LaGrotte v. Simmons Airlines Inc ( 2001 )

UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 99-11405
MICHAEL LaGROTTE,
Plaintiff-Appellee,
v.
SIMMONS AIRLINES, INC., Individually and Doing Business as
AMERICAN EAGLE, CLIFF KLIESLING, and JACK B. SHATTUCK,
Defendants-Appellants.
Appeal from the United States District Court
for the Northern District of Texas
(3:99-CV-2652-G)
February 13, 2001
Before GARWOOD, PARKER, and DENNIS, Circuit Judges.
PER CURIAM:*
Appellants appeal the district court’s order remanding this
action to state court and imposing costs and attorney fees based on
bad-faith removal. Although the order could have been more
precise, we nonetheless conclude that we lack jurisdiction to
review the merits of the remand order. In addition, we vacate the
*
Pursuant to 5TH CIR. R. 47.5, the Court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
finding of bad-faith removal and affirm the remainder of the order
imposing costs and expenses, including attorney fees, under 28
U.S.C. § 1447(c). We deny all pending motions as moot.
I.
Appellee, a former airline pilot employed by Appellants,
originally brought this action in state court alleging various
state-law claims against Appellants for a variety of incidents
culminating in Appellants’ discharge of Appellee in December 1996,
for his refusal to fly in bad weather conditions. Appellee
specifically alleged causes of action for wrongful discharge,
promissory estoppel, breach of contract, negligent
misrepresentation, and intentional infliction of emotional
distress.
On May 29, 1997, Appellants removed the action to the district
court, asserting complete preemption under the Railway Labor Act
(“RLA”), 45 U.S.C. §§ 151-188, and the Airline Deregulation Act
(“ADA”), 49 U.S.C. § 41713. Notwithstanding the absence of any
federal question presented in Appellee’s complaint, Appellants
claimed that federal question jurisdiction per 28 U.S.C. § 1331existed because the complaint involved the interpretation of the
collective bargaining agreement (“CBA”) governing Appellee’s
employment relationship with Appellants. Appellants argued that
such interpretation completely preempted Appellee’s claims under
the RLA, 45 U.S.C. § 184, or otherwise his claims were preempted by
the ADA. Plaintiff filed a motion to remand on June 27, 1997, and
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the district court granted the motion and remanded the action to
state court on March 16, 1998.
Eleven days before trial in state court, Appellee filed a
motion in limine to exclude certain evidence Appellants sought to
use to limit Appellee’s recovery of damages. The motion alleged
that the evidence should be excluded in light of the terms of the
CBA. Believing that this reference to the CBA by Appellee made the
action removable under 28 U.S.C. § 1446(b), Appellants filed a
second notice of removal in the district court the next business
day, November 22, 1999.
On that same day Appellee filed an emergency motion to remand,
seeking to remand the action back to state court so that the
existing trial setting there could be maintained. The district
court entered an order a few hours later granting Appellee’s motion
to remand, remanding the action to state court, and imposing costs
and attorney fees per § 1447(c). Appellants filed a motion for
reconsideration of the order, which the district court denied, and
a petition for a writ of mandamus, which we denied. Then
Appellants timely appealed the district court’s order.
II.
A.
The initial question before us is whether we have jurisdiction
to review the district court’s remand order. Section 1447 provides
in relevant part:
(c) A motion to remand the case on the basis of any
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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. . . .
(d) An order remanding a case to the State court from
which it was removed is not reviewable on appeal or
otherwise. . . .
Section 1447(d) “must be read in pari materia with § 1447(c), so
that only remands based on grounds specified in § 1447(c) are
immune from review under § 1447(d)." Quackenbush v. Allstate Ins.
Co., 517 U.S. 706, 711 (1996); Things Remembered, Inc. v. Petrarca,
516 U.S. 124, 127 (1995); Thermtron Prods., Inc. v. Hermansdorfer,
423 U.S. 336, 343 (1976). Thus, remand orders based on a defect in
removal procedure or lack of subject matter jurisdiction are not
reviewable on appeal or otherwise. See Quckenbush, 517 U.S. at
711; Smith v. Texas Children's Hosp., 172 F.3d 923, 925 (5th Cir.
1999). Section 1447(d) “prohibits review of all remand orders
issued pursuant to § 1447(c) whether erroneous or not.” Thermtron
Prods., Inc., 423 U.S. at 343; Smith, 172 F.3d at 925. However,
when a remand order is not based on a defect in removal procedure
or lack of subject matter jurisdiction, we have jurisdiction to
review the order on appeal. See In re Excel Corp., 106 F.3d 1197,
1200 (5th Cir.) (per curiam), cert. denied, 522 U.S. 859 (1997).
Appellants argue that we have jurisdiction because the
district court did not base remand on a lack of subject matter
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jurisdiction or other defect in removal procedure. Appellants
specifically argue that the district court based remand on a “per
se rule barring successive appeals.” Because such rule is not a
ground within § 1447(c), Appellants argue that we have jurisdiction
to review the remand order.
We disagree. We conclude that the district court based its
remand order on lack of subject matter jurisdiction under §
1447(c). In ordering remand, the district court stated that “[a]
second removal on the same ground previously urged is not
authorized,” R. at 72 (emphasis added). This statement merely
invoked the general principle that “once a case is remanded to
state court, a defendant is precluded only from seeking a second
removal on the same ground.” S.W.S. Erectors, Inc. v. Infax, Inc.,
72 F.3d 489, 493 (5th Cir. 1996). Subsequent or successive
removals are not per se barred. Id.; cf. § 1446(b). Although the
district court’s order could have been more precise, in light of
the first remand order, which remanded based on a lack of subject
matter jurisdiction, the only rational interpretation of the second
remand order is that it was based on a lack of subject matter
jurisdiction because the district court concluded that the second
notice of removal alleged the same ground for removal--RLA
preemption-–as the first notice of removal. Moreover, the district
court rejected Appellants’ basis for removal jurisdiction “on the
merits.” R. at 72 n.*. Therefore, we lack jurisdiction to review
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the propriety of the remand order.
B.
However, we do have jurisdiction over the district court’s
order of sanctions finding bad-faith removal and imposing costs and
attorney fees under § 1447(c). See Miranti v. Lee, 3 F.3d 925,
927-28 (5th Cir. 1993). Because costs and expenses, including
attorney fees, under § 1447(c) may not be automatically awarded
whenever remand is authorized, we review orders imposing such
awards for abuse of discretion. Valdes v. Wal-Mart Stores, Inc.,
199 F.3d 290, 292 (5th Cir. 2000). Whether discretion was abused
depends upon the “propriety of the removing party's actions based
on an objective view of the legal and factual elements in each
particular case.” Id. at 293.
Appellants argue that the district court abused its discretion
in entering its sanctions order. Specifically, Appellants argue
that the district court failed to provide them with notice and
opportunity to be heard by entering the order without allowing
Appellants an opportunity to respond to Appellee’s emergency
motion. In addition Appellants argue that sanctions were not
warranted because they properly removed the action in light of
Appellee’s motion in limine.
We disagree. Although we find that the district court erred
in concluding that Appellants removed this action in bad faith, it
was within its discretion in imposing costs and attorney fees. An
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award of costs and expenses under § 1447(c) is permitted without a
finding of bad faith as long as the award is objectively justified.
See id. at 292 (“[T]he district court may award fees even if
removal is made in subjective good faith.”). If the district court
had ordered the award pursuant to FED. R. CIV. P. 11 or its inherent
powers, Appellants’ arguments may be more persuasive. Although it
may have been better practice to allow Appellants to respond to the
motion to remand, Appellants nonetheless had an opportunity to
state its basis for removal in their second notice of removal, and
also had an opportunity to advance its arguments in its petition
for a writ of mandamus and in this appeal. Cf. Ackerman v. FDIC,
973 F.2d 1221, 1225-26 (5th Cir. 1992) (noting that the opportunity
to be heard was satisfied on appeal). Moreover, § 1447(c) gives
notice that the district court “shall” remand an action for lack of
subject matter jurisdiction at any time. See Wisconsin Dep’t of
Corrections v. Schacht, 524 U.S. 381, 392 (1998); cf. Henderson v.
Dep’t of Pub. Safety and Corrections, 901 F.2d 1288, 1293-94 (5th
Cir. 1990) (discussing imputed notice of Rule 11).
Finally, the district court did not abuse its discretion in
awarding costs and fees because Appellants’ second removal was not
objectively reasonable in light of the facts of this action. The
district court had concluded in the first remand order that
Appellants failed to prove that Appellee’s claims were preempted by
the RLA and ADA. When Appellee filed his motion in limine in state
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court, he merely alleged that the CBA precluded Appellants from
introducing a particular item of evidence to minimize their
damages. Such tangential reference to the CBA does not mean that
his claims were preempted by the RLA so as to support removal
jurisdiction in the district court. See Anderson v. American
Airlines, Inc., 2 F.3d 590, 596 (5th Cir. 1994) (holding that a
state-law retaliation claim is not preempted by the RLA simply
because it relies on the CBA to support its credibility); cf.
Hawaiian Airlines, Inc. v. Norris, 512 U.S. 246, 257-58 (1994)
(“[S]ubstantive protections provided by state law, independent of
whatever labor agreement might govern, are not pre-empted under the
RLA.”).
III.
For the foregoing reasons, we conclude that we lack
jurisdiction under 28 U.S.C. § 1447(c) to review the remand order.
In addition, the district court’s finding of bad-faith removal is
VACATED. The remainder of the order imposing costs and expenses,
including attorney fees, under § 1447(c) is AFFIRMED. All pending
motions are DENIED AS MOOT.
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