In the
United States Court of Appeals
For the Seventh Circuit
Nos. 10-3017, 10-3018
T OWNSQUARE M EDIA,
INC., formerly known as
R EGENT C OMMUNICATIONS, INC.,
Defendant-Appellant,
v.
A LAN R. B RILL, et al.,
Plaintiffs-Appellees.
Appeals from the United States District Court
for the Southern District of Indiana, Evansville Division.
Nos. 3:09-cv-00061-, -00062-RLY-WGH—Richard L. Young, Chief Judge.
A RGUED JANUARY 19, 2011—D ECIDED JULY 21, 2011
Before P OSNER, K ANNE, and R OVNER, Circuit Judges.
P OSNER, Circuit Judge. This appeal requires us to plumb
the mysteries of removal and remand in the context of
bankruptcy.
Section 1446(a) of the Judicial Code (Title 28) specifies
procedures for removing a case from a state court to a
federal district court. Section 1447 specifies procedures
2 Nos. 10-3017, 10-3018
after removal, and in subsection (c) provides that “a
motion to remand [a case removed from a state court to
a federal district court] 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 judg-
ment [in the removed case] it appears that the district
court lacks subject matter jurisdiction, the case shall be
remanded [to the state court].”
The next subsection, however, provides that “an order
remanding a case to the State court from which it was
removed is not reviewable on appeal or otherwise.” 28
U.S.C. § 1447(d). As an original matter, this broad rule
of nonappealability (with the exception, also in (d), inap-
plicable to this case, of remands in civil rights cases
governed by 28 U.S.C. § 1443) would, one would
have thought, make subsection (c) irrelevant to the
appealability of a remand. But in Thermtron Products, Inc. v.
Hermansdorfer, 423 U.S. 336, 345-46 (1976), overruled on
other grounds in Quackenbush v. Allstate Ins. Co., 517 U.S.
706 (1996), the Supreme Court held that (c) limits (d):
only cases remanded under (c) are nonappealable. The
only cases remanded under (c) are ones in which either
it appears that the district court lacks subject-matter
jurisdiction or there was some other “defect” in the re-
moval, though in the latter case a motion to remand
the case has to have been made within 30 days after
the notice of removal was filed. Only the first ground
for remand is relevant in this case because there was no
timely motion to remand; so to simplify exposition
we’ll pretend that only if absence of subject-matter juris-
Nos. 10-3017, 10-3018 3
diction is the ground for remand is the remand order
unappealable.
The Supreme Court has adhered to the limiting inter-
pretation of subsection (d), most recently in Carlsbad
Technology, Inc. v. HIF Bio, Inc., 129 S. Ct. 1862 (2009),
despite the evident misgivings of the Justices them-
selves, which we’ll discuss later.
A further complication is the existence of a separate
statute governing removal of bankruptcy cases, 28 U.S.C.
§ 1452(b), under which this case was removed. But we’ll
see that this court has held that the limitations in
section 1452(b) on appeal are identical to the limitations
in section 1447. So if but only if absence of subject-matter
jurisdiction was the ground for the remand in this case,
the remand is not appealable and we must therefore
dismiss the appeal.
Enough, for the moment, about statutes; we need to
tell the reader about the case. Alan Brill owned a number
of media companies. In 2002 creditors forced several of
them into a Chapter 11 bankruptcy. Neither Brill nor
Brill’s other companies were debtors in the bankruptcy
proceeding.
The bankruptcy judge ordered that the radio stations
owned by the debtors be auctioned off. See 11 U.S.C. § 363.
Brill bid at the auction, but the successful bidder was
Regent, as we will refer to the principal appellant despite
its change of name (we can ignore the other appellants).
The bankruptcy plan was confirmed in 2003. Essentially
it was a liquidation, although the bankrupt companies
were not dissolved.
4 Nos. 10-3017, 10-3018
Years later Brill (we can ignore his co-plaintiffs—other
firms that he owns) sued Regent, along with pre-judgment
creditors of the debtors and some of the debtors’ lawyers
and other professional advisors (“bankruptcy profession-
als,” they are called), in an Indiana state court. The 111-
page complaint contained a multiplicity of tort and con-
tract claims. The creditors were alleged to have violated
the terms of the bond covenants and by these and other
means to have forced the debtors to default on their
bonds. The main allegations against the bankruptcy
professionals were that they had misused confidential
information and encouraged Regent to violate two con-
fidentiality agreements that it had made with Brill. The
complaint charged Regent mainly with those violations
plus fraud. All claims were based on Indiana law.
The background of the claim against Regent (which is
all that remains of Brill’s case) was as follows. Before
the bankruptcy, Brill had discussed with Regent the
possibility of selling his companies’ radio stations to it,
and as part of the negotiations (never completed) the
parties had made an agreement prohibiting Regent from
using any information it obtained from Brill in those
negotiations in a manner that would harm him or his
companies. The sale never went through. But during
the bankruptcy Brill discussed with Regent a plan to bid
jointly for the debtors’ radio stations, and they signed
another confidentiality agreement. Brill claims that
Regent used information subject to the agreements
to outbid him at the auction ordered by the bankruptcy
court.
Nos. 10-3017, 10-3018 5
In the order confirming the bankruptcy plan, the bank-
ruptcy judge, consistent with a recommendation in the
plan, had forbidden suits against the bankruptcy profes-
sionals. (Third-party releases for the protection of bank-
ruptcy professionals are common and, when consensual,
unexceptionable. See, e.g., In re Specialty Equipment Cos., 3
F.3d 1043, 1046-47 (7th Cir. 1993).) Those bankruptcy
professionals who had been debtors’ counsel and whom
Brill had sued asked the bankruptcy judge to compel him
to comply with the judge’s order confirming the plan;
he had violated the order by suing them.
The order had also barred anyone but the debtors from
pursuing certain litigation against pre-bankruptcy credi-
tors of Brill’s companies. Those creditors, upset that
he’d included them as defendants in his suit, removed
the suit to the bankruptcy court rather than just asking
the bankruptcy judge to enforce compliance with his
order as the bankruptcy professionals had done. The
creditors based removal on 28 U.S.C. § 1452(a), which
authorizes removal to a district court of any claim of
which that court would have jurisdiction under 28 U.S.C.
§ 1334, which confers on the district courts original juris-
diction “of all civil proceedings arising under title 11
[the Bankruptcy Code], or arising in or related to cases
under title 11.” §§ 1334(a), (b). Although section 1452(a)
provides for removal to the district court rather than to
the bankruptcy court, Bankruptcy Rule 9027, buttressed
by standing orders in the district courts (including the
district court for the Southern District of Indiana), trans-
fers removed suits from district court to bankruptcy
court. In re Seven Fields Development Corp., 505 F.3d 237, 246-
6 Nos. 10-3017, 10-3018
47 and 247 n. 8 (3d Cir. 2007); see also William L. Norton,
Jr., Norton Bankruptcy Law and Practice § 7:1 (3d ed. 2011).
Regent didn’t sign the petition for removal. For cases
governed by 28 U.S.C. § 1441(a)—the general statute
authorizing removal from state courts to federal district
courts of cases presenting claims arising under state
law—all defendants must consent for removal to be
effective. Hanrick v. Hanrick, 153 U.S. 192, 196 (1894); Pettitt
v. Boeing Co., 606 F.3d 340, 343 (7th Cir. 2010). That would
not be a problem in this case; Regent indicated its
consent shortly after removal, and no objection to its
failure to have signed the petition to remove was made—
and without a timely objection to the lack of unanimity
the defect would not be fatal. 28 U.S.C. § 1447(c); Doe v.
GTE Corp., 347 F.3d 655, 657 (7th Cir. 2003); Payne ex rel.
Estate of Calzada v. Brake, 439 F.3d 198, 203-04 (4th Cir.
2006); cf. Lively v. Wild Oats Markets, Inc., 456 F.3d 933, 942
(9th Cir. 2006). But in any event section 1452(a)
authorizes removal by “a party” (in contrast to section
1441(a), which authorizes removal by “the defendant or
the defendants”—the plural being the basis for the re-
quirement of unanimity), and so has been interpreted
to reject the requirement of unanimity. California Public
Employees’ Retirement System v. WorldCom, Inc., 368 F.3d
86, 103 (2d Cir. 2004); Creasy v. Coleman Furniture Corp.,
763 F.2d 656, 660 (4th Cir. 1985). By making it easier to
remove a bankruptcy case, this interpretation promotes
judicial economy by concentrating bankruptcy litigation
in the bankruptcy courts.
So the case was properly removed. The bankruptcy
judge quickly determined that the suit against the bank-
Nos. 10-3017, 10-3018 7
ruptcy professionals was barred. But by then Brill had
already dismissed them from his suit, so the judge
merely ordered him not to reinstate them.
The judge stayed the suit while reserving decision
on the issues raised by the other defendants. Brill then
filed an amended complaint (actually a second amended
complaint, but we’ll suppress that detail and pretend
there were only two complaints), eliminating all defen-
dants except Regent and making clear that his only
claims arose from Regent’s alleged violations of the
confidentiality agreements. The bankruptcy judge ruled
that, as thus amended, Brill’s complaint was unrelated
to the bankruptcy and that the bankruptcy court had
no jurisdiction over it, so the judge ordered the suit
remanded to the state court.
Preferring to defend against Brill’s suit in the bank-
ruptcy court rather than in an Indiana state court, Regent
appealed the remand order to the district court. 28
U.S.C. § 158(a)(1). The district judge affirmed, saying
that “once the bankruptcy court determined that the
[amended complaint] was in play and that, based
on the claims now alleged by Brill . . . , it had no jurisdic-
tion, . . . no action other than the remand of Brill’s Law-
suit could be taken. Once a court determines that it
lacks jurisdiction, it lacks the ability to do anything
more than announce the fact and rid itself of the cause”
(citations omitted). Regent appeals from the district
court’s decision.
The bankruptcy court had jurisdiction over Brill’s
first complaint. Although he’d already dismissed the
professionals, the pre-judgment creditors remained as
8 Nos. 10-3017, 10-3018
defendants along with Regent. The suit was therefore
within the bankruptcy court’s jurisdiction. For by suing
those creditors Brill was challenging the bankruptcy
court’s confirmation of the plan of liquidation, and a
bankruptcy court has jurisdiction over challenges to its
orders whatever their basis. Travelers Indemnity Co. v.
Bailey, 129 S. Ct. 2195, 2205 (2009); In re Millenium
Seacarriers, Inc., 458 F.3d 92, 95 (2d Cir. 2006) (per curiam);
In re Allegheny Health, Education & Research Foundation,
383 F.3d 169, 176 (3d Cir. 2004); In re Eveleth Mines, LLC,
318 B.R. 682, 687 (8th Cir. BAP 2004).
And once a district court acquires jurisdiction over a
claim, it acquires jurisdiction (“supplemental jurisdic-
tion”) over closely related claims even if they are based
on state law. 28 U.S.C. § 1367(a). One might think that
the bankruptcy court, being a “unit of the district court,”
28 U.S.C. § 151, would have the same supplemental
jurisdiction as the district court rather than that
closely related claims would have to be split between
the two courts, especially since Congress has given the
district courts (including therefore bankruptcy courts)
jurisdiction over proceedings “related to” bankruptcy.
28 U.S.C. § 1334(b); see In re Sasson, 424 F.3d 864, 868-69
(9th Cir. 2005). But 28 U.S.C. § 157(c)(1) withholds author-
ity from the bankruptcy judge to make the decision in a
“related to” case; he can only recommend a decision to the
district court. It would be odd to think a bankruptcy
judge could do more in the case of a supplemental state-
law claim. And bankruptcy judges are awfully busy
(in the year ending on March 31, 2011, there were more
than 1.5 million bankruptcy filings in the United States,
“Bankruptcy Statistics,” www.uscourts.gov/Statistics/
Nos. 10-3017, 10-3018 9
BankruptcyStatistics.aspx (visited July 5, 2011), and only
about 350 bankruptcy judges); they shouldn’t be bothered
with resolving claims that bear only remotely on the
bankruptcy proceeding, as in the case of Brill’s claim
against Regent arising out of the confidentiality agree-
ments.
The few courts of appeals to have addressed the issue
are divided over whether bankruptcy courts have sup-
plemental jurisdiction. Compare In re Lionel Corp., 29
F.3d 88, 92 (2d Cir. 1994), with In re TXNB Internal Case,
483 F.3d 292, 300 (5th Cir. 2007), and In re Walker, 51 F.3d
562, 571-73 (5th Cir. 1995). The bankruptcy courts are also
divided. See cases cited in In re Kebe, 444 B.R. 871, 879-80
(Bankr. S.D. Ohio 2011); also Eric C. Surette, “Exercise
of Supplemental Jurisdiction by Bankruptcy Courts
Pursuant to 28 U.S.C.A. § 1367,” 52 A.L.R. Fed. 2d 243
(2011); Ralph Brubaker, “On the Nature of Federal Bank-
ruptcy Jurisdiction: A General Statutory and Constitu-
tional Theory,” 41 Wm. & Mary L. Rev. 743, 926-33 (2000);
Susan Block-Lieb, “The Case against Supplemental Bank-
ruptcy Jurisdiction: A Constitutional, Statutory, and
Policy Analysis,” 62 Fordham L. Rev. 721 (1994). Our court
has not taken sides, and we needn’t do so in this case
because it would not affect the outcome; we’ll merely
assume that the bankruptcy court could have exercised
supplemental jurisdiction over the state-law claims, at
least to the extent of recommending a decision. But we
note parenthetically the oddity that the cases that
permit bankruptcy judges to exercise supplemental juris-
diction allow them to make and not just recommend
the decision resolving the supplemental claim. This is
10 Nos. 10-3017, 10-3018
inconsistent with the statutory treatment of “related to”
jurisdiction (and why should supplemental jurisdiction
be broader?) and is in tension with the Supreme
Court’s reluctance to allow bankruptcy judges disposi-
tive authority over state-law claims. Stern v. Marshall,
No. 10-179, 2011 WL 2472792, at *15-17, 19 (U.S. June 23,
2011); Northern Pipeline Construction Co. v. Marathon Pipe
Line Co., 458 U.S. 50, 83-84 (1982) (plurality opinion); Block-
Lieb, supra, 62 Fordham L. Rev. at 793-96. But that’s
another issue we need not resolve.
Often, as in this case, the federal claim is resolved one
way or another while the supplemental state-law claims
are pending, unresolved. That does not eliminate the
district court’s jurisdiction over those claims, but it does
make it an attractive case for the court, in the exercise
of discretion conferred by section 1367, to relinquish its
jurisdiction over them to the state courts, especially if
the federal claim has, as in this case, been resolved
without a trial. Carnegie-Mellon University v. Cohill, 484
U.S. 343, 350 and n. 7 (1988); Groce v. Eli Lilly & Co., 193
F.3d 496, 500-01 (7th Cir. 1999).
The Supreme Court’s decision in Carlsbad Technology,
Inc. v. HIF Bio, Inc., supra, holds, repeating earlier
decisions, that relinquishing jurisdiction presupposes
jurisdiction, so that while a decision to remand for lack
of jurisdiction is unreviewable by virtue of 28 U.S.C.
§ 1447(d), a decision to relinquish supplemental jurisdic-
tion is reviewable. This creates an anomaly, as pointed
out in Justice Breyer’s concurring opinion in Carlsbad.
129 S. Ct. at 1869-70. A supplemental claim by definition
Nos. 10-3017, 10-3018 11
has no independent basis for the assertion of federal
jurisdiction: it neither is based on federal law nor is
made by or against a citizen of another state or a
foreign country. It is allowed to be litigated (in the
district court’s discretion) in federal court purely as a
matter of judicial economy, because it is connected to
a federal claim pending in a federal court. But if it were
erroneously remanded to a state court—erroneously
because there were compelling reasons of judicial
economy for retaining the case in federal court—still the
harm to federal law and the federal judiciary would be
slight, although overall judicial efficiency would be
impaired. It doesn’t make much sense for such a remand
to be appealable, when remanding a case to a state court
in violation of a federal statute is not appealable if the
district court “relied upon a ground that is colorably
characterized as subject-matter jurisdiction.” Powerex
Corp. v. Reliant Energy Services, Inc., 551 U.S. 224, 234
(2007). The riposte that relinquishing jurisdiction presup-
poses jurisdiction—which is the rule—is semantically
correct but reveals the limitations of literalism as a
method of legal interpretation.
Apparently the Justices have qualms about the rule. A
footnote in the Carlsbad opinion states that the Court will
“not revisit today whether Thermtron was correctly de-
cided,” because “neither the brief for petitioner nor the
brief for respondents explicitly asked the Court to do so
here.” 129 S. Ct. 1866 n. *. The Court added that the parties
to the Court’s previous post-Thermtron decisions had
likewise not asked that it be overruled. Id. Had they
asked, the Court might have obliged, for it said it
12 Nos. 10-3017, 10-3018
wouldn’t revisit the Thermtron decision today. Four
Justices indicated in concurring opinions in Carlsbad
their disquiet with Thermtron and none defended the
decision. And Justice Rehnquist’s dissent in Thermtron,
see 423 U.S. at 353-61, has never been satisfactorily an-
swered. He said that “according to the Court, this case
is beyond the reach of § 1447(d) by virtue of the fact
that respondent appears to have expressly premised
his remand of the case before him on a ground not autho-
rized by Congress, a conclusion purportedly drawn
from the face of respondent’s order. I may agree, arguendo,
that an order of remand based upon the clogged docket
of the district court and a desire to obtain for the parties
a trial in some forum without unreasonable delay, how-
ever salutary the motivation behind it, is not within the
discretion placed in district courts by Congress. But
I fail to see how such an order of remand is any more
unauthorized than one where the district court er-
roneously concludes that an action was removed ‘im-
providently and without jurisdiction.’ Surely such an
error equally contravenes congressional intent to extend
a ‘right’ of removal to those within the statute’s terms.”
423 U.S. at 356.
The norm that the Court does not overrule a decision
unless asked to do so is another anomaly. (The norm
is echoed in Justice Scalia’s concurring opinion in
Carlsbad, 129 S. Ct. at 1868—and then he states his dis-
agreement with Thermtron in strong terms. See id. at 1868-
69.) Fortunately it is not followed consistently, a famous
example being the overruling of Swift v. Tyson, 41 U.S.
(16 Pet.) 1 (1842), by Erie Railroad Co. v. Tompkins, 304
Nos. 10-3017, 10-3018 13
U.S. 64 (1938). It’s a questionable norm because lawyers
are reluctant to ask a court to overrule one of its deci-
sions—let alone a string of them—because it smacks
of desperation (“I can win only if you admit that your
previous decisions were wrong”).
Even so, a plaintiff’s abandoning his federal claim,
as Brill did when he filed the amended complaint
dropping all defendants except Regent, ordinarily
requires dismissal of the entire case, including the sup-
plemental claims, Rockwell International Corp. v. United
States, 549 U.S. 457, 473-74 (2007); cf. Church of Scientology
v. United States, 506 U.S. 9, 12 (1992); Cunningham Charter
Corp. v. Learjet, Inc., 592 F.3d 805, 807 (7th Cir. 2010),
for there is no longer a federal hook on which to hang
them. But if the case has been removed to federal court
and the defendant opposes the remand, as in this case,
dismissal is no longer mandatory—that is the “forum
manipulation” exception recognized in Rockwell Inter-
national, see 549 U.S. at 474 n. 6; see also In re Burlington
Northern Santa Fe Ry., 606 F.3d 379, 380-81 (7th Cir.
2010) (per curiam). For then it is a case not just of the
plaintiff’s abandoning his federal claims but of his
seeking to deprive the defendant of the opportunity to
defend the remaining claims in the court that obtained
jurisdiction of the case on the defendant’s initiative.
That is called pulling the rug out from under your ad-
versary’s feet.
That argument was not considered by the bankruptcy
court, however. Regent had failed to argue to that court
or for that matter to the district court that the amended
14 Nos. 10-3017, 10-3018
complaint was within the supplemental jurisdiction, and
it compounded the forfeiture by failing to argue the
point to us in its opening brief, though it argued it very
fully in its reply brief. The case for the bankruptcy
court’s retaining jurisdiction over the supplemental
claims was in any event weak. The claims were only
tenuously related to the bankruptcy. From the bank-
ruptcy court’s perspective the important thing was to
get as much for the creditors from the sale of the debtors’
assets as possible, and there is no evidence that Regent’s
outbidding Brill at the auction disserved the creditors.
The bankruptcy judge’s familiarity with the bankruptcy
was unlikely to yield such insights into Brill’s claims—
based as they were on agreements that had not been
submitted in the bankruptcy proceeding—as would
have argued for the bankruptcy judge’s deciding
their merits himself rather than letting the state court
decide.
Regent resisted remand on the ground that the plain-
tiff’s suit was within the bankruptcy court’s jurisdiction
even after the other defendants were dropped. It argued
that the suit challenged that court’s orders approving the
sale of debtors’ assets and was therefore an impermissible
collateral attack. Regent was wrong. Brill’s suit does not
claim that the auction had been conducted improperly, and
so it does not contradict the bankruptcy court’s approval
of the sale. The bankruptcy judge determined that the
auction had not been collusive and that the winner,
Regent, was a good-faith purchaser. Brill bows to that
ruling. His brief states that he “is not seeking to appeal,
overturn or undo the ruling by the Bankruptcy Court
Nos. 10-3017, 10-3018 15
that Regent was a winning bidder at the Auction or any
other Bankruptcy Court order or ruling entered in con-
nection with the Auction, or otherwise,” that he “does
not seek the transfer of any assets that were ever part of
the Bankruptcy Estate,” and that “neither [his] claims
nor the relief sought thereby will have any impact on
the validity or finality of the Sale.” He just wants dam-
ages. Cf. BCS Services, Inc. v. Heartwood 88, LLC, 637 F.3d
750 (7th Cir. 2011).
Yet if his claims against Regent were within the sup-
plemental jurisdiction of the bankruptcy court, even if
no one mentioned this, the court had jurisdiction. If a
complaint is filed in (or removed to) a federal district
court, and it includes state-law as well as federal claims,
it doesn’t have to cite 28 U.S.C. § 1367 to invoke sup-
plemental jurisdiction; that can be assumed—why
would the state-law claims be included in the complaint
if the plaintiff didn’t want the court to decide them? Cf.
Jass v. Prudential Health Care Plan, Inc., 88 F.3d 1482, 1491-
92 (7th Cir. 1996); Lewis v. Local Union No. 100 of Labor-
ers’ International Union of North America, AFL-CIO, 750 F.2d
1368, 1375 n. 7 (7th Cir. 1984).
In the Powerex case, cited earlier, having entertained
the possibility that Ҥ 1447(d) permits appellate review
of a district-court remand order that dresses in jurisdic-
tional clothing a patently nonjurisdictional ground,” 551
U.S. at 234, the Supreme Court considered whether the
remand order might have rested on a decision by the
district court not to exercise supplemental jurisdiction.
But it found “no reason to believe that the District
16 Nos. 10-3017, 10-3018
Court’s remand was actually based on this unexplained
discretionary decision. The District Court itself never
mentioned the possibility of supplemental jurisdiction . . . .
To the contrary, . . . it relied upon lack of subject-matter
jurisdiction,” and “it does not appear from the record
that petitioner ever even argued to the District Court
that supplemental jurisdiction was a basis for retaining
the claims against it.” 551 U.S. at 235 (emphasis in origi-
nal). The quoted passage could mean that if no one men-
tioned supplemental jurisdiction to the court the remand
must have been based on a decision to deny jurisdiction,
not relinquish it. Still, to withstand appellate review,
dismissal for want of jurisdiction must be at least
colorable. Was it in this case, in light of Carlsbad? Isn’t
Carlsbad, decided after Powerex, clear that relinquishing
jurisdiction over supplemental state-law claims is not
a denial of jurisdiction?
And the district court didn’t say it lacked jurisdiction;
for it did not dismiss Regent’s appeal—it affirmed the
bankruptcy judge’s order dismissing the supplemental
claims. This may seem a quibble, since the remand
was ordered by the bankruptcy court, a division of
the district court. But it could be more than a quibble.
Remember that Brill’s case was removed under 28 U.S.C.
§ 1452, and that statute, differently worded from section
1447, authorizes the district court to remand a removed
case “on any equitable ground” and adds that if it does
so, its remand order is not appealable. § 1452(b).
The Supreme Court has held that section 1452(b) does
not displace section 1447(d), and therefore a remand to
Nos. 10-3017, 10-3018 17
a state court of a case removed to a federal district court
(or to a bankruptcy court, directly or, more properly, by
reference from the district court) is not appealable if it
was based on absence of subject-matter jurisdiction.
Things Remembered, Inc. v. Petrarca, 516 U.S. 124, 128-29
(1995). But section 1452(b) may have added additional
impediments to appeal of remand orders by making a
remand of a bankruptcy case nonappealable if it was
based “on any equitable ground.” A bankruptcy judge
who remands a case because he is relinquishing rather
than denying federal jurisdiction could be thought to
have based the remand on an “equitable ground.” So two
Justices suggested, concurring in Things Remembered,
when they said that section 1452(b) enlarges the grounds
for remanding—and remember that the statute is explicit
that no remand under that subsection is appealable. 516
U.S. at 131-36; see also Hernandez v. Brakegate, Ltd., 942
F.2d 1223 (7th Cir. 1991); In re United States Brass Corp.,
110 F.3d 1261, 1265-66 (7th Cir. 1997).
In Good v. Voest-Alpine Industries, Inc., 398 F.3d 918, 922-
23, 927 (7th Cir. 2005), however, we held that section
1452(b) was not intended to eliminate any of the
exceptions to nonappealability that the Supreme Court
had recognized in interpreting section 1447(d)—including
the exception for cases in which a district court declines
to exercise supplemental jurisdiction. And so if that’s
a proper characterization of what the bankruptcy judge,
seconded by the district judge, did in this case, the
decision is reviewable.
Of course the bankruptcy judge was explicit that he
was dismissing the supplemental claims for want of
18 Nos. 10-3017, 10-3018
subject-matter jurisdiction. If that ground for dismissal
was colorable, yet incorrect, the dismissal is not
reviewable. But could it be thought colorable, given
the recent reaffirmation in Carlsbad of the rule that relin-
quishing jurisdiction over a supplemental claim is not
a dismissal for want of jurisdiction?
That depends on what “colorable” means in this con-
text. It could mean, as just suggested, that absence of
subject-matter jurisdiction must be at least arguable. Or
it could mean that what must be arguable is that the
district judge’s ground for dismissal was indeed absence
of subject-matter jurisdiction, no matter how great a
mistake the judge had made in thinking so. Powerex
implies the first position, as does Atlantic National Trust
LLC v. Mt. Hawley Ins. Co., 621 F.3d 931, 937-38, 940 (9th
Cir. 2010). But Kircher v. Putnam Funds Trust, 547 U.S. 633
(2006), which was not overruled by Powerex, embraces
the second, remarking that “the District Court said that
it was remanding for lack of jurisdiction, an unreviewable
ground, and even if it is permissible to look beyond
the court’s own label [in a footnote, id. at 641 n. 9, the
Court left open whether that was permissible], the
orders are unmistakably premised on the view that . . . the
court had no subject-matter jurisdiction . . . . And ‘[w]here
the order is based on one of the [grounds enumerated
in 28 U.S.C. § 1447(c)], review is unavailable no matter
how plain the legal error in ordering the remand.’ ” Id.
at 641-42, quoting Briscoe v. Bell, 432 U.S. 404, 413-14 n. 13
(1977); see also Moody v. Great Western Ry., 536 F.3d 1158,
1164 (10th Cir. 2008); Price v. J & H Marsh & McLennan,
Inc., 493 F.3d 55, 61 (2d Cir. 2007).
Nos. 10-3017, 10-3018 19
And that seems right, as it usually is easier to determine
what the district court’s (or in this case the bankruptcy
court’s) ground for dismissing a case was than whether
it was not merely an erroneous ground but a frivolous
one—and it is certainly easier to determine what the
ground was than to determine both what it was and
whether, if the ground was absence of jurisdiction, it
was at least arguably sound.
The word “jurisdiction” is a chameleon, judges do not
always use it with precision, and the distinction between
relinquishing and disavowing jurisdiction is a fine one.
Had Regent argued supplemental jurisdiction to the
bankruptcy judge, we might interpret what the judge
did as relinquishment rather than disavowal. But as no
one mentioned supplemental jurisdiction, it hardly
seems likely that the judge, in holding that he lacked
jurisdiction, meant that he had jurisdiction but was relin-
quishing it. Such a characterization of his ruling would
not be “colorable.” So the remand was indeed unre-
viewable, and Regent’s appeal must therefore be—
we conclude at long last—
D ISMISSED.
7-21-11