Certain Underwriters at Lloyd's v. Warrantech Corp.

PATRICK E. HIGGINBOTHAM, Circuit Judge:

This case brings questions of our jurisdiction to review an order remanding the case to state court after its removal as a case that “relates to” an earlier arbitration proceeding. Certain Underwriters at Lloyd’s, London and Other Insurers Subscribing to Reinsurance Agreements F96/2922/00 and No. F97/2992/00 seek dismissal for lack of jurisdiction of the appeal filed by Warrantech Corporation and Joel San Antonio (collectively, “Appellants”). Appellants appeal (1) the district court’s order remanding all “unresolved” issues back to state court; (2) the district court’s order granting Underwriters partial summary judgment on Appellants’ res judicata and collateral estoppel affirmative defenses; and (3) the district court’s order dismissing with prejudice Warrantech’s counterclaims.1

*570/

This case arises out of the administration of consumer warranties and extended service plans on computers, printers, and related items sold by CompUSA, a national electronics retailer. CompUSA contracted with Warrantech to administer the warranties on CompUSA’s consumer goods. The contract required Warrantech to obtain insurance to cover the cost of paying warranty claims, which Warrantech did with Houston General Insurance Company, a nonparty to this litigation. Houston General, in turn, reinsured a portion of the risk with Underwriters.

After approximately one year, Underwriters contended that Warrantech was paying unauthorized claims and refused to reinsure Houston General for any unauthorized amounts. Houston General instituted arbitration proceedings to determine Underwriters’ obligations, which took place under the Convention on the Recognition and Enforcement of Foreign Arbi-tral Awards (hereinafter, “the New York Convention”).2 After five weeks of hearings, the arbitration panel ordered Underwriters to pay Houston General $39 million, and the order was confirmed by the United States District Court for the Southern District of New York.3

On September 19, 2002, one month after the arbitral panel’s decision, Underwriters filed the instant lawsuit against Warran-tech in Texas state court, seeking to recoup as damages the reinsurance payments that Underwriters was ordered to pay Houston General.4 Warrantech filed counterclaims, asserting causes of action for fraud, unfair and deceptive insurance practices in violation of Article 21.21 of the Texas Insurance Code,5 and violation of the duty of good faith and fair dealing.6 After Underwriters added San Antonio to the litigation, the case was removed under 9 U.S.C. § 205,7 with Appellants asserting res judicata and collateral estoppel affir*571mative defenses based on the arbitration award to Houston General.

Underwriters moved to remand the matter to state court. In consideration of its jurisdiction, the district court, relying upon Beiser v. Weyler,8 stated that its only task was to determine whether Appellants’ arbitration-related affirmative defenses were “facially frivolous.”9 Concluding that they were not, the district court denied Underwriters’ motion to remand. In its order, the court supplied a caveat: “If the court later makes a summary ruling that the arbitration award does not provide a defense to any of [Underwriters’] claims, the court will then consider whether the action should be remanded to the state court.”10

Subsequently, Underwriters moved for partial summary judgment on Appellants’ res judicata and collateral estoppel affirmative defenses and on Warrantech’s state-law counterclaims. On August 24, 2004, the district court granted summary judgment for Underwriters, concluding that the affirmative defenses were without merit and dismissing Warrantech’s counterclaims with prejudice. After determining that “there [was] no just reason for delay,” the district court entered final judgment dismissing Warrantech’s counterclaims.11 That decision forms the basis of part of this appeal.

After its August 24 order, the district court requested additional briefing on whether Underwriters’ remaining state-law claims should be remanded to state court given that the issues related to the arbitration award were -no longer part of the lawsuit. After briefing, the district court granted Underwriters’ motion to remand, concluding that Appellants were not asserting any “non-frivolous” defense based on the arbitration award.12 Finding no “policy” reasons in support of exercising jurisdiction over this case and concluding that there were “no other grounds for federal jurisdiction,” the district court remanded all “unresolved claims and causes of action” to state court.13

II

We must first decide what we can decide. Prior to remanding all “unresolved” matters to the Texas state court, the district court granted Underwriters’ motion for partial summary judgment on Appellants’ res judicata and collateral estoppel affirmative defenses and Warrantech’s state-law counterclaims. Appellants seek merits review of each of the district court’s orders. Underwriters seeks dismissal for lack of appellate jurisdiction.

A

1

Our analysis of the district court’s remand order begins with 28 U.S.C. § 1447(d): “An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise.”14 The Supreme Court instructs that § 1447(d) must be read in pari materia with § 1447(c),15 which provides two bases *572for remanding cases to state court: (1) a defect in the removal procedure (which must be made within 30 days of the date of removal) and (2) the lack of subject matter jurisdiction.16

It is plain that with any remand based on the enumerated grounds of § 1447(c), the clear language of § 1447(d) is an absolute bar to appellate review.17 Since there is no contention, here, of a defect in the removal procedure, we only lack appellate jurisdiction to review the district court’s remand order if it is based on a lack of subject matter jurisdiction.

Our analysis is complicated by the Supreme Court’s recognition, in a narrow category of cases,18 that a district court can remand a case to state court on the basis of a non-§ 1447(c) ground.19 In Carnegie-Mellon University v. Cohill, the Supreme Court held that where all federal claims have been eliminated a federal district court “has discretion to remand to state court a removed case involving pendent claims upon a proper determination that retaining jurisdiction over the case would be inappropriate.”20 To the Court, under limited circumstances “a remand may best promote the values of economy, convenience, fairness, and comity.”21 Thus, it is also plain that with any remand based on the policy considerations offered in Camegie-Mellon, § 1447(d) is no longer a bar to appellate review.22 Should we find jurisdiction to review the district court’s remand order, our review is for an abuse of discretion.23

So framed, we must determine whether the district court’s order remanding all “unresolved” matters to state court was based on jurisdictional grounds, i.e., § 1447(c), which bars appellate review, or nonstatutory grounds, i.e., Carnegie-Mellon, which allows for discretionary review. Our inquiry is guided by a clear statement requirement: for a remand order to be reviewable on appeal, the district court must “clearly and affirmatively” state a non-§ 1447(c) ground for remand.24 Our clear-statement requirement allows a quick inquiry into jurisdiction, preventing delay through protracted litigation of jurisdictional issues,25 and it avoids having this Court decipher the tea-leaves of a district court’s remand order to determine wheth*573er it was “jurisdictional” or not. When the matter is remanded to state court (often following removal from state court initially), the district court has determined that the plaintiffs choice of forum should stand. Our clear-statement requirement best serves this policy.

Moreover, our clear-statement requirement focuses our inquiry away from the merits of the district court’s decision. Section 1447(d) precludes examination of the merits of the district court’s actions; we only must determine what the district court 'perceived it was doing, as “no matter how erroneous,”26 a remand order based on a § 1447(c) ground precludes review on appeal. A contrary rule — one requiring a thorough and exhaustive examination of the district court’s reasons for remand— risks tainting the limited, jurisdictional-inquiry mandated by § 1447(d) with a merits-inquiry, a process that, as noted, would only lead to a lengthier appeals process. Although we are not in search of magic words, our clear-statement requirement carefully delimitates our jurisdiction — neither expanding it beyond statutorily imposed limits, nor eschewing it when matters are appropriately before us.

Nothing in the Supreme Court’s recent decision in Kircher v. Putnam Funds Trust requires us to back away from our clear statement requirement. There, the Court held that § 1447(d)’s ban on appellate review of remand orders applied to cases removed under the Securities Litigation Uniform Standards Act of 1998.27 The Court had no reason to consider a clear statement requirement, as the district court plainly indicated that it remanded the case for a lack of subject matter jurisdiction.28

We recognize that there is some disagreement among the circuits regarding the methodology for reviewing remand orders. We apply a clear-statement requirement; others do not, opting instead to analyze a remand order for what the district court did rather than what the district court said it did. The Supreme Court recognized but did not resolve this dispute in Kircher. Justice Scalia would stop with the district court’s words, forgoing any examination of the merits; the majority passed on the issue, noting that the result was the same under either approach. As the Solicitor General recently recognized, this type of “methodological dispute may have more impact on how district court judges draft remand orders than on the rights of the parties.”29 The validity of our methods for reviewing remand orders is not before us, so we need say no more.

2

With these principles in mind, our analysis requires examination of the text of the district court’s remand order.30 Af*574ter concluding that Appellants were not “asserting any non-frivolous defense to [Underwriters’] claims based on the arbitration award,” the court made passing reference to policy considerations:

No policy evidenced by the federal arbitration statutes would be advanced in the slightest by the exercise by this court of subject matter jurisdiction over the issues that remain to be resolved in this case .... There is no reason from a policy standpoint for this court to further entertain jurisdiction over this case, bearing in mind that there is no claim of arbitrability, and that the only issues which implicate the arbitration award itself have been summarily removed from the case.31

Appellants contend that the order’s reference to “policy” indicates that the remand was based, not on a lack of subject matter jurisdiction, but on the efficiency and economy considerations guiding courts under Camegie-Mellon. Underwriters point to subsequent language in the remand order, which, they contend, indicates the remand was based on a lack of subject matter jurisdiction. Specifically,

[N]ow that the arbitration award issues have been removed from this case by a summary ruling, and there being “no other grounds for federal jurisdiction” in this case, the case should be remanded to the state court.
Therefore, [t]he court ORDERS that all unresolved claims and causes of action in the above-captioned action be, and are hereby, remanded to the state court from which this action was removed.32

With only this language before us, we conclude that the district court did not “clearly and affirmatively” state a non-§ 1447(c) ground for remand. To be sure, Appellants’ contentions are not without merit, as this presents a close case: both parties can point to language in the remand order supporting their position. Appellants’ argument falls short however, following a closer examination of the district court’s language and upon application of the dear-statement requirement embraced by this Court.

The district court’s first reference to “policy” is to that “evidenced by the federal arbitration acts,” and not the concerns animating discretionary remands.33 The second reference to “policy” considerations is essentially a single sentence, with no citation to Camegie-Mellon, Thermtron Products, or any of the efficiency and economy factors guiding courts in making discretionary remands. Any conclusion that this was a discretionary remand, on the basis of references to policy, is militated by the subsequent discussion by the district court suggesting that it perceived itself to lack subject matter jurisdiction. As the district court concluded its remand order, it stated that there are “no other grounds for jurisdiction,” language we read to mean the court perceived it lacked subject matter jurisdiction. Moreover, the court also states that the case “should” — a derivative of the imperative “shall”; although “must” might have been a more *575emphatic indication of a jurisdictional remand, so too would “may” be more probative of a discretionary remand. As such, we cannot say that the district court “clearly and affirmatively” stated a non- § 1447(c) ground for remand.34

3

Unclear remand orders are not a new thing in this Court, even given our strict adherence to a clear-statement requirement. We have confronted situations before in which a district court’s remand order offered language supporting both a statutory and a nonstatutory remand. In Bogle v. Phillips Petroleum, Co., various plaintiffs injured in a chemical-plant explosion brought state-law claims against Phillips for their injuries as well as a claim for wrongfully denied medical benefits, which Phillips used to remove the case alleging that the Employee Retirement Income Security Act preempted the litigation.35 The district court ruled on the asserted ERISA-preemption defense, finding no preemption, and granted plaintiffs’ motion to remand, stating that “[t]his case does not contain a federal claim” and applying the discretionary factors from Camegie-Mellon,36 On appeal, we dismissed for lack of jurisdiction, concluding that “[t]he district court’s discussion [of the Camegie-Mellon factors], although improper sur-plusage, [did] not taint its ultimate conclusion that it lacked subject matter jurisdiction.”37

The district court’s reliance on Beiser v. Weyler does not alter our conclusion. Reading “relates to” very broadly,38 Beiser suggests that in cases removed under 9 U.S.C. § 205, the district court, as here, should initially deny remand as long as the defendant’s • asserted, arbitration-related defenses are not “facially frivolous.”39 That is precisely what the district court did here, initially denying Underwriters’ motion to ■ remand, and no contention is raised on appeal that this decision was error.40 We do not depart from Reiser’s *576insistence on easy removal of causes whenever a defendant can assert a nonfrivolous connection to an arbitration award under the New York Convention.

Moreover, nothing in Beiser alters our analysis of the district court’s order. The mere citation of dicta in Beiser suggesting a discretionary remand cannot serve to satisfy our clear-statement requirement,41 and nothing in Beiser suggests that we should not apply our clear-statement requirement within the context of § 205 removals. Application of our clear-statement requirement is consistent with the plain text of § 205, which provides that, although allowing removal on the basis of a federal defense presented in the petition for removal, “[t]he procedure for removal of causes otherwise provided by law shall apply.”42 This “procedure for removal” incorporates § 1447(d)’s absolute bar to appellate review,43 as well as our insistence that a district court “clearly and affirmatively” state a non-§ 1447(c) ground for remand. As we find no clear statement in this case, our appellate jurisdiction is precluded by § 1447(d).44

B

Although we lack jurisdiction to review the district court’s remand order, we still must consider whether we can review the district court’s grant of partial summary judgment to Underwriters on Appellants’ res judicata and collateral estoppel defenses. District court determinations accompanying remand orders are reviewable despite § 1447(d) if they meet the requirements of City of Waco, Texas v. United States Fidelity & Guaranty Co.45 Under City of Waco, we can review a pre-remand decision of the district court if the decision is “separable” from the remand order and independently reviewable under the collateral order doctrine.46 A decision *577is “separable” if (1) the decision preceded the remand order “in logic and in fact” such that it was “made by the district court while it had control of the case”;47, and (2) the decision is “conclusive” — that is, “functionally unreviewable in state courts.”48

Our decision in Linton v. Airbus Industrie is illustrative.49 There, prior to remanding the matter to state court, the district court determined that the defendants did not qualify for foreign sovereign immunity, the basis for removal.50 We held that “[i]n light of the district court’s ultimate conclusion that the entire case had to be remanded for lack of subject matter jurisdiction, the district court’s [foreign sovereign immunity] determination [could] be deemed a jurisdictional finding under the facts of this case and, as such, [could] be reviewed by the state court upon remand.”51 Thus, determinations made in the process of remanding a case for lack of jurisdiction are “jurisdictional findings” that can be revisited by the state court upon remand.52

Here, the district court’s orders— that res judicata and collateral estoppel did not provide Appellants a defense to Underwriters’ state-law claims — were made in the process of remanding the case for lack of jurisdiction. We see no difference between the rejection, in Linton, of the defendants’ foreign sovereign immunity defense — the basis for removal — and the rejection, here, of Appellants’ affirmative defenses — again, the basis for removal. We conclude that the district court’s order rejecting Appellants’ affirmative defenses is not “conclusive” under City of Waco; thus, we are unable to review the merits of the district court’s decision.

C

Finally, we turn to the most troubling aspect of this case — namely, what to do with the district court’s order dismissing with prejudice Warrantech’s state-law counterclaims. Unlike resolution of Appellants’ arbitration-based affirmative defenses, we cannot say that the decision to dismiss the counterclaims was a “jurisdictional” finding, not “conclusive” under City of Waco, and therefore not binding on the state court upon remand. We also decline to hold that the decision is “conclusive” under City of Waco, as Warrantech asserts and as Underwriters appears to concede.53 Rather, the prudent resolution of Warran-tech’s state-law counterclaims requires a step-back, a reexamination of what the *578district court should have done upon concluding that Appellants’ arbitration-related affirmative defenses were meritless. We conclude that the district court, upon resolving the merits of the arbitration-related affirmative defenses, abused its discretion in continuing to exercise supplemental jurisdiction over Warrantech’s state-law counterclaims.54

Warrantech’s state-law counterclaims rode into federal court on the coattails of Appellants’ assertion that Appellants’ res judicata and collateral estoppel affirmative defenses “relate[d] to” the state-law claims asserted by Underwriters.55 As we have noted, this is proper, and it would be within the district court’s prerogative to adjudicate them on the merits, but only if the district court properly exercised its discretion under 28 U.S.C. § 1367, the statute granting the federal courts supplemental jurisdiction over related state-law claims.56 After concluding that Appellants’ affirmative defenses lacked merit, the following claims remained in the case: (1) Underwriters’ state-law claims against Warrantech and San Antonio; and (2) Warrantech’s state-law counterclaims against Underwriters. It is at this moment in time that we must examine the district court’s exercise of supplemental jurisdiction.

Our inquiry starts with the mandatory nature of 28 U.S.C. § 1367(a), which provides that a district court “shall” have supplemental jurisdiction over claims “so related to” claims within the court’s original jurisdiction.57 Yet § 1367(a)’s command is moderated by the factors provided in 28 U.S.C. § 1367(c), which allow a district court to decline supplemental jurisdiction under certain circumstances.58 In consideration of these factors, we have stated that it is our “general rule” that courts should decline supplemental jurisdiction when all federal claims are dismissed or otherwise eliminated from a case.59

This is such a case. Here, all claims with even a tenable connection to federal jurisdiction were dismissed very early in the litigation. As the Supreme Court noted in United Mine Workers v. Gibbs, “[I]f the federal claims are dismissed before trial, even though not insubstantial in a *579jurisdictional sense, the state claims should be dismissed as well.”60 We echoed a similar thought in the context of removal under § 205 in Beiser:

Under § 205 ... the federal issue in cases will often be resolved early enough to permit remand to the state court for a decision on the merits .... If the district court decides that the arbitration clause does not provide a defense, and no other grounds for federal jurisdiction exist, the court must ordinarily remand the case back to state court.61

Thus, the absence of any claims with any connection to federal law at such an early point in the litigation suggests that the district court abused its discretion in exercising supplemental jurisdiction over War-rantech’s state-law counterclaims.62

Moreover, Warrantech’s state-law counterclaims have little, if any, relation to the arbitration award. Our task is to compare the federal basis for jurisdiction (here, the asserted affirmative defenses stemming from the arbitration award) against the dismissed state-law claims (here, Warrantech’s counterclaims arising from Underwriters’ alleged discovery conduct and failure to voluntarily make payment of warranty claims).63 There is little factual overlap between these two claims. Appellants asserted their arbitration-related affirmative defenses in response to Underwriters’ underlying claims. Res judi-cata and collateral estoppel are judicial economy devices, seeking to prevent reliti-gation of issues previously adjudicated.64 Warrantech’s counterclaims arise out of separate and independent actions of Underwriters — discovery misconduct and failure to pay insurance claims. In short, we do not see a sufficient connection between the two claims to warrant the exercise of supplemental jurisdiction. We conclude that the district court abused its discretion in exercising supplemental jurisdiction over Warrantech’s state-law counterclaims.

Ill

In sum, our inquiry into what we can decide leaves us without jurisdiction to consider the merits of any of the district court’s orders. First, we lack jurisdiction to review the district court’s remand order as the district court did not “clearly and affirmatively” state a non-§ 1447(c) ground for remand. Second, the district court’s order dismissing Appellants’ res judicata and collateral estoppel affirmative defenses was a “jurisdictional finding,” not binding on the state court following remand. Finally, the district court abused its discretion in exercising supplemental jurisdiction over Warrantech’s state-law counterclaims. Accordingly, the district court’s order dismissing with prejudice Warran-tech’s counterclaims must be VACATED, and the remainder of Appellants’ appeal must be DISMISSED.

Appellee’s motion to dismiss appeal for lack of jurisdiction is GRANTED.

. Both Warrantech and San Antonio assert affirmative defenses based on the arbitration award. Only Warrantech asserts various state-law counterclaims against Underwriters. As such, when discussing the affirmative de*570fenses, we refer to "Appellants” and when discussing the counterclaims, we refer only to "Warrantech.”

. See 9 U.S.C. §§ 201-208 (2000).

. Houston General Ins. Co. v. Certain Underwriters at Lloyd's London, No. 02 Civ. 7559 JSR, 2003 WL 22480058 (S.D.N.Y. Oct.31, 2003).

. Underwriters asserts causes of action against Warrantech for fraud and negligent misrepresentation, alleging that they are sub-rogated to all rights Houston General may have to seek damages from defendants concerning claims wrongfully submitted and paid under the insurance policies. Underwriters also seeks to recover for spoliation, alleging that Warrantech destroyed certain evidence during the course of the arbitration proceeding.

. Article 21.21 of the Texas Insurance Code was repealed by Acts 2003, 78th Leg., ch. 1274, § 26(a) (effective Apr. 1, 2005). It was replaced by Tex. Ins.Code Ann. tit. 5, § 541.001 et seq. The recodification does not affect the issues in this appeal.

. Warrantech's counterclaims arise from Underwriters' alleged discovery conduct during the arbitration proceedings and the failure of Underwriters to voluntarily make payment of warranty claims.

. Section 205 provides:

Where the subject matter of an action or proceeding pending in a State court relates to an arbitration agreement or award falling under the Convention, the defendant or the defendants may, at any time before the trial thereof, remove such action or proceeding to the district court of the United States for the district and division embracing the place where the action or proceeding is pending. The procedure for removal of causes otherwise provided by law shall apply, except that the ground for removal provided in this section need not appear on the face of the complaint but may be shown in the petition for removal.

*5719 U.S.C. § 205.

. 284 F.3d 665 (5th Cir.2002).

. Order Denying Remand (May 13, 2004), at 4.

. Order Denying Remand (May 13, 2004), at 4.

. Summary Judgment Order (Aug. 24, 2004), at 13.

. Remand Order (Sept. 23, 2004), at 3.

. Remand Order (Sept. 23, 2004), at 3-6.

. 28 U.S.C. § 1447(d) (2000).

. Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 711, 116 S.Ct. 1712, 135 L.Ed.2d 1 (1996); Things Remembered, Inc. v. Petrarca, 516 U.S. 124, 116 S.Ct. 494, 133 L.Ed.2d 461 (1995); Thermtron Prods., Inc. v. Hermansdor*572fer, 423 U.S. 336, 345-46, 96 S.Ct. 584, 46 L.Ed.2d 542 (1976).

. 28 U.S.C. § 1447(c) (2000).

. Gravitt v. Southwestern Bell Tel. Co., 430 U.S. 723, 723, 97 S.Ct. 1439, 52 L.Ed.2d 1 (1977) (per curiam) (noting that § 1447(d) gives an “unmistakable command” so as to preclude review of remands for grounds stated in § 1447(c) “by appeal, mandamus, or otherwise”); see also Thermtron Prods., 423 U.S. at 343, 96 S.Ct. 584.

. See Angelides v. Baylor Coll. of Medicine, 117 F.3d 833, 836 (5th Cir.1997) (noting that the Thermtron Court carved out only a "narrow exception to the strict bar to appellate review of remand orders”).

. Thermtron Prods., 423 U.S. at 343, 96 S.Ct. 584 (finding jurisdiction review remand order expressly based on the district court’s crowded docket).

. 484 U.S. 343, 357, 108 S.Ct. 614, 98 L.Ed.2d 720 (1988).

. Id. at 353, 108 S.Ct. 614.

. See Bogle v. Phillips Petroleum Co., 24 F.3d 758, 761 (5th Cir.1994); Burles v. Amerada Hess Corp., 8 F.3d 301, 304 (5th Cir.1993).

. Giles v. NYLCare Health Plans, Inc., 172 F.3d 332, 339 (5th Cir.1999).

. Heaton v. Monogram Credit Card Bank of Georgia, 231 F.3d 994, 997 (5th Cir.2000); Copling v. Container Store, Inc., 174 F.3d 590, 596 (5th Cir.1999); Giles, 172 F.3d at 336; Soley v. First Nat’l Bank of Commerce, 923 F.2d 406, 408 (5th Cir.1991); Royal v. State Farm Fire & Cas. Co., 685 F.2d 124, 126 (5th Cir.1982); In re Weaver, 610 F.2d 335, 337 (5th Cir.1980); see also In re Merrimack Mutual Fire Ins. Co., 587 F.2d 642, 648 (5th Cir.1978).

. See United States v. Rice, 327 U.S. 742, 751, 66 S.Ct. 835, 90 L.Ed. 982 (1946) (noting that Congress opposes “interruption of the litigation of the merits of removed cause by prolonged litigation of questions of jurisdic*573tion of the district court to which the cause is removed”); Soley, 923 F.2d at 408 (citing Thermtron Prods., 423 U.S. at 351, 96 S.Ct. 584) (noting that the purpose of § 1447(d) is “to prevent delay through protracted litigation of jurisdictional issues”). As a result, "the district court is the final arbiter of whether it has jurisdiction to hear the case.” Smith v. Texas Children’s Hosp., 172 F.3d 923, 925 (5th Cir.1999).

. Arnold v. State Farm Fire & Cas. Co., 277 F.3d 772, 775 (5th Cir.2001); State of Rio de Janeiro of Federated Republic of Brazil v. Philip Morris, 239 F.3d 714, 716 (5th Cir.2001).

. Kircher v. Putnam Funds Trust, - U.S. -, 126 S.Ct. 2145, 2153-55, 165 L.Ed.2d 92 (2006).

. Id. at 2158 (Scalia, J., concurring) (quoting the district court).

. Brief for the United States as Amicus Curiae; No. 05-107, Davis v. Int’l Union, United Automobile, Aerospace & Agricultural Implement Workers of Am. (UAW), at 9-11 (2006) (filed in response to invitation from Supreme Court).

. See McDermott Int’l, Inc. v. Lloyds Underwriters of London, 944 F.2d 1199, 1201 n. 1 *574(5th Cir.1991) (directing district courts to “take care to explain their reasons for remanding cases” because "the availability of appellate review turns exclusively on the district court's reason for remand”); Tillman v. CSX Transp., Inc., 929 F.2d 1023, 1026 (5th Cir.1991) (“Reviewability of a remand order depends entirely upon the trial court's stated grounds for its decision to remand.”).

. Remand Order (Sep. 23, 2004), at 5 (emphasis added).

. Remand Order (Sep. 23, 2004), at 6 (emphasis added).

. See Carnegie-Mellon, 484 U.S. at 353, 108 S.Ct. 614 ("[A] remand may best promote the values of economy, convenience, fairness, and comity.”).

. We do not decide today whether, had the district court omitted the language indicating a perceived lack of subject-matter jurisdiction, the passing reference to "policy” considerations would be sufficient to satisfy our clear-statement requirement.

. 24 F.3d 758, 760-61 (5th Cir.1994).

. Id. at 762.

. Id.

. Beiser relies, in part, on the expansive definition of “relates to" in Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96-97, 103 S.Ct. 2890, 77 L.Ed.2d 490 (1983), an ERISA preemption case. Beiser v. Weyler, 284 F.3d 665, 669 (5th Cir.2002); see also Acosta v. Master Maintenance and Const. Inc., 452 F.3d 373, 375 (construing "relates to” under § 205 and again relying on Shaw). We do not revisit Beiser s construction of "relates to" here, but we do note, as did the district court here, that subsequent ERISA preemption cases have recognized some limits on the reach of "relates to.” See, e.g., New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 654, 115 S.Ct. 1671, 131 L.Ed.2d 695 (1995).

. Beiser v. Weyler, 284 F.3d 665, 669 (5th Cir.2002) (holding that a dispute "relates to” an arbitration clause "whenever the clause could conceivably have an affect on the outcome of the case”). We continued,

As a result, absent the rare frivolous petition for removal, as long as the defendant claims in its petition that an arbitration clause provides a defense, the district court will have jurisdiction to decide the merits of the claim. This approach honors the statute’s command that we treat defenses based on arbitration clauses under the Convention in the same way that we treat removal generally. It allows the district court to determine its jurisdiction from the petition for removal, without taking evidence and without a merits-like inquiry.

Id. at 671-72 (internal footnote omitted).

. As the question is not presented, we do not decide whether the district court’s decision was correct. We do recognize, however, that Warrantech’s affirmative defenses in the pres*576ent litigation are rather tangentially related to the arbitration award between Houston General and Underwriters.

. Cf. Giles, 172 F.3d at 335 (finding a discretionary remand where the district court stated that "[tjhis is an appealable order because the basis of my ruling is an exercise of discretion to remand pendent state law claims”).

. 9 U.S.C. § 205; cf. 28 U.S.C. § 1441(a) (2000) ("[A]ny civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending.”).

. Dahiya v. Talmidge Int'l, Ltd., 371 F.3d 207, 209 (5th Cir.2004) (citing Transit Cas. Co. v. Certain Underwriters at Lloyd’s of London, 119 F.3d 619, 624-25 (8th Cir.1997); LaFarge Coppee v. Venezolana De Cementos, S.A.C.A., 31 F.3d 70, 71-72 (2d Cir.1994); In re Amoco Petroleum Additives Co., 964 F.2d 706, 712-13 (7th Cir.1992)).

. Appellants also attempt to revive the oft-rejected argument that a "post-removal event” offers an escape from the strictures of § 1447(d). Appellants argue that because the district court initially denied Underwriters’ motion to remand, then adjudicated Underwriters' summary judgment motions, and only then issued its remand order, § 1447(d) is no longer a bar to appellate review. We have consistently rejected this argument. See Angelides v. Baylor College of Medicine, 117 F.3d 833, 836 & n. 3 (5th Cir.1997) (collecting cases). Appellants offer no reason why we should not do so here once again.

Appellants also ask us to adopt a "not-all-post-removal-events-are-equal” approach, which they contend is illustrated by the Seventh Circuit in Adkins v. Illinois Central Railroad Co., 326 F.3d 828, 833 (7th Cir.2003). Given the clear line of precedent in our Court regarding the treatment of post-removal events, we decline to do so.

. 293 U.S. 140, 55 S.Ct. 6, 79 L.Ed. 244 (1934).

. Dahiya, 371 F.3d at 210; Heaton v. Monogram Credit Card Bank, 297 F.3d 416, 421 (5th Cir.2002).

. City of Waco, 293 U.S. at 143, 55 S.Ct. 6.

. Arnold, 277 F.3d at 776.

. 30 F.3d 592 (5th Cir.1994).

. Linton, 30 F.3d at 594-95. The foreign defendants relied upon 28 U.S.C. § 1330(a), which confers original jurisdiction upon district courts over any action against a "foreign state” that is "not entitled to immunity.” 28 U.S.C. § 1330(a) (2000).

. Linton, 30 F.3d at 597.

. See Dahiya, 371 F.3d at 210-11 (reviewing cases).

. We take no position on whether the order dismissing Warrantech’s counterclaims is "conclusive” under City of Waco. Warrantech relies upon John G. and Marie Stella Kenedy Memorial Foundation v. Mauro, in which we concluded that we had jurisdiction to review the dismissal of plaintiffs' federal law claims even though the district court remanded the remaining state-law claims for lack of jurisdiction. 21 F.3d 667, 670 (5th Cir.1994). In John G., unlike here, there was a sound basis for federal jurisdiction — plaintiffs asserted claims fell under 28 U.S.C. § 1331. Here, in contrast, there are no federal claims; the only basis for federal jurisdiction was 9 U.S.C. § 205, and once the arbitration-related affirmative defenses were found to be without merit, the district court properly remanded the matter to state court.

. See Hernandez ex rel. Hernandez v. Tex. Dep't of Protective & Regulatory Servs., 380 F.3d 872, 878 (5th Cir.2004) (“Prior to reaching the merits, we must verify, sua sponte, that our jurisdiction ... is proper.”); In re McCloy, 296 F.3d 370, 373 (5th Cir.2002) (“[A] lack of subject matter jurisdiction may be raised at any time, and we can examine the lack of subject matter jurisdiction for the first time on appeal.”).

. See 9 U.S.C. § 205.

. Robertson v. The Neuromedical Center, 161 F.3d 292, 296 (5th Cir.1998); Parker & Parsley Petroleum Co. v. Dresser Industries, 972 F.2d 580, 585 (5th Cir.1992).

. 28 U.S.C. § 1367(a) ("Except as provided in subsections (b) and (c) or as expressly provided otherwise by Federal statute, in any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution.”).

. 28 U.S.C. § 1367(c) ("The district court may decline to exercise supplemental jurisdiction over a claim under subsection (a) if — (1) the claim raises a novel or complex issue of State law, (2) the claim substantially predominates over the claim or claims over which the district court has original jurisdiction, (3) the district court has dismissed all claims over which it has original jurisdiction, or (4) in exceptional circumstances, there are other compelling reasons for declining jurisdiction.”).

. Parker & Parsley Petroleum Co., 972 F.2d at 585; Wong v. Stripling, 881 F.2d 200, 204 (5th Cir.1989).

. 383 U.S. 715, 726, 86 S.Ct. 1130, 16 L.Ed.2d 218 (1966).

. Beiser, 284 F.3d at 674-75.

. See Carnegie-Mellon, 484 U.S. at 351, 108 S.Ct. 614 (nothing that when the single federal law claim is eliminated at an "early stage” of the litigation, the district court has "a powerful reason to choose not to continue to exercise jurisdiction”); Parker & Parsley Petroleum Co., 972 F.2d at 585.

. We are not seeking a connection between the arbitration-based defenses and Underwriters' state-law claims properly presented in Texas state court. That is the proper inquiry under Beiser, but the issue has not been presented on appeal.

. See Key v. Wise, 629 F.2d 1049, 1061 (5th Cir.1981) (discussing res judicata); Parklane Hosiery, Inc. v. Shore, 439 U.S. 322, 329, 99 S.Ct. 645, 58 L.Ed.2d 552 (1979) (discussing collateral estoppel).