Tuesday, January 27, 2009

5th Circuit holds district court's remand order under 1367(c) reviewable

In Brookshire Brothers Holding, Inc. v. Dayco Products, Inc., No. 07-31154, 2009 WL 22876 (5th Cir. January 6, 2009), the Fifth Circuit held that a district court's order of remand based on 28 USC § 1367(c) is reviewable. 

Section 1447(d) provides that an "order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise."  The Fifth Circuit acknowledged the Supreme Court's recent holding in Powerex two years ago.  As you may recall, Professor Dodson provided an examination of the Powerex case on this blog when it was first released.  As Professor Dodson pointed out at the time, the Supreme Court held that when the District Court relies upon a ground that is "colorably characterized" as subject-matter jurisdiction, appellate review is barred by § 1447(d).  In what is now a deepening circuit split, the Fifth Circuit found that declining supplemental jurisdiction is not "colorably characterized" as a remand based on a lack of subject matter jurisdiction: 

In this case, the district court’s order of remand was clearly based on 28 U.S.C. § 1367(c). The district court summarized Brookshire’s argument that remand was required under 28 U.S.C. § 1447(c) in the first paragraph of the order, but the court then went on to analyze the remand issue under the discretionary standard set out in 28 U.S.C. § 1367(c), finding that “[w]hile it is certainly within our discretion to retain this case for further proceedings, after examining the factors enumerated in § 1367(c), the Court finds that the suit before us contains only issues of State law, and in the interest of comity, these State law issues would be more properly decided by a State forum.”  The order of remand cannot be “colorably characterized” as being based on lack of subject matter jurisdiction under section 1447(c).

You can read the full opinion here.



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