta ti ng th at is su in g a n i nju nc ti on un de r th e “ rel it ig at io n e xc ep ti on [to th e Act ] is res orti ng to he av y art il le ry ” an d “ [f]or tha t re as on , eve ry be ne fitof t he do ub t g oe s t owardth e st at e co urt” ); Wesc h, 6 F.3dat 1 46 9 (“ The qu es ti on of wh ethe r to st ay pro ceed in gs in a st at e co urt i s n ev er o ne to be tak enli gh tl y , as i t i m pi ng es on th e v ery de li cat e ba la nc e st ru ck

be twee n t he fed eral an d s ta te jud ic ia l s y st em s.”) . Neces si ty is k ey . The ex cep ti on inqu es ti on do es no t p erm itin jun ct io ns in ai d o f a co urt’s jur is di ct io n, b uton ly tho se th atare “ ne ces sa ry in aidof i ts juri sd ic ti on .” It c ert ai nl y “ is no t en ou gh th atth e reque st edin jun ct io n i s re la te d t o th atjuri sd ic ti on .” Atl . Coa stLin e R.R., 3 98 U.S. at 2 95 , 90 S.Ct . at 1 74 7. Fe de ral co urts m ay

en joi n s ta te co urt p ro ceed in gs ba se d o n t he “ ne ces sa ry in aidof i ts 1 3 Case: 10-10711 Date Filed: 11/19/2012 Page: 13 of 24juri sd ic ti on ” ex cep ti on in on ly two s itua ti on s, wh ere: “ (1 ) th e d is tri ctco urt h as

ex cl us iv e juri sd ic ti on ov er the act io n b ecau se itha d b een rem ov edfro m st at e co urt; or, (2 ) th e st at e co urt en te rta in s an in rem act io n i nv ol vi ng a res ov er wh ic h th e d is tri ctco urt h as be enex erci si ng juri sd ic ti on in anin rem act io n.” In re Baysho re Fo rdTruc ks Sal es , Inc ., 47 1 F .3d12 33 , 12 51 (11 th Cir . 20 06 ). As At la nt a adm it s, the re was no “ rem ov al ,” in th e requi redsen se , of thi s cas e fro m st at e co urt t o fe de ral co urt, s o t he fir stsi tu at io n d oe s n otex is t. The qu es ti on is whet he r th e se co ndon e d oe s. Th e rea so n t ha t the sec on d s itua ti on is anex cep ti on to th e Ant i-I njunc ti on Act p ro hi bi ti on is th at“ [a] st at e co urt an d a fed eral co urt ca nn otsi m

ul ta ne ou sl y

ex erci se in rem

juri sd ic ti on ov er the same pr op erty .” Uni te d S ta te s v . $2 70 ,00 0 i n U.S. Cu rren cy , Plu s In te res t, 1 F.3d11 46 , 11 47 (11 th Cir .19 93 ); s ee al so In r e Am . Hon daMo to r Co . Deale rs hi ps Rel at io ns Lit ig ., 31 5 F .3d41 7, 4 39 (4t h C ir. 2 00 3) (“ The ‘ ne ces sa ry in aidof i ts juri sd ic ti on ’ ex cep ti on to th e Ant i-I nju nc ti on Act i s wi de ly und ers to odto ap pl y m os t o fte n whe n afed eral co urt was th e fi rs t i n o bt ai ni ng juri sd ic ti on ov er a re s i n a n i n re m act io n andth e sa m e fed eral co urt s eek s t o e njo in su it s i n s ta te co urts in vo lv in g t he sa m e res .”). Atl an taco nt en ds th atit s wat er an d s ewer s y st em is a res ov er wh ic h t he di st ric t co urt h as ex erci se d i ts juri sd ic ti on th ro ug h t he co ns en t d ecre es , whi ch 1 4 Case: 10-10711 Date Filed: 11/19/2012 Page: 14 of 24im

po se “ ex te ns iv e o ng oi ng ob li ga ti on s re la ti ve to . . . th e was te wate r co ll ect io n, tra ns m is si on , andtre at m en t co m po ne nt s” of t he syste m . The pro bl em with Atl an ta ’s con te nt io n i s t ha t the st at e se rv ic e d el iv ery pr oc eed in gs in st at e co urt ar e ob vi ou sl y no t an in rem

act io n. Th os e p ro ceed in gs do no t d ire ct ly inv ol ve an y res . In st ead , th ey

in vo lv e a d is pu te ab ou t the de li ve ry of s erv ic es , whi ch is a qu in te ss en ti al in pe rs on am di sp ut e. Cf. Bu rr & Fo rm an , 47 0 F .3dat 1 03 2 & n.3 4; Ven do Co . v. Lektro -Ven d C or p., 4 33 U.S. 62 3, 6 42 , 97 S.Ct . 28 81 , 28 93 (19 77 ) (“ The tra di ti on al no ti on is th atin pe rs on am act io ns in fed eral an d s ta te co urt m ay pr oc eedco nc urren tl y , witho utin te rfer en ce fr om eit he r co urt, an d t he re i s n o ev id en ce tha t the [‘nece ss ary in aidof i ts juri sd ic ti on ’] ex cep ti onto [28 U.S.C.] § 22 83 was i nt en de d t o a lt er thi s b al an ce.”) . Becau se th ere i s n o i n re m act io n i n st at e co urt, the st at e co urt an d t he fed eral co urt ar e n otad jud ic at in g ri gh ts to th e sa m e p ro pe rty, andth e in rem ex cep ti on do es no t ap pl y . See Bu rr & Fo rm an , 47 0 F.3 d a t 1 03 1– 32 (ex pl ai ni ng th atth e “ fo cu s o f th is ex cep ti onis on pa ral le l i n re m pr oc eed in gs —o ne in fed eral co urt, the othe r in st at e co urt” ). Becaus e th e st at e pr oc eed in gs are n otanin rem act io n d ire ct ly inv ol vi ng a res , th e st at e an d fe de ral co urt ar e n otin dang er o f si m ul ta ne ou sl y

ex erci si ng inrem

juri sd ic ti on ov er the sa m e p ro pe rty. $27 0,0 00 inU.S. Curren cy , Plu s In te res t, 1 F.3dat 1 14 7; see als o Em pi re Tru stCo . v. Bro ok s, 2 32 F. 64 1, 6 45 –4 6 (5 th Cir . 19 16 ) (“ [W] he re the 1 5 Case: 10-10711 Date Filed: 11/19/2012 Page: 15 of 24is su es in th e subs eque ntsu itare d iff eren t fr om

th os e in vo lv edin th e fi rs t s ui t, an d th e subjec t-matte r is no t i de nt ic al , th ere c anbe no in fri ng em en t o f th e juri sd ic ti on of th e co urt i n wh ic h t he fir stsu itis pe nd in g, b y reas onof t he in st itut io n o f th e se co ndsu itin a co urt o f co nc urren t juris di ct io n.” ); De nv er-Gre el ey Vall ey W at er Use rs Ass ’n v. Mc Neil , 13 1 F .2d67 , 71 (10 th Cir . 19 42 ) (“ [T]he n eces si ty doe s no t ex is t wh ic h wo ul d warran t i nju nc ti ve rel ie f whe re the subs eque ntact io n d oe s no t cr eat e a co nf

li ctbe twee n t he co urts ov er the po ss es si on or c us to dy of th e res .”). Fo r th es e rea so ns , th e se co ndsi tu at io n i n wh ic h afed eral co urt i s al lo wed to en joi n s ta te co urt p ro ceed in gs un de r th e “ ne ces sa ry in aidof i ts juri sd ic ti on ” ex cep ti on to th e Ant i-I nju nc ti on Act d oe s n otap pl y he re. 5 The m ot iv at io n fo r th e is su an ce o f th e in jun ct io n a ga in stth e st at e co urt pr oc eed in gs was t he fearth atth os e p ro ceed in gs co ul d re su ltina reduc ti on in so m e of Atl an ta ’s waterservi ce re ve nu e, whi chco ul d i m pe de it s ef

fo rts to co m

pl y with it s co ns en t d ecre e o bl ig at io ns be cau se th atrev enue is pl ed ge d a s p artof t he co ll at eral forth e b on ds Atl an tais su edto fin an ce i ts co m pl ia nc e with t he de cree s. Whe n t he di st ric t co urt en te redth e co ns en t d ecre es requi rin g t ha t the sewe r syste m be cle an edup , itlef

t t o At la nt a th e ta skof f

in an ci ng it s co m

pl ia nc e wit h t ho se

Atlanta’s c ontention that the Clean Water Ac t liti g ation itself is a res ove r which the 5 district court has e x erc ised in rem jurisdiction fails for the same re asons. 1 6 Case: 10-10711 Date Filed: 11/19/2012 Page: 16 of 24de cree s. Itwas At la nt a’s de ci si on to is su e b on ds to fin an ce s om e o f it s

co m pl ianc e eff

orts . It was Atl an ta ’s dec is io n t o p le dg e it s wat er an d s ewer s y st em rev enue to pa y

off th os e b on ds . If th e wat er s y st em rev enue de cl in es foran y reas on , th e p ro bl em

wil l af fectth e b on d h ol de rs an d t he Cit y of At la nt a. It wi ll no t af fectth e fed eral co urt’s jur is di ct io n o ve r th e co ns en t d ecre es an d o ve r th ei r en fo rcem en t. If the po te nt ia l re du ct io n i n wat er s y st em rev enue is lar ge en ou gh—an d th ere h as be enno sh owi ng th atitis —At la nt a m ay ha ve a pr ob le m

pa y in g o ff the bo nd s t ha t h av e al read y

be enis su ed , bu t tha t wi ll be Atl an ta ’s pro bl em , no t the di st ric t co urt’s. If so m e ad di ti on al rev enue is requi redto off se t an y th atAtl an ta 6 lo se s, i t wi ll be Atl an ta ’s res po ns ib il ity to fin d t ha t re ve nu e, no t the di st ric t co urt’s. Inth e way

th atm at te rs , a th reat en edde cl in e in rev enue for th is reas on is no di ffer en t fr om

a de cl in e in rev enue forso m e o th er re as on , su ch as d ecre as ed us ag e am on g e xi st in g wat er cu st om ers . The fac t tha t the st at e se rv ic e d el iv ery pr oc eed in gs m ay

reac h ares ul t tha t wi ll m ak e itm or e d iff ic ul t fo r Atl an tato pa y of f th e b on ds th atitha s i ss ue d t o p ay forth e cl ean up do es no t m ak e anin jun ct io n
Acc ordingto Atlanta, “[a]bout 13 perce nt of its total revenue s in fiscal year 2008-2009 6 came from sale s of wate r outside the city boundarie s,” which a

mounts to about $41 mi llion per year . The re cord doe s not indicate how much of that reve nue come s specific ally from providing water service to Sandy

Springs or

whether Atlanta could make up, in some other wa y or fr om some other sourc e, any

reve nue it may

lose from not providingwater service to Sandy

Springs. 1 7 Case: 10-10711 Date Filed: 11/19/2012 Page: 17 of 24ag ai ns t tho se st at e p ro ceed in gs ne ces sa ry in aidof f

ed eral co urt juris di ct io n o ve r th e co ns en t d ecre es . Cf. Atl . Coa stLin e R.R., 3 98 U.S. at 2 95 , 90 S.Ct . at 1 74 7 (“ [I]t is no t en ou gh th atth e reque st edin jun ct io n i s re la te d t o [t he fed eral co urt’s] juri sd ic ti on , bu t i t m

us t b e ‘nece ss ary in aidof’ th atjuri sd ic ti on .” (em ph as is ad de d) ). The di stric t co urt was sen si ti ve to an yth in g t ha t thr eat en edto im pe de Atl an ta ’s com

pl ianc e wit h t he two co ns en t d ecre es . W e d o n otbl am e th e co urt fo r th at . Its sen si ti vi ty is u nd ers tand ab le in li gh t o f th e v as t am ou ntof t im e an d e ffo rt th atth e co urt h as de vo te d t o the un de rlyin g C le anW at er Actcas e, to th e co ns en t de cree s, an d t o t he ir i m

pl em en ta ti on . Butno am ou ntof g oo d m ot iv es an d n o am ou ntof e xp en de d t im e o r effo rt c anbe st ow o n afed eral co urt the au th or it y to in te rfer e wit h aso ve rei gn st at e’s pr oc eed in gs . Onl y th e Co ns ti tu ti on an d Co ng res s ca n d o t ha t, an d n ei th er h as do ne so he re. See Sav e th e Bay, Inc. v . U.S. Arm y , 63 9 F .2d11 00 , 11 02 (5t h C ir. Fe b. 1 98 1) (“ W e h av e o nl y th e au th or it y en do wedby the Co ns ti tu ti on an d t ha t co nf erre d b y Co ng res s.”) . IV. W e tu rnno w to th e supp le m en ta l juris di ct io n i ss ue . In ad di ti on to rel y in g on th e All Writ s Actas aso ur ce o f au th or it y foren joi ni ng th e p art ie s fr om pu rs ui ng th e st at e se rv ic e d el iv ery pr oc eed in gs , th e d is tri ctco urt co nc lu de d t ha t 1 8 Case: 10-10711 Date Filed: 11/19/2012 Page: 18 of 24un de r 28 U.S.C. § 1 36 7( a) i t al so ha d s up pl em en ta l juris di ct io n o ve r th os e

pr oc eed in gs ; tha t was analt ern at iv e b as is fortak in g o ve r th e p ro ceed in gs an d de ci di ng th e is su es rai se d i n t he m . The d is tri ctco urt d idno t ex pl ai n h ow i ts fed eral qu es ti on juri sd ic ti onov er the Cle anW at er Actli ti ga ti on all owe d i t t o ex erci se supp le m en ta l juris di ct io n o ve r th e wat er d el iv ery se rv ic e is su es in th e st at e p ro ceed in gs . Sect io n 1 36 7( a) g iv es fed eral co urts “ th e p owe r to ex erci se supp le m en ta l juri sd ic ti on ov er al l cl ai m s t ha t ar is e o utof aco m m on nu cl eu s o f op erat iv e fac t wit h asubs ta nt ia l fe de ral cla im .” Tam ia m i Pa rtn ers , Ltd . ex r el . Tam ia m i Dev . Co rp . v. Mi cco su ke e Trib e o f In di an s o f Fl a., 17 7 F .3d12 12 , 12 23 (11 th Cir . 19 99 ) (quo ta ti onm ark s o m it te d) ; s ee al so 28 U.S.C. § 1 36 7( a) (“ [I]n an y civ il act io n o f whi ch th e d is tri ctco urts ha ve ori gi na l juris di ct io n, t he di stric t co urts sh al l h av e supp le m en ta l juris di ct io n o ve r al l o th er cl ai m s t ha t ar e so rel at edto cl ai m s i n the act io n wi th in su ch ori gi na l juris di ct io n t ha t the y form pa rt o f th e sa m e cas e o r co nt ro ve rs y un de r Arti cl e III o f th e Uni te d S ta te s C on st itut io n.” ). W e rev ie w de n ov o adi st ric t co urt’s l eg al co nc lu si on th atitha s s ub ject m at te r juri sd ic ti on ov er a ca se or c on tro ve rs y . See, e.g ., MacGi nn it ie v. Ho bb s Gro up ,

1 9 Case: 10-10711 Date Filed: 11/19/2012 Page: 19 of 24LLC, 42 0 F .3d12 34 , 12 39 (11 th Cir . 20 05 ). 7

The fed eral Cle anW at er Actli ti ga ti on an d t he st at e se rv ic e d el iv ery pr oc eed in gs in vo lv e d iff

eren t i ss ue s u nd er d iff

eren t l aw ari si ng fro m

di ffer en t s et s of fact s o ccu rri ng in di ffer en t d ecad es . The fed eral li ti ga ti on aro se fro m en vi ro nm en ta l l aw vi ol at io ns in th e o pe rat io n o f Atl an ta ’s sewe r syste m du rin g t he 19 90 s. Th e st at e p ro ceed in gs aro se fro m di sa gr eem en ts ab ou t wh ere S an dy Sp rin gs cange t i ts wate r se rv ic e aft er i t i nc or po rat edin20 05 . As we h av e ackno wled ge d, At la nt a d idis su e b on ds to fin an ce i ts sewe r cl ean up effo rts , pl ed gi ng th e rev enue s fr om it s s ewer an d wat er s y st em as co ll at eral forth os e b on ds . And , if l eftto th e st at e la w m eri ts of the m at te r, th e st at e se rv ic e d el iv ery pr oc eed in gs m ay res ul t i n ade crea se in th e rev enue st ream co m in g fr om

th e wat er s y st em , whi ch Atl an tafear s wo ul d u nd erm in e it s ab il it y to co m pl y with t he co ns en t d ecre es . Atla nt a’s po si ti on is th atby try in g t o wre stfro m

Atlanta asse rts that the district court’s de cision about whethe r to exercise suppleme ntal 7 jurisdiction should be reviewe d only for a n abuse of

discretion. I f a district c ourt’s jurisdiction over a claim arises from 28 U.S.C. § 1367(a) , the cour t has some discre tion about whether to exercise that jurisdiction if any of the fa ctors set out in § 1367(c) exis t. It is a district court’s discretionar

y decision under

§ 1367(c) about whethe r to exercise its supplemental jurisdiction that we r eview f

or an a buse of discr etion. See, e.g ., Estate of Amerg i ex rel. Amerg i v. Palestinian Auth., 611 F.3d 1350, 1356 (11th Cir. 2010). In the pre sent ca se, howe ver, the issue is not how the district court should have e x erc ised its discretion in reg ard to supplementa l jurisdiction that it had. The issue is whether the district court ha d supplemental jurisdiction to beg in with, and that is a question of law w e re view de novo. See , e.g ., Hill v. BellSouth Telec omms., Inc., 364 F .3d 1308, 1314 (11th Cir. 2004). 2 0 Case: 10-10711 Date Filed: 11/19/2012 Page: 20 of 24itth e wat er s y st em lo cat edin San dy Spri ng s, an d t he reb y th reat en in g i ts rev enue , San dy Spri ng s h as “ im

pl ic at edth e sa m e cas e o r co nt ro ve rs y as t he Cle anW at er Act c la im s.” B r. of

App el le e at45 . Atl an tais wron g. Th e te stis no t wh ethe r th e sa m e cas e o r co ntro ve rs y is

“ im pl ic at ed .” The t es t i s wh ethe r th e cl ai m s as se rte d “ de riv e fro m a co m m on nu cl eu s o f op erat iv e fac t.” Un it edMi ne W orke rs of Am . v. Gib bs , 38 3 U.S. 7 15 , 72 5, 8 6 S .Ct. 1 13 0, 1 13 8 (1 96 6) . W e ta ke th e nuc le us of f act s o n wh ic h t he fed eral qu es ti on cla im s ar e b as edan d c om pa re i t t o t he nu cl eu s o f fac ts on whi ch th e st at e la w cla im s ar e b as ed . W e d o n otlo okat the res ul ts th atm ay flo w fro m th e im pl ic at io ns of f

in di ng th atsupp le m en ta l juris di ct io n d oe s n otex is t. Itis no t a res ul ts -o rie nt edan al y si s, b uta fact -o rie nt edon e. 8 How At la nt a p ay s fo r it s s ewer cl ean up effo rts (orev enwhet he r itpay s fo r th em ) do es no t ch an ge th e fac tu al pre di cat e th atga ve ris e to th e Cl ean W at er Act li ti ga ti on . Thatfactua l p red ic at e was a se wer s y st em th atwas i n v io la ti onof

Atlanta re lies on Parker

v. Scrap Me tal Processors, Inc., 468 F .3d 733 (11th Cir. 2006), 8 to support its argument that the district court prope rly exercised suppleme ntal jurisdiction in thi s case . That dec ision does not help Atlanta at all. As a ll of the parties in Parke r agree d, the fe dera l and state c laims in that case a rose out of a

common nucleus of ope rative f act, g iving the district court the pow er to e x erc ise supplemental jurisdiction over the state law c laims. See id. at 743. The issue Parke r dec ided was whether the district court ha d abused its discre tion by declining under 28 U .S.C. § 1367(c) to exercise suppleme ntal jurisdiction that it had. I d. at 738. That is not the issue befor e us her e. 2 1 Case: 10-10711 Date Filed: 11/19/2012 Page: 21 of 24fed eral cle anwate r la ws. The st at e se rv ic e d el iv ery pr oc eed in gs ab ou t the so ur ce

of San dy Spri ng s’ waterservi ce d o n otde riv e fro m a po ll ut in g s ewer s y st em or an y fed eral Cle anW at er Actvi ol at io ns . They de riv e in st eadfro m San dy Spri ng s’ in co rp or at io n a nda di sp ut e ab ou t h ow wat er s erv ic e is to be ha nd le d i n t he ne wly in co rp or at edcit y . Atl an ta ’s tes t fo r supp le m en ta l juris di ct io n wo ul d g ran t fe de ral co urts juri sd ic ti on ov er an y

st at e law cla im

th atco ul d p ot en ti al ly affectrev enue s u se d t o co m pl y with afed eral co urt d ecre e, reg ard le ss of t he cla im ’s factua l p red ic at e. Co ns id er an ex am

pl e. A cit y

pl ed ge s t he rev enue itge ts fro m anoc cupa ti on al tax to pa y th e b on ds itha s i ss ue d t o fu ndco m pl ia nc e wit h afed eral co urt d ecre e in vo lv in g C le anW at er Actvi ol at io ns . If li ti ga ti onis fil edin st at e co urt o ve r th e st at e co ns ti tu ti on al va li di ty of th atoc cupa ti on al tax , un de r Atl an ta ’s app ro ach th e fed eral co urt wo ul d h av e supp le m en ta l juris di ct io n t o d eci de th atpu rel y st at e la w is su e b ecau se th e o ut co m e co ul d p ot en ti al ly affectrev enue s u se d t o p ay bo nd s is su edto fun d e ffo rts to co m pl y with t he fed eral co urt d ecre e. Supp le m en ta l juri sd ic ti on is no t tha t m al le ab le . The di stric t co urt erredin co nc lu di ng th atitha d s up pl em en ta l juris di ct io n

2 2 Case: 10-10711 Date Filed: 11/19/2012 Page: 22 of 24ov er the st at e se rv ic e d el iv ery pr oc eed in g i ss ue s. 9 V. W e m us t k eep fed eral jud ic ia l p owe r co nf in edwithi n the “ ex actde gr ees an d ch arac te r” s etou t b y

Co ng res s, Ody ss ey

Mari ne Exp lo rat io n, In c. v. Un id en ti fie d Sh ip wreck edVess el , 65 7 F .3d11 59 , 11 79 (11 th Cir . 20 11 ), an d we s ho ul d g ua rd ag ai ns t an yth in g tha t d is rupt s t he de li cat el y ba lanc edsyste m

of dua l s ov erei gn ty th atis on e o f th e fo un da ti on st on es un de rlyin g o urCo ns ti tu ti on . See Am . Fire & Cas . Co. v . Fin n, 3 41 U.S. 6, 1 7, 7 1 S .Ct. 5 34 , 54 2 (1 95 1) (“ The juri sd ic ti on of t he fed eral co urts is care fu ll y gu ard edag ai ns t ex pa ns io n b y jud ic ia l i nt erp ret at io n . . . .”); Heal y v. Ra tt a, 29 2 U.S. 2 63 , 27 0, 5 4 S .Ct. 7 00 , 70 3 (1 93 4) (“ Due reg ardfor th e ri gh tfu l i nd ep en de nc e o f st at e g ov ern m en ts , whi ch sh ou ldactua te fed eral co urts , requi res th atth ey

scrup ul ou sl y

co nf in e th ei r own juri sd ic ti on to th e p reci se li m it s wh ic h t he st atut e h as de fin ed .”); Ru ss el l Co rp . v. Am . Hom e Ass ur . Co., 26 4 F .3d10 40 , 10 50 (11 th Cir . 20 01 ) (“ [T]here i s a p res um pt io n a ga in stth e ex erci se of f

ed eral juri sd ic ti on. . . .”); Sm it h v . GTE Co rp ., 23 6 F .3d12 92 , 12 99 (1 1t h C ir. 2 00 1) (“ [F]ede ral co urts sh ou ldpro ceedwith c au ti onin co ns tru in g Relying on F eder al Rules of Civil P roce dure 19 a nd 21, the district court joined Sandy 9 Springs a s a third-pa

rty defe ndant in the Clean Water A ct litigation. B eca use the district cour

t lacke d subject matter jurisdiction over the state c ourt servic e deliver y proce eding s, it necessa

rily follows that joinder of Sandy Springs in the Clea

n Water Ac t liti g ation was improper . 2 3 Case: 10-10711 Date Filed: 11/19/2012 Page: 23 of 24co ns ti tu ti on al an d s ta tu to ry pro vi si on s d eal in g wi th th ei r juri sd ic ti on .” (quo ta ti on m ark s & alt erat io n o m it te d) ); Ei gh th Reg ’l W ar Lab orBd . v. Hu m bl e Oil & Ref

. Co ., 14 5 F .2d46 2, 4 64 (5t h C ir. 1 94 4) (“ The juri sd ic ti on of t he di st ric t co urt i s co nf in edwithi n s tri ctli m it s . . . .”); Le M ie ux Bro s. v . Trem on t Lu m be r Co ., 14 0 F.2 d 3 87 , 38 9 (5 th Cir . 19 44 ) (“ Uni te d S ta te s Di st ric t Co urts are co urts of l im it ed juri sd ic ti on . Creatur es of s ta tu te , th ey ha ve on ly suc h ju ris di ct io n a s t he st atut es ex pr es sl y co nf er, an d t hi s ju ris di ct io n m us t al way s af

firm at iv el y

ap pe ar.”) . The di st ric t co urt ex ceed edth e sc op e o f it s au th or it y by exerc is in g juris di ct io n o ve r th e st at e se rv ic e d el iv ery pr oc eed in gs . The di stric t co urt’s o rd er en joi ni ng Fu lt on Co un ty andSan dy Spri ng s fr om pu rs ui ng th e st at e se rv ic e d el iv ery pr oc eed in gs inst at e co urt i s VACATED , and th e cas e is REMANDED with i ns tru ct io ns forth e d is tri ctco urt t o d is m is s fo r la ck of subjec t m atte r juri sd ic ti on Atl an ta ’s Am en de d Th ird -Party Com pl ai ntag ai ns t San dy Spri ng s.

2 4 Case: 10-10711 Date Filed: 11/19/2012 Page: 24 of 24