Harrisson v. NCL (Bahamas) Ltd.

• Decision Date: 22 August 2012
• Docket Number: No. 11–12179.,11–12179.
• Citation: 23 Fla. L. Weekly Fed. C 1458,691 F.3d 1308
• Parties: Erikson HARRISSON, Plaintiff–Appellee, v. NCL (BAHAMAS) LTD., d.b.a. NCL, Defendant–Appellant.
• Court: U.S. Court of Appeals — Eleventh Circuit

691 F.3d 1308

23 Fla. L. Weekly Fed. C 1458

Erikson HARRISSON, Plaintiff–Appellee,

v.NCL (BAHAMAS) LTD., d.b.a. NCL, Defendant–Appellant.

No. 11–12179.

United States Court of Appeals, Eleventh Circuit.

Aug. 22, 2012.

Paul Brown Feltman, Alvarez, Carbonell, Feltman, Jimenez & Gomez, LLC, Coral Gables, FL, Peter P. Sotolongo, Sotolongo, PA, Miami, FL, for Plaintiff–Appellee.

Valentina M. Tejera, Mase Lara Eversole, PA, Geoffrey Edward Probst, Norwegian Cruise Lines, Inc., Miami, FL, for Defendant–Appellant.

Appeal from the United States District Court for the Southern District of Florida.

Before CARNES, BARKETT and HILL, Circuit Judges.

BARKETT, Circuit Judge:

Erikson Harrisson, a former seaman employee of NCL (Bahamas) Ltd. (“NCL”), was injured on the job and sued NCL in Florida state court claiming that NCL was negligent under the Jones Act, 46 U.S.C. § 30104, ¹ and failed to provide maintenance and care as required by U.S. maritime law. NCL, noting that Harrisson's employment contract required the parties to submit disputes to arbitration, removed the case to federal district court under 9 U.S.C. § 205, which permits removal where “the subject matter of an action or proceeding pending in a State court relates to an arbitration agreement or award falling under” the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “Convention”). 9 U.S.C. § 205. ² After the removal, the district court in a single order denied NCL's motion to enforce the arbitration clause on the basis that the arbitration clause was void under the Convention for violating public policy and remanded the matter back to state court. NCL appeals this order.

Harrisson moves to dismiss NCL's appeal arguing that by concluding that the arbitration clause was null and void and thus no longer a basis for jurisdiction, the district court dismissed the case for lack of subject-matter jurisdiction. Therefore, Harrisson argues that pursuant to 28 U.S.C. § 1447(d) we are precluded from reviewing the order remanding the case to state court. 28 U.S.C. § 1447(d) provides:

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.³

In Thermtron Products, Inc. v. Hermansdorfer, the Supreme Court limited § 1447(d) to remands based on the grounds specified in 28 U.S.C. § 1447(c), which are a lack of subject-matter jurisdiction or a defect in the removal procedure. 423 U.S. 336, 342–44, 96 S.Ct. 584, 46 L.Ed.2d 542 (1976); 28 U.S.C. § 1447(c), (d).⁴

NCL argues that § 1447(d) does not apply because we should construe the remand as based on the district court's interpretation of a contract clause and not on based on the district court lacking subject-matter jurisdiction. Alternatively, NCL argues that even if § 1447(d) applies, we can review the denial of the motion to compel arbitration based on exceptions to the rule of § 1447(d).

Discussion

Section 1447(d) generally prevents an appellate court from reviewing a district court's order remanding a case back to state court for a lack of subject-matter jurisdiction, “even if the district court's decision is clearly erroneous.” New v. Sports & Recreation, Inc., 114 F.3d 1092, 1096 (11th Cir.1997); see also Kircher v. Putnam Funds Trust, 547 U.S. 633, 642, 126 S.Ct. 2145, 165 L.Ed.2d 92 (2006) (same). Likewise, 28 U.S.C. § 1447(d) also generally bars our review of the district court's determinations related to a remand based on a lack of jurisdiction, because upon determining a lack of jurisdiction, the district court “has no jurisdiction to touch the case on the merits.” Kircher, 547 U.S. at 644, 126 S.Ct. 2145.

However, the parties focus on two exceptions to this statutory bar. First, we are permitted to review a remand order that is based on grounds other than a lack of jurisdiction or a defect in the removal procedure. Thermtron, 423 U.S. at 342–44, 96 S.Ct. 584;see also Sammie Bonner Const. Co., Inc. v. Western Star Trucks Sales, Inc., 330 F.3d 1308, 1311–12 (11th Cir.2003). Second, we may review orders “that lead to, but are separate from, orders of remand and have a conclusive effect upon the ensuing state court action.” Aquamar S.A. v. Del Monte Fresh Produce, 179 F.3d 1279, 1286 (11th Cir.1999).⁵

Relying on Snapper, Inc. v. Redan, NCL argues that this case falls under the first exception, contending that the district court did not remand for a lack of subject-matter jurisdiction. 171 F.3d 1249 (11th Cir.1999). We find Snapper completely inapposite.⁶ The Snapper defendants removed their case based on diversity jurisdiction, which was never contested, and the district court remanded back to state court after it determined that the forum selection clause in the contract waived their right to removal. Id. at 1251–52. In permitting appellate review, we explained that “the federal court has held the parties to the terms of their agreement, as with any other contractual adjudication.” Id. at 1253. Thus, the district court in Snapper had, and never lost, jurisdiction to hear the case, but ruled only that removal was improper based on the language of the contract. In contrast here, the court reviewed the arbitration clause to determine if it provided any basis for the district court's jurisdiction in the first place. After finding that the arbitration clause was null and void under the Convention, the district court lacked any jurisdictional basis and thus remanded the case to the state court.⁷

Even if we find that the district court remanded for a lack of jurisdiction, NCL contends that the remand is separate from the denial of the motion to compel arbitration and that we can review the denial, pursuant to City of Waco v. United States Fidelity & Guaranty Co., 293 U.S. 140, 143–44, 55 S.Ct. 6, 79 L.Ed. 244 (1934). Under Waco, courts may review an interlocutory appeal of an order that is considered (1) “separable” from the remand order, and (2) has a “conclusive effect” upon the subsequent court action. Aquamar, 179 F.3d at 1286;see also Waco, 293 U.S. at 143–44, 55 S.Ct. 6 (permitting appellate review of a dismissal of a cross-complaint that preceded a remand based on a lack of diversity jurisdiction).

We find the order not to be “conclusive” under Waco. An order is conclusive pursuant to Waco only if it will be “functionally unreviewable in the state court, and it changes the contours of the state court action after remand.” Hernandez, 334 F.3d at 1241 (internal quotations and citations omitted). Under similar facts to those before us, the Fifth Circuit in Dahiya v. Talmidge International, Ltd. held that the doctrine in Waco does not permit review of a denial of the motion to compel arbitration prior to a remand for a case removed under § 205, in part, because the denial was made “in the process of remanding a case for lack of jurisdiction, [and thus] that determination is jurisdictional and can be revisited by a state court upon remand.” 371 F.3d 207, 211 (5th Cir.2004). Collateral estoppel does not bar the state court from revisiting the claim because “§ 1447(d) prevents the [appellants] from appealing the District Court's decision.” Kircher, 547 U.S. at 647, 126 S.Ct. 2145.

Here, the district court's analysis of the arbitration clause was limited to the question of whether the clause was valid for purposes of subject matter jurisdiction. The denial of the motion to compel arbitration does not preclude the state court from reconsidering that question de novo and freely determining whether the arbitration clause is valid. See id. at 647, 126 S.Ct. 2145 (noting that state courts are “perfectly free to reject the remanding court's reasoning”); In re Loudermilch, 158 F.3d at 1146 (same); see also City of Oldsmar v. State, 790 So.2d 1042, 1046 n. 4 (Fla.2001) (noting that, under Florida law, collateral estoppel applies only when a matter has been “fully litigated and determined in a contest that results in a final decision of a court of competent jurisdiction”).⁸

For the foregoing reasons, we grant Harrisson's motion to dismiss NCL's appeal for lack of jurisdiction.

DISMISSED FOR LACK OF JURISDICTION.

HILL, Circuit Judge, dissenting:

I dissent.

I disagree with the majority decision to dismiss this appeal for lack of jurisdiction.

We have appellate jurisdiction to review the district court's order denying NCL's motion to compel arbitration under the Convention. That part of the order is immediately appealable under 9 U.S.C. § 16(a)(1)(C), and made applicable to the Convention by 9 U.S.C. § 208.

Here the district court erred in refusing to order arbitration. Its substantive finding that NCL's agreement to arbitrate was unenforceable was based upon Thomas v. Carnival Corp., 573 F.3d 1113 (11th Cir.2009). Subsequently, this court, in Lindo v. NCL (Bahamas) Ltd., 652 F.3d 1257 (11th Cir.2011), found Thomas to be inconsistent with Bautista v. Star Cruises, 396 F.3d 1289 (11th Cir.2005) and now states the law of the circuit Lindo, 652 F.3d at 1277–78.¹

The district court's remand order was based upon its interpretation of the meaning of a choice-of-law or forum selection clause; this is a reviewable decision, external to the removal process. See Snapper Inc. v. Redan, 171 F.3d 1249, 1252–53 (11th Cir.1999); Cunningham v. Fleetwood Homes of Ga., 253 F.3d 611, 617 (11th Cir.2001) (“[a]greements to arbitrate are essentially forum-selection clauses”); Pelleport Investors, Inc. v. Budco Quality Theatres, Inc., 741 F.2d 273, 276–77 (9th Cir.1984); see also28 U.S.C. § 1447(c) and (d).

The majority erroneously finds that “the district court's analysis of the arbitration clause was limited to the question of whether the clause was valid for purposes of subject matter jurisdiction.” Here the district court clearly conducted two distinct substantive analyses: (1) that the...