981 F.2d 816 (5th Cir. 1993), 92-1319, Buchner v. F.D.I.C.

Docket Nº:92-1319.
Citation:981 F.2d 816
Party Name:Donald R. BUCHNER, Laveta Buchner, Janet E. Wiley, Eddie E. Wiley, Vernor E. Bell, and Delores J. Bell, Plaintiffs-Appellees, v. FEDERAL DEPOSIT INSURANCE CORPORATION, in its Corporate Capacity and as Receiver of the First National Bank of Darrouzett, Darrouzett, Texas, Defendants-Appellants.
Case Date:January 22, 1993
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

Page 816

981 F.2d 816 (5th Cir. 1993)

Donald R. BUCHNER, Laveta Buchner, Janet E. Wiley, Eddie E.

Wiley, Vernor E. Bell, and Delores J. Bell,

Plaintiffs-Appellees,

v.

FEDERAL DEPOSIT INSURANCE CORPORATION, in its Corporate

Capacity and as Receiver of the First National

Bank of Darrouzett, Darrouzett, Texas,

Defendants-Appellants.

No. 92-1319.

United States Court of Appeals, Fifth Circuit

January 22, 1993

Daniel H. Kurtenbach, F.D.I.C. Legal Div., Appellate Litigation, Washington, DC and John M. Brown, Mullin, Hoard & Brown, Amarillo, TX, for defendants-appellants.

John Curney, Jr. and Edward M. Johnson, Johnson, Curney & Fields, San Antonio, TX, for plaintiffs-appellees.

Appeal from the United States District Court for the Northern District of Texas.

Page 817

Before GOLDBERG, JOLLY, and WIENER, Circuit Judges.

WIENER, Circuit Judge:

This case concerns the authority of a federal district court to remand a federal cause of action to state court. Holding that such a court has no discretionary authority to remand a case over which it has subject matter jurisdiction, we reverse the order of remand in this case.

I.

FACTS AND PROCEEDINGS

The FDIC originally sued Donald R. Buchner, et al. (the Buchners) in Texas state court to collect sums due on obligations to the First National Bank of Darrouzett (the Bank), which was then under the receivership of the FDIC. Counterclaims asserted against the FDIC by the Buchners in that state court were severed from the collection action. As thus severed, those counterclaims form the basis of this appeal.

The FDIC removed the counterclaim portion of this severed case to federal court some four months after the severance. The district court subsequently granted the Buchners' motion for remand because the FDIC's removal was untimely. 1

During the months following remand, the parties waged a battle of pleadings in state court. The FDIC's answer to the Buchners' Original Petition asserted that the Buchners' claims sounded in tort and that they had failed to comply with the provisions of the Federal Tort Claims Act (the FTCA). 2 The FDIC also filed a Motion to Dismiss for Lack of Jurisdiction in the state court, alleging that the Buchners' exclusive remedy was the FTCA.

The Buchners responded with their Second Amended Original Petition which included claims for violation of the National Bank Act and violation of the General Order Authorizing Receiver's Sale of Assets and Sale or Compounding of All Bad or Doubtful Debts of the bank (the General Order) previously issued by the federal district court. The FDIC again filed a Motion to Dismiss, based on the exclusive nature of the FTCA.

The Buchners replied with their Third Amended Original Petition, purporting to eliminate all claims governed by the FTCA thereby mooting the Motion to Dismiss. This third amended petition asserted six claims against the FDIC: 1) violation of the National Bank Act; 2) breach of contract with the bank; 3) violation of the Texas Deceptive Trade Practices Act; 4) violation of the Texas Insurance Code; 5) discrimination; and 6) violation of the General Order.

After the state court overruled the FDIC's Motion to Dismiss, the Buchners filed their Fourth Amended Original Petition. It retained all of the causes of action from the Third Amended Original Petition except the Deceptive Trade Practices Act claim.

The Buchners' next state court pleading proved to be the undoing of their efforts to keep the present suit in state court. The FBI apparently had been conducting a criminal investigation of the Buchners in connection with the failure of the Bank. In response, the Buchners sought legal sanctions against FBI Special Agent Baldone and the Dallas office of the FBI. The Buchners did not seek these sanctions in a separate legal action, but instead filed a Motion for Sanctions against these parties in the same state court case, which had begun as a counterclaim and had been severed, removed to federal court, and remanded to state court. Within 30 days of the filing of this sanctions motion, Special Agent Baldone removed the entire case to federal court pursuant to 28 U.S.C. §§ 1442(a)(1) 3 and 1446(b).

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The Buchners promptly moved to dismiss their claims against the FBI and Special Agent Baldone and again to remand the case to state court once those parties were dismissed. Without objection from the FDIC, the district court subsequently granted the Buchners' motion to dismiss the FBI and Special Agent Baldone. The FDIC did oppose the motion to remand, however, arguing that the federal district court had no choice but to retain jurisdiction over the case because it involved federal claims and the FDIC was a party. The district court declined to address the merits of the FDIC's claims regarding subject matter jurisdiction "because [the FDIC] waived its right of removal on those bases long ago." The district court first found that it had discretion whether to exercise jurisdiction over the present case or to remand it, and then exercised its jurisdiction by choosing to remand the action to state court. The FDIC timely appealed this order pursuant to its special statutory authority. 4

II.

ANALYSIS

  1. Effect of...

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