Farmland National Beef Packing Co. v. Stone Container Corp.

F I L E D
United States Court of Appeals
Tenth Circuit
APR 16 2004
UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT PATRICK FISHER
Clerk
FARMLAND NATIONAL BEEF
PACKING COMPANY, L.P.,
Plaintiff-Appellee,
No. 04-3028
v. (D.C. No. 03-CV-1312-JTM)
(D. Kan.)
STONE CONTAINER
CORPORATION; JEFFERSON
SMURFIT CORPORATION;
SMURFIT-STONE CONTAINER
CORPORATION; INTERNATIONAL
PAPER COMPANY; GEORGIA
PACIFIC CORPORATION;
WEYERHAEUSER PAPER
COMPANY; TEMPLE-INLAND
INC.; GAYLORD CONTAINER
CORPORATION; UNION CAMP
CORPORATION; TENNECO INC.;
TENNECO PACKAGING
CORPORATION OF AMERICA;
PACKAGING CORPORATION OF
AMERICA,
Defendants-Appellants.
ORDER AND JUDGMENT *
*
This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
Before, KELLY, HENRY, and LUCERO, Circuit Judges.
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument.
Plaintiff-appellee originally filed this antitrust suit against the twelve
defendant companies in state court. Defendants-appellants removed the case to
federal court, see generally 28 U.S.C. § 1446, but appellee believed that the
notice of removal was defective. Appellee filed a motion to remand, but outside
the thirty-day window allowed by § 1447(c). Appellee argued that the district
court lacked subject matter jurisdiction because there was no complete diversity
of citizenship, and that the notice of removal was procedurally defective because,
though signed by counsel, two company names were left off the signature block.
Appellants responded to appellee’s motion, and also filed a motion to correct their
clerical error in the notice of removal–but outside the thirty-day window allowed
for removal by § 1446(b). The district court strictly construed the defect against
appellants and remanded the case to state court for appellants’ failure to file their
unambiguous unanimous consent to removal within thirty days after service of the
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initial pleading. See Pet. for Writ of Mandamus, Tab F; § 1446(b). The district
court did not expressly rule on appellants’ motion to correct. See Pet. for Writ of
Mandamus, Tab F.
Appellants now seek to overturn the district court’s order so that the case
can proceed in federal court. We granted their motion to expedite their appeal,
and appellee has responded. Appellee’s motion to dismiss also remains to be
decided.
As we noted in our prior order, the initial question in any challenge to an
order remanding a removed case is whether the remand order is reviewable at all.
SBKC Serv. Corp. v. 1111 Prospect Partners, L.P., 105 F.3d 578, 580 (10th Cir.
1997). 28 U.S.C. § 1447(d) states that a remand order “is not reviewable on
appeal or otherwise,” except that a remand authorized by 28 U.S.C. § 1443 is
reviewable. The exception under § 1443 is not applicable here, so it appears at
first blush that review of the district court’s remand order is barred. However,
“the application of § 1447(d) is not as broad as its language suggests. Appellate
review is barred by § 1447(d) only when the district court remands on grounds
permitted by § 1447(c).” Dalrymple v. Grand River Dam Auth., 145 F.3d 1180,
3
1184 (10th Cir. 1998) (citing Things Remembered, Inc. v. Petrarca, 516 U.S. 124,
127-28 (1995) and Thermtron Prods., Inc. v. Hermansdorfer, 423 U.S. 336,
345-46 (1976), overruled on other grounds, Quackenbush v. Allstate Ins. Co.,
517 U.S. 706, 714-15 (1996)).
The district court did not mention § 1447(c) in its order. See Pet. for Writ
of Mandamus, Tab F. But this court held in Dalrymple that the mere omission of
a citation to § 1447(c) is not sufficient to allow review by this court, just as the
mere citation to § 1447(c) is not sufficient to bar review by this court.
Dalrymple, 145 F.3d at 1184. Rather, “[i]n order to evaluate the reviewability of
the district court’s remand order[], [this court] must independently review the
record to determine the actual grounds upon which the district court believed it
was empowered to remand.” Id.
In this case, the district court relied on two legal points: first, that
§ 1446(b) provides that the notice of removal must be filed within thirty days
after the defendants received the initial pleading, and, second, that all of the
defendants must give their consent to removal within the thirty-day window.
Pet. for Writ of Mandamus, Tab F at 1-3. Relying on the fact that two defendant
company names were missing from the signature block on the notice of removal
(even though those two defendants were specifically identified in the first
paragraph of the notice of removal, and their citizenship specifically pleaded), the
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court concluded that it was ambiguous whether the two companies consented to
removal and construed the ambiguity against removal. The court found it
unnecessary to consider appellee’s other arguments.
Appellants maintain that the district court’s order of remand is subject to
review in this court and should be reversed. They argue that: (1) the absence of
two defendant company names from the signature block is not a defect that can
justify a remand under § 1447(c); and (2) even if it is, appellee’s motion to
remand was untimely to raise any procedural defects in the notice of removal.
Appellants’ second argument necessarily implicates a third question they did not
raise: (3) whether the district court was authorized to remand based on the
alleged procedural defect outside the thirty-day window provided in § 1447(c)
even if appellee’s motion to remand was untimely. Appellee argues that the
appeal should be dismissed because: (1) appellants’ notice of removal was
procedurally defective; and (2) its motion to remand was timely or, even if it was
not, appellants waived any objection to its untimely motion to remand by not
raising that objection in the district court. Appellee also asserts in passing that
the district court could have remanded for lack of subject matter jurisdiction due
to lack of complete diversity of citizenship. We need not address this last
assertion because it is unsupported by any argument or authorities, and belied by
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the facts asserted in appellants’ notice of removal. See Phillips v. Calhoun, 956
F.2d 949, 953-54 (10th Cir. 1992).
Upon consideration, appellee’s motion to dismiss is denied. Under the
circumstances of this case, our authority to review the district court’s remand
order is intertwined with the result of our review. Appellee’s motion to remand
was untimely to raise any procedural defects under 28 U.S.C. § 1447(c), and the
district court therefore was not authorized under § 1447(c) to remand based on the
procedural defect of lack of unanimous consent to removal. As a result, we have
jurisdiction to review the remand order and, for the same reason, we reverse the
district court and direct it to vacate its remand order.
Analysis
This court has held that for a paper to fall within the removal statutes, it
must be unambiguous. Cf. Akin v. Ashland Chem. Co., 156 F.3d 1030, 1035-36
(10th Cir. 1998) (holding that ambiguous initial pleading was not “unequivocal
notice of the right to remove” and did not trigger time for defendants to file
notice of removal under § 1446(b)). It is not necessary for us to decide whether
the omission of the name of a defendant on a signature block in these
circumstances renders the notice ambiguous, let alone constitutes a procedural
defect, because appellants’ second argument has merit–the untimely filing of
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appellees’ motion to remand left the district court without authority under
§ 1447(c) to remand based on that ostensible procedural defect. 1
Our examination of the timing of appellee’s motion to remand begins with
the overriding principle that because federal removal jurisdiction is statutory in
nature, it is strictly construed. See Shamrock Oil & Gas Corp. v. Sheets, 313 U.S.
100, 108-09 (1941). “[A]ll doubts are to be resolved against removal.” Fajen v.
Found. Reserve Ins. Co., 683 F.2d 331, 333 (10th Cir. 1982). It is true that all of
the defendants must consent to removal. Wisc. Dep’t of Corr. v. Schacht,
524 U.S. 381, 393 (1998) (Kennedy, J., concurring); Cornwall v. Robinson,
654 F.2d 685, 686 (10th Cir. 1981); §§ 1441(a), 1446(a). But the lack of
unanimous consent is a procedural defect, not a jurisdictional defect. SBKC Serv.
Corp., 105 F.3d at 580; Sheet Metal Workers Int’l Ass’n v. Seay, 693 F.2d 1000,
1005 n.8 (10th Cir. 1982). Under § 1447(c), “[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).”
1
Appellee argues that appellants waived their objection to its untimely
motion to remand by not raising the objection in the district court. We exercise
our discretion to consider appellants’ challenge to the timeliness of appellee’s
motion to remand, even though appellants did not raise this argument in the
district court. See Singleton v. Wulff, 428 U.S. 106, 120-21 (1976). The issue is
one of law, not of fact; the record is adequate for our review; and the resolution
of the question is not in doubt.
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Section 1446(a) states that “defendants desiring to remove any civil action . . .
shall file in the district court of the United States . . . a notice of removal.”
Appellee argues that the thirty-day period for its motion to remand started
to run when a copy of the notice of removal was filed in the state court. See
§ 1446(d). But that argument contravenes the plain language of § 1447(c). The
time began to run when appellants filed their notice of removal in the district
court. Therefore, appellee’s motion to remand was untimely. Appellants’ notice
of removal was docketed in federal court on Friday, August 29, 2003, and
appellee filed its motion to remand on Tuesday, September 30. It was due on
Monday, September 29 (because the thirtieth day fell on Sunday). Because
appellee’s motion to remand was not filed within thirty days after the notice of
removal was filed in the district court, the district court lacked discretion under
§ 1447(c) to remand based on a procedural defect. See Loftis v. United Parcel
Serv., Inc., 342 F.3d 509, 516-17 (6th Cir. 2003); In re Bethesda Mem. Hosp.,
Inc., 123 F.3d 1407, 1410 (11th Cir. 1997); Hamilton v. Aetna Life & Cas. Co.,
5 F.3d 642, 643-44 (2d Cir. 1993) (per curiam); In re Shell Oil Co., 932 F.2d
1523, 1528-29 (5th Cir. 1991). All of the circuit courts to have addressed the
question have held that the thirty-day period binds the district court as well as the
party opposing removal. See Loftis, 342 F.3d at 516-17; Bethesda Mem. Hosp.,
123 F.3d at 1410; In re Continental Cas. Co., 29 F.3d 292, 294-95 (7th Cir. 1994);
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Hamilton, 5 F.3d at 643-44; Maniar v. FDIC, 979 F.2d 782, 784-85 (9th Cir.
1992); FDIC v. Loyd, 955 F.2d 316, 322 (5th Cir. 1992); Air-Shields, Inc. v.
Fullam, 891 F.2d 63, 65 (3d Cir. 1989). As a result, even if the missing company
names on the notice of removal originally put unanimous consent to removal in
doubt, the basis of the district court’s remand in this case is a procedural defect
and the defect was untimely raised. Therefore, the district court’s action was not
authorized by § 1447(c), review in this court is not barred by § 1447(d), and the
district court’s remand order must be vacated. We need not decide whether the
district court should have acknowledged appellants’ motion to correct their notice
of removal.
Appellee’s motion to dismiss is DENIED. The district court’s remand
order is REVERSED and the district court is directed to vacate it.
ENTERED FOR THE COURT
PER CURIAM
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