761 F.3d 1042 (9th Cir. 2014), 12-56028, Smith v. Mylan Inc.

Docket Nº:12-56028
Citation:761 F.3d 1042
Opinion Judge:NGUYEN, Circuit Judge:
Party Name:ANDREW SMITH, individually and as successor-in-interest to Jennifer Roberts (deceased); A. S., by and through her Guardian Ad Litem, Tera Harden Esq.; individually and as successor-in-interest to Jennifer Roberts (deceased); S. N., by and through her Guardian Ad Litem, Sherry Kinnison; individually and as successor-in-interest to Jennifer Roberts (
Attorney:Clem C. Trischler and Jason M. Reefer, Pietragallo Gordon Alfano, Pittsburgh, Pennsylvania; Julian G. Senior, Spencer LLP, Manhattan Beach, California, for Defendants-Appellants. Patricia A. Law, Law Offices of Patricia A. Law, Riverside, California, for Plaintiffs-Appellees.
Judge Panel:Before: Dorothy W. Nelson, Richard A. Paez, and Jacqueline H. Nguyen, Circuit Judges. Opinion by Judge Nguyen.
Case Date:August 04, 2014
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit

Page 1042

761 F.3d 1042 (9th Cir. 2014)

ANDREW SMITH, individually and as successor-in-interest to Jennifer Roberts (deceased); A. S., by and through her Guardian Ad Litem, Tera Harden Esq.; individually and as successor-in-interest to Jennifer Roberts (deceased); S. N., by and through her Guardian Ad Litem, Sherry Kinnison; individually and as successor-in-interest to Jennifer Roberts (deceased), Plaintiffs-Appellees,

v.

MYLAN INC.; MYLAN PHARMACEUTICALS, INC.; MYLAN TECHNOLOGIES INC.; MYLAN INSTITUTIONAL INC., Defendants-Appellants

No. 12-56028

United States Court of Appeals, Ninth Circuit

August 4, 2014

Submitted, Pasadena, California: February 10, 2014. [*]

Appeal from the United States District Court for the Central District of California. D.C. No. 5:12-cv-00216-ODW-SP. Otis D. Wright II, District Judge, Presiding.

Diversity Jurisdiction / Removal

The panel vacated the district court's dismissal based on lack of subject matter jurisdiction of a wrongful death case, and remanded to the district court.

Defendants invoked diversity jurisdiction and filed a notice of removal fourteen months after the lawsuit was filed in state court. The district court sua sponte remanded on the ground that Defendants had removed the case too late, and pursuant to 28 U.S.C. § 1447(c) found that it lacked subject matter jurisdiction.

The panel held that it had jurisdiction to review the district court's remand order. The panel also held that the district court acted in excess of its statutory authority because the one-year time limitation for removal of diversity cases under 28 U.S.C. § 1446(b) (current version at 28 U.S.C. § 1446(c)) was a procedural requirement rather than jurisdictional. The panel held that the district court could not remand sua sponte based on a non-jurisdictional defect because procedural deficiencies were waivable. The panel concluded that Plaintiffs' failure to object constituted a waiver of any right to contest the removal.

Clem C. Trischler and Jason M. Reefer, Pietragallo Gordon Alfano, Pittsburgh, Pennsylvania; Julian G. Senior, Spencer LLP, Manhattan Beach, California, for Defendants-Appellants.

Patricia A. Law, Law Offices of Patricia A. Law, Riverside, California, for Plaintiffs-Appellees.

Before: Dorothy W. Nelson, Richard A. Paez, and Jacqueline H. Nguyen, Circuit Judges. Opinion by Judge Nguyen.

OPINION

Page 1043

NGUYEN, Circuit Judge:

A state court action may not be removed to federal court on the basis of diversity jurisdiction more than one year after the action was filed. See 28 U.S.C. § 1446(b) (current version at 28 U.S.C. § 1446(c)). Defendants in this wrongful death case invoked diversity jurisdiction and filed a notice of removal fourteen months after the lawsuit was filed in state court. The district court sua sponte remanded on the ground that Defendants had removed the case too late. The court, relying on 28 U.S.C. § 1447(c), found that it lacked subject matter jurisdiction.

We hold that the district court acted in excess of its statutory authority because the one-year time limitation for removal of diversity cases under § 1446(b) is a procedural requirement rather than jurisdictional. While the district court may remand at any time prior to final judgment for lack of subject matter jurisdiction, it cannot remand sua sponte based on a non-jurisdictional defect because procedural deficiencies are waivable. Here, Plaintiffs' failure to object constitutes a waiver of any right to contest the removal. We therefore vacate and remand.

Page 1044

FACTUAL BACKGROUND

Plaintiffs Andrew Smith, Alexandra Smith, and Sarah Nevitt (collectively, " Plaintiffs" ), individually and as successors-in-interest to their mother, filed a wrongful death action in state court on December 22, 2010. In October 2011, Plaintiffs served Defendants Mylan Inc., Mylan Pharmaceuticals, Inc., Mylan Technologies, Inc., and Mylan Institutional, Inc. (collectively, " Defendants" ) with an amended complaint. At that point, however, Defendants could not have removed the case because there was no federal question jurisdiction and the parties were not completely diverse. See 28 U.S.C. § § 1331, 1332, 1441. On January 30, 2012, more than one year after the filing of the case, the state court dismissed the last remaining non-diverse defendant. Two weeks later, on February 9, 2012, Defendants removed the matter to federal court, invoking diversity jurisdiction.

Plaintiffs did not file a motion to remand or otherwise object to removal. To the contrary, shortly after removal, the parties filed a joint report pursuant to Rule 26(f) of the Federal Rules of Civil Procedure in preparation for a scheduling conference with the court. Nonetheless, a few weeks later, on May 3, 2012, the district court sua sponte remanded the case pursuant to § 1447(c) for lack of subject matter jurisdiction, finding that the case was improperly removed more than one year after it commenced in state court. Defendants timely appealed.

DISCUSSION

A.

As a threshold matter, we must decide whether we have jurisdiction to review the district court's remand order. Aside from certain exceptions not relevant here, § 1447(d) states that a remand order " is not reviewable on appeal or otherwise." Despite this broad language, § 1447(d) does not preclude review if the district court lacked authority to remand under § 1447(c) in the first instance. Kelton Arms Condo. Owners...

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