IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 07-20618

MICHELE POCHE,

Plaintiff-Appellee,

v.

TEXAS AIR CORPS, INC. D/B/A CERT EMERGENCY SERVICES, 

Defendant-Appellant.

Appeal from the United States District Court

for the Southern District of Texas, Houston Division

Before KING, WIENER, and ELROD, Circuit Judges. 

JENNIFER W. ELROD, Circuit Judge: 

Defendant-Appellant Texas Air Corps, Inc. (“TAC”) appeals the district

court’s order remanding this case to state court. Because our precedent compels

the conclusion that the district court was without authority to remand PlaintiffAppellee Michele Poche’s Fair Labor Standards Act claim, we reverse and

remand. 

I. Facts and Proceedings

TAC hired Michele Poche as an ambulance medic and dispatcher in June

2006. According to Poche’s state court petition, TAC told her that she would

work between fifty and sixty hours per week, and that she would be assigned a

company cell phone and would be on call at all times TAC was operating. Poche

further alleges that although TAC initially treated her as an employee,

United States Court of Appeals

Fifth Circuit

F I L E D

November 19, 2008

Charles R. Fulbruge III

Clerk
No. 07-20618

2

withholding taxes from her paychecks, she worked significantly more than sixty

hours a week and never received overtime wages. 

In October 2006, Poche and TAC executed an Employment Agreement

backdated to the first day of Poche’s employment with TAC. Under the terms

of the agreement, Poche was to be paid a salary based on a fifty-hour work week

for “providing professional emergency medical staffing as scheduled.” The

agreement further provided that Poche was an independent contractor rather

than an employee of TAC and was therefore not entitled to overtime wages.

Poche alleges that despite this provision, TAC continued to withhold taxes from

her paychecks but did not pay the amounts withheld to the IRS. After some

delay, TAC issued a 1099-MSC form reflecting payments to Poche totaling

$16,617.38—an amount that did not include the taxes TAC withheld from

Poche’s paychecks. On April 9, 2007, Poche received a check from TAC for

$3,894.23, which TAC denominated a “tax escrow distribution” for 2006. The

following day, TAC fired Poche without the two weeks’ notice required by the

Employment Agreement. 

Poche sued TAC in the 129th Judicial District Court of Harris County,

Texas, seeking a declaratory judgment regarding her entitlement to overtime

wages and alleging fraud and misrepresentation, breach of contract, and

violations of the federal Fair Labor Standards Act (“FLSA”). TAC removed the

case to the United States District Court for Southern District of Texas under 28

U.S.C. § 1441 on the ground that Poche’s petition raised a federal question. TAC

then filed counterclaims against Poche for theft and conversion in violation of

the Texas Theft Liability Act, breach of contract, fraud and negligent

misrepresentation, and breach of fiduciary duty. 

After TAC filed its counterclaims, Poche moved to remand the entire case,

arguing that because most of the claims and counterclaims arose under state

law, the case should be decided in state court. TAC opposed the motion, arguing

that (1) most of the state law claims were not subject to remand because they
No. 07-20618

3

were not separate and independentfrom the FLSA claim; and (2) considerations

of judicial economy warranted retaining the remaining state law claims. After

the district court granted the motion to remand, TAC filed a motion for

reconsideration, arguing that even if the state court claims were subject to

remand, the court had no discretion to remand Poche’s federal FLSA claim. The

district court denied the motion for reconsideration, and this appeal followed. 

II. Standard of Review

“If a district court’s decision to remand a case to state court is based on its

discretion, then we . . . review that decision for abuse of discretion.” Hook v.

Morrison Milling Co., 38 F.3d 776, 780 (5th Cir. 1994). Whether the district

court has that discretion, however, is a legal question we review de novo. Id.

III. Discussion

This appeal presents the following question: does 28 U.S.C. § 1441(c)

permit a district court to remand federal claims conferring removal jurisdiction

where those claims are part of a case “predominated” by state law? Before the

enactment of the Judicial Improvements Act of 1990, Pub. L. No. 101-650 § 312,

104 Stat. 5089, 5114 (1990), the operative statutory text provided: 

Whenever a separate and independent claim or cause of action,

which would be removable if sued upon alone, is joined with one or

more otherwise non-removable claims or causes of action,the entire

case may be removed and the district court may determine all issues

therein, or, in its discretion, may remand all matters not otherwise

within its original jurisdiction.

28 U.S.C. § 1441(c) (amended 1990) (emphasis added). Under this version of the

statute, a district court could not remand federal claims conferring removal

jurisdiction. See In re Wilson Indus., Inc., 886 F.2d 93, 96 (5th Cir. 1989). With

the 1990 amendment, however, the statute now provides: 

Whenever a separate and independent claim or cause of action

within the jurisdiction conferred by section 1331 of this title is

joined with one or more otherwise non-removable claims or causes

of action, the entire case may be removed and the district court may
No. 07-20618

4

determine all issues therein, or, in its discretion, may remand all

matters in which State law predominates. 

28 U.S.C. § 1441(c) (emphasis added). To affirm the district court’s remand

order, we would have to hold that the word “matters” in the current version of

section 1441(c) refers to an entire action, including component federal claims

conferring removal jurisdiction, rather than to particular causes of action. Some

courts have adopted this interpretation of “matters.” See, e.g., Lang v. Am. Elec.

Power Co., 785 F. Supp. 1331, 1334–35 (N.D. Ind. 1992); Moralez v. Meat Cutters

Local 539, 778 F. Supp. 368, 370–71 (E.D. Mich. 1991); see also 14C CHARLES

ALANWRIGHT,ARTHUR R.MILLER&EDWARDH.COOPER,FEDERAL PRACTICE AND

PROCEDURE § 3739 (3d ed. 1998). Our precedent, however, requires a different

result. 

A. Buchner

We begin our analysis with Buchner v. FDIC, 981 F.2d 816 (5th Cir. 1993),

which TAC cites for the proposition that “federal district courts do not, under

[section] 1441(c), have discretion to remand claims arising under federal

question jurisdiction.” In Buchner, the FDIC sued Donald Buchner and others

(collectively, the “Buchners”) in state court to collect money owed to a bank in

receivership. 981 F.2d at 817. The Buchners asserted counterclaims against the

FDIC, and four months after those claims were severed from the collection

action, the FDIC removed them to federal court. Id. The FDIC’s removal was

untimely, and the district court granted a motion to remand the claims. Id. 

The case continued in state court, and there it would have remained but

for a sanctions motion the Buchners filed against the FBI and one of its agents

conducting a criminal investigation in connection with the failure of the bank in

receivership. See id. The agent removed the entire case, including the

previously remanded claims, to federal court pursuant to 28 U.S.C. §§ 1442(a)(1)

and 1446(b). Id. The Buchners dismissed their sanctions motion against the

FBI and its agent and moved for a second remand of the case to state court. Id.
No. 07-20618

5

at 818. The FDIC opposed the remand motion, arguing that “the federal district

court had no choice but to retain jurisdiction over the case because it involved

federal claims and the FDIC was a party.” Id. Without addressing the merits

of the FDIC’s opposition,the district court granted the motion to remand, ruling

that the FDIC had “waived its right of removal on those bases long ago.” Id.

On appeal, we rejected the district court’s waiver analysis, holding that

“[t]he factthatthe FDIC waived its right to remove the instant case is irrelevant

to the determination of whether the case should have or could have been

remanded once it had been properly removed by another party who had not

waived the rightto remove.” Id. We then proceeded to consider the merits of the

FDIC’s opposition to the Buchners’ motion to remand, and in doing so, discussed

whether the district court had discretion under section 1441(c) to remand the

case. We held that it did not: 

[I]f a case is removed from state court on the basis of federal

question jurisdiction and that case also includes state law claims, §

1441(c) allows the district court to decide the entire case or, in its

discretion, to remand all matters in which state law predominates.

As the FDIC is a party to the present suit, all of the component

claims are conclusively deemed to have arisen under federal law.

And, as § 1441(c) authorizes the federal district court to remand

only those matters in which state law predominates, this

discretionary remand provision is inapplicable to the instant action.

Id. at 819 (emphasis added). Notwithstanding TAC’s reliance on Buchner, this

holding—that section 1441(c) is inapplicable to cases comprised entirely of

federal claims—does not resolve the question dispositive of the present appeal:

whether section 1441(c) authorizes remand of claims conferring removal

jurisdiction that are part of a case “in which state law predominates.” We thus

must look elsewhere in our precedent for guidance. 

B. Eastus and Metro Ford
No. 07-20618

6

We next consider Eastus v. Blue Bell Creameries, L.P., 97 F.3d 100 (5th

Cir. 1996), and Metro Ford Truck Sales, Inc. v. Ford Motor Co., 145 F.3d 320 (5th

Cir. 1998), on which Poche relies in arguing that section 1441(c) permits district

courts to “remand [an] entire action, federal claims and all, if the state law

claims predominate.” Eastus, 97 F.3d at 106; see also Metro Ford, 145 F.3d at

328. In Eastus, Greg and Paige Eastus sued Blue Bell in Texas state court for

violation of the federal Family and Medical Leave Act (“FMLA”), intentional

infliction of emotional distress, and tortious interference with prospective

contractual relations after Greg Eastus lost his job at the company. 97 F.3d at

102–03. Blue Bell removed the case to federal court, and the Eastuses filed a

motion to remand the entire case. Id. at 103. The district court remanded the

state law intentional infliction of emotional distress and tortious interference

claims, but not the federal FMLA claim. Id.

The Eastuses appealed, arguing that the district court abused its

discretion in remanding their state law claims. Id. at 104. In considering the

appeal, we explained that for remand to be proper under section 1441(c), “the

claim remanded must be (1) a separate and independent claim or cause of action;

(2) joined with a federal question; (3) otherwise non-removable; and (4) a matter

in which state law predominates.” Id. Applying this standard, we determined

that the intentional infliction of emotional distress claim was not “separate and

independent” from their FMLA claim, and accordingly held that “[b]ecause §

1441(c) does not authorize remand of state law claims unless they are separate

and independent from the removed federal question claim, the district court

abused its discretion by remanding this claim.” Id. at 105.

We reached a different conclusion regarding the tortious interference

with prospective contractual relations claim. After determining that the tortious

interference claim was “separate and independent” from the FMLA claim, we

considered the argument that “§ 1441(c) allows remand only when state law

predominates as to the entire case” and “because district courts have the power
No. 07-20618

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to remand the entire action, they no longer have the power to remand specific

causes of action.” Id. at 106. Though we acknowledged that the argument was

not withoutforce, we rejected it:“[W]e hold that § 1441(c) still allows the district

court to remand separate and independent state claims, if state law

predominates as to the individual claim. Therefore, § 1441(c) authorized the

district court to remand the tortious interference claim.” Id. at 106–07.

It is true, as Poche observes in her brief on appeal, that in discussing the

meaning of section 1441(c), we stated that “[c]ourts that have considered the

meaning of the new § 1441(c) have decided overwhelmingly that the provision

now permits them to remand the entire action, federal claims and all, ifthe state

law claims predominate.” Id. at 106. We further stated that the phrase “in

which State law predominates” in section 1441(c) “is not superfluous if it is

understood to give district courts the power to remand the entire case if state

law predominates.” Id. Neither of these statements, however, was essential to

our holding in Eastus, and in any event, the case did not present the question

now before us—whether section 1441(c) permits a district court to remand

claims conferring removal jurisdiction. The statements are thus dicta and do not

end our inquiry. See, e.g., Breen v. Texas A&M Univ., 485 F.3d 325, 336 (5th Cir.

2007) (recognizing that “statements in . . . cases . . . unnecessary to their

holdings . . . constitute[] only non-binding dicta”). 

Metro Ford Truck Sales, Inc. v. Ford Motor Co., however, comes closer to

the mark. In that case, Metro sued Ford in Texas state court, seeking to prevent

Ford from terminating Metro’s franchise agreement or taking actions to correct

problems at Metro uncovered by an audit. Metro Ford, 145 F.3d at 323. After

Ford filed counterclaims against Metro and third-party claims against Metro’s

principal, Metro filed an amended petition thatincluded a claim againstFord for

price discrimination under the Texas Antitrust Act. Id. Ford removed the case

to federal court on the theory that “the Texas Antitrust Act does not prohibit

price discrimination, and, therefore, Metro’s antitrust claim for price
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discrimination could arise, if at all, only under the federal Robinson-Patman Act,

conferring federal question jurisdiction.” Id.

After the district court denied Metro’s motion for remand, Metro filed an

amended complaint asserting claims against Ford for price discrimination and

vertical price fixing in violation of federal law, and Ford amended its third-party

complaint against Metro’s principal to include a RICO claim. Id. The district

court granted Ford summary judgment on Metro’s antitrust claims, and

remanded the entire case, including Ford’s federal RICO claim, to state court.

Id. at 324. Metro appealed the district court’s grant of summary judgment, and

Ford appealed the court’s remand of its third-party RICO claim and the state

law claims. Id.

In arguing that the district court had no authority under section 1441(c)

to remand its RICO claim, Ford relied on several cases, including Buchner, in

which “the court sought to remand federal claims which would have been

otherwise removable.” Id. at 328. We explicitly rejected Ford’s reliance on these

authorities, explaining that Ford’s RICO claim did not confer removal

jurisdiction: 

The essential concept governing in this appeal, perhaps overlooked

by Ford, is that the district court’s jurisdiction was derived from a

§ 1441 removal. When an action is brought to federal court through

the § 1441 mechanism, for both removal and original jurisdiction,

the federal question must be presented by plaintiff’s complaint as it

stands at the time the petition for removal is filed and the case

seeks entry into the federal system. It is insufficient that a federal

question has been raised as a matter of defense or counterclaim.

Similarly, the defendant’s third-party claim alleging a federal

question does not come within the purview of § 1441 removability.

Id. at 326–28 (footnotes and internal quotation marks omitted). 

Were this the extent of Metro Ford’s analysis, the case would lend no

support to Poche’s position—unlike the RICO claim at issue in Metro Ford, her

FLSA claim is indisputably “otherwise removable.” After discussing the fact

that Ford’s RICO claim “could not, and did not, confer removal jurisdiction,”
No. 07-20618

1 See 5th Cir. R. 47.5.3 (providing that unpublished opinions issued before

January 1, 1996, are precedent). 

9

however, we cited Eastus for the proposition that “the new § 1441(c) permits

courts to remand an entire action, or distinct claims, both state and federal, if

state law predominates.” This statement “could be characterized either as an

alternate holding or as dicta,” cf. Republic of Tex. Corp. v. Bd. of Governors of the

Fed. Reserve Sys., 649 F.2d 1026, 1038 (5th Cir. 1981), though at least one

unpublished, non-precedential decision of our court has relied upon itin holding

that district courts can remand claims conferring removal jurisdiction. See

Jones v. Belhaven College, 98 F. App’x 283, 284 (5th Cir. Apr. 8, 2004) (citing

Metro Ford, 145 F.3d at 328). We need not navigate the murky waters between

alternate holdings and dicta, however, because an earlier precedent, Laurents

v. Arcadian Corp., No. 94-41183, 1995 WL 625394 (5th Cir. Oct. 4, 1995),

controls.1

C. Laurents

In Laurents, employees of a chemical plant owned by Arcadian Corporation

filed a class action lawsuit against the company and others (collectively

“Arcadian”) in state court, alleging “a host of state law tort and contract claims

involving the collective bargaining agreement between Arcadian and the Lake

Charles Metal Trades Council.” 1995 WL 625394, at *1. Arcadian removed the

case to federal court on the theory that federal question jurisdiction existed

under the federal Labor Relations Management Act of 1947. Id. The district

court denied the employees’ motion to remand. Id. 

On appeal, the employees argued that “the district court abused its

discretion by failing to remand the entire case to state court pursuant to 28

U.S.C. § 1441(c) because the state law issues overwhelmingly predominate any

preempted claims.” Id. at *2 (internal quotation marks omitted). We squarely
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rejected this argument, holding that the district court had no authority to

remand claims that conferred removal jurisdiction: 

Although the district court had discretion to remand state law

claims that were removed along with one or more federal question

claims, it may not remand the component claims that are

conclusively deemed to have arisen under federal law, absent a

defect in the removal procedure or circumstances rendering the

retention of jurisdiction “inappropriate.” 

Id. To the extent Laurents conflicts with the later-decided Metro Ford, we are

bound to follow Laurents. See United States v. Walker, 302 F.3d 322, 324–25

(5th Cir. 2002) (noting “this circuit’s rule that one panel may not overrule a prior

panel opinion and the earlier precedent controls”). We are thus compelled to

conclude, irrespective of the arguments advanced by the parties’ very able

counsel, that the district court in the present case was without authority to

remand Poche’s FLSA claim. Having so concluded, we leave the disposition of

Poche’s state law claims and TAC’s counterclaims to the discretion ofthe district

court. 

IV. Conclusion

For the reasons set forth above, we REVERSE the district court’s order

remanding this case to state court and REMAND for proceedings consistent with

this opinion.