Dahiya v. Talmidge Intl., Ltd., 051804 FED5, 02-31068

Docket Nº:051804 FED5, 02-31068
Party Name:Dahiya v. Talmidge Intl.
Case Date:May 18, 2004
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

VINOD KUMAR DAHIYA, Plaintiff-Appellee,



No. 02-31068

United States Court of Appeals, Fifth Circuit

May 18, 2004

Appeal from the United States District Court for the Eastern District of Louisiana, New Orleans

Before BARKSDALE, DeMOSS, and BENAVIDES, Circuit Judges.

BENAVIDES, Circuit Judge:

Defendants-Appellants filed a motion for rehearing complaining of this court's order of dismissal entered March 11, 2004. After considering this motion for rehearing, which we treat as a petition for reconsideration, the motion is GRANTED, the previous order of dismissal is withdrawn, and the following opinion is entered in lieu thereof.

Plaintiff-Appellee Vinod Kumar Dahiya filed this maritime personal injury action in Louisiana state court against several Defendants-Appellants: his employer, Neptune Ship management Services; the owner of the ship on which he was injured, Talmidge International; co-owners of the fleet to which the ship belongs, American Eagle Tankers and American Eagle Tankers Agencies; and the ship's insurer, Brittania Steam Ship Insurance Association. Appellants removed to federal court on the grounds that their dispute with Dahiya was subject to an arbitration agreement governed by the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the "Convention"), 9 U.S.C.A. §§ 201-208 (West 1999 & Supp. 2003). The district court remanded the case to state court for lack of subject matter jurisdiction and denied Appellants' motions to compel arbitration and to stay the proceedings. Because this remand deprives us of appellate jurisdiction to consider any part of the district court's order, we dismiss this appeal.


In 1999, Dahiya and Neptune signed two documents-—a "deed" and a "bond"-—in New Delhi, India. Together, the documents provided that Dahiya would receive two years of training, then work for Neptune for two years. The deed included an arbitration clause providing that any dispute arising out of the deed would be subject to arbitration in Singapore or India.1

As part of his training, Dahiya worked on the M/T EAGLE AUSTIN, a vessel owned by Talmidge. Dahiya suffered burns while operating the vessel's incinerator and was later evacuated to a Louisiana hospital, where he received treatment.

Dahiya returned to India, but he sued Neptune, Talmidge, and the three other Appellants in Louisiana state court. Dahiya's suit, brought under the Savings to Suitors Clause, 28 U.S.C.A. § 1333(1) (West 1993), alleged that Appellants had breached obligations under the Jones Act, 46 U.S.C.A. app. § 688 (West 2003), general maritime law, and other applicable law.

Appellants invoked federal jurisdiction as a federal question, see 28 U.S.C.A. § 1441 (b) (West 1994), and under § 205 of the Convention, 9 U.S.C.A. § 205 (West 1999), 2 and removed to federal court. Appellants filed their removal petition more than thirty days after receiving notice of Dahiya's suit. Generally, such a delay would preclude removal. See 28 U.S.C.A. § 1446(b) (West 1994). Section 205, however, allows removal at any time prior to trial, and Dahiya does not dispute that Appellants filed their petition before trial.

Once in federal court, Appellants moved to compel arbitration and to stay the proceedings or, in the alternative, to dismiss Dahiya's suit. Dahiya moved to remand. Dahiya argued that the deed's terms did not qualify as an arbitration agreement under the Convention and therefore could not support removal under § 205.

The district court sided with Dahiya and, in a single order, remanded the case to state court and denied Appellants' motions to stay proceedings and to compel arbitration. The court began its order by assessing the validity of what it called the "forum selection clause"—-i.e., the arbitration clause in the deed between Dahiya and Neptune. The court held that this clause was invalid because forum selection clauses contravene Louisiana public policy. The court then turned directly to the question of its jurisdiction. The court began by noting that because Appellants failed to remove within thirty days, federal jurisdiction hinged entirely on § 205. With respect to jurisdiction under § 205, the court reasoned that because the deed contained no valid forum selection clause, the parties had not entered an agreement to arbitrate valid under the Convention. The court therefore concluded that it had no jurisdiction under § 205, remanded the case, and denied Appellants' pending motions.

Appellants sought review of the district court's order and moved for a stay of the the ongoing state court proceedings. Dahiya moved to dismiss for lack of appellate jurisdiction. Both motions have been carried with the case.3


Our analysis begins and ends with Dahiya's motion to dismiss, for in the absence of appellate jurisdiction, we have no authority to review the district court's order.

We cannot review the remand itself. After a district court remands a case to state court for lack of subject matter jurisdiction, 28 U.S.C. § 1447(d) bars a federal appellate court from reviewing the remand ruling "no matter how erroneous." Arnold v. State Farm Fire & Cas. Co., 277 F.3d 772, 775 (5th Cir. 2001); see 28 U.S.C.A. § 1447 (c), (d) (West 1994). The district court appears to have concluded that it lacked subject matter jurisdiction and to have remanded on that basis. Thus, under § 1447(d), we cannot review the remand.

That Appellants removed under § 205 of the Convention does not vest us with jurisdiction despite § 1447(d). In cases removed under § 205, "[t]he procedure for removal of causes otherwise provided by law shall apply." 9 U.S.C.A. § 205. This "procedure for removal" includes the strictures of § 1447(d). Transit Cas. Co. v. Certain Underwriters at Lloyd's of London, 119 F.3d 619, 624-625 (8th Cir. 1997); La Farge Coppee v. Venezolana de Cementos, S.A.C.A., 31 F.3d 70, 71-72 (2d Cir. 1994); In re Amoco Petroleum Additives Co., 964 F.3d 706, 712-13 (7th Cir. 1992). Thus, when a case removed under § 205 is subsequently remanded for lack of subject matter jurisdiction, an appellate court cannot review the order of remand.

Appellants contend that, regardless of whether we can review the remand itself, we have jurisdiction to review the district court's denial of arbitration and denial of stay under 9 U.S.C. § 16, which provides that appeals may be taken from orders refusing stays or denying motions to compel arbitration, see 9 U.S.C.A. § 16 (a) (1) (A) , (C) (West 1999). 4 We lack jurisdiction under § 16 because the denials of Appellants' motions to stay and to compel arbitration accompanied a remand for lack of subject matter jurisdiction. See Transit Cas., 119 F.3d at 623-625. Any order remanding for lack of subject matter jurisdiction necessarily denies all other pending motions, for "[u]nless a federal court possesses subject matter jurisdiction over a dispute, . . . any order it makes (other than an order of dismissal or remand) is void." John G. & Marie Stella Kenedy Mem'l Found. v. Mauro, 21 F.3d 667, 674 (5th Cir. 1994) (quoting Shirley v. Maxicare Tex., Inc., 921 F.2d 565, 568 (5th Cir. 1991)). Motions to stay proceedings and to compel arbitration will be common if not universal in cases removed under § 205. Thus, in the vast majority of cases removed under § 205, an order of remand will be the effective equivalent of a denial of motions to stay proceedings and to compel arbitration. Recognizing appellate review of such remand orders under § 16 would circumvent § 1447(d) by affording review of remand orders issued in nearly every case removed under § 205. Section 205, by expressly invoking "[t]he procedure for removal of causes otherwise provided by law," forecloses such a result.

District court determinations accompanying an order of remand are reviewable in spite of § 1447(d) if they meet the requirements first outlined in City of Waco, Texas v. United States Fidelity & Guaranty Co., 297 U.S. 140 (1934). Under Waco, a federal appeals court can review a pre-remand decision made by a district court if that decision is "separable" from the remand order and independently reviewable through a mechanism such as the collateral order doctrine. Heaton v. Monogram Credit Card Bank, 2 97 F.3d 416, 421 (5th Cir. 2002). To be separable, the decision must meet two criteria. First, the decision must have preceded the remand order "in logic and in fact" such that the decision was "made by the [d]istrict [c]ourt while it had control of the cause." Waco, 293 U.S. at 143. Second, the decision must be "conclusive," i.e., "functionally unreviewable in state courts." Arnold, 277 F.3d at 776.

The district court's refusal to compel arbitration and to stay proceedings is not reviewable under Waco because that refusal was not conclusive. Our precedent "has defined conclusiveness in terms of whether the order was 'substantive' or 'jurisdictional' : if a decision is simply jurisdictional it is not conclusive." Doleac ex rel. Doleac v. Michalson, 264 F.3d 470, 486 (5th Cir. 2001). Thus, in Soley v. First National Bank of Commerce, 92 3 F.3d 406, 410 (5th Cir. 1991), we considered whether we could review a pre-remand ruling on ERISA preemption and concluded that "because we interpret[ed] the remand order as jurisdictional, the state court [would] have an opportunity to consider the appellants' preemption defense and the district court's order [would] have no preclusive effect." Likewise, in Linton v. Airbus Industries, 30 F.3d 592, 597 (5th Cir. 1994), we considered whether we could review a district court's pre-remand rulings on foreign sovereign immunity and held that "[i]n light of the district court's ultimate conclusion that the...

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