Opinion ID: 686785
Heading Depth: 2
Heading Rank: 2

Heading: Is a sua sponte remand authorized by the removal statutes?

Text: 15 Generally, the application of the Sec. 1447(d) bar of appellate review would end our inquiry. However, the fact that the district court remanded the case to state court sua sponte, rather than responding to a party's motion, requires this court to determine, as the defendants further contend on appeal, whether such action is authorized by the removal statutes. Although Thermtron's interpretation of Sec. 1447(d) prohibits us from reviewing whether the remand order was substantively proper, i.e., whether the district court applied Sec. 1446 properly, it does not prohibit us from determining whether the district court exceeded its statutory authority by issuing the remand in this manner, i.e., sua sponte. See In re Continental Casualty Co., 29 F.3d 292 (7th Cir.1994); In re Amoco Petroleum Additives Co., 964 F.2d 706 (7th Cir.1992). In other words, we must decide whether the district court in the instant case possessed the authority under Sec. 1447(c) to issue the remand order sua sponte for purely procedural defects. If Sec. 1447(c) does in fact authorize a sua sponte remand for procedural defects, then the district court did not exceed its statutory authority and, as stated, we are barred from reviewing the validity of the district court's remand order. If a sua sponte remand is unauthorized by Sec. 1447(c), however, then not only was the district court in error, but we may vacate the remand order and direct the district court to reinstate the case to its docket. 7 16 This issue, whether Sec. 1447(c) authorizes sua sponte remands for procedural defects, is one of first impression in this circuit. Prior to the 1988 amendments to Sec. 1447(c), a court was allowed to remand [i]f at any time before final judgment it appear[ed] that the case was removed improvidently and without jurisdiction.... 28 U.S.C. Sec. 1447(c) (1973) (repealed 1988). The 1988 amendments to Sec. 1447, however, made significant changes to the rule. The first sentence of Sec. 1447(c) now states that, with respect to remands grounded on procedural defects, a motion to remand must be made within 30 days after the filing of the notice of removal.... 8 Specifically, we are faced with the question of whether the inclusion of the word motion in the 1988 amendments to Sec. 1447(c) refers exclusively to motions made by the parties, or alternatively, includes a district court's sua sponte remand. 17 A few district courts interpreting the 1988 amendments to the removal statute have concluded that the phrase motion to remand includes a district court's sua sponte remand. Corry v. City of Houston, 832 F.Supp. 1095 (S.D.Tex.1993); Cassara v. Ralston, 832 F.Supp. 752, 754 (S.D.N.Y.1993); see also Averdick v. Republic Fin. Servs., Inc., 803 F.Supp. 37 (E.D.Ky.1992). In essence, these courts conclude that the purpose behind amending 1447(c) was not to limit the court's power to remand a case sua sponte, but rather, to require that remands based on procedural defects be sought within thirty days after removal. Corry, 832 F.Supp. at 1096-97; 9 Cassara, 832 F.Supp. at 753-54. 18 On the other hand, the Courts of Appeals for the Fifth and Seventh Circuits have recently addressed this issue, and have flatly rejected that position. In re Allstate Ins. Co., 8 F.3d 219 (5th Cir.1993); In re Continental Casualty Co., 29 F.3d 292 (7th Cir.1994). In In re Allstate, the Fifth Circuit first noted that the district court has no inherent authority; either the statute provides the court with the authority to remand, or it does not. Following this rationale, the court concluded that Sec. 1447(c)'s second sentence assigns to the court concern for its jurisdictional prerequisites [i.e., subject matter jurisdiction]; the first consigns procedural formalities to the care of the parties. In re Allstate Ins. Co., 8 F.3d at 223. Finding this to be a warranted distribution of responsibility, the court held that Sec. 1447(c) does not confer upon the district courts discretion sua sponte to remand for purely procedural defects. Id. The court of appeals reasoned: 19 Where a removed plaintiff, by its inaction, has acquiesced in federal jurisdiction, for example, it hardly will do for the court sua sponte to interfere with the parties' apparent choice of forum. In such circumstances, where subject matter jurisdiction exists and any procedural shortcomings may be cured ... we can surmise no valid reason for the court to decline the exercise of jurisdiction. 20 Id. 21 The Seventh Circuit, also addressing the precise issue of sua sponte remands based exclusively on procedural defects, agreed with the result in In re Allstate, although it did not embrace all of the Fifth Circuit's reasoning. In re Continental Casualty Co., 29 F.3d 292 (7th Cir.1994). The Seventh Circuit concluded that procedural defects in removal are, in this respect, similar to lack of personal jurisdiction, and therefore, may be waived. The court reasoned that a plaintiff has a right to remand if the defendant removed improperly, but also may accept the defendant's choice of a federal forum. Id. at 294. Having found himself in federal court after removal, the plaintiff may want to stay there. Id. Thus, in the court's opinion, the power of a sua sponte remand could deprive both parties of their preferred forum. The Seventh Circuit, therefore, held that a district court cannot, sua sponte, remand a case for purely procedural defects. Id. 22 We conclude that the decisions of the Fifth and Seventh Circuits present a more logical interpretation of the current statute. We hold, therefore, that there is a distinction in the statute between defects in removal procedure, which are waived unless raised in a plaintiff's motion within thirty days after removal, and lack of subject matter jurisdiction, which requires the court to remand at any time prior to final judgment. Thus, Sec. 1447(c) does not authorize sua sponte remands for purely procedural defects. 23 The district court in Cassara placed great importance on the fact that, according to BLACK'S LAW DICTIONARY, the word sua sponte means [o]f his or its own will or motion. Although the definition of sua sponte does refer to the term motion, the definition of motion, however, does not contemplate something a court does on its own. Rather, motion is defined as [a]n application made to a court or judge for the purpose of obtaining a rule or order directing some act to be done in favor of the applicant. BLACK'S LAW DICTIONARY 1013 (6th ed. 1990) (emphasis added). While definitions found in the Dictionary are certainly not dispositive of cases such as this, we agree that the most logical interpretation of the term motion as used in Sec. 1447(c) is that which a party requests a court to do, not what a court does on its own accord. To find otherwise, the statute would, in essence, be authorizing a court to make an application for relief to itself. 24 We also agree with the Fifth Circuit's reasoning in In re Allstate that the two sentences of Sec. 1447(c) distribute different roles to the court and the parties. Not only did Congress incorporate the word motion in the 1988 amendments where it had previously been absent, but it did so only in the first sentence, i.e., for procedural defects. The first sentence of Sec. 1447(c) requires that a motion must be made within 30 days after the filing of the notice of removal to remand a case on the basis of a procedural defect. The second sentence, however, without mentioning motion, requires that if the district court lacks subject matter jurisdiction, the case shall be remanded. Thus, the court can, in fact must, dismiss a case when it determines that it lacks subject matter jurisdiction, whether or not a party has filed a motion. The inclusion of the term motion with respect to procedural defects, however, implies that a court must wait for a motion by a party before it is authorized by Sec. 1447(c) to remand. The statute simply delegates different roles to a district court. 25 Moreover, the legislative history to the 1988 amendments, as noted by the Fifth Circuit, appears to prescribe such a holding: 26 So long as the defect in removal procedure does not involve a lack of federal subject matter jurisdiction, there is no reason why either State or Federal courts, or the parties, should be subject to the burdens of shuffling a case between two courts that each have subject matter jurisdiction. 27 In re Allstate Ins. Co., 8 F.3d at 223 (quoting H.R.REP. No. 889, 100th Cong., 2d Sess. 72 (1988), reprinted in 1988 U.S.C.C.A.N. 5982, 6033). 28 A plaintiff may forgive the procedural defect and accept the defendant's preference of a federal forum. A district court should not interfere with an agreed upon forum until the plaintiff, by motion, indicates an objection to the removal procedure or the court determines that subject matter jurisdiction is lacking. As the Seventh Circuit (per Easterbrook, J.) noted, quick action without inviting the parties' submissions may illustrate the adage that haste makes waste. In re Continental Casualty Co., 29 F.3d at 295. The removal statutes seek to prevent extended delays and the needless shuffling of cases. The application of the sua sponte remand in this case, however, has brought litigation on the merits of this case to an abrupt halt, and is a fitting example of why sua sponte remands on nonjurisdictional grounds run contrary to the goals of the statute. 29 Given the sound decisions in the Fifth and Seventh Circuits, we are persuaded that the better reading of Sec. 1447(c) prohibits a district court from remanding sua sponte for a procedural defect. We therefore REVERSE the district court's order of remand and direct that the case be reinstated to the district court docket. 30