Boelens v. Redman Homes, Inc.

Decision Date06 May 1985
Docket Number83-1821,Nos. 83-1467,83-1867 and 84-1019,s. 83-1467
Citation759 F.2d 504
Parties1985-2 Trade Cases 66,769 Sue BOELENS, Individually and as Next Friend of Julie Boelens and Jennifer Boelens, Plaintiff-Appellee, v. REDMAN HOMES, INC. & Republic Homes of Texas, Inc., Defendants-Appellants. Sue BOELENS, Individually and as next friend of Julie Boelens and Jennifer Boelens, Plaintiff-Appellant Cross-Appellee, v. REDMAN HOMES, INC., Defendant-Appellee Cross-Appellant, and Republic Homes of Texas, Inc., Defendant-Appellee.
CourtU.S. Court of Appeals — Fifth Circuit

Camp, Jones, O'Neill & Hall, John P. Camp, Daniel L. Bates, Fort Worth, Tex., for Redman.

Hughes & Hill, H. Robert Powell, Clifton T. Hutchinson, Dallas, Tex., for Republic.

Vickery & Webb, Arnold Anderson Vickery, Elizabeth Kilbride, Houston, Tex., for Boelens.

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

ON PETITION FOR REHEARING AND SUGGESTION FOR REHEARING EN BANC

(Opinion December 20, 1984, 748 F.2d 1058).

Before WISDOM, RANDALL, and JOLLY, Circuit Judges.

WISDOM, Senior Circuit Judge:

In our original decision in this case, we held that personal injury claims arising solely from breach of warranty are not cognizable under the Magnuson-Moss Warranty Act (MMWA), 15 U.S.C. Secs. 2301-2312 (1982); a plaintiff may, however, recover personal injury damages under the MMWA if he has pleaded and proved a violation of the substantive provisions of Sec. 2308 (prohibiting disclaimer of implied warranties), Sec. 2304(a)(2) (prohibiting full warrantors from limiting the duration of implied warranty coverage), or Sec. 2304(a)(3) (prohibiting full warrantors from excluding or limiting consequential damages unless such exclusion or limitation conspicuously appears on the face of the warranty). Boelens v. Redman Homes, Inc., 5 Cir.1984, 748 F.2d 1058, 1068. We noted that "[t]he plaintiffs' amended complaint in this case makes a claim under the MMWA only for breach of warranty; no claim for breach of the substantive obligations of the Act is asserted." Id. at 1063. Accordingly, we ruled that the plaintiffs could not avail themselves of their claim for personal injury damages in attempting to satisfy the $50,000 amount-in-controversy requirement of the MMWA. Because the remaining claims cognizable under the MMWA did not satisfy the $50,000 amount, we concluded that the judgment of the district court should be vacated and the case remanded with instructions to dismiss for lack of subject matter jurisdiction. The plaintiffs have filed a motion for rehearing, a suggestion for rehearing en banc, and a motion for leave to amend the pleadings.

The plaintiffs originally brought this case under federal question jurisdiction, alleging violations of four federal statutes: (1) the MMWA; (2) the Mobile Home Construction and Safety Standards Act, 42 U.S.C. Secs. 5401-5426 (1982) (MHCSS); (3) the Federal Hazardous Substances Act, 15 U.S.C. Secs. 1261-1274 (1982) (FHSA); and (4) the Consumer Products Safety Act, 15 U.S.C. Secs. 2051-2081 (1982) (CPSA). The plaintiffs later amended the complaint to drop the claims under the MHCSS, the FHSA, and the CPSA. The case proceeded to trial under the MMWA and various pendent state law claims. In their several motions before us now, the plaintiffs argue that, even accepting the correctness of our holding concerning the scope of the MMWA, we should not dismiss for lack of subject matter jurisdiction. First, the plaintiffs argue that subject matter jurisdiction is determined by the original, not the amended, complaint, and that the original complaint invoked three federal statutes other than the MMWA each sufficient to confer federal question jurisdiction.

Second, they argue that the complaint, as construed by the trial court, alleged breaches of the substantive provisions of the MMWA, and that these allegations are sufficient under this Court's opinion to allow recovery of personal injury damages, thereby allowing such damages to apply in satisfaction of the amount-in-controversy requirement. Finally, the plaintiffs argue that they should be allowed to amend the complaint under 28 U.S.C. Sec. 1653 either to reassert the original claims under the MHCSS, the FHSA, and the CPSA, or to correct the "technical" defects in the pleading under the MMWA to clarify the claim for breach of the substantive obligations of the MMWA. We deny the plaintiffs' motions for the following reasons.

I. THE AMENDED COMPLAINT GOVERNS FOR PURPOSES OF DETERMINING JURISDICTION

The plaintiffs do not seek in their motions to challenge this Court's construction of the MMWA, but rather argue that because in the original complaint they invoked three federal statutes other than the MMWA, the district court had federal question jurisdiction over the action independent of the claim under the MMWA. The plaintiffs insist that the claims under the three federal statutes conferred jurisdiction because those claims were not "immaterial and made solely for the purpose of obtaining jurisdiction" or "wholly insubstantial and frivolous". Bell v. Hood, 1946, 327 U.S. 678, 682-83, 66 S.Ct. 773, 776, 90 L.Ed. 939; Fellows v. Universal Restaurants, Inc., 5 Cir.1983, 701 F.2d 447, 449, cert. denied, 1984, 104 S.Ct. 102. The plaintiffs further argue that the later amendment of the complaint to drop the claims under these statutes did not oust jurisdiction, because jurisdiction is determined by looking to the original complaint. For support, the plaintiffs point to Mobil Oil Corp. v. Kelley, 5 Cir., 493 F.2d 784, cert. denied, 1974, 419 U.S. 1022, 95 S.Ct. 498, 42 L.Ed.2d 296, which stated the general principle that jurisdiction "is determined at the outset of the suit", and "the determination whether a suit arises under the Constitution or laws of the United States rests upon 'the plaintiff's statement of his own cause of action' ". Id. at 786 (quoting Louisville & Nashville R.R. v. Mottley, 1908, 211 U.S. 149, 152, 29 S.Ct. 42, 43, 53 L.Ed. 126).

We have been unable to locate any case that squarely faced the issue whether, in a case of original jurisdiction, the voluntary amendment of the complaint to drop a federal question removes that claim as a basis for jurisdiction. The cases that we have found dealing with the issue of jurisdictional ouster resulting from later developments in a case all arise in the context of removal. "It is a fundamental principle of law that whether subject matter jurisdiction exists is a question answered by looking to the complaint as it existed at the time the petition for removal was filed." IMFC Professional Services, Inc. v. Latin American Home Health, Inc., 5 Cir.1982, 676 F.2d 152, 157 (Former Fifth). Perhaps the best known example of this general rule is St. Paul Mercury Indemnity Co. v. Red Cab Co., 1938, 303 U.S. 283, 58 S.Ct. 586, 82 L.Ed. 845, which held that the amendment of the complaint, in a suit removed to federal court, to reduce the amount claimed to a figure below the jurisdictional amount did not divest the court of jurisdiction, when at the time of the removal the sum claimed was in excess of the jurisdictional amount and there was no showing that such amount was not claimed in good faith. The plaintiff apparently had amended the complaint for the purpose of destroying jurisdiction.

Although there is older authority to the contrary, 1 the majority view is that a plaintiff's voluntary amendment to a complaint after removal to eliminate the federal claim upon which removal was based will not defeat federal jurisdiction. 2

The policy behind this rule is obvious. When a plaintiff chooses a state forum, yet also elects to press federal claims, he runs the risk of removal. A federal forum for federal claims is certainly a defendant's right. If a state forum is more important to the plaintiff than his federal claims, he should have to make that assessment before the case is jockeyed from state court to federal court and back to state court. The jockeying is a drain on the resources of the state judiciary, the federal judiciary and the parties involved; tactical manipulation [by the] plaintiff ... cannot be condoned.

Austwick v. Board of Education, N.D.Ill.1983, 555 F.Supp. 840, 842.

The rule that a plaintiff cannot oust removal jurisdiction by voluntarily amending the complaint to drop all federal questions serves the salutary purpose of preventing the plaintiff from being able to destroy the jurisdictional choice that Congress intended to afford a defendant in the removal statute. The same considerations are not present, however, in a case of original federal question jurisdiction in which the plaintiff, rather than the defendant, is invoking the jurisdiction of the federal court. In that case, because the burden is on the plaintiff to establish jurisdiction in the first instance, we conclude that the plaintiff must be held to the jurisdictional consequences of a voluntary abandonment of claims that would otherwise provide federal jurisdiction.

Our conclusion that we must look to the amended complaint in assessing original federal question jurisdiction is consistent with the general rule that an amended complaint ordinarily supersedes the original and renders it of no legal effect, unless the amended complaint specifically refers to or adopts the earlier pleading. 3 See Wilson v. First Houston Inv. Corp., 5 Cir.1978, 566 F.2d 1235, 1237-38, vacated on other grounds, 1979, 444 U.S. 959, 100 S.Ct. 442, 62 L.Ed.2d 371; International Controls Corp. v. Vesco, 2 Cir.1977, 556 F.2d 665, 668, cert. denied, 1978, 434 U.S. 1014, 98 S.Ct. 730, 54 L.Ed.2d 758; Cicchetti v. Lucey, 1 Cir.1975, 514 F.2d 362, 365 n. 5; Loux v. Rhay, 9 Cir.1967, 375 F.2d 55, 57; Jefferson v. H.K. Porter Co., N.D.Ala.1980, 485 F.Supp. 356, 359.

We have found one case in this circuit that seems to have applied this general rule in looking to the amended complaint in a federal question case to assess jurisdiction. In ...

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