201 F.3d 754 | 6th Cir. | 2000
Lead Opinion
MOORE, J., delivered the opinion of the court, in which GILMAN, J., joined. WELLFORD, J. (p. 762), delivered a separate concurring opinion.
OPINION
In this appeal, the defendant-appellant, Bando Manufacturing of America, Inc. (“Bando”), challenges the district court’s finding that it did not have original federal question jurisdiction over one of plaintiff-appellee Benjamin Craig Long’s claims and asks this court to reverse the district
I. BACKGROUND
Long was employed by Bando from February of 1989 until he was terminated in May of 1996. In 1992, Gates Rubber Company (“Gates”), a competitor, sued Bando, alleging various forms of anticompetitive activity, including appropriation of Gates’s trade secrets. Gates also charged that Bando had concealed or destroyed information relevant to its competitive strategies and trade secrets. In the summer of 1995, less than a year before he was terminated but several years after the Gates litigation had ended, Long reported to Matt Adams, the vice president of Bando, that he saw Adams and James Blankenship, the president of Bando, taking “stuff’ to the trash dumpsters just before the 1992 inspection of the Bando facilities by Gates. In that same year and the following year, Long received two poor performance reviews and several warnings that he would be subject to disciplinary action if his performance did not improve, culminating in his suspension for three days in March of 1996. Long was finally discharged in May of 1996 based on a finding that he had falsified a production schedule. After his discharge, Long attempted to aid Gates in reopening its motion for sanctions against Bando on the ground that Bando had concealed and destroyed documents relevant to the trade secrets litigation.
Long filed suit in Kentucky state court on April 30, 1997, alleging that he was terminated as a result of his refusal to acquiesce in the “cover up” of the company’s theft of trade secrets. He alleged due process violations under the U.S. and Kentucky Constitutions, “reverse discrimination” in violation of Title VII, and discharge “in violation of the public policy of retaliatory discharge.” J.A. at 16 (Complaint). Bando removed the case, relying on Long’s federal due process and Title VII claims as the basis for federal jurisdiction. Long then amended his complaint, adding that “[ojther public policies of this Commonwealth and of the United States which have been violated by the Defendant’s wrongful termination of the Plaintiff include, but are not limited to” the policies embodied in four federal criminal statutes: 18 U.S.C. § 1509 (Obstruction of court orders), 18 U.S.C. § 2314 (Transportation of stolen goods), 18 U.S.C. § 2315 (Sale or receipt of stolen goods), and 18 U.S.C. § 1621 (Perjury).
The district court granted Bando’s motion for summary judgment as to Long’s federal due process claim. The district court also denied Long’s motion to remand for lack of subject matter jurisdiction, finding that it had subject matter jurisdiction. Finally, the district court found that none of the remaining claims (wrongful discharge in violation of public policy, breach of contract, and defamation) raised a substantial federal question and therefore, declining to exercise its supplemental jurisdiction, remanded the case to the state court. In particular, the district court found that naming four federal statutes as evidence of public policy in the complaint did not convert Long’s state wrongful discharge claim into a federal claim. Relying on the Supreme Court’s opinion in Merrell Doio Pharmaceuticals, Inc. v. Thompson, 478 U.S. 804, 106 S.Ct. 3229, 92 L.Ed.2d 650 (1986), the district court analyzed whether the statutes cited by Long implied a private remedy for their violation and, finding that they did not, concluded that the wrongful discharge claim did not present a federal question invoking the district court’s “arising under” jurisdiction.
Bando filed a motion to alter or amend the district court’s judgment, alleging that the district court erred in concluding that Long’s wrongful discharge claim did not raise a substantial federal question giving rise to original federal question jurisdiction in the district court. In its December 8, 1998 order, the district court acknowledged that it had erred in its analysis of whether Long’s wrongful discharge claim provided a basis for original federal question jurisdiction. The court recognized that, even if it determined, first, that there was no implied private cause of action for the violation of the federal statutes listed in Long’s complaint, it must still consider, second, “whether the state law wrongful discharge [claim] ‘necessarily turned’ upon a question of federal law.” J.A. at 32 (D.Ct.Op.). If the claim necessarily turned on a question of federal law, the district court acknowledged, it could find that it had federal question jurisdiction, without applying the “implied remedy” test. Nonetheless, the district court still found that, on the facts of this case, there was no substantial, disputed question of federal law in the plaintiffs claim sufficient to invoke the district court’s “arising under” jurisdiction and therefore denied Bando’s request to alter or amend its prior judgment remanding the case to the state court. Bando timely appealed that ruling to this court. We now hold that, although a complaint that does not state a federal cause of action may in some cases invoke federal jurisdiction, the federal statutes cited in Long’s wrongful discharge claim were insufficient to provide federal question jurisdiction.
II. ANALYSIS
In order to invoke the district court’s removal jurisdiction, a defendant must show that the district court has original jurisdiction over the action. See 28 U.S.C. § 1441(a). The burden of showing that the district court has original jurisdiction is on the party seeking removal. See Her Majesty the Queen in Right of the Province of Ontario v. City of Detroit, 874 F.2d 332, 339 (6th Cir.1989). Furthermore, because they implicate federalism concerns, removal statutes are to be narrowly construed. See Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108-09, 61 S.Ct. 868, 85 L.Ed. 1214 (1941).
In this ease, the parties do not allege diversity of citizenship. Removal jurisdiction was thus based on 28 U.S.C. § 1441(b), allowing removal of actions “of which the district courts have original jurisdiction founded on a claim or right arising under the Constitution, treaties or laws of the United States,” without regard to the citizenship of the parties. Because removal jurisdiction is possible only where the federal district court would have had original jurisdiction over the case, and because the “arising under” language of
A. Reviewability of the Remand Order
This court has jurisdiction to review the district court’s decision to remand Long’s state law claims. The parties did not raise this issue, but, because it is a jurisdictional matter, we consider it sua sponte. See, e.g., In re General Motors Corp., 3 F.3d 980, 982 (6th Cir.1993).
Although the plain language of 28 U.S.C. § 1447(d) suggests that remand orders concerning cases removed pursuant to 28 U.S.C. § 1441 are never reviewable, the Supreme Court held in Thermtron Products, Inc. v. Hermansdorfer, 423 U.S. 336, 96 S.Ct. 584, 46 L.Ed.2d 542 (1976), that §§ 1447(c) and (d) must be read together, and therefore that § 1447(d) prohibits review only of remand orders issued pursuant to a finding, under § 1447(c), that the district court lacked subject matter jurisdiction.
B. The Existence of Federal Question Jurisdiction
This court reviews de novo a district court’s decision regarding subject matter jurisdiction. See Hilliard v. United States Postal Serv., 814 F.2d 325, 326 (6th Cir.1987).
Before delving into Bando’s argument that the district court had federal question jurisdiction over Long’s wrongful termination claim, it is helpful to understand what Bando is not arguing. Bando is obviously not arguing that Long’s wrongful discharge claim is a federal claim; it is clear that wrongful discharge is a state-law cause of action. Nor is it arguing that Long’s complaint attempts to imply a private right of action under the listed federal criminal statutes, thereby stating a federal cause of action. Finally, it is not arguing that Long’s state-law claim is completely preempted by federal law, which would mean that Long had stated a federal claim whether he intended to or not. See, e.g., Avco Corp. v. Aero Lodge No. 735, Int’l Ass’n of Machinists, 390 U.S. 557, 88 S.Ct. 1235, 20 L.Ed.2d 126 (1968). Rather, Bando is arguing that Long’s wrongful termination claim, without raising an express or implied federal claim, involves a substantial and disputed question of federal law and is therefore sufficient to invoke the district court’s “arising under” jurisdiction.
The exact contours of the federal courts’ jurisdiction under 28 U.S.C. § 1331 are somewhat imprecise. The most important Supreme Court case to deal with this issue in recent years is Merrell Dow. In Merrell Dow, the plaintiffs had sued a drug manufacturer on'a state-law negligence claim, alleging that its drug Bendectin was mis-branded in violation of the Federal Food, Drug, and Cosmetic Act (FDCA). See Merrell Dow, 478 U.S. at 805-06, 106 S.Ct. 3229. The Supreme Court held that the plaintiffs had not invoked the federal courts’ “arising under” jurisdiction by raising state-law claims for negligence that incorporated federal drug labeling standards. See id. at 817, 106 S.Ct. 3229. Although the scope of the Court’s holding in Merrell Dow is somewhat unclear, it clearly left open the possibility of federal jurisdiction even in the absence of an express or implied federal cause of action, if a substantial federal question of great federal interest is raised by a complaint framed in terms of state law, and if resolution of that federal question is necessary to the resolution of the state-law claim. See, e.g., id. at 808-10 & n. 5, 813-14 & nn. 11-12, 106 S.Ct. 3229; see also City of Chicago v. International College of Surgeons, 522 U.S. 156, 164, 118 S.Ct. 523, 139 L.Ed.2d 525 (1997) (reaffirming that a case may “arise under” the laws of the United States if it requires resolution of a substantial question of federal law, even if state law creates the plaintiffs cause of action); Thornton v. Southwest Detroit Hosp., 895 F.2d 1131, 1133 (6th Cir.1990) (noting that federal courts have jurisdiction in “only those cases in which a well-pleaded [cjomplaint establishes either that federal law creates the cause of action or that the plaintiff[’s] right to relief necessarily depends on resolution of a substantial question of federal law” (emphasis added) (quoting Franchise Tax Board, 463 U.S. at 27-28, 103 S.Ct. 2841) (internal quotation marks omitted)).
In Christianson v. Colt Industries Operating Corp., 486 U.S. 800, 108 S.Ct. 2166, 100 L.Ed.2d 811 (1988), the Supreme Court further elaborated the circumstances under which a state-law claim “necessarily depends” upon a “substantial question of federal law.” In that case, the Court held that a claim does not “arise under” the federal patent laws if the com
In light of Christianson, it is clear that the resolution of a federal question is not necessary or essential to the resolution of Long’s wrongful discharge claim. Bando argues that under Kentucky law, a plaintiff must demonstrate that the public policy making his discharge unlawful is embodied in federal or state legislative enactments. See, e.g., Grzyb v. Evans, 700 S.W.2d 399, 401 (Ky.1985). Bando contends that Long relied solely on federal statutes as evincing that public policy, and therefore that the court’s construction of those federal statutes is essential to a determination of Long’s claim. This argument is unpersuasive. Long’s complaint put forth alternate bases in state and federal law for the public policy in contravention of which he was discharged. Long’s initial complaint stated that his “discharge was in violation of the public policy of retaliatory discharge.” J.A. at 16 (Complaint). This statement could be read to refer to Kentucky Revised Statutes 61.102, Kentucky’s “whistleblower statute,” forbidding the retaliatory termination of an employee who interferes with a company’s unlawful activities.
Furthermore, although the question whether a wrongful discharge claim based on federal public policies invokes federal jurisdiction appears to be one of first impression in this circuit, other circuits have held that such claims do not belong in federal court. See Campbell v. Aerospace Corp., 123 F.3d 1308, 1315 (9th Cir.1997) (finding the federal interest to be insufficient, and noting that state law mirrors the federal policy at issue), cert. denied, 523 U.S. 1117, 118 S.Ct. 1794, 140 L.Ed.2d 935 (1998); Willy v. Coastal Corp., 855 F.2d 1160, 1167-72 (5th Cir.1988) (finding the federal element in such a claim to be insufficiently substantial and also noting that the plaintiff supported his claim with state as well as federal theories); see also Drake v. Cheyenne Newspapers, Inc., 842 F.Supp. 1403 (D.Wyo.1994). These precedents suggest that the federal question in Long’s complaint is insufficiently substantial and disputed to invoke federal jurisdiction.
C. Propriety of Remand
We also note that the district court had the authority to remand rather than dismiss Long’s state-law claims under 28 U.S.C. § 1867(c). In Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 108 S.Ct. 614, 98 L.Ed.2d 720 (1988), the Supreme Court held that a district court has discretion to remand pendent state-law claims rather than dismissing them, if the values of economy, convenience, fairness, and comity so dictate.
Carnegie-Mellon was decided before 28 U.S.C. § 1367 was adopted, however, and the language of § 1367 does not explicitly grant district courts the authority to remand cases to the state courts rather than dismiss them without prejudice.
Whether to remand or dismiss is a matter normally left to the discretion of the district court, see Carnegie-Mellon, 484 U.S. at 357, 108 S.Ct. at 622-23. We find this discretion unaffected by the subsequent enactment of 28 U.S.C. § 1367(d), in the Judicial Improvements Act of 1990.... Section 1367(d) tolls the state statute of limitations on any state claim over which a federal court has exercised supplemental jurisdiction until 30 days after its dismissal. It thus reduces one concern expressed in Carnegie-Mellon — 'that plaintiffs would lose their claims if their case were dismissed rather than remanded. Other concerns remain, however, such as convenience to the parties and a faster resolution of the case. We find no indication in the legislative history of the Judicial Improvements Act that Congress intended to limit the district court’s discretion to remand in a case removed from state court.
Id. at 1267 (citation omitted). Furthermore, most circuits, including this one, have assumed that the discretionary power to remand survives the adoption of § 1367. See, e.g., Musson Theatrical, Inc. v. Federal Express Corp., 89 F.3d 1244, 1254-55 (6th Cir.1996); Decatur Mem’l Hosp. v. Connecticut Gen. Life Ins. Co., 990 F.2d 925, 927-28 (7th Cir.1993); Executive Software N. Am., Inc. v. United States Dist. Ct, 24 F.3d 1545, 1551-53 (9th Cir.1994); see also 28 U.S.C.A. § 1367 Practice Commentary 835 (1993); 14C ChaRles A. WRIght, Arthur R. Miller & Edward H. Cooper, Federal Practice & Prooedure: Jurisdiction 3d § 3739, at 498-501 (1998). We agree with the analysis of the D.C. Circuit and hold that the district court acted properly in remanding rather than dismissing Long’s case.
III. CONCLUSION
For the foregoing reasons, we AFFIRM the district court’s remand order.
. In other words, Long claimed that he was terminated for his refusal to participate in the company’s theft of trade secrets ("stolen goods” under 18 U.S.C. §§ 2314, 2315), its obstruction of the discovery orders in the Gates litigation, and its employees’ perjury about concealing or destroying documents.
. 28 U.S.C. § 1447(c) provides, in pertinent part, "If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.”
28 U.S.C. § 1447(d) provides, "An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1443 of this title shall be reviewable by appeal or otherwise.”
. The holding of Thermtron, limiting the prohibition on review of remand orders to those remands that are based on a lack of subject matter jurisdiction, was recently reaffirmed in Quackeribush v. Allstate Ins. Co., 517 U.S. 706, 116 S.Ct. 1712, 135 L.Ed.2d 1 (1996). In Quackenbush, the Supreme Court also held that remand orders not falling within the scope of § 1447(c) could be reviewed on direct appeal, thereby abrogating Thermtron's suggestion that remand orders were not final orders and therefore could be reviewed only by means of a writ of mandamus. See id. at 712-15, 116 S.Ct. 1712.
. Christianson dealt with the scope of the Federal Circuit’s patent-law jurisdiction under 28 U.S.C. §§ 1295(a) and 1338(a), not the federal courts' general federal question jurisdiction under § 1331. The Court noted in Christianson, however, that it applies the same test to determine “arising under” jurisdiction under both §§ 1331 and 1338(a). See Christianson, 486 U.S. at 807-09, 108 S.Ct. 2166.
. Long himself has not mentioned K.R.S. 61.102; in his brief, he mentioned the Kentucky Trade Secrets Act, K.R.S. 365.880 to 365.990 (1990), as the original basis for his wrongful discharge claim.
.Bando also argues that the standard for finding a "substantial” federal question is extremely low; however, the cases that it cites for this proposition dealt with the standard for finding federal jurisdiction based on an express or implied private federal cause of action. Those cases simply state that when a plaintiff attempts to bring a claim under a federal statute, that claim need only be non-frivolous in order to invoke federal jurisdiction: it need not, in other words, even be sufficient to avoid dismissal under Federal Rule of Civil Procedure 12(b)(6). See, e.g., Oneida Indian Nation v. County of Oneida, 414 U.S. 661, 666, 94 S.Ct. 772, 39 L.Ed.2d 73 (1974).
. 28 U.S.C. § 1367(c) provides, in pertinent part, "The district courts may decline to exercise supplemental jurisdiction over a claim” if any of four criteria is met (emphasis added).
. We observe that both Camegie-Mellon and this case deal only with the question whether § 1367 permits remand in a narrow set of cases — namely, removed cases in which all federal claims have been dismissed and the district court has only supplemental claims before it. See Camegie-Mellon, 484 U.S. at 345, 108 S.Ct. 614 ("The question before us is whether a federal district court has discretion under the doctrine of pendent jurisdiction to remand a properly removed case to state court when all federal-law claims in the action have been eliminated and only pendent state-law claims remain.”).
Concurrence Opinion
concurring.
I concur in the result reached in this case, but would base this decision on a more straightforward rationale. My conclusion is that plaintiff Long’s claims of wrongful discharge simply did not sufficiently raise a federal question in order to provide jurisdiction in the district court. I agree with my colleague, Judge Moore, at the outset that the burden in this case is upon plaintiff and that removal statutes are strictly construed. Plaintiff must show that he is relying on a claim “arising under the Constitution ... or laws of the United States.” 28 U.S.C. § 1441(b).
I also agree with Judge Moore’s analysis that we have jurisdiction to review the action taken by the district court, and that remand was within the sound discretion of the district court once lack of a federal question was determined.
The substance of Long’s claims against his former private employer is clearly wrongful discharge essentially by a state action since no federal employment discrimination law action is asserted. Nor does defendant Bando claim federal preemption under the circumstances of this case.
There are several reasons why I believe this case is essentially controlled by Merrell Dow Pharmaceuticals, Inc. v. Thompson, 478 U.S. 804, 106 S.Ct. 3229, 92 L.Ed.2d 650 (1986). That case affirmed this court’s decision at 766 F.2d 1005 (6th Cir.1985). Merrell Dow, I believe, despite some ambiguous language, affirmed our holding that “[fjederal question jurisdiction would, thus, exist only if plaintiffs’ right to relief depended necessarily on a substantial question of federal law.” 766 F.2d at 1006. Merrell Dow cites Justice Holmes’ opinion in American Well Works Co. v. Layne & Bowler Co., 241 U.S. 257, 260, 36 S.Ct. 585, 60 L.Ed. 987 (1916), that a “suit arises under the law that creates the cause of action.” 478 U.S. at 808, 106 S.Ct. 3229. It cites with approval Franchise Tax Board v. Construction Laborers Vacation Trust, 463 U.S. 1, 9, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983), that “a case may arise under federal law ‘where the vindication of a right under state law necessarily turned on some construction of federal law.’ ” Id. Finally, Merrell Dow emphasized “prudence and restraint in the jurisdictional inquiry,” and that where Congress provided no “private, federal cause of action for the violation [of the federal statute]” relied upon in the complaint, jurisdiction fails, and a federal question is not raised. Id. at 810, 817, 106 S.Ct. 3229.
Plaintiffs right to relief did not necessarily depend on any of the federal statutes relied upon in the complaint. There was no substantial question of federal law presented. None of the federal statutes cited (and discussed by the district court) created plaintiffs wrongful discharge claim. Congress provided no private federal remedy for plaintiff with respect to 'any of these statutes. There was no implied federal cause of action created by or necessarily springing from any federal statute cited. The district court, in short, exercised prudence and restraint in denying federal jurisdiction. I am not persuaded by Bando’s attempts to distinguish Merrell Dow, and I find no basis under the several principles expressed and approved in that case to overturn the district court’s decision. See Miller v. Norfolk & W. Ry. Co., 834 F.2d 556 (6th Cir.1987).
I see no need to pursue any state law rationale asserted by Bando to create jurisdiction in this case. I would, accordingly, AFFIRM the district court.
. I see no conflict with the decision in this case with Milan Express Co. v. Western Surety Co., 886 F.2d 783 (6th Cir.1989), or MCI Telecommunications Corp. v. Graham, 7 F.3d 477 (6th Cir.1993).
