Source: https://supreme.justia.com/cases/federal/us/114/635/
Timestamp: 2019-04-20 00:26:30+00:00

Document:
In a suit against a corporation in a court of the state from which its charter is derived to recover on a judgment recovered against it in a circuit court of the United States in a district within the limits of another state, a petition by the defendant for the removal of the cause into the circuit court of the United States which alleges that the defendant was not an inhabitant of the latter state, and was not personally served with process by itself or its officers, but does not allege that there was no service of process on an agent of the corporation in the district in which the judgment was recovered, and that there was no appearance of the defendant in the suit, is not sufficient to raise a defense of want of jurisdiction under Rev.Stat. § 739.
"An allegation by a defendant in a suit in a state court of New York that an assignment of the cause of action in the suit by a citizen of another state to a citizen of New York was colorable, and was made for the purpose of preventing a removal of the cause to a court of the United States, presents a defense of the action in the court of that state, but furnishes no ground for removal of the cause to a court of the United States."
The fact that a judgment was recovered in a court of the United States does not, in a suit upon that judgment, raise a question under the laws of the United States within the meaning of the Act of March 3, 1875.
of the cause to the circuit court of the United States. The facts which make the federal question are stated in the opinion of the Court.
"That heretofore and on or about the 12th day of December, 1876, one Charles Cochran, then a resident of the State of Ohio, in due form of law, commenced an action in the United States Circuit Court for the Northern District of Ohio against the defendant in this action praying for a judgment against said defendant for twenty thousand dollars' damages; that the defendant in said action and herein duly appeared in said action, and answered the petition or complaint of said Cochran, and after trial had of the issues thus joined at which the defendant therein and herein duly appeared, judgment was duly directed, and subsequently, and on or about the 10th day of October, 1878, was duly entered and docketed in the office of the Clerk of said United States Circuit Court for the said Northern District of Ohio in favor of the said complainant Cochran and against the said The Provident Savings Life Assurance Society of New York, the defendant therein and herein, for the sum of three thousand three hundred five and 45/100 dollars damages and costs. . . ."
judgment, duly assigned and transferred to this plaintiff the said judgment, together with all his rights and claims thereunder and the interest due thereon."
The defendant, in answer to the complaint, admitted that Cochran had taken some proceedings in the Circuit Court of the United States for the Northern District of Ohio, praying for judgment against the defendant, but averred that there was never any personal service of process, summons, or petition upon the defendant, and denied any knowledge of the recovery of any judgment as alleged in the complaint, or that Cochran had assigned the alleged judgment to Ford.
"The Provident Savings Life Assurance Society of New York"
that this action is brought upon an alleged assignment of said judgment to the plaintiff above named by said Cochran, and is now pending and undetermined; that the matter in dispute exceeds, exclusive of costs, the sum or value of five hundred dollars, and involves questions arising under the laws of the United States, to-wit, under § 739 of the Revised Statutes of the United States. Said section forbids"
"any suit to be brought by any original process before either of the United States courts against an inhabitant of the United States in any other district than that of which he is an inhabitant, or in which he shall be found at the time of serving the writ."
"And your petitioner avers that the said suit in Ohio was by original process, but that the said process was never served personally upon the defendant in said action in Ohio or upon any of its officers, nor was the defendant ever an inhabitant of Ohio or found therein, and, as your petitioner verily believes, said circuit court never acquired jurisdiction, and said judgment is invalid and void, and that such want of personal service as aforesaid is alleged in the answer in the present action, and that the trial of this action will necessarily involve the construction and effect of the said law of the United States, to-wit, the said 739th section of the said United States Revised Statutes."
"Secondly. And your petitioners further say, as they are informed and verily believe, that the plaintiff in this action is not the real party in interest therein, but that said Cochran is the real party in interest, and that said alleged assignment is merely colorable; that it was made without any consideration and merely for the purpose of prosecuting and collecting said judgment for the benefit of said Cochran, and to avoid the necessity of said Cochran's giving security for costs as a nonresident of this state, and to embarrass and, if possible, prevent the transfer of this action to the United States courts, and that the controversy in this action is in reality and in substance between the defendant and the said Charles Cochran, who are citizens of different states, to-wit, the defendant is in law a citizen of New York, and said Cochran a citizen of Ohio."
a prayer for removal of the cause in the usual form. The court refused to remove the cause, and the trial proceeded and resulted in a verdict and judgment for the plaintiff, which judgment is brought here by the present writ of error.
The question for our consideration is whether, upon the petition as presented and the pleadings as they then stood, the application for removal should have been granted.
The first ground of removal set forth in the petition was in effect that the defendant had a defense arising under § 739 of the Revised Statutes of the United States, which defense was that the judgment sued on was absolutely void for want of jurisdiction in the court, because that section forbids any suit to be brought by any original process before either of the United States courts against an inhabitant of the United States in any other district than that of which he is an inhabitant or in which he shall be found at the time of serving the writ, and it is averred that the suit was by original process, and that said process was never served personally upon the defendant in Ohio (the defendant being a New York corporation) or upon any of its officers there, and that the defendant was never an inhabitant of Ohio.
United States circuit court. So that merely alleging that the defendant was not an inhabitant of Ohio, and was not found there, and was not personally served with process by itself or its officers, was not sufficient to raise a defense under § 739 of want of jurisdiction in the circuit court, without also negativing service of process on an agent of the defendant in Ohio, and the actual appearance of the defendant to the suit, for want of jurisdiction, set up to avoid a judgment, must be shown with the greatest certainty. The petition of removal is very careful not to negative these important contingencies, and that, in the face of the allegation of the complaint that the defendant did appear to the suit, and did answer the petition and appear at the trial. Hence, we say that the allegation of a defense under the statute is clearly evasive and inconsequential, and we are not at all surprised to find that when the record of the Ohio suit was produced it showed that the defendant's agent was served with process, and that the defendant did actually appear to the suit and answer the petition, and did appear at and contest the trial, which lasted for a fortnight.
Reading the petition for removal therefore in the light of the pleadings on file when it was presented, we are satisfied that the first ground of removal set out therein was insufficient.
the action brought by the assignee. We know of no instance where the want of consideration in a transfer, or a colorable transfer, of a right of action from a person against whom the defendant would have a right of removal to a person against whom he would not have such a right, has been held a good ground for removing a cause from a state to a federal court. Where an assignment of a cause of action is colorably made for the purpose of giving jurisdiction to the United States court, the fifth section of the act of Congress of March 3, 1875, relating to removals, has now given to the circuit courts power to dismiss or remand the cause at any time when the fact is made to appear. And by analogy to this law, it may perhaps be a good defense to an action in a state court to show that a colorable assignment has been made to deprive the United States court of jurisdiction; but, as before said, it would be a defense to the action, and not a ground of removing that cause into the federal court. We think, therefore, the second ground of removal was also insufficient.
It is suggested, however, that a suit on a judgment recovered in a United States court is necessarily a suit arising under the laws of the United States, as much so as if the plaintiff or defendant were a corporation of the United States, and hence that such a suit is removable under the Act of March 3, 1875.
It is observable that the removal of the cause was not claimed on any such broad ground as this; but so far as the character of the case was concerned, only on the ground that the defendant had a defense under § 739 of the Revised Statutes, specifying what the defense was, and we have already shown that that ground of removal, as stated in the petition, was insufficient. But conceding that the defendant is now entitled to take its position on the broader ground referred to, is it tenable and sufficient for the purpose?
securities depends upon the fact of their being the obligations of the United States. So if A have title to land by patent of the United States and brings an action against B for trespass or waste, committed by cutting timber, or by mining and carrying away precious ores or the like, it is not therefore a case arising under the laws of the United States. It is simply the case of an ordinary right of property sought to be enforced. A suit on a judgment is nothing more, unless some question is raised in the case (as might be raised in any of the cases specified) distinctly involving the laws of the United States -- such a question, for example, as was ineffectually attempted to be raised by the defendant in this case. If such a question were raised, then it is conceded it would be a case arising under the laws of the United States.
These considerations show a wide distinction, as it seems to us, between the case of a suit merely on a judgment of a United States court, and that of a suit by or against a United States corporation; which latter; according to the masterly analysis of Chief Justice Marshall in Osborn v. Bank, 9 Wheat. 738, is pervaded from its origin to its close by United States law and United States authority.
Without pursuing the subject further, we conclude with expressing our opinion that this last ground of removal, like those already considered, was insufficient.

References: § 739
 § 739
 § 739
 § 739
 § 739
 v.