Philip Morris Inc v. Repub Venezuela

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued October 16, 2001 Decided April 26, 2002
No. 00-7213
Republic of Venezuela,
Appellee
v.
Philip Morris Incorporated, et al.,
Appellants
Consolidated with
00-7214, 00-7215, 00-7216, 00-7257, 00-7258
Appeals from the United States District Court
for the District of Columbia
(No. 99ms00213)
Herbert M. Wachtell argued the cause for appellants Philip
Morris Companies, Inc., et al. With him on the briefs were
Timothy M. Broas, Robert F. McDermott, Jr., Paul S. Ryer-
son, Daniel F. Kolb, Kenneth N. Bass, Gene E. Voigts,
Richard L. Gray, Patrick S. Davies and Steven Klugman.
David Gruenstein and Leigh A. Hyer entered appearances.
Robin S. Conrad, Kenneth S. Geller and John J. Sullivan
were on the brief of amicus curiae Chamber of Commerce of
the United States of America in support of appellants.
Joel S. Perwin argued the cause for appellees. With him
on the brief were Jonathan S. Massey, George M. Fleming,
Sylvia Davidow and Andres C. Pereira.
Before: Ginsburg, Chief Judge, Henderson, Circuit Judge,
and Williams, Senior Circuit Judge.
Opinion for the Court filed by Chief Judge Ginsburg.
Separate concurring opinion filed by Senior Circuit Judge
Williams.
Ginsburg, Chief Judge: The district court issued orders
remanding to a Florida state court four lawsuits filed by
foreign states against tobacco companies based in the United
States. The companies ask that we reverse the orders of the
district court and that we issue a writ of mandamus to
prevent the court from ordering the remand of similar law-
suits still pending before it. We hold that we are without
appellate jurisdiction to review the orders the district court
already has issued and that we have no warrant to prohibit
the district court from remanding to state court those cases
upon which it has not yet acted.
I. Background
Various foreign countries or subdivisions thereof sued 15
United States tobacco companies in a Florida court to recover
damages under the laws of Florida. Specifically, the Repub-
lics of Venezuela and of Ecuador, the Brazilian States of Mato
Grosso Do Sol, Goias, and Espirito Santo, and the Russian
Federation filed nearly identical complaints in the Circuit
Court for Florida's Eleventh Judicial District in Miami-Dade
County. They advanced at least ten distinct theories of
liability, such as fraud, negligence, and unjust enrichment,
and sought compensation from the companies for the costs of
treating persons suffering from diseases associated with to-
bacco use. Twenty-nine other foreign states or subdivisions
have filed similar actions--not now before us--in state and
federal courts around the United States. The tobacco compa-
nies removed the present cases from the Florida state court
to the United States District Court for the Southern District
of Florida. The Judicial Panel on Multidistrict Litigation
then consolidated the cases brought by Venezuela and three
other foreign states and transferred them to the United
States District Court for the District of Columbia.
Some months later the district court dismissed for failure
to state a claim a substantially similar suit against the tobacco
companies brought in that court by the Republic of Gua-
temala. See In re Tobacco (Guatemala), 83 F. Supp.2d 125,
126 (1999), aff'd, Service Employees Int'l Union Health &
Welfare Fund v. Philip Morris Inc., 249 F.3d 1068 (2001).
The court ruled that Guatemala's claims were not viable
because Guatemala could not establish that its alleged inju-
ries, that is, its expenditures for the care and treatment of its
citizens, were proximately caused by any misconduct on the
part of the tobacco companies. For the same reason the
district court has since dismissed several cases that had
originated in other federal courts and been transferred by the
JPML to this district. The cases under review are unlike
those the district court dismissed only in that they were filed
originally in state courts and therefore reached the district
court after the tobacco companies removed them to a federal
court pursuant to 28 U.S.C. s 1441; they are substantively
identical in all other respects.
The district court ordered that Venezuela's suit be remand-
ed to the Circuit Court for Florida's Eleventh Judicial Dis-
trict on the ground that there is no federal jurisdiction over
the case. The court held that Venezuela's complaint does
"not present a federal question on [its] face, and federal
question jurisdiction is not proper under the federal common
law of foreign relations." In re Tobacco (Venezuela), 100
F. Supp.2d 31, 38 (2000); see also id. at 35 ("The complaints
... contain only state statutory and common law claims").
The court later ordered the cases filed by Ecuador, Espirito
Santo, and Goias remanded to the same Florida state court
"for the reasons stated" in Venezuela. Since this case was
argued on appeal, the Florida court in turn has dismissed the
suits of Venezuela and Espirito Santo, citing with approval
the district court's opinion in Guatemala. See Venezuela v.
Philip Morris Cos., No. 99-01943 (Nov. 20, 2001); Espirito
Santo v. Brooke Group Ltd., Inc., No. 00-07472 (Nov. 20,
2001). The suits filed by Ecuador and by Goias remain
pending before the Florida court.
On October 30, 2000--after the district court had dismissed
Guatemala and ordered Venezuela remanded--the JPML
transferred to that court the cases Russia and Mato Grosso
had brought in Florida and the tobacco companies had re-
moved to the federal court there. The district court here has
not yet acted upon those cases.
To summarize, the six cases now on review were originally
filed in the Florida Circuit Court, then removed to a federal
court in Florida, and finally transferred to the district court
here; the district court ordered four cases--Venezuela, Ecua-
dor, Espirito Santo, and Goias--remanded to the Florida
Circuit Court for lack of federal subject matter jurisdiction
and has pending before it the two--Russia and Mato Gros-
so--that reached the district court after it had ordered the
other cases remanded. For the sake of simplicity, we will
refer to the four remanded cases as the Latin America Cases.
II. Analysis
The tobacco companies appeal the remand orders in the
Latin America Cases. They also ask the court to issue a writ
of mandamus prohibiting the district court from ordering the
remand of Russia and Mato Grosso to the state court where
those cases originated. Apparently, the companies would
rather have the district court dismiss all the cases on the
merits, as it dismissed Guatemala, than remit the cases to
any less certain fate in the courts of Florida.
A. Appeal of the Latin America Cases
This court is without jurisdiction to consider the appeal of
the Latin America Cases. The orders of the district court
return those cases to the state court from which they were
removed on the ground that the court did not have federal
subject matter jurisdiction over them. When it appears that
a district court lacks subject matter jurisdiction over a case
that has been removed from a state court, the district court
must remand the case, 28 U.S.C. s 1447(c), and the court's
order remanding the case to the state court whence it came
"is not reviewable on appeal or otherwise," id. s 1447(d). See
also Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 711-12
(1996) ("remands based on grounds specified in s 1447(c) are
immune from review under s 1447(d)").
The tobacco companies claim that, notwithstanding the
unambiguous bar of the statute, some courts have said the
prohibition of s 1447(d) "is not as broad as it seems." Poore
v. American-Amicable Life, 218 F.3d 1287, 1291 (11th Cir.
2000). In each case they cite, however, the court was describ-
ing not the prohibition in s 1447(d) but the exception thereto
allowing review of a remand order that is not predicated upon
either a lack of subject matter jurisdiction or a defect in the
removal process. See Poore, 218 F.3d at 1289; Liberty Mut.
v. Ward Trucking, 48 F.3d 742, 745-46 (3d Cir. 1995). Be-
cause the district court remanded the Latin America Cases
for want of federal subject matter jurisdiction, the exception
does not apply here, and the cases cited by the companies are
not on point.
The tobacco companies argue also that their appeals raise
the "substantial question whether Congress intended by
s 1447(d) to make a district court the final arbiter of ... an
important issue of constitutional dimension," namely, "wheth-
er, under our constitutional scheme, claims by foreign govern-
ments of this nature fall within the adjudicatory authority of
the federal courts based upon federal common law." We are
tempted to say, as Wolfgang Pauli once said of a colleague's
idea, the contention is "not even wrong." James Gleick,
Genius: The Life and Science of Richard Feynman 115 (1992).
For starters, the appeal does not raise an issue of "constitu-
tional dimension." The district court decided a pleading
point: whether a complaint alleging various torts under the
law of Florida "raises issues of federal law." Chicago v.
International Coll. of Surgeons, 522 U.S. 156, 163 (1997).
There is no provision in the Constitution, and the companies
do not cite to any, that suggests this mundane inquiry takes
on a "constitutional dimension" when the plaintiff is a foreign
sovereign.
Furthermore, the companies err in suggesting there is an
exception to the prohibition of appellate review in s 1447(d)
when the remand order does raise a constitutional question.
As long as the district court orders a case remanded for want
of subject matter jurisdiction, the Congress has insulated the
decision to remand from review "whether or not that order
might be deemed erroneous by an appellate court." Therm-
tron Prods., Inc. v. Hermansdorfer, 423 U.S. 336, 351 (1976).
The decision of the Third Circuit In re TMI Litig. Cases
Cons. II, 940 F.2d 832 (1991), which the companies offer for
the proposition that "in extraordinary circumstances
[s 1447(d) does not prohibit] appellate consideration of cer-
tain categories of remand orders," is not to the contrary.
TMI holds that "1447(d) was not intended to preclude appel-
late consideration of a section 1292(b) certified question con-
cerning the constitutionality of an Act of Congress"--in that
case the very statute upon the basis of which the plaintiff had
invoked federal jurisdiction. Id. at 836. The decision recog-
nizes that s 1447(d) precludes appellate review of an order
remanding a case to a state court when, as here, the order is
"based upon a finding that removal was not authorized by
Congress." Id. at 845; accord Rio de Janeiro v. Philip
Morris Inc., 239 F.3d 714, 716 n.6 (5th Cir. 2001).
The plaintiffs argue that the court may not hear the
appeals for the additional reason that the records of the cases
have been transferred back to the state court. See Starnes v.
McGuire, 512 F.2d 918, 935 (1974) (en banc), a habeas corpus
case in which we said that "once a record is transferred to a
permissible forum in another district, this court loses jurisdic-
tion over the matter." The companies respond that Starnes
governs only those cases that have been transferred to anoth-
er federal court, see Kimbro v. Velton, 30 F.3d 1501, 1504 n.2
(D.C. Cir. 1994), and that we should not extend its holding to
cases that have been remanded to state court. Having
already held that s 1447(d) precludes review, however, we
need not resolve this side dispute in order to decide the
present cases.
B. Mandamus in Russia and Mato Grosso
The tobacco companies also petition this court for a writ of
mandamus prohibiting the district court from issuing any
orders remanding Russia and Mato Grosso to the Florida
Circuit Court where they were filed. The companies contend
the lawsuits arise under federal common law because they
implicate the vital interests--economic and sovereign--of a
foreign nation and, hence, the foreign relations of the United
States. (We will assume without deciding that the companies
are correct about the significance of these cases to American
foreign policy.) The foreign states respond that "federal
jurisdiction exists only when a federal question is presented
on the face of the plaintiff's properly pleaded complaint," and
that a federal court may not assert jurisdiction over a case
that raises no question of federal law simply because the
plaintiff is a foreign sovereign. We need not resolve this
dispute unless we determine first that a writ of mandamus is
at least potentially available in the circumstances of this case.
As a threshold matter, we agree with the tobacco compa-
nies that s 1447(d) is not a jurisdictional bar to the relief they
request. The statute "prohibits review of all remand orders
issued pursuant to s 1447(c) whether erroneous or not and
whether review is sought by appeal or by extraordinary writ,"
Thermtron Prods., 423 U.S. at 343, but the district court has
not issued an order of remand in Russia or Mato Grosso. By
its terms, therefore, s 1447(d) does not prevent the court
from entertaining the present petitions. But see Black &
Decker v. Brown, 817 F.2d 13, 14 (3d Cir. 1987). We will not
infer a jurisdictional limitation upon "our normal and tradi-
tional function when no statute requires that we do so." Id.
at 15 (Garth, J., dissenting).
As we often have noted, "the writ of mandamus is an
extraordinary remedy, to be reserved for extraordinary situa-
tions." National Ass'n of Crim. Def. Lawyers, Inc. v. United
States DOJ, 182 F.3d 981, 986 (1999) (NACDL). We are
particularly disinclined to issue the writ before the district
court has acted, as the petitioners here request. See In re
Bituminous Coal Operators' Ass'n, Inc., 949 F.2d 1165, 1167
(D.C. Cir. 1991) ("indiscriminate use of the remedy [would]
avoid the stricture of the final judgment rule"). In resolving
such a preemptive petition, we consider instructive the follow-
ing factors:
(1) whether the party seeking the writ has any other
adequate means, such as a direct appeal, to attain the
desired relief;
(2) whether that party will be harmed in a way not
correctable on appeal;
(3) whether the district court clearly erred or abused its
discretion;
(4) whether the district court committed an oft-repeated
error; and
(5) whether the decision of the district court raises im-
portant and novel problems or issues of law.
See NACDL, 182 F.3d 986-87. As the tobacco companies
correctly observe, a petitioner need not be favored by all five
factors in order to demonstrate its entitlement to the writ of
mandamus; indeed, "it is difficult to envision a case that
involves both an oft-repeated error as well as an issue of law
of first impression." Valley Broad. Co. v. United States Dist.
Ct. for the Dist. of Nev., 798 F.2d 1289, 1292 n.3 (9th Cir.
1986). Our cases also make clear, however, that two of the
factors are actually prerequisites, for no writ of mandamus--
whether denominated "advisory," "supervisory," or other-
wise--will issue unless the petitioner shows (1, above) that it
has no other adequate means of redress, see NACDL, 182
F.3d at 987, and (3, above) that the writ is necessary to
emend a clear error or abuse of discretion. See Byrd v.
Reno, 180 F.3d 298, 303 (D.C. Cir. 1999).
We doubt the tobacco companies satisfy the first condition.
It is true, as the companies assert, that they could not seek
review of an order remanding Russia or Mato Grosso to the
state court in Florida, but that is not because some practical
exigency prevents the companies from availing themselves of
their remedy at law. Compare, e.g., In re Sealed Case, 141
F.3d 337, 340 (D.C. Cir. 1998) (issuing writ to prevent trans-
fer of motion to quash third-party subpoena). On the con-
trary, the companies have no legal right to appellate review.
Rather, the court of appeals is prohibited by statute from
reviewing remand orders--by appeal or otherwise--of the
sort the district court might issue in Russia and Mato
Grosso. Although, as we have said, s 1447(d) does not
deprive this court of jurisdiction to issue a writ of mandamus,
the determination of the Congress that we should not review
a remand order certainly militates against our opining in
advance upon the propriety of a remand order the district
court might otherwise issue. See Ex parte Pennsylvania, 137
U.S. 451, 454 (1890) ("it is unquestionably a general rule that
the abrogation of one remedy does not affect another. But in
this case, we think, it was the intention of [C]ongress to make
the judgment of the circuit court remanding a cause to the
state court final and conclusive").
In any event, the tobacco companies do not come close to
demonstrating that it would be a clear error or an abuse of
discretion for the district court to order the cases remanded.
The companies identify no precedent of this court or of the
Supreme Court even suggesting there is federal subject
matter jurisdiction over a case merely because the plaintiff is
a foreign government with a sovereign or an economic inter-
est in the outcome of the lawsuit. The other circuits to have
considered the companies' theory--in cases where the foreign
sovereigns were not the plaintiffs but had a material interest
in the outcomes--are divided over the issue of federal juris-
diction. Compare Pacheco de Perez v. AT&T Co., 139 F.3d
1368, 1377 (11th Cir. 1998) ("Where a state law action has as a
substantial element an issue involving foreign relations or
foreign policy matters, federal jurisdiction is present"), and
Torres v. Southern Peru Copper Corp., 113 F.3d 540, 542-43
(5th Cir. 1997) (same), with Patrickson v. Dole Food Co., 251
F.3d 795, 803 (9th Cir. 2001) (rejecting reasoning of Pacheco
and Torres and citing with approval decision of district court
to remand in Venezuela). Considering that the Ninth Circuit
has adopted as its own the district court's reason for remand-
ing in the Latin America Cases, we cannot agree with the
companies that the district court is now poised to commit a
clear error that would justify our issuing a writ of manda-
mus.* See Byrd v. Reno, 180 F.3d 298, 303 (D.C. Cir. 1999)
(denying petition for writ of mandamus "because it [was] far
from clear that the district court erred"); In re Thornburgh,
869 F.2d 1503, 1507 (D.C. Cir. 1989) ("the petitioner must
demonstrate that [its] right to relief is 'clear and indisputa-
ble' ") (quoting Kerr v. United States Dist. Ct. for the N. Dist.
of Ca., 426 U.S. 394, 403 (1976)).
In sum, the companies have failed to make out one if not
both prerequisites for a writ of mandamus. Therefore, we
deny the companies' petitions without considering the other
factors mentioned in NACDL.
__________
* The companies argue in a footnote that "even if the entire
claims [sic] of these foreign governments are not deemed to be
governed by federal common law ... the question of the availability
of the parens patriae doctrine in these suits is in and of itself
clearly a substantial question governed by federal law sufficient to
confer federal-question jurisdiction." We respond in kind. Cf.
Hutchins v. District of Columbia, 188 F.3d 531, 539 n.3 (D.C. Cir.
1999) ("We need not consider cursory arguments made only in a
footnote").
"[T]he doctrine of parens patriae is merely a species of pruden-
tial standing," Service Employees, 249 F.3d at 1073; it is not a
substantive element of the plaintiffs' state common law claims.
Whether a litigant has standing to sue may present a threshold
issue for a federal court, but our doctrines of prudential standing
are of no moment in a state court, the jurisdiction of which is not
similarly limited to what is granted by an act of the legislature.
The companies may not bootstrap their way into a federal court
with a claim that the plaintiffs' standing would be an issue had the
plaintiffs originally filed their lawsuits in a federal court, and the
district court therefore did not err in rejecting this argument.
Finally, we decline, as we must, the companies' invitation to
issue an advisory opinion to the effect that the district court
should not remand Russia or Mato Grosso. See Br. of
Appellants at 31 ("[I]t may be entirely possible for this Court
to grant petitioners effective relief in this proceeding while
stopping short of actually issuing a writ of mandamus at this
time"). Article III does not authorize a federal court "to
declare, for the government of future cases, principles or
rules of law which cannot affect the result as to the thing in
issue in the case before it." California v. San Pablo & T.R.
Co., 149 U.S. 308, 314 (1893).
III. Conclusion
For the foregoing reasons, the appeals in the Latin Amer-
ica Cases are dismissed for want of appellate jurisdiction, and
the petitions for a writ of mandamus in Russia and Mato
Grosso are denied.
So ordered.
Williams, Senior Circuit Judge, concurring: Although I
agree that the defendants' arguments do not prevail, they
seem to me a good deal subtler than the majority opinion lets
on.
First, the argument for federal jurisdiction is not for all
claims in which a plaintiff foreign government has "a sover-
eign or an economic interest in the outcome," Maj. Op. at 9,
but for a considerably narrower set, ones "where the actions
of a foreign government are a direct focus of the litigation."
Defendants' Br. at 36, quoting Pacheco de Perez v. AT&T, 139
F.3d 1368, 1377 (11th Cir. 1998). This is manifested here,
defendants argue, by the plaintiff governments' claim that
"their very policymaking--their core governmental decision-
making as such--was subverted by an American industry
over a period of some 40 years." Appellants' Br. at 34.
From this the defendants reason that adjudication of the
claims will necessarily take the court deep into the evaluation
of plaintiff states' governmental decisionmaking, thereby im-
plicating United States foreign relations and rendering the
dispute "inappropriate for state law to control." Texas In-
dus. v. Radcliff Materials, Inc., 451 U.S. 630, 641 (1981).
But it is not clear that these allegedly federal issues satisfy
the well-pleaded complaint rule--i.e., the proposition that
federal court jurisdiction under s 1331 exists only if the
federal issue appears on the face of a properly pleaded
complaint. See Caterpillar Inc. v. Williams, 482 U.S. 386,
392 (1987); see also Louisville & Nashville R. Co. v. Mottley,
211 U.S. 149, 152 (1908). Federal issues raised by way of
defense do not qualify, see Franchise Tax Bd. of Cal. v.
Construction Laborers Vacation Trust for Southern Cal., 463
U.S. 1, 14 (1983); Metropolitan Life Ins. Co. v. Taylor, 481
U.S. 58, 63 (1987); Gully v. First Nat. Bank in Meridian, 299
U.S. 109, 112 (1936), yet that appears to be the character of
the issues sketched out by defendants. The plaintiffs pre-
sumably will portray themselves as completely innocent gulls
of the tobacco companies, akin for example to garden-variety
medical insurers, and the companies will then respond with
evidence impugning the supposed innocence.
The defendants hint at an argument that the present case
might fall under the rubric of "complete preemption," an
exception to the well-pleaded complaint doctrine. See Rivet
v. Regions Bank of Louisiana, 522 U.S. 470, 475-76 (1998).
But they do not offer us an analytical basis for extending the
complete preemption doctrine beyond the two statutes that
the Supreme Court has held effected such a preemption:
s 502(a) of the Employee Retirement Income Security Act
and s 301 of the Labor Management Relations Act. See,
e.g., Metropolitan Life Insurance Co. v. Taylor, 481 U.S. 58,
64-67 (1987) (ERISA); Avco Corp. v. Aero Lodge Number
735, International Ass'n of Machinists and Aerospace Work-
ers, 390 U.S. 557, 560-62 (1968) (LMRA); see also Anderson
v. H&R Block, 2002 U.S. App. LEXIS 5978, at *5-*12 (11th
Cir., Apr. 3, 2002) (discussing well-pleaded complaint and
complete preemption doctrines).
Second, defendants argue a still narrower position: that
some of plaintiffs' common law claims, those brought by the
foreign governments as parens patriae, even though they are
purportedly only under state law, in fact depend on an
anterior federal law issue, namely a finding of federal pruden-
tial standing. See Defendants' Br. at 38 & n.**. Although
normally of course federal standing doctrines are no part of
state common law actions, see Maj. Op. at 10 n.*, defendants
point to our decision in Service Employees Int'l Union Health
& Welfare Fund v. Philip Morris, Inc., 249 F.3d 1068 (D.C.
Cir. 2001), in which we treated the parens patriae standing
issue as an element of the plaintiffs' state common law claims,
and, in reliance entirely on federal law concepts, found the
absence of such standing fatal to the claims. See id. at 1073;
see also id. at 1069 (noting complaints' inclusion of common
law claims). But in that case the plaintiffs themselves explic-
itly invoked parens patriae standing as to all claims, see
Appellants' Opening Br. at 37-38 and Reply Br. at 6-7,
Service Employees (No. 00-7093), drawing no distinction be-
tween the statutory and common law claims. Thus, the court
in Service Employees had no occasion to hold that state
common law parens patriae claims by a foreign government
inherently include a federal element.