Jefferson County v. Acker

• Decision Date: 27 March 1998
• Docket Number: No. 94-6400,94-6400
• Citation: 137 F.3d 1314
• Parties: , 11 Fla. L. Weekly Fed. C 1183 JEFFERSON COUNTY, a political subdivision of the State of Alabama, Plaintiff-Appellant, v. William M. ACKER, Jr., Defendant-Appellee. JEFFERSON COUNTY, a political subdivision of the State of Alabama, Plaintiff-Appellant, v. U.W. CLEMON, Defendant-Appellee.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1314

137 F.3d 1314

67 USLW 3567, 11 Fla. L. Weekly Fed. C 1183

JEFFERSON COUNTY, a political subdivision of the State of

Alabama, Plaintiff-Appellant, v. William M. ACKER, Jr., Defendant-Appellee.

JEFFERSON COUNTY, a political subdivision of the State of

Alabama, Plaintiff-Appellant, v. U.W. CLEMON, Defendant-Appellee.

No. 94-6400.

United States Court of Appeals, Eleventh Circuit.

March 27, 1998.

Edwin A. Strickland, Jeffrey M. Sewell, Charles S. Wagner, Birmingham, AL, for Plaintiff-Appellant.

Irwin W. Stolz, Jr., Seaton D. Purdom, Gambrell & Stolz, Atlanta, GA, for Acker and Clemon.

Kevin M. Forde, Richard J. Prendergast, Chicago, IL, amicus for Federal Judges Association.

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

Before HATCHETT, Chief Judge, TJOFLAT, ANDERSON, EDMONDSON, COX, BIRCH, DUBINA, BLACK, CARNES and BARKETT, Circuit Judges, ^* and KRAVITCH and HENDERSON ^**, Senior Circuit Judges.

COX, Circuit Judge:

The issue presented by this case is whether Jefferson County, Alabama may require Article III judges to pay a tax for the privilege of engaging in their occupation within the county. In our earlier en banc opinion ¹ we affirmed the district court's grant of summary judgment for the defendants, holding that the tax violates the Supremacy Clause of the Constitution. The Supreme Court vacated our judgment and remanded the case for reconsideration in light of its recent decision in Arkansas v. Farm Credit Services, 520 U.S. 821, 117 S.Ct. 1776, 138 L.Ed.2d 34 (1997), directing us to consider the effect of the Tax Injunction Act, 28 U.S.C. § 1341, on federal jurisdiction in this case. Upon reconsideration we hold that the district court had jurisdiction and reinstate our en banc opinion on the merits.

I. BACKGROUND ²

Jefferson County Ordinance No. 1120 imposes a tax on persons not otherwise required to pay a license or privilege tax to the State of Alabama or Jefferson County. It states in pertinent part:

It shall be unlawful for any person to engage in or follow any vocation, [etc.], within the County ... without paying license fees to the County for the privilege of engaging in or following such vocation, [etc.], which license fees shall be measured by one-half percent (1/2%) of the gross receipts of each such person.

Jefferson County, Ala., Ordinance No. 1120, § 2 (Sept. 29, 1987). Defendants William M. Acker, Jr. and U.W. Clemon are United States District Judges for the Northern District of Alabama who maintain their principal offices in Birmingham, the Jefferson County seat. They refused to pay the privilege tax, contending that the tax as applied to federal judges violates the United States Constitution. Jefferson County subsequently sued them in state court to recover delinquent privilege taxes under the ordinance. The defendants removed the cases to federal court pursuant to 28 U.S.C. § 1442(a)(3); Jefferson County moved to remand, but the motion was denied. The cases subsequently were consolidated.

The district court granted summary judgment for the defendants, holding that the legal incidence of the tax fell not upon the judges but upon the federal judicial function itself, thus constituting a direct tax on the United States in violation of the intergovernmental tax immunity doctrine. See Jefferson County v. Acker, 850 F.Supp. 1536, 1545-46 (N.D.Ala.1994) (subsequent history omitted). The district court also held that as applied to federal judges the ordinance violated the Compensation Clause of Article III. See id. at 1547-58. Jefferson County appealed, and a panel of this court reversed. See Jefferson County v. Acker, 61 F.3d 848 (11th Cir.1995) (subsequent history omitted).

On rehearing en banc, this court affirmed the district court's ruling with respect to the intergovernmental tax immunity doctrine, stating that any holding with respect to the Compensation Clause was unnecessary. See Jefferson County v. Acker, 92 F.3d 1561, 1576 (11th Cir.1996) (subsequent history omitted). With respect to the immunity issue, we concluded that although the privilege tax is measured by the income of the taxed individual, the taxable event is the performance of federal judicial duties in Jefferson County. See id. at 1572. As such, the privilege tax represents a fee that a federal judge must pay to lawfully perform his or her duties, and therefore a direct tax on the United States. See id. We further determined that Congress did not consent to such taxation; as the states may not levy a direct tax on the United States without Congress' consent, we held that the tax is unconstitutional as applied to the judges. See id. at 1573-76.

Jefferson County then filed in the Supreme Court a petition for a writ of certiorari. The Solicitor General submitted an amicus brief on behalf of Jefferson County, in which it argued that the Tax Injunction Act ("TIA"), 28 U.S.C. § 1341, barred federal jurisdiction over the case. In a brief memorandum opinion, the Supreme Court vacated our en banc judgment and remanded the case for consideration of the TIA's effect on federal jurisdiction in light of the recent decision in Arkansas v. Farm Credit Services, 520 U.S. 821, 117 S.Ct. 1776, 138 L.Ed.2d 34 (1997). Jefferson County raised the jurisdictional issue in the district court in its unsuccessful motion to remand, but on appeal did not. Therefore, this is the first time that the issue has been raised in this court. We review jurisdictional rulings and other questions of law de novo. See, e.g., McKusick v. City of Melbourne, 96 F.3d 478, 482 (11th Cir.1996).

II. DISCUSSION

A. Does the Federal Officer Removal Statute Apply?

The defendants removed this case to federal court under 28 U.S.C. § 1442(a)(3), the section of the federal officer removal statute applicable to federal court officers. Jefferson County contends that this case does not fall within the ambit of the statute, and that removal of the case to federal court was therefore improper. ³ As no other circumstances exist that would support federal court jurisdiction, improper removal would mandate dismissal. Thus, our first inquiry is to determine whether § 1442 applies.

Unlike the general removal statute (28 U.S.C. § 1441), § 1442 is a jurisdictional grant that empowers federal courts to hear cases involving federal officers where jurisdiction otherwise would not exist. See Loftin v. Rush, 767 F.2d 800, 804 (11th Cir.1985). It reads in pertinent part:

(a) A civil action or criminal prosecution commenced in a State court against any of the following persons may be removed by them to the district court of the United States for the district and division embracing the place wherein it is pending:

....

(3) Any officer of the courts of the United States, for any Act under color of office or in the performance of his duties;

28 U.S.C.A. § 1442(a)(3) (1994 & Supp.1997). The judges are "officer[s] of the courts of the United States," but removal of an action under this section requires the satisfaction of two additional requirements: (1) the defendant must establish a "causal connection between what the officer has done under asserted official authority" and the action against him, Maryland v. Soper, 270 U.S. 9, 33, 46 S.Ct. 185, 190, 70 L.Ed. 449 (1926); and (2) the defendant must advance a "colorable defense arising out of [his] duty to enforce federal law," Mesa v. California, 489 U.S. 121, 133, 109 S.Ct. 959, 966-67, 103 L.Ed.2d 99 (1989); accord Magnin v. Teledyne Continental Motors, 91 F.3d 1424, 1427-28 (11th Cir.1996). Thus, under the statute federal officers facing state law claims against them arising out of their duties may remove their cases to federal court if they advance a colorable federal defense. See Arizona v. Manypenny, 451 U.S. 232, 241-42, 101 S.Ct. 1657, 1664, 68 L.Ed.2d 58 (1981). Jefferson County argues that the judges have not satisfied either requirement.

We agree with the district court that the plain language of § 1442 is sufficiently broad to encompass this case. The Jefferson County ordinance at issue makes it "unlawful for any person to engage in ... any ... occupation ... without paying license fees to the County." Jefferson County, Ala., Ordinance No. 1120, § 2 (Sept. 29, 1987). Under official authority, Judges Acker and Clemon have "engaged in the occupation" of being United States District Judges "without paying license fees to the County," and as a result the county has sued them. There is a direct causal connection between the judges' acts under official authority and the action against them.

As for the second requirement, Jefferson County in effect urges us to reconsider our decision on the merits, contending that the judges do not have immunity from the tax and therefore have not advanced a "colorable" defense for their refusal to pay. However, § 1442 does not require the resolution of, or even a detailed inquiry into, the merits of the federal defense advanced. One of the primary purposes of § 1442 is to allow officials to have the validity of their federal defenses determined in federal court. See Willingham v. Morgan, 395 U.S. 402, 89 S.Ct. 1813, 23 L.Ed.2d 396 (1969). For removal to be proper under § 1442, "[the federal defense alleged] need only be plausible; its ultimate validity is not to be determined at the time of removal." Magnin, 91 F.3d at 1427. At the time of removal the judges' immunity defense was at least "plausible," a conclusion supported by both the district court's grant of summary judgment for the judges and this court's subsequent affirmance. We hold that the federal officer removal statute is sufficiently broad to permit removal of this case.

B. Does the Tax Injunction Act Preclude Federal Jurisdiction?

The next issue to be resolved is the effect, if any, of the Tax Injunction Act (TIA) on federal jurisdiction in this case. Before the passage of the TIA, equity practice directed federal courts to abstain in cases involving state taxation out of...