Scott Schmidt v. Walworth County, Wisconsin ( 2019 )

NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with Fed. R. App. P. 32.1
United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Submitted November 21, 2019*
Decided November 27, 2019
Before
DIANE P. WOOD, Chief Judge
FRANK H. EASTERBROOK, Circuit Judge
DANIEL A. MANION, Circuit Judge
No. 19-2032
SCOTT R. SCHMIDT, Appeal from the United States District
Plaintiff-Appellant, Court for the Eastern District of
Wisconsin.
v. No. 19-C-0099
WALWORTH COUNTY, et al., Lynn Adelman,
Defendants-Appellees. Judge.
ORDER
Scott Schmidt appeals the denial of his costs and expenses as part of an otherwise
successful motion to remand his case to state court. See 28 U.S.C. § 1447(c). His
complaint invokes Wisconsin law, as well as 42 U.S.C. § 1983 and several clauses of the
United States Constitution. Because the purported federal claims gave the defendants a
reasonable basis to seek removal, the district court reasonably denied Schmidt his costs
and expenses, so we affirm.
* We have agreed to decide this case without oral argument because the briefs
and record adequately present the facts and legal arguments, and oral argument would
not significantly aid the court. FED. R. APP. P. 34(a)(2)(C).
No. 19-2032 Page 2
Schmidt’s complaint primarily asserts that Wisconsin officials violated state law
when enforcing a state-court judgment against him. According to Schmidt, a Wisconsin
circuit court entered a judgment against him for unpaid debts arising from a prior
criminal case and certified the judgment to Wisconsin’s Department of Revenue. The
Department then, contrary to state law, drew funds from two of his bank accounts to
satisfy the judgment. In his complaint, citing 42 U.S.C. § 1983, he also asserts that these
officials violated the “Equal Protection” and “Ex Post Facto” clauses of the Constitution
and “Due Process of Law.”
The defendants removed the case to federal court. They asserted that the
complaint presented a federal question under 42 U.S.C. § 1983 because Schmidt alleged
several violations of the Constitution. Schmidt moved to remand, arguing that not all
defendants consented to the removal and that his claims arose under state law. He also
moved for his expenses and costs, contending that the defendants lacked an objectively
reasonable basis for removal.
The district court granted Schmidt’s motion to remand but denied the motion “in
all other respects.” In doing so, it referenced an earlier order explaining that Schmidt
did not allege federal claims under any of the three constitutional clauses detailed in his
complaint. Violations of state law are not themselves violations of federal due process;
Schmidt did not allege he was part of a class covered by the equal-protection clause;
and the ex post facto clause does not apply to collecting criminal judgments. The court
added that the Rooker-Feldman doctrine likely blocked some of these claims, too.
See Exxon Mobil Corp. v. Saudi Basic Indus., 544 U.S. 280, 284 (2005). The district court did
not address the consent issue because, without subject-matter jurisdiction, it correctly
decided that it had to remand the case. See 28 U.S.C. § 1447(c).
Schmidt appeals the denial of his costs and expenses. He argues that because in
its remand order the district court never articulated why it denied his request for costs
and expenses, it violated Circuit Rule 50 and thus abused its discretion. But even if
Circuit Rule 50 applies to the ruling on Schmidt’s motion, this court may still evaluate
the ruling when the “reasons are apparent from the record.” Ross Bros. Constr. Co. v. Int’l
Steel Servs., Inc., 283 F.3d 867, 872 (7th Cir. 2002) (quoting United States v. Ettrick Wood
Prods., Inc., 916 F.2d 1211, 1218 (7th Cir. 1990); see also Wolf v. Kennelly, 574 F.3d 406,
410–11 (7th Cir. 2009). The cases Schmidt cites are distinguishable because in those cases
we could glean no reasons from the record for the district courts’ remand decisions.
Compare In re Shell Oil Co., 966 F.2d 1130, 1132 (7th Cir. 1992) (remanding where court
had “no idea” of reasons underlying decision to remand), and Louis Vuitton, S.A. v.
No. 19-2032 Page 3
K-Econo Merch., 813 F.2d 133, 134–35 (7th Cir. 1987) (same, regarding findings of fact
and law after bench trial), with In re Amoco Petrol. Additives Co., 964 F.2d 706, 707–09 (7th
Cir. 1992) (noting lack of reasons in remand order but inferring from record).
The court’s reasons for denying the request for costs and expenses are both
apparent from the ruling that preceded the remand order and proper. In the briefing
before the district court, Schmidt correctly stated that a district court may, upon
remanding a case, award costs under 28 U.S.C. § 1447(c) “only where the removing
party lacked an objectively reasonable basis for seeking removal.” Martin v. Franklin
Cap. Corp., 546 U.S. 132, 141 (2005); see also Lott v. Pfizer, Inc., 492 F.3d 789 (7th Cir. 2007).
Thus the court was aware of the standard. It is also apparent from the earlier ruling that
the district court properly applied that standard. It determined that the defendants had
a reasonable basis to seek removal because the complaint named three federal-law bases
for removal. See 28 U.S.C. §§ 1331, 1441(a). Although the court analyzed each asserted
federal basis and decided that none stated a valid claim, the naming of the three in the
complaint gave the defendants reasonable grounds to seek removal.
Finally, Schmidt argues that the defendants’ lack of unanimous consent to
removal was itself an unreasonable basis for removal. But this argument conflates the
proper procedure for removal with removal jurisdiction. Compare 28 U.S.C. § 1446(b)
(describing procedure), with 28 U.S.C. § 1441(a) (describing jurisdiction). Only the
objective absence of the latter can justify an award of costs. See Martin, 546 U.S. at 141.
As we have just explained, the complaint presented an apparent ground for removal
jurisdiction and therefore a legitimate reason to deny an award of costs and expenses.
AFFIRMED