Court Opinion

ID: 216607
Source: CourtListenerOpinion
Date Created: 2011-05-12 17:07:03+00
Date Added: 2024-06-11T17:28:29.019926
License: Public Domain

Case: 10-11112 Document: 00511475152 Page: 1 Date Filed: 05/12/2011

           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT  United States Court of Appeals
                                                    Fifth Circuit

                                                 FILED
                                                                            May 12, 2011

                                     No. 10-11112                           Lyle W. Cayce
                                   Summary Calendar                              Clerk

BIG COUNTRY VEIN RELIEF, L.P.,

                                                   Plaintiff–Appellee,
v.

DIRECTORY ASSISTANTS, INCORPORATED,

                                                   Defendant–Appellant.

                    Appeal from the United States District Court
                         for the Northern District of Texas
                               USDC No. 6:10-CV-70

Before WIENER, PRADO, and OWEN, Circuit Judges.
PER CURIAM:*
       Directory Assistants, Inc. (DAI), appeals the district court’s order
remanding this case to the state court from which it was removed. Because we
determine that we are without jurisdiction, we dismiss the appeal.
                                              I
       Big Country Vein Relief (Big Country), a Texas citizen, filed this lawsuit
against DAI on July 6, 2009, seeking to enjoin pending arbitration proceedings.

       *
         Pursuant to 5TH CIR . R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR .
R. 47.5.4.
     Case: 10-11112 Document: 00511475152 Page: 2 Date Filed: 05/12/2011

                                       No. 10-11112

After DAI, a citizen of Connecticut, timely removed the case to federal court on
the basis of diversity jurisdiction, the subject arbitration occurred. Big Country
then moved for remand.           DAI opposed remand, arguing that because the
arbitration had already occurred, the motion was moot.                        Big Country
subsequently filed an unopposed motion for leave to file an amended complaint.
The amended complaint added four non-diverse entities as additional
defendants, and also sought a declaratory judgment that the arbitration award
against Big Country was unenforceable. The United States District Court for
the Northern District of Texas thereafter issued an order denying Big Country’s
original motion to remand, but upon motion for reconsideration, reversed course
and remanded the case to state court on November 23, 2009.
       Almost eight months later, on July 16, 2010, Big Country filed a motion
in state court to vacate the arbitration award. The certificate of service for that
motion indicated that only DAI, and not the four additional defendants, was
served.    DAI subsequently appeared at a state court hearing on August 5,
arguing unsuccessfully that the lawsuit should be stayed. On August 16, DAI
again removed to federal court. Big Country moved for remand, asserting that
the removal, filed more than a year after the original lawsuit was filed on
July 6, 2009, was untimely under 28 U.S.C. § 1446(b). DAI acknowledged that
the removal was untimely, but urged the district court to ignore that defect
pursuant to the equitable tolling exception to § 1446(b)’s one-year time limit
recognized by this court in Tedford v. Warner-Lambert Co.1 DAI argued that
application of the equitable exception was warranted because Big County had
engaged in forum manipulation, as evidenced by its assertion of purportedly non-
viable claims against, and lack of service upon, the additional non-diverse

       1
         327 F.3d 423, 426 (5th Cir. 2003) (“Section 1446(b) is not inflexible, and the conduct
of the parties may affect whether it is equitable to strictly apply the one-year limit.”).

                                              2
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                                        No. 10-11112

defendants. Unpersuaded, the district court granted Big Country’s motion to
remand. This appeal followed.
                                               II
       The threshold issue in this case is whether federal law permits us to
review the district court’s remand order. Our authority to review district court
orders remanding removed cases to state court is substantially limited by
28 U.S.C. § 1447(d). That statute provides, subject to an exception not relevant
here, that “[a]n order remanding a case to the State court from which it was
removed is not reviewable on appeal or otherwise.” Despite this seemingly broad
prohibition on appellate review, the Supreme Court has “interpreted § 1447(d)
to cover less than its words alone suggest.”2 Specifically, “§ 1447(d) should be
read in pari materia with § 1447(c), so that only remands based on the grounds
specified in the latter are shielded by the bar on review mandated by the
former.”3 Section 1447(c), in pertinent part, provides,
       A motion to remand the case on the basis of any defect other than
       lack of subject matter jurisdiction must be made within 30 days
       after the filing of the notice of removal under section 1446(a). If at
       any time before final judgment it appears that the district court
       lacks subject matter jurisdiction, the case shall be remanded.

Section 1447(d), then, precludes review “only of remands for lack of subject-
matter jurisdiction and for defects in removal procedure.” 4
       Here, DAI correctly concedes that its failure to remove within 28 U.S.C.
§ 1446(b)’s one-year time limit is a defect in removal procedure for the purposes

       2
           Powerex Corp. v. Reliant Energy Servs., 551 U.S. 224, 229 (2007).
       3
           Id. (citing Thermtron Prods., Inc. v. Hermansdorfer, 423 U.S. 336, 345-46 (1976)).
       4
         Id. at 229-230 (citing Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 711-12 (1996);
Things Remembered, Inc. v. Petrarca, 516 U.S. 124, 127-28 (1995)); see also Powerex Corp., 551
U.S. at 230 (“[T]he prohibition on appellate review remains limited to remands based on the
grounds specified in Quackenbush.”).

                                                3
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                                       No. 10-11112

of § 1447(c).5 On its face, this concession seems to end our jurisdictional inquiry:
we lack jurisdiction when a remand order is based on a defect in removal
procedure.
       DAI nevertheless posits that review is not foreclosed by § 1447(d), pointing
to several decisions concerning discretionary remands of supplemental state law
claims, including the Supreme Court’s recent decision in Carlsbad Technology,
Inc. v. HIF Bio, Inc.6 There, the Supreme Court held that when a district court’s
remand is premised on its decision not to exercise supplemental jurisdiction over
state law claims, appellate review is not barred by § 1447(c) and (d).7 The Court
reasoned that a district court’s decision to decline supplemental jurisdiction is
“not based on a jurisdictional defect but on its discretionary choice not to hear
the claims despite its subject-matter jurisdiction over them.” 8 DAI asserts that
the district court’s refusal to apply equitable tolling in this case was likewise
discretionary, and therefore a non-§ 1447(c) ground for removal.
       This argument fails because the district court’s equitable tolling decision
goes to the merits of whether a procedural defect in removal existed. Had the
district court applied equitable tolling, DAI’s removal would have been
considered timely, eliminating the procedural defect.               By contrast, a district
court’s decision either to exercise or to decline to exercise supplemental
jurisdiction has no bearing on whether a jurisdictional defect exists in a case.

       5
         See Things Remembered, Inc., 516 U.S. at 128 (“There is also no dispute that the
District Court remanded this case on grounds of untimely removal, precisely the type of
removal defect contemplated by § 1447(c).”); see also Schexnayder v. Entergy La., Inc., 394 F.3d
280, 283 (5th Cir. 2004) (stating that an untimely removal petition “constitute[s an] allowable
§ 1447(c) reason[] for remand”).
       6
           129 S. Ct. 1862 (2009).
       7
           Id. at 1867.
       8
           Id.

                                               4
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                                          No. 10-11112

We also note that we have previously rejected, in an unpublished opinion, the
same argument now advanced by DAI.9
       The district court determined that equitable tolling did not apply and
entered an order remanding based on DAI’s untimely removal, a procedural
defect within the bounds of § 1447(c). Whether the district court correctly
applied the doctrine of equitable tolling in this case does not concern us, as our
precedent “prohibit[s] us from reviewing a remand order entered pursuant to
§ 1447(c) whether erroneous or not.”10 We therefore conclude that we lack
jurisdiction to hear this appeal.
                                      *         *        *
       APPEAL DISMISSED.

       9
         Certa v. Cain, 308 F. App’x 845, 847 (5th Cir. 2009) (unpublished) (per curiam)
(“Defendants–Appellants argue that the district court remanded the case based on a
discretionary finding that Plaintiffs–Appellees had not abused the forum-selection process.
The district court remanded this case, however, because the notice of removal was untimely
under § 1446(b), not based, for example, on its discretion to remand supplemental state law
claims. As Defendants–Appellants concede, the one-year time limit of § 1446(b) for removing
a case is procedural; thus, the district court’s remand on that basis falls within the ambit of
§ 1447(d) and this court lacks jurisdiction to hear this appeal.” (internal citation omitted)); see
also Anton Leasing, Inc. v. Engram, No. 87-1072, 1988 WL 33381, at *1 (4th Cir. Apr. 14, 1988)
(unpublished) (per curiam) (dismissing appeal for lack of jurisdiction under § 1447(d) despite
appellant’s equitable tolling argument).
       10
         Albarado v. S. Pac. Transp. Co., 199 F.3d 762, 766 (5th Cir. 1999) (quotation marks
and citations omitted).

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