Source: http://openjurist.org/955/f2d/316
Timestamp: 2015-10-06 10:49:30
Document Index: 522444309

Matched Legal Cases: ['§ 1446', '§ 1447', '§ 1446', '§ 1446', '§ 191', '§ 1821', '§ 1819', '§ 1446', '§ 1447', '§ 1446', '§ 1819', '§ 1819', '§ 1446', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1819', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1447', '§ 1819']

955 F2d 316 Federal Deposit Insurance Corporation Na Na Na Ncnb Na v. A Loyd H | OpenJurist
955 F. 2d 316 - Federal Deposit Insurance Corporation Na Na Na Ncnb Na v. A Loyd H HomeFederal Reporter, Second Series 955 F.2d.
955 F2d 316 Federal Deposit Insurance Corporation Na Na Na Ncnb Na v. A Loyd H 955 F.2d 316
22 Fed.R.Serv.3d 430
FEDERAL DEPOSIT INSURANCE CORPORATION, as Receiver for FirstRepublicbank Dallas, N.A., f/k/a First Republicbank OakCliff, N.A., f/k/a Interfirst Bank Oak Cliff, N.A., and NCNBTexas National Bank, N.A., Plaintiffs-Appellants,v.James A. LOYD, Johnny Barnes, and Bobbie H. Barnes,Defendants-Appellees.
No. 90-1714.
William Frank Carroll, Bruce L. Collins, III, John M. Nevins, Baker, Mills & Glast, Dallas, Tex., Gregory E. Gore, FDIC, Washington, D.C., for FDIC & NCNB.
James F. Mobley, Cedar Hill, Tex., for J. Barnes & B. Barnes.
Before THORNBERRY, JOLLY, and WIENER, Circuit Judges.
This case arises from the November 4, 1988, removal of pending state litigation by NCNB Texas National Bank ("NCNB"), and the FDIC, as Receiver of First RepublicBank Dallas, N.A. Twenty-one months later, the district court sua sponte remanded the case to state court, solely on the ground that the original motion for removal was procedurally defective as having not been timely filed pursuant to 28 U.S.C. § 1446(b). On appeal, the FDIC and NCNB argue that the district court did not have the authority sua sponte to remand the case for non-jurisdictional defects after the lapse of the thirty-day limitations period of 28 U.S.C. § 1447(c). In the alternative, the FDIC argues that removal was not procedurally defective because (1) the thirty-day removal period of § 1446(b) does not apply to removal by the FDIC; and, (2) assuming § 1446(b) does apply, removal was timely made within thirty days of its intervention in the state proceeding. Because we find that the district court erred for each of the above reasons, we reverse.
* The facts are brief and uncontested. James A. Loyd was an officer of InterFirst Bank Oak Cliff, N.A. InterFirst alleged that in 1972, Loyd, in conspiracy with J. Barnes and B. Barnes (collectively "Defendants"), devised a scheme to steal, and in fact did steal, approximately $490,000 in funds from accounts held by the InterFirst on behalf of its customers.
This action was originally filed in the Texas state court over six years ago--on March 8, 1985--by InterFirst against Loyd and the Defendants, asserting claims for breach of trust, conversion, theft and civil conspiracy, and seeking actual damages, injunctive relief, attorneys' fees, and punitive damages. Loyd died a few days before suit was filed. Consequently, on May 1, 1985, InterFirst filed a motion joining the Independent Executrix of Loyd's estate. In September 1987, the Defendants filed an answer, a counterclaim, with respect to InterFirst and a cross-claim against Loyd's estate. Subsequently, judgment was entered against Loyd's estate.1
On February 8, 1988, the Defendants filed their First Amended Counterclaim against First RepublicBank Oak Cliff, successor to InterFirst. Thereafter, First RepublicBank Oak Cliff was merged into First RepublicBank Dallas, N.A. ("First RepublicBank").
On July 29, 1988, the Comptroller of the Currency declared First RepublicBank insolvent pursuant to 12 U.S.C. § 191. On the same date, the Comptroller appointed the FDIC as Receiver of First RepublicBank pursuant to 12 U.S.C. § 1821(c). Also on that date, the FDIC entered into a Purchase and Assumption Agreement with NCNB Texas National Bank whereby the affirmative claims of First RepublicBank against the Defendants were transferred to NCNB. Liability on the counterclaim was retained by the FDIC as Receiver.
On September 28, 1988, NCNB made an appearance in the state court action to protect certain property rights and interests, and filed its Fourth Amended Original Petition. On November 4, 1988, the FDIC filed its plea in intervention in the state court action, and on that same date the FDIC and NCNB removed the state court action to the United States district court.
Subsequent to removal, the parties to this litigation filed numerous amended petitions and answers, as well as motions for partial summary judgment and responses thereto. On April 27, 1990, the district court entered an order sua sponte raising "the question whether the removal of this action was timely within the meaning of 12 U.S.C. § 1819(b)(2)(B) and 28 U.S.C. § 1446(b)" and requested letter briefs addressing this issue. On May 21, 1990, the FDIC and NCNB filed their briefs with the court.
On August 2, 1990, 744 F.Supp. 126, the district court entered its order remanding this action to state district court. The district court found that the FDIC's and NCNB's removal was untimely and that, despite the applicability of amended § 1447(c), a district court could on its own motion remand a case more than thirty days after removal.
In concluding that the removal was untimely and therefore procedurally defective, the district court first held that the procedural requirements of § 1446(b) applied to the FDIC's removal of an action pursuant to § 1819. The district court concluded that the enactment of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 ("FIRREA"), Pub.L. No. 101-73, 103 Stat. 183 (1989), did not effect a change in the law with respect to the procedural requirements for removal under § 1819.
After having concluded that the procedural requirements of § 1446(b) applied to the FDIC, the district court, relying primarily on its prior decision in Addison Airport of Texas, Inc. v. Eagle Inv. Co., 691 F.Supp. 1022 (N.D.Tex.1988), held that the thirty-day time period for removal commenced on the date the FDIC was appointed Receiver of the failed financial institution. Therefore, because the FDIC was appointed Receiver on July 29, 1988, yet did not remove until November 4, 1988, the district court held that removal was untimely.
Having found an apparent procedural defect in removal, the district court next addressed whether a court could remand on such ground after the expiration of the thirty-day period specified in § 1447(c).2 The district court first considered whether § 1447(c) applied to the pending action, and if so, (1) whether the amendments affected the court's power to raise the issue of remand on its own motion, and (2) whether the thirty-day time limit of § 1447(c) prohibited remand. The district court determined that amended § 1447(c) did apply to the pending litigation, but concluded that § 1447(c) did not prohibit its sua sponte remand.
The district court recognized that the thirty-day time limit for filing motions to remand had expired, and that a motion to remand, if filed by a party, would be prohibited by the express language in § 1447(c). However, the district court reasoned that it could remand the case on its own motion even after the thirty-day remand period.
Finally, the district court rejected the argument that NCNB was entitled to remove the action, even if the FDIC was not, within thirty days of the FDIC's intervention. The district court concluded that NCNB was also required to remove the action within thirty days after the FDIC was appointed Receiver.
On August 30, 1990, the FDIC and NCNB timely appealed.
* The actions of the district court in remanding this case present questions of law. Accordingly, we review the district court's conclusions de novo. Pullman-Standard v. Swint, 456 U.S. 273, 287, 102 S.Ct. 1781, 1789, 72 L.Ed.2d 66 (1982).
We must first determine whether we have jurisdiction to review the district court's remand order. Generally, our authority to review a remand order is severely limited by 28 U.S.C. § 1447(d), which provides, in pertinent part, that "[a]n order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise." The FDIC, however, is specifically exempted from this prohibition by 12 U.S.C. § 1819(b)(2)(C), which provides that "[t]he [FDIC] may appeal any order of remand entered by any United States district court." Accordingly, the FDIC may appeal as a matter of right, and we therefore have jurisdiction to review the district court's remand with respect to the FDIC.
NCNB, on the other hand, may not avail itself of this provision. Recognizing this fact, NCNB presents two alternate grounds for our jurisdiction to hear its appeal. First, NCNB argues that its appeal is proper because it was timely filed under Fed.R.App.P. 4(a)(3). Rule 4(a)(3) provides that:
Rule 4(a)(3), however, does not grant a party an appeal as of right when it has been forbidden by § 1447(d). The party appealing must have a right before invoking Rule 4(a)(3). See Fed.R.App.P. 4(a)(1) (noting that an appeal must be filed within thirty days "[i]n a civil case in which an appeal is permitted by law as of right"). Accordingly, Rule 4(a)(3) does not present NCNB with a means of circumventing the limitations of § 1447(d).
In the alternative, NCNB asks that we treat its notice of appeal as an application for a writ of mandamus. With respect to NCNB's request for a writ of mandamus, we must determine whether the district court exceeded its jurisdiction or "clearly and indisputably abused its discretion." In re Chesson, 897 F.2d 156, 159 (5th Cir.1990). In making this determination, "the party seeking the writ has the burden of proving a clear and indisputable right to it." In re Placid Oil Co., 802 F.2d 783, 786 (5th Cir.1986). The Supreme Court in Thermtron Products, Inc. v. Hermansdorfer, 423 U.S. 336, 345, 96 S.Ct. 584, 590, 46 L.Ed.2d 542 (1976), held that § 1447(d) does not preclude all review of remand orders. Rather, the Court noted that although subsection (d) of § 1447 prohibits appellate review of remand orders, that subsection must be read in conjunction with subsection (c), which defines the permissible grounds for remand. Id. at 345-46, 96 S.Ct. at 590-91. The Court concluded that a writ of mandamus is an appropriate method for reviewing a remand order, but only in cases where the district judge has clearly "exceeded his statutorily defined powers." Id. at 351, 353, 96 S.Ct. at 593, 594. See also New Orleans Public Service, Inc. v. Majoue, 802 F.2d 166, 167 (5th Cir.1986).
Recently, in the companion cases of In re Shell Oil Co., 932 F.2d 1518, 1519 (5th Cir.1991), cert. denied sub nom. Castillo (Gerardo Acuna) v. Shell Oil Co., --- U.S. ----, 112 S.Ct. 914, 116 L.Ed.2d 814 (1992) ["Shell Oil (I) "] and In re Shell Oil Co., 932 F.2d 1523, 1525 (5th Cir.1991) ["Shell Oil (II) "], we observed that the application of the Thermtron "exception" has become difficult because § 1447(c) has been amended since Thermtron was decided. See, e.g., Judicial Improvements and Access to Justice Act of 1988, Pub.L. No. 100-702, 102 Stat. 4642 (1988) ("JIAJA"). Prior to the recent amendments, § 1447(c) provided that, "[i]f at any time before final judgment it appears that the case was removed improvidently and without jurisdiction, the district court shall remand the case." 28 U.S.C. § 1447(c) (West 1973) (emphasis added). Under this version of § 1447(c), the Thermtron Court held that a district court's remand for reasons other than improvident removal or lack of jurisdiction could constitute an unauthorized remand, and permit appellate review. Thermtron, 423 U.S. at 351, 96 S.Ct. at 593.
When Congress amended § 1447(c) in 1988, however, it deleted the reference to "improvident removal." In its place, Congress substituted the phrase "any defect in removal procedure," and added a requirement that motions to remand based on such grounds be made within thirty days. The new version of 28 U.S.C. § 1447(c)3 now reads:
In Shell Oil (I), we interpreted these changes in § 1447(c) as reflecting "a congressional intent to delete improvident removal as an unreviewable basis for remand, at least when a motion to remand based on such improvident removal is made outside the 30-day time limit." 932 F.2d at 1520. In other words, we held that we have jurisdiction to review a remand order that is premised on a procedural defect in removal and when remand is made after the thirty-day period has passed. Id.
The Third Circuit adopted a similar view in Air-Shields, Inc. v. Fullam, 891 F.2d 63 (3d Cir.1989). In that case, the court considered whether it could review the district court's sua sponte remand order that was entered seven months after the case was removed and was based on a procedural defect. In reversing the remand order, the Air-Shields court held that:
Because the district court's remand decision in this case ... was not based on the "controlling statute," [i.e., amended § 1447(c) ] our review is not limited by subsection (d) of Section 1447. By remanding the case for procedural defects after the thirty day limit imposed by the revised Section 1447(c) had expired, the district court 'exceeded [its] statutorily defined power.' Therefore, the "issuance of the writ of mandamus [is] not barred by § 1447(d)."
Id. at 66 (quoting Thermtron, 423 U.S. at 351, 96 S.Ct. at 593).
It is important to note that the district court did not suggest that it remanded this case for lack of subject matter jurisdiction. Clearly, a remand for lack of subject matter jurisdiction would fall within the statutorily defined powers granted by § 1447(c), and § 1447(d) would preclude our review of such a remand with respect to NCNB. See Shell Oil (I), 932 F.2d at 1520. The district court, however, recognized that it had subject matter jurisdiction under § 1819(b)(2)(A), which provides, with certain exceptions not relevant here, that "all suits of a civil nature at common law or in equity to which the [FDIC], in any capacity, is a party shall be deemed to arise under the laws of the United States." (Emphasis added). See Carrollton-Farmers Branch Indep. School Dist. v. Johnson & Cravens, 889 F.2d 571, 572 (5th Cir.1989); Triland Holdings & Co. v. Sunbelt Serv. Corp., 884 F.2d 205, 207 (5th Cir.1989).
In its August 2, 1990 remand order, the district court remanded the case expressly because of an alleged untimely removal by the FDIC and NCNB.