Cnty. of Charleston v. Finish Line Found. II Inc.

• Decision Date: 05 July 2018
• Docket Number: No. 2:17-cv-03496,2:17-cv-03496
• Parties: County of Charleston, South Carolina Plaintiff, v. Finish Line Foundation II Inc, et al. Defendants.
• Court: U.S. District Court — District of South Carolina

County of Charleston, South Carolina Plaintiff, v. Finish Line Foundation II Inc, et al. Defendants.

No. 2:17-cv-03496

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF SOUTH CAROLINA CHARLESTON DIVISION

July 5, 2018

ORDER

This matter comes before the court on Finish Line Foundation II ("Finish Line"), KRF XSL LLC ("KRF"), SC Investment Holdings LLC ("SC Investment"), and Kiawah River Farms LLC ("Kiawah River Farms"), Kiawah River Excavating and Earthworks LLC ("Earthworks"), and Kiawah River Stables LLC's ("Kiawah River") (collectively, "defendants") motion to stay the court's order remanding the case pending the Fourth Circuit's ruling on defendants' appeal of the order to remand, ECF No. 32. For the reasons set forth below, the court denies the motion.

I. BACKGROUND

County of Charleston filed this suit against defendants in order to stop their allegedly illegal development of land on Johns Island. In early September, 2017, the Charleston County Planning and Zoning Department ("Zoning") discovered that the following land development activities had occurred on defendants' properties without permits: "use of commercial land clearing equipment to clear and grub land, cutting and removal of protected trees, uncontrolled burning of vegetative waste, and resource extraction and mining." Compl. ¶¶ 12-14. County of Charleston claims that these activities violated the county's zoning requirements. Id. ¶¶ 14-16. It further claims that it informed defendants of these violations through letters, personal meetings, and Stop Work Orders, and that on September 28, 2017, County of Charleston was assured that all work had ceased. Id. ¶ 19-24. County of Charleston claims that it dismissed the violations with the understanding that defendants would take corrective action and apply for the necessary permits, yet land-clearing activities continued through November 2017. Id. ¶ 25. On November 21, 2017, Zoning issued 45 Ordinance Summons to defendants. Id. ¶ 26.

On November 30, 2017, County of Charleston filed this action in the Court of Common Pleas for the Ninth Judicial Circuit, because it believes that defendants will not comply with the zoning regulations despite their promise to do so. Id. ¶ 27. It requests that the court find that defendants have violated certain Zoning and Land Development Regulations ("ZLDR") and enter an injunction to prohibit any further development, particularly the damage and removal of trees. Id. ¶¶ 28-31. Additionally, County of Charleston asks the court to issue an order finding defendants in violation of ZLDR 6.4.23 and, pursuant to S.C. Code § 48-23-205, declare that defendants have been conducting forestry activities and are barred from applying for building permits, site disturbances, subdivision plans, or any other approval for development on their properties in Charleston County for five years. Id. ¶ 35. County of Charleston also sued Kiawah River Farms and Kiawah River Excavating and Earthworks, LLC ("Earthworks"), and Kiawah River Stables, LLC ("Kiawah River Stables") for operating in South Carolina without a business license. Id. ¶¶ 36-41.

Defendants removed the matter on December 28, 2017, based on diversity jurisdiction. ECF No. 1. County of Charleston filed its motion for abstention on January 26, 2018, ECF No. 8, which the court granted on April 30, 2018, ECF No. 27. That same day the clerk's office sent a certified copy of the remand order to the clerk of the Court of Common Pleas. ECF No. 28-30. On May 1, 2018, defendants filed their notice of appeal of the order remanding the case to state court, ECF No. 31, and a motion to stay remand pending the Fourth Circuit's decision on their appeal, ECF No. 32. On May 11, 2018, County of Charleston filed its response, ECF No. 35, and on May 18, 2018, defendants filed their reply, ECF No. 36.

II. STANDARD

"A court has the power to stay proceedings, which is 'incidental to the power inherent in every court to control the disposition of the causes on its docket with economy of time and effort for itself, for counsel, and for litigants.'" Doe v. Bayer Corp., 367 F. Supp. 2d 904, 914 (M.D.N.C. 2005) (quoting Landis v. N. Am. Co., 299 U.S. 248, 254 (1936)). In exercising its authority to grant a discretionary stay, the court "must weigh competing interests and maintain an even balance." Landis, 299 U.S. at 254, 255 (citing Kansas City S. Ry. Co. v. United States, 282 U.S. 760, 763 (1931)). Furthermore, "[t]he party seeking a stay must justify it by clear and convincing circumstances outweighing potential harm to the party against whom it is operative." Williford v. Armstrong World Indus., Inc., 715 F.2d 124, 127 (4th Cir. 1983). When deciding on a motion to stay, a court considers four factors:

(1) whether the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantiallyinjure the other parties interested in the proceeding; and (4) where the public interest lies.

Nken v. Holder, 556 U.S. 418, 426 (2009).

III. DISCUSSION

Defendants ask the court to stay its order remanding the case to state court until the Fourth Circuit rules on defendants' appeal of the court's order to remand. Defendants argue that their appeal will likely succeed on the merits and that they will be irreparably harmed if the court does not stay its order to remand. The court first addresses whether it has jurisdiction over this motion before considering whether defendants are entitled to a stay under the Nken v. Holder standard.

A. Jurisdiction to Rule on the Motion to Stay

Although neither party has questioned whether the court has jurisdiction to rule on the motion to stay, the court finds it necessary to address it considering that this case differs from the normal rules regarding a federal court's jurisdiction over a remanded matter. Removal and remand proceedings in federal court are governed by 28 U.S.C. § 1447, which provides that:

(c) A motion to remand the case 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 judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded. An order remanding the case may require payment of just costs and any actual expenses, including attorney fees, incurred as a result of the removal. A certified copy of the order of remand shall be mailed by the clerk to the clerk of the State court. The State court may thereupon proceed with such case.

(d) An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1442 or 1443 of this title shall be reviewable by appeal or otherwise.

28 U.S.C. § 1447. In considering whether a court has jurisdiction to review its own remand orders or, by extension, to grant a stay of its remand order, courts have distinguished between remand orders based on lack of subject-matter jurisdiction under § 1447(c) and those remand orders based on other grounds outside of § 1447. For remand orders based on lack of subject-matter jurisdiction under § 1447(c), a court is divested of jurisdiction over a case when it has completed the remand process by having the district court clerk send a certified copy of the remand order to the state court. Vogel v. U.S. Office Prod. Co., 258 F.3d 509, 519-20 (6th Cir. 2001); see also Shapiro v. Logistec USA, Inc., 412 F.3d 307, 311 (2d Cir. 2005) ("Section 1447(d) establishes that once a section 1447(c) remand order has been mailed to the state court pursuant to the latter section, federal jurisdiction is at an end."); Hudson United Bank v. LiTenda Mortg. Corp., 142 F.3d 151, 159 (3d Cir. 1998) ("The mailing of a remand order divests the district court of jurisdiction when the remand is authorized by § 1447(c)."). "This view is premised on both the language of § 1447(c) and (d) and the need to establish a determinable jurisdictional event after which the state court can exercise control over the case without fear of further federal interference." Trans Penn Wax Corp. v. McCandless, 50 F.3d 217, 225 (3d Cir. 1995).

Section 1447(d) prohibits appellate courts from reviewing decisions to remand based on subject-matter jurisdiction. Shapiro, 412 F.3d at 311. Building on this rule, courts have also found that "the 'or otherwise' language of section 1447(d) bars district courts from reconsidering orders remanding cases on section 1447(c) grounds." Id. "But if the remand is not on section 1447(c) grounds, and therefore section 1447(d) does not apply, then the mailing of the remand order to the state court does not strip the federalcourt of jurisdiction." Id. In other words, if remand is based on grounds other than subject-matter jurisdiction, or is otherwise permitted by federal statute, the court retains some level of jurisdiction over it for the purpose of reviewing its order to remand or staying its order to remand pending appeal. See Hudson United Bank, 142 F.3d at 159 (3d Cir. 1998) ("Because the remand in this case was authorized by § 1367(c), the mailing of the remand order to state court did not divest the district court of jurisdiction to entertain Hudson's motion for reconsideration."); Coffey v. Freeport-McMoran Copper & Gold Inc., 2009 WL 10672022, at *1-2 (W.D. Okla. May 8, 2009) ("The remand order here, while based on § 1447(c), is not subject to § 1447(d), [because the] Class Action Fairness Act of 2005 ("CAFA") gives the federal appellate courts discretionary jurisdiction to review CAFA remand orders.").

This court remanded the case based on abstention, not because it lacked subject-matter jurisdiction over the matter, which was properly before the court on diversity jurisdiction. See Quackenbush v. Allstate...