[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________ FILED
U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 08-14606
MARCH 11, 2009
Non-Argument Calendar
THOMAS K. KAHN
________________________ CLERK
D. C. Docket No. 08-61134-CV-WJZ
CORPORATE MANAGEMENT ADVISORS, INC.,
Plaintiff-Appellee,
versus
ARTJEN COMPLEXUS, INC.,
ARTHUR BARAT,
Defendants-Appellants.
________________________
No. 08-14607
Non-Argument Calendar
________________________
D. C. Docket No. 08-61159-CV-WJZ
CORPORATE MANAGEMENT ADVISORS, INC.,
Plaintiff-Appellee,
versus
ARTJEN COMPLEXUS, INC.,
ARTHUR BARAT,
Defendants-Appellants.
________________________
Appeals from the United States District Court
for the Southern District of Florida
_________________________
(March 11, 2009)
Before TJOFLAT, WILSON and FAY, Circuit Judges.
WILSON, Circuit Judge:
This appeal raises the following issue: whether the failure to allege facts
sufficient to establish subject matter jurisdiction in a notice of removal is a defect
in the removal procedure.1 We conclude that it is a defect, and consequently, the
district court cannot sua sponte remand a case to state court on that ground.
I. BACKGROUND
On July 18, 2008, Artjen Complexus, Inc. and Arthur M. Barat (together
1
Although we have previously addressed this question in In re First National Bank of
Boston, as that case was vacated on other grounds, we have no binding precedent to guide us. 70
F.3d 1184 (11th Cir. 1995), vacated, 102 F.3d 1577 (11th Cir. 1996) (per curiam). Today, we
reassert much of the reasoning from In re First National.
2
“Artjen Parties”) filed a notice of removal, seeking to remove a suit filed by
Corporate Management Advisors, Inc. from a Florida state court to the District
Court for the Southern District of Florida. The Artjen Parties sought removal on
the basis of diversity jurisdiction, pursuant to 28 U.S.C. § 1332. However, in their
notice of removal, the Artjen Parties alleged only the residency of one of the
parties, rather than his citizenship. Since residency is not the equivalent of
citizenship for diversity purposes, the district court concluded that it lacked subject
matter jurisdiction. Accordingly, pursuant to 28 U.S.C. § 1447(c), the district
court sua sponte remanded the case to state court.
On July 23, 2008, the Artjen Parties filed an amended notice of removal in
which, they contend, they alleged sufficient facts to establish complete diversity of
citizenship between the parties. However, on July 29, 2008, the district court again
remanded the case to state court. The district court concluded that, pursuant to 28
U.S.C. § 1447(d), it lacked jurisdiction to review a remand order “on appeal or
otherwise . . . .” The Artjen Parties appealed. Although we initially dismissed
their appeals for lack of jurisdiction, on November 26, 2008, we granted the Artjen
Parties’ motion for reconsideration of our order of dismissal and consolidated their
appeals.
II. DISCUSSION
3
“The interpretation of a statute is a question of law subject to de novo
review.” United States v. Murrell, 368 F.3d 1283, 1285 (11th Cir. 2004) (citation
omitted). Accordingly, we review the district court’s interpretation of 28 U.S.C. §
1447 de novo.
Section 1447(d) provides that “[a]n order remanding a case to the State court
from which it was removed is not reviewable on appeal or otherwise . . . .”
Furthermore, we are precluded from reviewing such a remand order “whether or
not that order might be deemed erroneous by [us].” Thermtron Prods., Inc. v.
Hermansdorfer, 423 U.S. 336, 351, 96 S. Ct. 584, 593 (1976), overruled on other
grounds by Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 116 S. Ct. 1712
(1996). However, § 1447(d) “is tightly circumscribed to cover only remand orders
within the scope of 28 U.S.C. § 1447(c), based on (1) a district court’s lack of
subject matter jurisdiction or (2) a defect in removal other than lack of subject
matter jurisdiction that was raised by the motion of a party within 30 days after the
notice of removal was filed.” Ellenburg v. Spartan Motors Chassis, Inc., 519
F.3d 192, 196 (4th Cir. 2008) (internal quotation marks and citation omitted).
The district court may remand a case sua sponte for lack of subject matter
jurisdiction at any time. See 28 U.S.C. § 1447(c). Furthermore, a remand order
based on subject matter jurisdiction is not reviewable. 28 U.S.C. § 1447(d).
4
However, we have jurisdiction to review whether the “district court
exceeded its authority under § 1447(c) by remanding this case because of a
perceived procedural defect in the removal process without waiting for a party’s
motion.” Whole Health Chiropractic & Wellness, Inc. v. Humana Med. Plan, Inc.,
254 F.3d 1317, 1321 (11th Cir. 2001). As we held in Whole Health, “[t]he
language of § 1447(c), especially Congress’s use of the language ‘a motion to
remand . . . must be made,’ in connection with remand based on a procedural
defect in the removal process, and the lack of that phrase with respect to removal
for lack of subject matter jurisdiction, indicates that the district court must wait for
a party’s motion before remanding a case based on procedural defect.” Id. at 1320-
21.
Here, the district court based its sua sponte remand order on a perceived lack
of subject matter jurisdiction under § 1447(c), specifically, on the absence of
diversity. However, we conclude that the failure to establish a party’s citizenship
at the time of filing the removal notice is a “procedural, rather than jurisdictional,
defect. . . .” In re Allstate Ins. Co., 8 F.3d 219, 221 (5th Cir. 1993).
In so holding, we rely substantially on the Fifth Circuit’s well-reasoned
opinion in In re Allstate. In that case, because Allstate failed to adequately allege a
party’s residency in its notice of removal, the district court remanded the case to
5
the state court. Id. at 220. On appeal, the Fifth Circuit reasoned that “a
‘procedural defect’ within the meaning of § 1447(c) refers to any defect that does
not go to the question of whether the case originally could have been brought in
federal district court. . . .” Id. at 221 (internal quotation marks and citation
omitted). Thus, “Allstate’s failure to allege, in its notice of removal, the plaintiff’s
citizenship at the time the original petition was filed constitutes a procedural, rather
than jurisdictional, defect; although Allstate failed conclusively to demonstrate
diversity, the record discloses no dispute that it in fact existed.” Id. The Fifth
Circuit then held that district courts lack the “discretion sua sponte to remand for
purely procedural defects,” specifically, defects in establishing citizenship for the
purpose of establishing diversity jurisdiction. Id. at 223. See also Harmon v. OKI
Sys., 115 F.3d 477, 479 (7th Cir. 1997) (citing with approval the reasoning in In re
Allstate that “a defendant’s failure to allege citizenship as opposed to residency . . .
constituted a procedural defect”).
We agree with the Fifth Circuit’s interpretation of § 1447(c) and
construction of a party’s failure to establish citizenship in its notice of removal as a
procedural defect. “[W]here subject matter jurisdiction exists and any procedural
shortcomings may be cured by resort to § 1653, we can surmise no valid reason for
the court to decline the exercise of jurisdiction.” In re Allstate, 8 F.3d at 223.
6
See also Ellenburg, 519 F.3d at 198 (holding that the Fourth Circuit has
jurisdiction to review a district court’s sua sponte remand order, even when that
remand order is styled as a remand for lack of subject matter jurisdiction, if the
order was in fact based on the procedural insufficiency of the Notice of Removal).
Section 1653 provides that “[d]efective allegations of jurisdiction may be
amended, upon terms, in the trial or appellate courts.” As the Fifth Circuit has
explained:
The general allegation in the original petition for removal in this case,
‘that the controversy in said case is entirely between citizens of
different states,’ although conclusionary in nature and possibly not
sufficient if not amended, is sufficient to confer jurisdiction on the
federal courts to permit the curing of the defect by amendment.
Firemen’s Ins. Co. v. Robbins Coal Co., 288 F.2d 349, 350 (5th Cir. 1961)
(citation omitted).2 If a party fails to specifically allege citizenship in their notice
of removal, the district court should allow that party “to cure the omission,” as
authorized by § 1653. D.J. McDuffie, Inc. v. Old Reliable Fire Ins. Co., 608 F.2d
145, 146-47 (5th Cir. 1979). For example, in Armada Coal, a party “imperfectly
pled” federal diversity jurisdiction as the ground for its removal to federal court.
Armada Coal Export, Inc. v. Interbulk, Ltd., 726 F.2d 1566, 1568 (11th Cir. 1984).
2
See Bonner v. City of Prichard, Ala., 661 F.2d 1206, 1207 (11th Cir. 1981) (en banc)
(adopting the prior precedent of the former Fifth Circuit as binding precedent in the Eleventh
Circuit).
7
We remanded the case to district court with instructions to grant the party leave to
amend its notice of removal to “unequivocally” establish diversity of citizenship.
Id. at 1569. See also Barrow Dev. Co. v. Fulton Ins. Co., 418 F.2d 316, 318 (9th
Cir. 1969) (holding that defective allegations of citizenship may be amended to
establish diversity jurisdiction).
Here, the Artjen Parties appeal the district court’s refusal to allow them to
amend their notice of removal, pursuant to 28 U.S.C. § 1447(d)’s prohibition on
review of a remand order “on appeal or otherwise.” Because we hold that the
district court erred by remanding this case on jurisdictional grounds when faced
solely with a procedural defect in the removal process, we direct the district court
to permit Artjen leave to amend its notice of removal, pursuant to 28 U.S.C. §
1653.
III. CONCLUSION
For the foregoing reasons, we reverse the district court’s July 21, 2008 Order
of Remand and July 29, 2008 Order of Remand. We remand the case to the district
court for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
8