Meier v. Premier Wine & Spirits, Inc.

• Decision Date: 27 May 2005
• Docket Number: No. CV 04-4085 ADS JO.,CV 04-4085 ADS JO.
• Citation: 371 F.Supp.2d 239
• Parties: Herbert MEIER, Plaintiff, v. PREMIER WINE & SPIRITS, INC, et al., Defendants.
• Court: U.S. District Court — Eastern District of New York

371 F.Supp.2d 239

Herbert MEIER, Plaintiff, v. PREMIER WINE & SPIRITS, INC, et al., Defendants.

No. CV 04-4085 ADS JO.

United States District Court, E.D. New York.

May 27, 2005.

COPYRIGHT MATERIAL OMITTED

Patricia Byrne Blair, Zimmer, Mazzei & Blair, Esqs., Hauppauge, NY, for Plaintiff.

Paul Hugo Galligan, Seyfarth Shaw LLP, New York City, for Defendants.

MEMORANDUM AND ORDER

ORENSTEIN, United States Magistrate Judge.

Plaintiff Hebert Meier ("Meier") originally filed the instant lawsuit in New York State Supreme Court, County of Nassau. It was soon thereafter removed to this court by defendants Premier Wine & Spirits, Inc. ("Premier"), John Casano, Daniel Lorusso, David Taub, and Marc Taub. None of the plaintiff's claims assert a cause of action arising under federal law, and the parties are not citizens of diverse states. The defendants purported to remove the case not because there was federal jurisdiction over the causes of action themselves, but rather because their defense to the claims is that they are preempted by federal law, namely, Section 301 of the Labor Management Relations Act of 1947, 29 U.S.C. § 185. See Docket Entry ("DE") 1 at 2. At the initial conference on December 1, 2004, I asked the parties whether this court had subject matter jurisdiction in the absence of diversity or any cause of action asserting a claim under federal law. DE 7. I asked counsel to brief the issue and also, in light of defendants' counsel's concern that my resolution of the question might exceed my authority, also asked counsel to brief the issue of whether 28 U.S.C. § 636(b)(1)(A) permits a magistrate judge to issue an order of remand pursuant to 28 U.S.C. § 1447(c). DE 13. Having considered the parties' submissions, I find, for the reasons set forth below, that I do have authority as a magistrate judge to decide the remand issue and that no remand is warranted because this court has subject matter jurisdiction.

I. A Magistrate Judge's Authority To Order A Remand

As a threshold question, I must first determine if a magistrate judge is authorized pursuant to § 636(b)(1)(A) to issue an order remanding an improperly removed case to state court. The defendants say no, and that if I find subject matter jurisdiction is lacking I may do no more than issue a Report and Recommendation to the assigned district judge. The plaintiff has taken no position on the question.

As far as I can determine, the Second Circuit has not considered the matter, and the district courts in this circuit have not spoken with one voice. In Mahl Bros. Oil Co., Inc. v. St. Paul Fire & Marine Ins. Co., 307 F.Supp.2d 474, 478 (W.D.N.Y.2004), the district court applied the "clearly erroneous" of 28 U.S.C. § 636(b)(1)(A) in reviewing a magistrate judge's order denying remand, thereby implicitly recognizing that the magistrate had authority to issue an order rather than merely a recommendation. More explicitly, Magistrate Judge Foschio determined he had such authority in Amalgamated Local Union Number 55 v. Fibron Prods., Inc., 976 F.Supp. 192, 194 n. 1 (W.D.N.Y.1997). On the other hand, Magistrate Judge Maas concluded that he lacked authority to order a remand in H.M.S. Mech. Sys., Inc., v. Carrier Corp., 2004 U.S. Dist. Lexis 24911, *1 n. 1 (S.D.N.Y. Nov. 24, 2004).

There is a similar lack of unanimity on the question in other circuits. Most district courts to have considered this issue have found remand to be within a magistrate judge's authority under 28 U.S.C. § 636(b)(1)(A). See Johnson v. Wyeth, 313 F.Supp.2d 1272, 1272-73 (N.D.Ala.2004); Vogel v. U.S. Office Prods. Co., 56 F.Supp.2d 859 (W.D.Mich.1999), reversed, 258 F.3d 509, 515-16 (6th Cir.2001); Archdiocese of Milwaukee v. Underwriters at Lloyd's, 955 F.Supp. 1066, 1068 (E.D.Wis.1997); Delta Dental of Rhode Island v. Blue Cross & Blue Shield of Rhode Island, 942 F.Supp. 740, 744-45 (D.R.I.1996); DeCastro v. AWACS, Inc., 940 F.Supp. 692, 694-5 (D.N.J.1996); Campbell v. Int'l Bus. Machines, 912 F.Supp. 116, 118 (D.N.J.1996); Young v. James, 168 F.R.D. 24, 26-27 (E.D.Va.1996); MacLeod v. Dalkon Shield Claimants Trust, 886 F.Supp. 16, 18 (D.Or.1995); Vaquillas Ranch Co., Ltd. v. Texaco Exploration & Prod., Inc., 844 F.Supp. 1156, 1160-63 (S.D.Tex.1994); City of Jackson, Miss. v. Lakeland Lounge of Jackson, Inc., 147 F.R.D. 122, 124 (S.D.Miss.1993); Banbury v. Omnitrition Int'l Inc., 818 F.Supp. 276, 278-79 (D.Minn.1993); Searcy v. Knostman, 155 B.R. 699, 702 (S.D.Miss.1993); McDonough v. Blue Cross of Northeastern Pennsylvania, 131 F.R.D. 467, 472 (W.D.Pa.1990); Acme Elec. Corp. v. Sigma Instruments, Inc., 121 F.R.D. 26, 28 (W.D.N.Y.1988); Walker v. Union Carbide Corp., 630 F.Supp. 275, 277 (D.Me.1986); Jacobsen v. Mintz, Levin, Cohn, Ferris, Glovsky, & Popeo, P.C., 594 F.Supp. 583, 585 (D.Me.1984); but see Long v. Lockheed Missiles and Space Co., 783 F.Supp. 249, 250-51 (D.S.C.1992); Giangola v. Walt Disney World Co., 753 F.Supp. 148, 151-53 (D.N.J.1990).

On the other hand, every appellate court that has weighed the issue has determined a remand to be the functional equivalent of a dispositive order, and therefore beyond a magistrate judge's authority under 28 U.S.C. § 636(b)(1)(A). The Third Circuit appears to have been the first appellate court to employ such reasoning, and its lead was followed in the Sixth and Tenth Circuits. See In re U.S. Healthcare, 159 F.3d 142, 145-46 (3d Cir.1998); Vogel v. U.S. Office Prods. Co., 258 F.3d 509, 515-16 (6th Cir.2001); First Union Mortgage Corp. v. Smith, 229 F.3d 992, 997 (10th Cir.2000).

The circuit courts' conclusion that a remand pursuant to § 1447 is the functional equivalent of a dismissal is based on an analogy to a situation where a plaintiff simultaneously files parallel federal and state actions seeking relief for the same alleged loss. The Third Circuit reasoned that a magistrate judge would not be permitted to issue an order dismissing the federal case simply because it could describe its action as nondispositive "on the theory that ... a parallel action is pending in the state court." U.S. Healthcare, 159 F.3d at 145-46. From that assuredly correct premise, the court concluded that even without the existence of a parallel state court action, a magistrate judge's order of remand suffers the same defect because, from a practical standpoint, it likewise cuts off access to the federal court while permitting a case to go forward in the state court. Id. The Third Circuit thus held that a magistrate judge lacks authority under § 636(b)(1)(A) to remand a case to state court because such an order is "dispositive of all the claims and defenses in the case as it banishes the entire case from federal court." Id. at 146.

I respectfully disagree with that analysis, for two reasons. First, while Rule 72 of the Federal Rules of Civil Procedure conditions different types of review of a magistrate judge's order on whether the order can be characterized as "dispositive" or "nondispositive," the statute from which that rule — and the magistrate judge's authority — is derived does not use those terms. Instead, it authorizes magistrate judges "to hear and determine any pretrial matter pending before the court" except for eight specific types of motion, none of which is a motion for remand. 28 U.S.C. § 636(b)(1)(A) (emphasis added). Rule 72's references to "dispositive" and "nondispositive" orders is intended to be synonymous with the statute's language. See Fed.R.Civ.P. 72, Advisory Committee Notes.¹ The statute's plain language thus permits a magistrate to hear and determine a pretrial motion for remand under § 1447.²

Second, even assuming that a magistrate judge lacks authority to issue a "dispositive" order not listed in § 636(b)(1)(A), a remand order, unlike an order of dismissal, is not dispositive. A dismissal ends a lawsuit. The disappointed litigant may succeed in resuscitating his claim in another forum, but only by commencing a new lawsuit, because the dismissal order was dispositive of the original action. An order of remand is not the functional equivalent. It neither disposes of the merits of a party's claim nor terminates the party's ability to seek such a disposition; most importantly, it in no way ends the litigation, not even conditionally. To the contrary, a remand order guarantees that a pending lawsuit will continue, albeit in a different forum. Indeed, a remand to state court under 28 U.S.C. § 1447 of an action previously removed to federal court under 28 U.S.C. § 1441 is in an important sense precisely the opposite of an order of dismissal: whereas the latter ends the parties' lawsuit altogether, the former restores it to its original status as an active case in a state court.

In that sense, an order of remand is comparable to an order transferring venue under 28 U.S.C. § 1404: both preclude a party from obtaining relief in its chosen forum, but both ensure that the litigation will continue. In both cases, after the order takes effect, the parties simply pick up where they left off before the order was entered; no new pleading is needed because no previously existing pleading has been nullified by virtue of the order. Thus for the same reason that a magistrate judge's authority includes the power to order a transfer of venue, see, e.g., Shenker v. Murasky, 1996 WL 650974 (E.D.N.Y. Nov.6, 1996); Michelli v. City of Hope, 1994 WL 410964, *6 n. 1 (S.D.N.Y. Aug. 4, 1994) (citing cases), it should also be understood to encompass the power to order a remand pursuant to § 1447.³

Having determined that a magistrate judge is empowered to remand an improvidently removed case pursuant to 28 U.S.C. § 1447(c), I turn to the question of whether such a remand is warranted in this case.

II. Remand

A case must be remanded to state court "[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction." Vera v. Saks & Co., 335 F.3d 109, 113 (2d Cir.2003) (quoting 28 U.S.C. § 1447(c)). Because...