Opinion ID: 1436350
Heading Depth: 3
Heading Rank: 1

Heading: Denial of Motion to Remand for Lack of Timeliness

Text: OCWD first argues that its objection to removal did not run afoul of the thirty-day time limit for remand motions on the basis of any defect other than lack of subject matter jurisdiction. [11] 28 U.S.C. § 1447(c). According to OCWD, its challenge focused on a defect in subject matter jurisdiction  namely, the District Court's failure to recognize that its action fell within the governmental unit exception to the bankruptcy removal statute. OCWD, however, misconstrues the relationship between removal procedures and subject matter jurisdiction. Where state and federal courts share subject matter jurisdiction, a removal statute may provide the procedural mechanism for transferring a case from one court to another, but the removal statute is not the source of subject matter jurisdiction. See 28 U.S.C. § 1441(a)-(b). [12] It follows that, when a removal statute is not the source of subject matter jurisdiction, improper removal under that statute does not amount to a deficiency in subject matter jurisdiction. An objection based on such an improper removal could therefore be waived unless raised within thirty days because it challenges an error other than lack of subject matter jurisdiction. 28 U.S.C. § 1447(c). See, e.g., Handelsman v. Bedford Vill. Assocs. Ltd. P'ship, 213 F.3d 48, 50 n. 2 (2d Cir.2000); Hamilton v. Aetna Life & Cas. Co., 5 F.3d 642, 643-44 (2d Cir.1993). A removal statute may, however, in limited circumstances, confer subject matter jurisdiction on the federal courts, as well as provide the procedural mechanism for removal. See, e.g., Niagara Mohawk Power Corp. v. Bankers Trust Co. of Albany, 791 F.2d 242, 244 (2d Cir.1986) (finding that the removal statute 28 U.S.C. § 1442(a)(1) confers jurisdiction as well as the right of removal). Where a federal court lacks jurisdiction independent of the removal statute, a substantive defect in removal is not waived under § 1447(c) because a substantive challenge to removal may be an implicit challenge to the court's subject matter jurisdiction. [13] See, e.g., Mignogna v. Sair Aviation, Inc., 937 F.2d 37, 40 (2d Cir.1991) (finding that the defect in removal created an unwaivable defect in subject matter jurisdiction). The bankruptcy removal statute is more akin to the general removal statute, 28 U.S.C. § 1441, which only provides a procedural mechanism for removal and does not confer subject matter jurisdiction, than it is to the federal officer removal statute, 28 U.S.C. § 1442(a)(1), which provides both a procedural mechanism and subject matter jurisdiction. In contrast to the federal officer removal statute, § 1452(a) does not enable a district court to assert jurisdiction over an action that could not otherwise have been commenced in federal court. Instead, § 1452(a) is similar to general removal statutes, such as § 1441(a) and (b), for which original federal jurisdiction is a pre-requisite. See 28 U.S.C. § 1452(a) (conditioning removal upon the district court's jurisdiction of such claim or cause of action under section 1334 of this title). Just as we have found challenges to removal defects under § 1441(a) and (b) to be waivable, so, too, are challenges to removal under § 1452(a). If § 1452(a) challenges are not raised within thirty days, we will consider them waived pursuant to § 1447(c). [14] OCWD's argument that its motion to remand on the basis of the governmental unit exception to the bankruptcy removal statute was a motion to remand for lack of subject matter jurisdiction, and was therefore not affected by the thirty-day time limit of § 1447(c), thus fails. The District Court was correct in concluding that OCWD had waived its objections to improper removal under § 1452(a). MTBE, 522 F.Supp.2d at 562. We acknowledge a tension between our analysis here and our prior discussion of removal and subject matter jurisdiction in MTBE. In MTBE, we evaluated whether removal was proper under either the bankruptcy or federal officer removal statute or, alternatively, on grounds of preemption or by the existence of a federal question. 488 F.3d at 124-36. Concluding that the requirements of the applicable removal statutes have not been met, we ordered that the cases be remanded to the forums from which they were removed. Id. at 136. Although we discussed the independent obligation to review the propriety of the removals in order to determine whether the district court ha[d] subject matter jurisdiction, id. at 121, 124, we never considered § 1447(c) or the relevant precedents analyzed above (with some limited exceptions [15] ). Nor did the parties cite § 1447(c) in their briefs to this Court for purposes of MTBE litigation. Although our decision in MTBE could be read to suggest that challenges based upon the governmental unit exception to § 1452(a) cannot be waived under § 1447(c), a sub silentio holding is not binding precedent. Getty Petroleum Corp. v. Bartco Petroleum Corp., 858 F.2d 103, 113 (2d Cir.1988) (internal quotation marks omitted); see United States v. Dauray, 215 F.3d 257, 261 n. 1 (2d Cir.2000) (same); see also United States v. Johnson, 256 F.3d 895, 915 (9th Cir.2001) (en banc) (stating that a court is not bound by a statement of law where it is merely a prelude to another legal issue that commands the panel's full attention) (cited with approval in United States v. Hardwick, 523 F.3d 94, 101 n. 5 (2d Cir.2008)). Accordingly, our prior holding in MTBE did not foreclose the District Court's conclusion that OCWD's challenge to bankruptcy removal under the governmental unit exception was waived pursuant to § 1447(c).