Monday, March 21, 2011
In a decision issued earlier this month, the Eighth Circuit considered the deadline for seeking a remand to state court based on the “Local Controversy” exception to jurisdiction under the Class Action Fairness Act (CAFA). See 28 U.S.C. § 1332(d)(4). The case is Graphic Communications v. CVS Caremark, No. 11-1067 (Mar. 11, 2011), 2011 WL 855672, 2011 U.S. App. LEXIS 4747. The defendant argued that the plaintiffs' remand motion, filed more than three months after removal to federal court, was untimely under 28 U.S.C. § 1447(c), which provides: “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.”
The unanimous opinion, authored by Judge Kermit Edward Bye, reasoned that the Local Controversy exception “operates as an abstention doctrine, which does not divest the district court of subject matter jurisdiction.” But the court also held that the applicability of CAFA’s Local Controversy exception “was not a ‘defect’ within the meaning of section 1447(c).” Therefore, § 1447(c)’s 30-day deadline did not apply either.
So what is the deadline? The court explained: “[T]he mere fact that the statutory time limitation on raising motions to remand does not apply does not mean that non-1447(c) remands are necessarily authorized at any time. Indeed, we do not believe the applicable time limitation for the instant motion to remand is equivalent to the anytime-before-judgment (or even on appeal) standard applicable for subject matter jurisdiction.” Instead, a motion to remand based on the local controversy exception must be “brought within a reasonable time frame,” which is the standard “for remands not covered by § 1447(c).” The Eighth Circuit sent the case back to the district court to resolve whether the plaintiffs had filed their remand motion within a “reasonable time frame.”
(Hat Tip: Scott Dodson)