Williams v. Beemiller, Inc.

• Decision Date: 28 May 2008
• Docket Number: Docket No. 06-4958-cv.
• Citation: 527 F.3d 259
• Parties: Daniel WILLIAMS and Edward Williams, Plaintiffs-Appellees, v. BEEMILLER, INC., doing business as Hi-Point, Charles Brown, MKS Supply, Inc., and International Gun-A-Rama, Defendants-Appellants, Kimberly Upshaw, James Nigel Bostic, Cornell Caldwell, and John Doe Traffickers 1-10, Defendants.
• Court: U.S. Court of Appeals — Second Circuit

527 F.3d 259

Daniel WILLIAMS and Edward Williams, Plaintiffs-Appellees, v. BEEMILLER, INC., doing business as Hi-Point, Charles Brown, MKS Supply, Inc., and International Gun-A-Rama, Defendants-Appellants Kimberly Upshaw, James Nigel Bostic, Cornell Caldwell, and John Doe Traffickers 1-10, Defendants.

Docket No. 06-4958-cv.

United States Court of Appeals, Second Circuit.

Argued: April 30, 2008.

Decided: May 28, 2008.

James W. Grable, Jr. (Vincent E. Doyle III, Connors & Vilardo, LLP, Buffalo, NY; Jonathan E. Lowy, Elizabeth S. Haile, Brady Center to Prevent Gun Violence, Legal Action Project, Washington, D.C., on the brief), Connors & Vilardo, LLP, Buffalo, NY, for Plaintiffs-Appellees.

Scott C. Allan (John F. Renzulli, on the brief), Renzulli Law Firm LLP, White Plains, NY, for Defendant-Appellant Beemiller, Inc. d/b/a Hi-Point Firearms.

Scott L. Braum (Timothy R. Rudd, Scott L. Braum & Associates, Ltd., Dayton, OH; Thomas J. Drury, Hedwig M. Auletta, Damon & Morey, LLP, Buffalo, NY, on the brief), Scott L. Braum & Associates, Ltd., Dayton, OH, for Defendant-Appellant Brown.

Jeffrey M. Malsch (Anthony P. Pisciotti, on the brief), Pisciotti, Malsch & Buckley, P.C., White Plains, NY, for Defendant-Appellant MKS Supply, Inc.

James J. Duggan (Troy S. Flascher, on the brief), Lustig & Brown, LLP, Buffalo, NY, for Defendant-Appellant International Gun-A-Rama, Inc.

Before: STRAUB and RAGGI, Circuit Judges, and STEIN, District Judge.^*

STRAUB, Circuit Judge:

Defendants-Appellants Beemiller, Inc., doing business as Hi-Point Firearms ("Beemiller"), Charles Brown ("Brown"), MKS Supply, Inc. ("MKS"), and International Gun-A-Rama ("Gun-A-Rama"), appeal from an order of the United States District Court for the Western District of New York (William M. Skretny, Judge), entered September 26, 2006, denying Defendants-Appellants' objections to the June 29, 2006 order by Magistrate Judge Leslie G. Foschio granting plaintiffs' motion to remand the case to New York State Supreme Court. This appeal raises the issues of whether we have jurisdiction to review a magistrate judge's order remanding a case to state court and whether a magistrate judge's authority to hear and determine pretrial matters under the Federal Magistrates Act includes the power to decide a motion to remand a case to state court. See 28 U.S.C. § 636(b)(1)(A); see also Fed.R.Civ.P. 72(a) & Advisory Committee Notes, 1983 Addition (noting that Rule 72(a) addressing district court-ordered referrals of non-dispositive matters under § 636(b)(1)(A)). For the reasons set forth below, we conclude that it does not. Accordingly, we vacate the District Court's order and remand the case to the District Court for proceedings consistent with this opinion.

FACTUAL AND PROCEDURAL BACKGROUND

This case arises from a drive-by shooting that occurred on August 16, 2003. While playing basketball in his neighborhood, Plaintiff-Appellee Daniel Williams was shot and injured by Defendant Cornell Caldwell. The police soon apprehended Caldwell, who eventually pleaded guilty to attempted assault in the first degree in Erie County Court in the State of New York. On July 28, 2005, Daniel Williams and his father commenced this action in New York State Supreme Court for the County of Erie. Plaintiffs alleged that Beemiller, MKS, and Gun-A-Rama had negligently sold or distributed the firearm used by Caldwell to shoot Williams and thus contributed to his injuries.

Claiming diversity jurisdiction and relying upon 28 U.S.C. § 1441(a)-(b), Beemiller and Brown removed the case to federal court on November 23, 2005. Shortly thereafter, written consents to removal were filed on behalf of MKS and Gun-A-Rama. Written consents were never filed on behalf of the remaining defendants. Citing defendants' failure to obtain the requisite consent to removal from all defendants, Plaintiffs moved for remand of the action to state court and for the award of costs and expenses, pursuant to 28 U.S.C. § 1447(c).

On January 4, 2006, the District Court referred all non-dispositive pretrial matters to the Magistrate Judge pursuant to 28 U.S.C. § 636(b)(1)(A). On June 29, 2006, the Magistrate Judge entered a decision and order granting Plaintiffs' motion for remand and determining that the Plaintiffs were entitled to an award of costs. In doing so, the Magistrate Judge concluded that "a motion for remand [is] not dispositive as it resolves only the question of whether there is a proper basis for federal jurisdiction to support removal and does not reach a determination of either the merits of a plaintiff's claims or defendant's defenses or counterclaims." However, the Magistrate Judge also acknowledged contrary authority on the issue and invited the District Court to treat the decision and order as a report and recommendation, if the District Court deemed it appropriate. On July 14, 2006, Defendants-Appellants timely submitted objections to the Magistrate Judge's order. In relevant part, Defendants-Appellants argued that the District Court should review the order de novo as a report and recommendation on a dispositive motion.

On September 26, 2006, the District Court entered an order denying Defendants-Appellants' objections. Upon finding that a motion for remand is considered non-dispositive, the District Court reviewed the decision and order of the Magistrate Judge and concluded that it was neither "clearly erroneous [nor] contrary to law" under Federal Rule of Civil Procedure 72(a).

On October 26, 2006, Defendants-Appellants timely filed a notice of appeal with this Court. On January 23, 2007, Plaintiffs-Appellees moved, inter alia, to dismiss the appeal pursuant to 28 U.S.C. § 1447(d), which prohibits appellate review of an order remanding a case to state court. On April 12, 2007, a panel of this Court denied the motion and directed the parties to further brief the following issues: "1) whether, under 28 U.S.C. § 636(b)(1)(A) and Fed.R.Civ.P. 72, a motion to remand a case to state court is a dispositive matter upon which a magistrate judge is unauthorized to rule without de novo review by the district court; 2) whether 28 U.S.C. § 1447(d) bars an appeal of a district court's order reviewing a magistrate judge's remand order under a clear-error-and-contrary-to-law standard of review; and 3) whether resolution of either of these two questions is dependent on resolution of the other."¹ We now consider these issues.

DISCUSSION

I. Jurisdiction to Review Remand Order

Before turning to the merits of Defendants-Appellants' appeal, we must determine whether we have jurisdiction to hear this case. A subsection of the remand statute provides that "[a]n order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise...." 28 U.S.C. § 1447(d). However, the Supreme Court has held that "[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." Thermtron Prods., Inc. v. Hermansdorfer, 423 U.S. 336, 345, 96 S.Ct. 584, 46 L.Ed.2d 542 (1976), abrogated on other grounds by Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 715, 116 S.Ct. 1712, 135 L.Ed.2d 1 (1996). Section 1447(c) provides, in relevant part:

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 under section 1446(a). If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.

28 U.S.C. § 1447(c). In interpreting these two provisions together, the Supreme Court concluded that "only remand orders issued under § 1447(c) and invoking the grounds specified therein that removal was improvident and without jurisdiction are immune from review under § 1447(d)." Thermtron, 423 U.S. at 346, 96 S.Ct. 584; see also Powerex Corp. v. Reliant Energy Servs., Inc., ___ U.S. ___, 127 S.Ct. 2411, 2415-16, 168 L.Ed.2d 112 (2007) (noting that § 1447(d) has been amended twice since Thermtron and assuming that the amendments are "immaterial to Thermtron's gloss on § 1447(d)"). Thus, § 1447(d) bars appellate review of a § 1447(c) remand order only if "a district court's remand is based on a timely raised defect in removal procedure or on lack of subject matter jurisdiction — the grounds for remand recognized by § 1447(c)." Things Remembered, Inc. v. Petrarca, 516 U.S. 124, 127-28, 116 S.Ct. 494, 496-97, 133 L.Ed.2d 461 (1995).

In contrast, if a remand order is based on non- § 1447(c) grounds, § 1447(d) poses no bar to our review. See Quackenbush, 517 U.S. at 712-15, 116 S.Ct. 1712 (concluding that appellate jurisdiction, in such circumstances, exists under 28 U.S.C. § 1291). We have applied this rule to allow our review of remand orders where the plaintiff did not challenge the subject matter jurisdiction of the district court and did not timely raise a defect in the removal procedure. See, e.g., Shapiro v. Logistec USA, Inc., 412 F.3d 307, 312-13 (2d Cir.2005) (finding jurisdiction to review district court's remand order that was based on an untimely challenge under 28 U.S.C. § 1441(b), which is a non-jurisdictional rule that prohibits removal to a forum in which a defendant is a citizen); Carvel v. Thomas & Agnes Carvel Found., 188 F.3d 83, 85-86 (2d Cir.1999) (finding jurisdiction to review district court's remand order that was based on a "prudential doctrine of abstention" not grounded in subject matter jurisdiction and where there was "no assertion of a procedural defect").

We have not previously decided whether a magistrate judge's order remanding a case to state court for lack of subject matter jurisdiction should be deemed a remand order properly grounded in § 1447(c). Two of our sister circuits have concluded that such an order is not grounded in § 1447(c) and thus § 1447(d) does not bar appellate review. See Vogel v. U.S. Office Prods. Co....