Opinions of the United
2003 Decisions States Court of Appeals
for the Third Circuit
12-10-2003
Ariel Land Owners v. Dring
Precedential or Non-Precedential: Precedential
Docket No. 03-1563
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PRECEDENTIAL
Filed December 9, 2003
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 03-1563
ARIEL LAND OWNERS, INC.
v.
LORI DRING; NANCY ASARO,
Appellants
On Appeal From The United States District Court
For The Middle District of Pennsylvania
(Civil Action No. 01-CV-00294)
District Judge: The Honorable A. Richard Caputo
Argued November 7, 2003
Before: MCKEE, SMITH, and GREENBERG, Circuit Judges
(Opinion Filed: December 9, 2003)
Joseph A. O’Brien
Karoline Mehalchick [Argued]
Oliver, Price & Rhodes
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
Michael P. Lehutsky
115 Lincoln Street
Honesdale, PA 18431
Counsel for Appellee
2
Donald H. Brobst
Elizabeth C. Leo
Rosenn, Jenkins & Greenwald
15 South Franklin Street
Wilkes-Barre, PA 18711
Michael Profita [Argued]
500 Glenpointe Centre West
Teaneck, NJ 07666
Counsel for Appellants
OPINION OF THE COURT
SMITH, Circuit Judge:
Appellants Lori Dring and Nancy Asaro appeal from an
order of the District Court for the Middle District of
Pennsylvania remanding this case to the state court in
which the complaint was originally filed. Because Appellee
Ariel Land Owners (“ALO”) failed to file a timely motion to
remand under 28 U.S.C. § 1447(c), the District Court had
no authority to remand this case. For that reason, we have
jurisdiction to review the remand order and we will reverse
the order of the District Court.
I.
On May 17, 1999, ALO filed an action to quiet title
against Appellants in the Wayne County Court of Common
Pleas. The complaint could have been filed in federal court
invoking diversity jurisdiction, and was therefore removable
to federal court on May 17. Appellants removed the case to
the Middle District of Pennsylvania almost two years later
on February 15, 2001. On December 12, 2002, over 20
months after the case was removed to federal court, ALO
filed a motion to remand challenging the timeliness of
removal.
On January 28, 2003, the District Court granted ALO’s
motion, remanding the case to state court. Ariel Land
Owners, Inc. v. Dring, 245 F. Supp. 2d 589 (M.D. Pa. 2003).
The District Court concluded that, pursuant to 28 U.S.C.
3
§ 1446(b), it lacked jurisdiction over the case because
removal had occurred more than one year after the
commencement of the case. The District Court further held
that, because the one-year time limit in § 1446(b) is
jurisdictional, remand was appropriate despite the fact that
ALO did not move to remand within 30 days after the notice
of removal, as required by § 1447(c). Appellants filed a
timely appeal of the District Court’s remand order.
II.
A remand order terminating all proceedings in federal
court is final and appealable under 28 U.S.C. § 1291. In re
FMC Corp. Packaging Sys. Div., 208 F.3d 445, 449 (3d Cir.
2000). Our jurisdiction to review the District Court’s
remand order is nevertheless limited by 28 U.S.C.
§ 1447(d), which provides that “[a]n order remanding a case
to the State court from which it was removed is not
reviewable on appeal or otherwise.” Thermtron Prods., Inc. v.
Hermansdorfer, 423 U.S. 336, 342-43 (1976); Cook v.
Wikler, 320 F.3d 431, 434-35 (3d Cir. 2003). Section
1447(d), however, does not bar review of “remand orders
issued outside the authority granted to District Courts
under section 1447(c).” FMC, 208 F.3d at 448; accord Cook,
320 F.3d at 435 n.5, 438-39 n.9.
Section 1447(c) states, in pertinent part:
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.
The statute is clear that, if based on a defect other than
jurisdiction, remand may only be effected by a timely
motion. FMC, 208 F.3d at 450 (“[I]t is clear under section
1447(c) that [the procedural] irregularity must be the
subject of a motion to remand within 30 days after filing
the notice of removal.”); Air-Shields, Inc. v. Fullam, 891 F.2d
63, 66 (3d Cir. 1989) (“By remanding the case for
procedural defects after the thirty day limit imposed by . . .
4
Section 1447(c) had expired, the district court exceeded [its]
statutorily defined power.”). On the other hand, a
jurisdictional defect may be raised at any time. Caterpillar
Inc. v. Lewis, 519 U.S. 61, 69 (1996) (“This 30-day limit
does not apply, however, to jurisdictional defects . . . .”);
Korea Exch. Bank v. Trackwise Sales Corp., 66 F.3d 46, 51
(3d Cir. 1995).
Accordingly, whether this appeal is barred by § 1447(d)
turns on whether the District Court exceeded its statutory
authority to remand under § 1447(c), which itself turns on
whether the basis for remand is jurisdictional. If the one-
year time limit in § 1446(b) is not jurisdictional, then the
District Court had no authority to remand, because ALO’s
motion was filed more than 30 days after the notice of
removal. If, on the other hand, the District Court is correct
and the one-year time limit is a jurisdictional requirement,
then a timely motion was not required to remand. We
review this question of statutory authority and federal
jurisdiction de novo. Cook, 320 F.3d at 438 n.8. Our
conclusion that the one-year time limit is not jurisdictional
resolves both the threshold issue of our jurisdiction, as well
as the merits of this appeal. See FMC, 208 F.3d at 449-50.1
1. Appellants also challenge the District Court’s application of the one-
year time limit to this case, which was removable when it was originally
filed in 1999. Appellants argue that the one-year time limit only governs
cases that are not removable when filed, reasoning that the provision is
a dependent clause that necessarily applies only to the antecedent
clause in the second paragraph of section 1446(b). Four of the circuits
agree. See Brown v. Tokio Marine & Fire Ins. Co., 284 F.3d 871, 873 (8th
Cir. 2002); Johnson v. Heublein Inc., 227 F.3d 236, 241 (5th Cir. 2000);
Brierly v. Alusuisse Flexible Packaging, Inc., 184 F.3d 527, 534 (6th Cir.
1999); Ritchey v. Upjohn Drug Co., 139 F.3d 1313, 1316-17 (9th Cir.
1998). We do not reach this issue because we conclude that the District
Court had no authority to remand. Moreover, even assuming that the
District Court had authority to issue the remand order, review of the
District Court’s application of the one-year limit is barred by section
1447(d). Cook, 320 F.3d at 435. Nevertheless, we note that many of the
District Court’s reasons for construing the one-year time limit as
jurisdictional also informed its departure from the above-cited decisions.
5
III.
Section 1446 establishes the procedure for removal.
Section 1446(b) states, in pertinent part:
The notice of removal of a civil action or proceeding
shall be filed within thirty days after the receipt by the
defendant . . . of a copy of the initial pleading setting
forth the claim for relief upon which such action or
proceeding is based . . . .
If the case stated by the initial pleading is not
removable, a notice of removal may be filed within
thirty days after receipt by the defendant . . . of a copy
of an amended pleading . . . from which it may first be
ascertained that the case is one which is or has
become removable, except that a case may not be
removed on the basis of jurisdiction conferred by
section 1332 of this title more than 1 year after
commencement of the action.
Although this Court has not specifically addressed
whether the one-year time limit in the second paragraph of
§ 1446(b) is jurisdictional, we have repeatedly stated that
“an irregularity in removal of a case to federal court is to be
considered ‘jurisdictional’ only if the case could not initially
have been filed in federal court.” Korea Exchange, 66 F.3d
at 50; accord Cook, 320 F.3d at 436; FMC, 208 F.3d at 450
n.6. Here, there is no dispute that the case could have
initially been filed in federal court. Our precedents thus
clearly indicate that jurisdiction was proper
notwithstanding any failure to comply with the one-year
time limit in § 1446(b).
In Korea Exchange, we surveyed a number of Supreme
Court decisions “refus[ing] to treat the removal statute as
imposing independent jurisdictional requirements.” 66 F.3d
at 49-50; accord Mackay v. Uinta Dev. Co., 229 U.S. 173,
176 (1913) (“Removal proceedings are in the nature of
process to bring the parties before the United States
court.”). In particular, it is well established that the 30-day
time limit for removal in the first paragraph of 1446(b) is
procedural, McGlinchey v. Hartford Acc. & Indem. Co., 866
F.2d 651, 653 (3d Cir. 1989), and that a case may not be
remanded for failure to comply with the 30-day time limit
6
absent a timely motion, Air-Shields, 891 F.2d at 64-65. We
see no reason in the language or history of § 1446(b) to
construe the one-year time limit any differently. Accord
Barnes v. Westinghouse Elec. Corp., 962 F.2d 513, 516 (5th
Cir. 1992) (holding that the one-year limit in section
1446(b) is procedural, not jurisdictional, and is therefore
waived if not raised in a timely motion to remand); cf.
Tedford v. Warner-Lambert Co., 327 F.3d 423, 426-27 & n.8
(5th Cir. 2003) (discussing Barnes and stating: “Having
found the first paragraph of § 1446(b) subject to equitable
considerations, we find no reason to depart from this
precedent with respect to the second paragraph of
§ 1446(b)”).
First, nothing in the text of the statute suggests that the
one-year limit operates differently from the 30-day limit.
Neither provision expressly purports to limit federal
jurisdiction, and the prohibitive terms of the one-year limit
(“except that a case may not be removed”) are no more
mandatory than the compulsory terms of the 30-day limit
(“[t]he notice of removal . . . shall be filed”).2 Instead, insofar
as the one-year limit applies to cases “removed on the basis
of jurisdiction conferred by section 1332,” i.e., diversity
jurisdiction, the statute recognizes that jurisdiction is
determined by whether the complaint, as amended, could
have been filed in District Court. See also 28 U.S.C.
§ 1441(a) (“[A]ny civil action brought in a State court of
which the district courts of the United States have original
jurisdiction, may be removed . . . .”); Korea Exch., 66 F.3d
at 49 (discussing the “clear distinction between the removal
‘process’ and restrictions on the subject matter jurisdiction
of the federal court over the case”).
Second, the legislative history of § 1446(b) shows that the
one-year time limit was designed to operate in tandem with
2. There is no question that the statute prohibits removal outside of
certain time limits; the question here is whether those time limits are
jurisdictional. The Supreme Court’s statement in Caterpillar that “[n]o
case, however, may be removed from state to federal court based on
diversity of citizenship ‘more than 1 year after commencement of the
action,’ ” 519 U.S. at 69, simply traces the mandatory language of the
statute, and sheds no light on whether the Court considers the one-year
time limit to be jurisdictional.
7
the 30-day time limit, and therefore that the two should be
construed consistently. Enacted as part of the 1988
Judicial Improvements and Access to Justice Act (the “1988
Act”), Pub. L. No. 100-702, § 1016(b), 102 Stat. 4642, 4669,3
the one-year time limit was intended to remedy the
anomalous situation where a change in the parties late in
the litigation allows a party to remove for the first time.
H.R. Rep. No. 100-889, at 72 (1988); accord Caterpillar, 519
U.S. at 74 n.12 (“Congress amended § 1446(b) in 1988 to
include the one-year limitation in order to ‘reduc[e] the
opportunity for removal after substantial progress has been
made in state court.’ ” (quoting H.R. Rep. No. 100-889, at
72). The one-year time limit was therefore intended simply
to close a procedural gap that had arisen in the application
of the 30-day time limit, and was not intended to operate in
a fundamentally different manner from the 30-day time
limit.
Importantly, the very same section of the 1988 Act also
added the requirement in § 1447(c) that motions to remand
based on non-jurisdictional defects be filed within 30 days
of removal. Pub. L. No. 100-702, § 1016(c), 102 Stat. at
4670. Congress was concerned with the “burdens of
shuttling a case between two courts that each have subject
matter jurisdiction,” and with the “risk that a party who is
aware of a defect in removal procedure may hold the defect
in reserve as a means of forum shopping if the litigation
should take an unfavorable turn.” H.R. Rep. No. 100-889,
at 72. These concerns apply with as much—if not greater—
urgency in the context of the one-year limit. Congress
recognized that “[r]emoval late in the proceedings may
result in substantial delay and disruption.” Id. That delay
and disruption is only compounded by permitting federal
proceedings to carry on at length (nearly two years in the
instant case), only to have the case interrupted again and
sent back to the state court. Such a result would be
manifestly inconsistent with the objectives of judicial
economy articulated in the 1988 Act. Id. at 22; Singh v.
Daimler-Benz AG, 9 F.3d 303, 306-10 (3d Cir. 1993)
(discussing the history and purpose of the 1988 Act).
3. Section 1016 of the 1988 Act is entitled “Improvements in Removal
Procedure.” Subsection (b) is entitled “Procedure for Removal.”
8
IV.
Because failure to remove within the one-year time limit
established by § 1446(b) is not a jurisdictional defect, a
district court has no authority to order remand on that
basis without a timely filed motion. And because no timely
motion was filed in this case, the District Court exceeded
its statutory authority to remand under § 1447(c), and
appellate review is not barred by § 1447(d). Moreover,
because the District Court exceeded its authority under
§ 1447(c), the remand order will be reversed.
A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit