Saks & Co v. Williams

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 00-21131
Summary Calendar
SAKS & CO. d/b/a SAKS FIFTH AVENUE,
Plaintiff-Appellant,
versus
JAMES W. WILLIAMS & ELIZABETH WILLIAMS,
Defendants-Appellees.
Appeal from the United States District Court
For the Southern District of Texas
(H-99-CV-4028)
June 29, 2001
Before HIGGINBOTHAM, WIENER, and BARKSDALE, Circuit Judges.
PER CURIAM:*
Saks sued defendants in state court to collect past due
amounts on defendants’ credit card. Saks won a judgment in state
court for approximately $640,000. In a separate proceeding,
defendants settled a federal case against CMS Generation Co. and
CMS Gas Transmission and Storage Co. That settlement, which
provided for payments from CMS to defendants, contained a
reservation of jurisdiction in the federal court. Saks applied to
*
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this opinion should not be published and is not precedent except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.
the state court for post-judgment relief, asking that the
settlement proceeds be seized. Defendants removed. During the
pendency of the case in federal court, Saks and defendants entered
into a settlement agreement. The district court therefore
dismissed the action, without prejudice to the right of Saks to
move for reinstatement within 90 days if the settlement was not
consummated. Saks appeals.
Saks first argues that the district court lacked jurisdiction.
While defendants have not made any arguments before this court to
demonstrate the existence of jurisdiction, “[t]he jurisdiction of
a United States District Court cannot be created, increased or
diminished by . . . agreement or stipulation of the parties.”1
Accordingly, we independently review the basis for jurisdiction.
It appears from the record that the district court asserted
jurisdiction on a theory of supplemental jurisdiction. A district
court may exercise supplementary jurisdiction “to secure or
preserve the effects of a judgment” previously rendered by that
court, even where “the federal district court would not have
jurisdiction over the second action if it had been brought as an
original suit.”2 As this action sought to seize the proceeds of a
1
Labiche v. Louisiana Patients’ Compensation Fund Oversight
Bd., 69 F.3d 21, 22 (5th Cir. 1995) (emphasis added).
2
Manges v. McCamish, Martin, Brown & Loeffler, 37 F.3d 221,
224 (5th Cir. 1994).
2
settlement approved by a federal court, we hold that supplemental
jurisdiction was properly asserted.3
Saks next argues that defendants did not remove in a timely
manner. 28 U.S.C. § 1446 requires a plaintiff to remove within 30
days of receipt of the cause of action; or if the original case is
not removable, within 30 days of receipt of the pleading which
established removability. Saks contends that the original service
of citation occurred on December 3, 1998, while removal did not
occur until November 18, 1999. According to Saks, removal was
therefore untimely. This argument is disingenuous at best. The
complaint served in December stated only that defendants owed
credit card debt, and made no claim against any settlement
proceedings. It was not until November 2, 1999 that Saks sought a
turnover order directed at the seizure of the settlement proceeds.
Removal occurred 16 days later. This removal was timely.
Having resolved the jurisdictional issues in this case, we
turn to the merits. The gravamen of Saks’s appeal is that by
dismissing the action, the district court called into question the
validity of the state court judgment awarding Saks approximately
$640,000. This concern is misplaced. As the petition for removal
makes clear, only the action for post-judgment relief was removed.
The removal petition states that the action being removed was
3
Saks argues, as a separate issue, that the district court
abused its discretion in not ruling on the motion to remand. This
is merely a regurgitation of Saks’s subject matter jurisdiction
argument, and fails for the same reason.
3
“filed on November 2, 1999.” That is the date upon which the
petition to turn over settlement proceeds was filed. Moreover,
that is after the date upon which final judgment on the merits of
Saks’s initial lawsuit against defendants was entered. The removal
petition states that the action “seeks to assert a claim on behalf
of Saks to the settlement proceeds in the case over which Judge
Werlein continues to exercise jurisdiction.” These excerpts make
clear that the civil action against defendants for non-payment of
credit card debt was not removed, nor was it dismissed by the
district court. All that was removed, and later dismissed, was the
suit for post-judgment relief.
Accordingly, the district court’s disposition of this case
does not impact the final judgment in Saks’s state court case
against defendants. Saks’s argument in this appeal is therefore
without merit.
AFFIRMED.
4