Southwestern Bell Tel. Co., In re, 76-2237

• Decision Date: 12 November 1976
• Docket Number: No. 76-2237,76-2237
• Citation: 542 F.2d 297
• Parties: In re SOUTHWESTERN BELL TELEPHONE COMPANY, American Telephone and Telegraph Company, and C. L. Todd, Petitioners.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 297

542 F.2d 297

In re SOUTHWESTERN BELL TELEPHONE COMPANY, American

Telephone and Telegraph Company, and C. L. Todd,

Petitioners.

No. 76-2237.

United States Court of Appeals, Fifth Circuit.

Nov. 12, 1976.

Jack Hebdon, Green & Kaufman, Inc., Hubert W. Green, James E. Barden, San Antonio, Tex., Dewey, Ballantine, Bushby, Palmer & Wood, Leonard Joseph, New York City, for petitioners.

Adrian A. Spears, U. S. Dist. Court Chief Judge, Pat Maloney, San Antonio, Tex., for Gravitt.

On Petition for Writ of Mandamus to the United States District Court for the Western District of Texas.

Before BROWN, Chief Judge, GEWIN, AINSWORTH, GODBOLD, DYER, CLARK, RONEY, GEE, TJOFLAT and HILL, Circuit Judges. ^*

PER CURIAM:

The court en banc affirms the decision of the panel on the basis of the panel opinion except as follows.

It is starkly revealed to the court en banc that plaintiffs do not make any real contentions of fact. They make no claim that Southwestern is not a Missouri corporation or that its principal place of business is not in Missouri. Their claim is one of law rather than fact. Standing squarely on the estoppel theory advanced by them in the District Court and adopted by that court, they say that Southwestern is barred from asserting the undisputed facts as a basis for federal jurisdiction. For reasons set out in the panel opinion, that proposition of law is erroneous. ¹

With the case thus clarified, it now appears that there is no occasion to direct the District Court to inquire further into the diversity issue.

As modified, the decision of the panel if AFFIRMED. A writ of mandamus will issue directing the District Court to vacate its remand order.

HILL, Circuit Judge, with whom CLARK, Circuit Judge, joins (dissenting):

It has well and truly been said that "Hard cases make bad law." ¹ My respected brother on the district court and my respected brothers comprising the majority of the court today seem to take that statement as a mandate. I view it as a warning. Therefore, I must respectfully dissent.

There is no universal definition of a "hard" case as contemplated by the maxim quoted above. I submit that the court faces a "hard" case whenever the judge of the court has the power to order that which he believes to be right and, yet, he does not have the authority to issue the order. The restraint then required leaves the wrong result undisturbed.

As presented in the district court, this case qualified as a "hard" case under my suggested definition. The action was commenced in state court against two corporate defendants and an individual. The individual defendant was a citizen of the forum state. On the eve of trial plaintiff's counsel reflected upon his situation. Like Aesop's fabled pup who dropped his bone to grab one seen in reflection, plaintiff discarded his built-in immunity from the "danger" of removal in order to seize the exquisite pleasure of proceeding against only corporate defendants. Before the ripples in the pool made by the dropping of the individual defendant had subsided, plaintiff found his case in the federal district court.

The district judge felt that the case never should have been in his court. It had arrived only through accident. Although ready for trial under state procedures, additional discovery available in the federal court demanded extensive new pretrial activity. Nevertheless, the district judge refused to disregard the law and serve his own yearnings, and he forthrightly declined to order remand of the case absent a valid motion upon valid grounds. ²

Ultimately, plaintiff filed a motion for remand, asserting that complete diversity of citizenship did not exist between plaintiff on the one hand and defendants on the other. In support, plaintiff presented what appears to have been rather significant evidence. The defendant Southwestern Bell Telephone Company, whose non-Texas citizenship was necessary for complete diversity, had theretofore filed a sworn pleading in a Texas state proceeding asserting that it was a Texas corporation and resident of Dallas. The district court decided the issue on a motion to remand based upon the evidence before him. The sworn statement by the corporate defendant was before the court. The court declined to hear contrary evidence from the defendant, citing the common law doctrine of judicial estoppel. Based, therefore, upon the evidence before the court, and limited to the evidence which the court was willing to accept, the district judge held that complete diversity of citizenship was lacking and the case had been "improperly removed" and ordered it remanded to the state court. ³

This mandamus action by the defendant followed.

In this court the case again meets my suggested test for a "hard" case. The district court had, it was felt, dealt rather harshly with the contentions of the defendant and his invocation of judicial estoppel seemed overdone for even such a time-honored principle. It appeared that the issue had been decided incorrectly. This court has sufficient power under our system to order that the result be changed. Yet, I submit, this court does not have the authority to issue such an order.

The Congress is empowered to define the jurisdiction of our court. ⁴ In its exercise of that constitutional power, it has declared that this court may not review an order of remand. Title 28 U.S.C.A. § 1447(d) provides, in pertinent part:

"An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, . . ."

The unique case of Thermtron Products, Inc. v. Hermansdorfer, 423 U.S. 336, 96 S.Ct. 584, 46 L.Ed.2d 542 (1976) is no authority for the review of the remand order in this case. As I view it, the Supreme Court in Thermtron defined only one boundary to the prohibition of review by the circuit courts. It held that § 1447(d) must be read in conjunction with 28 U.S.C. § 1447(c) which provides:

"If at any time before final judgment it appears that the case was removed improvidently and without jurisdiction, the district court shall remand the case, and may order the payment of just costs."

The facts present in Thermtron were unprecedented. The trial judge had held that the case was properly removed and that it was within the jurisdiction of the district court. He specifically did not find that the case "was removed improvidently and without jurisdiction". He nevertheless ordered the case remanded to the state court because, among other reasons, he felt that the docket in the district court was overcrowded. The Supreme Court did not hold that a finding of a district court that a case had been removed improvidently and without jurisdiction was subject to review. It merely held that a district court has no authority in the law to order a remand other than pursuant to a finding that the case had been removed improvidently and without jurisdiction. The district court is limited in its authority to order remand just as the circuit court is limited in its authority to review. It may only order remand pursuant to § 1447(c). In Thermtron the court said:

"It is unquestioned in this case and conceded by petitioners th...