Shapiro v. Logistec Usa, Inc.

• Decision Date: 20 June 2005
• Docket Number: Docket No. 04-0733-CV.
• Citation: 412 F.3d 307
• Parties: Michael D. SHAPIRO, Ancillary Administrator of the Estate of Michael Ryckman, Plaintiff-Appellee, v. LOGISTEC USA INC. and Scott Barlow, Defendants-Third-Party-Plaintiffs-Appellants, Sherwood Lumber Corp., Third-Party-Defendant.
• Court: U.S. Court of Appeals — Second Circuit

Page 307

412 F.3d 307

Michael D. SHAPIRO, Ancillary Administrator of the Estate of Michael Ryckman, Plaintiff-Appellee, v. LOGISTEC USA INC. and Scott Barlow, Defendants-Third-Party-Plaintiffs-Appellants, Sherwood Lumber Corp., Third-Party-Defendant.

Docket No. 04-0733-CV.

United States Court of Appeals, Second Circuit.

Argued: September 15, 2004.

Decided: June 20, 2005.

Robert T. Rimmer, The Reardon Law Firm, P.C. (Robert I. Reardon, Jr., of counsel), New London, CT, for Plaintiff-Appellee.

Patrick F. Lennon, Tisdale & Lennon LLC, Southport, CT, for Defendants-Third-Party-Plaintiffs-Appellants.

Before: SACK, RAGGI, and HALL, Circuit Judges.

SACK, Circuit Judge.

We confront here the issues of 1) under what circumstances we may review a district court's order remanding a diversity action to state court, 2) when a district court may reconsider its own remand motion, and 3) when, if ever, a plaintiff will be deemed to have waived his objection to removal by filing his motion for remand after the statutory period for doing so has run. We conclude, inter alia, that a) the remand granted by the district court in this case was made pursuant to 28 U.S.C. § 1441(b), which prohibits a defendant from removing an action to federal court on the basis of diversity jurisdiction if any defendant "is a citizen of the State in which such action is brought," b) such a remand is not covered by 28 U.S.C. § 1447(c) because it is not based on lack of subject matter jurisdiction or some other defect timely raised, c) therefore, 28 U.S.C. § 1447(d), which would bar both reconsideration by the district court of its remand order and our review of such a remand order after it has become effective, does not apply, and d) the district court should have granted the motion for reconsideration and denied the motion for remand because the plaintiff waived his section 1441(b) objection to removal by making the objection after the time limit imposed by section 1447(c) had expired.

BACKGROUND

On January 13, 2003, Michael Ryckman, a truck driver from the State of Washington, was fatally injured at defendant Logistec USA Inc.'s premises in New London, Connecticut when plywood being unloaded from his truck shifted and fell on him from a forklift operated by the defendant Scott Barlow, a Logistec employee. On June 6, 2003, the plaintiff Michael D. Shapiro, as ancillary administrator of Ryckman's estate, filed a complaint against the defendants in Connecticut Superior Court. In it, the plaintiff, alleging that Ryckman's death had been caused by the defendants' negligence or recklessness, asserted a claim for compensatory and punitive damages against them. He also sought attorneys' fees and costs.

On June 25, 2003, the defendants filed a notice of removal of the Connecticut state-court litigation in the United States District Court for the District of Connecticut (Christopher F. Droney, Judge). They asserted that Ryckman had been a citizen of the State of Washington at the time of his death and that his estate was therefore deemed to be a citizen of Washington under 28 U.S.C. § 1331(c)(2), that Logistec was a Delaware corporation with its principal place of business in the State of Connecticut, and that Barlow was a citizen of Connecticut. See Defs.' Notice Removal ¶¶ 1-4. They contended that there was therefore complete diversity of citizenship among the parties under 28 U.S.C. § 1332(a). See id. ¶ 7. The defendants further alleged that the amount in controversy exceeded $75,000. See id. They asserted that because the district court would thus have had diversity jurisdiction over the action under section 1332(a) had it originally been brought in that court, removal was proper under section 1441(a), which provides that any action brought in state court over which the district court would have had original jurisdiction may be removed to the district court "embracing the place where such action is pending," 28 U.S.C. § 1441(a). See Defs.' Notice Removal ¶ 10.

More than thirty days later, on July 30, 2003, the plaintiff filed a motion in the district court objecting to defendants' removal notice. He contended that removal was forbidden by 28 U.S.C. § 1441(b), which provides that an action is not removable if brought in the home forum of any defendant. See Pl.'s Objection Defs.' Notice Removal ¶¶ 8-9. Both Barlow and, for these purposes, Logistec, see 28 U.S.C. § 1332(c)(1), were citizens of the State of Connecticut, the forum state. See Pl.'s Objection Defs.' Notice Removal ¶ 9. The district court construed the plaintiff's motion as a motion to remand, and, on October 14, 2003, granted it and ordered that the case be remanded to state court. See Shapiro v. Logistec USA Inc., No. 3:03cv1123(CFD) (D.Conn. Oct. 14, 2003) (margin order).

On October 27, 2003, the defendants filed a motion for reconsideration of the remand order. On November 12, 2003, while that motion was pending, the defendants filed a notice of appeal of the remand order. The following day, while the reconsideration motion and notice of appeal were pending, the clerk of the district court sent certified copies of the docket sheet and order of remand to the state court.¹ On November 21, 2003, the state court acknowledged receipt of the file.

On April 8, 2004, the district court denied the defendants' motion for reconsideration of the order of remand on the ground that the court lacked jurisdiction to reconsider its order under 28 U.S.C. § 1447(d), which provides that "`[a]n order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise.'" Shapiro v. Logistec USA Inc., No. 3:03cv1123(CFD) (D.Conn. Apr. 8, 2004) (ruling on motion for reconsideration) (quoting 28 U.S.C. § 1447(d)) (emphasis in the original). On April 22, 2004, the defendants filed an amended notice of appeal, which added an appeal from the order denying their motion for reconsideration to their appeal from the order of remand.

DISCUSSION

I. Jurisdiction to Review Remand Orders

As a threshold matter, we must determine whether we have jurisdiction to hear this appeal. Concluding that we do, we then address the district court's jurisdiction to review its own remand order on a motion for reconsideration.

A. Statutory Framework

1. Removal and Remand Procedures. Title 28, United States Code, section 1441 sets forth the general federal statutory provision governing removals from state to federal court. It provides that a defendant

may remove to federal court "any civil action brought in a State court of which the district courts of the United States have original jurisdiction." Id. § 1441(a). Section 1441(b) provides, however, that an action is not removable if the district court's original jurisdiction is based on diversity of citizenship and any of the defendants "is a citizen of the State in which such action is brought." Id. § 1441(b).

Once a case has been removed to federal court, a party may move to remand the case to state court. Section 1447(c) provides that "[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." Id. § 1447(c). Section 1447(c) further states that "[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded." Id. Section 1447(c) also provides that "[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." Id.

2. Authority to Review Remand Orders

a. Appellate Jurisdiction

Section 1447(d) provides that "[a]n order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise." Id. § 1447(d). Congress's purpose in thus limiting the ability of federal courts to review orders remanding cases to state court was "to prevent delay in the trial of remanded cases by protracted litigation of jurisdictional issues." Thermtron Prods., Inc. v. Hermansdorfer, 423 U.S. 336, 351, 96 S.Ct. 584, 46 L.Ed.2d 542 (1976). But "[s]ection 1447(d) is not dispositive of the reviewability of remand orders in and of itself. That section and § 1447(c) must be construed together ...." Id. at 345, 96 S.Ct. 584. "This means that only remand orders issued under § 1447(c) and invoking the grounds specified therein ... are immune from review under § 1447(d)." Id. at 346, 96 S.Ct. 584; accord Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 711-12, 116 S.Ct. 1712, 135 L.Ed.2d 1 (1996). Such remand orders are non-reviewable even if erroneous. See Thermtron, 423 U.S. at 351, 96 S.Ct. 584; accord Volvo of Am. Corp. v. Schwarzer, 429 U.S. 1331, 1332-33, 97 S.Ct. 284, 50 L.Ed.2d 273 (1976) (Rehnquist, J., Circuit Justice). Thus, "[a]s long as a district court's remand is based on a timely raised defect [other than subject matter jurisdiction] or on lack of subject-matter jurisdiction [whenever made] — the grounds for remand recognized by § 1447(c) — a court of appeals lacks jurisdiction to entertain an appeal of the remand order under § 1447(d)." Things Remembered, Inc. v. Petrarca, 516 U.S. 124, 127-28, 116 S.Ct. 494, 133 L.Ed.2d 461 (1995).

It is a question of law whether the district court based its remand order on a section 1447(c) ground. We address the question by looking to the grounds upon which the court purported to base its decision. Thus, in Carvel v. Thomas & Agnes Carvel Foundation, 188 F.3d 83 (2d Cir. 1999), we considered a remand order that the district court purported to base upon the rule set forth in Princess Lida of Thurn & Taxis v. Thompson, 305 U.S. 456, 457, 59 S.Ct. 275, 83 L.Ed. 285 (1939) (concluding that "the exercise of jurisdiction by a state court over the administration of a trust deprives a federal court of jurisdiction of a later suit involving the same subject matter"). Although in remanding the claims at issue "the...