Executive Software North America, Inc. v. United States District CourtExecutive Software North America, Inc. v. United States District Court
- Reporters:
- Before:
- Tang, D.W. Nelson, Leavy
Executive Software North America, Inc., Craig Jensen, and Sally Jensen (“Petitioners“) petition this court for a writ of mandamus to compel the United States District Court for the Central District of California to retain jurisdiction over certain pendent state law claims filed in an employment discrimination suit against them by the plaintiff-real-party-in-interest, Donna Page. Petitioners1 contend that, in remanding the plaintiff‘s pendent state law claims, the district court misapprehended the scope of the supplemental jurisdiction statute,
Factual and Procedural Background
On April 8, 1993, Donna Page filed a complaint in state court against the petitioners. She claimed to have experienced several acts of discrimination during her employment with Executive Software. Specifically, Page, a black female, alleged that the company required all of its employees to study the teachings of the Church of Scientology written by L. Ron Hubbard. Page contends that when she refused to comply, she was charged with having made a number of errors in her work, and that when she attempted to contest the charges she was denied an opportunity to do so and was terminated. Page further asserts that the charges and subsequent termination were a mere “subterfuge for illegal discrimination against non believers in the Church of Scientology, women and racial minorities.”
In her complaint, Page alleged two federal causes of action, (1) a claim under Title VII,
Based on the two federal claims, the defendants removed the action to federal court. Subsequently, on May 20, 1993, the district court issued an order sua sponte to show cause why the three state law claims should not be remanded to state court. The court stated that “jurisdiction over the state claims depends upon whether this Court exercises its discretion to retain [them],” and admonished the parties to consider that “the Supreme Court defined the parameters of a federal court‘s supplemental jurisdiction in United Mine Workers v. Gibbs, 383 U.S. 715 [86 S.Ct. 1130, 16 L.Ed.2d 218] (1966).” After noting the requirements set forth in Gibbs for exercising supplemental jurisdiction, the Court added:
Even if [the Gibbs test is] met, however, a federal court has discretion to decline jurisdiction over state law claims if, for instance, the state claims substantially predominate, the state claims involve novel or complex issues of state law, trial of the state and federal claims together is likely to result in jury confusion, or retention of the state claims requires the expenditure of substantial additional judicial time and effort. [Gibbs, 383 U.S.] at 726-27 [86 S.Ct. at 1139]; see also
28 U.S.C. Sec. 1367(c) ; Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343 [108 S.Ct. 614, 98 L.Ed.2d 720] (1988).
The Removing Party(ies) should also be aware that this Court does not interpret the 1990 enactment of Section 1367 as restricting the discretionary factors set forth in Gibbs. Rather, this Court interprets Section 1367 as merely allowing this Court, at its discretion, to exercise jurisdiction over supplemental parties, which was previously foreclosed by Finley v. United States, 490 U.S. 545 [109 S.Ct. 2003, 104 L.Ed.2d 593] (1989).
The district court thereafter remanded the three state law claims, but provided no reasons.
Analysis
This petition presents several issues. First, we must determine whether we may review the district court‘s order in this case and if mandamus properly is invoked. Second, we must determine whether the district court clearly erred in its interpretation and application of the supplemental jurisdiction statute,
I. Reviewability
On its face, section 1447(d) of the Judicial Code would appear to bar review of the remand order in this case. That provision provides, with one exception not relevant here, that “[a]n order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise.”
In this case, the district court did not provide reasons for remanding the plaintiff‘s state law claims. In instances of ambiguity, this circuit “look[s] to the substance of the order to determine whether it was issued pursuant to section 1447(c).” Schmitt v. Insurance Co. of N. Am., 845 F.2d 1546, 1549 (9th Cir.1988). Here, the court retained jurisdiction over the federal claims asserted by the plaintiff, and we have held that asserting “original jurisdiction over at least one of the claims” “removes the possibility that a remand order is issued pursuant to section 1447(c).” Kunzi v. Pan Am. World Airways, Inc., 833 F.2d 1291, 1295 (9th Cir.1987). Accordingly, the remand order in this case is reviewable.
“Even though the order is reviewable, we may review the order only pursuant to the proper type of review.” Lee, 12 F.3d at 935. The Supreme Court in Thermtron held that remand orders, because they are not “final judgment[s] reviewable by appeal” are properly reviewed by ” ‘mandamus to compel action, and not by writ of error to review what has been done.’ ” Thermtron, 423 U.S. at 353, 96 S.Ct. at 594 (quoting Railroad Co. v. Wiswall, 90 U.S. (23 Wall.) 507, 508, 23 L.Ed. 103 (1875)). We have recognized a narrow exception to the availability of mandamus when the remand order can be appealed as a “collateral order” under the doctrine of Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541, 546, 69 S.Ct. 1221, 1225, 93 L.Ed. 1528 (1949), see, e.g., Lee, 12 F.3d at 935-36 (citing Whitman v. Raley‘s Inc., 886 F.2d 1177, 1180 (9th Cir.1989)). If the order properly is appealable as a collateral order, then mandamus is barred. See, e.g., Survival Systems v. United States Dist. Court, 825 F.2d 1416, 1418 (9th Cir.1987), cert. denied, 484 U.S. 1042, 108 S.Ct. 774, 98 L.Ed.2d 861 (1988); Pelleport Investors, Inc. v. Budco Quality Theatres, Inc., 741 F.2d 273, 276-78 (9th Cir.1984); see also Moses H. Cone Memorial Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 8 n. 6, 103 S.Ct. 927, 933 n. 6, 74 L.Ed.2d 765 (1983) (“[F]undamentally, a court of appeals has no occasion to engage in extraordinary review by mandamus ‘in aid of [its] jurisdictio[n],’
Petitioners contend that the collateral order doctrine is inapplicable because the district court did not resolve an issue of substantive law, but merely declined supplemental jurisdiction as a matter of discretion. Although we note that other circuits construe the collateral order doctrine in this context more broadly, see, e.g., Travelers Ins. v. Keeling, 996 F.2d 1485, 1489 (2d Cir.1993) (finding an order collateral if it “determines whether the dispute will be ... litigated in state court“), and more narrowly, see, e.g., Doughty v. Underwriters at Lloyd‘s, 6 F.3d 856, 862-64 (1st Cir.1993); Garcia v. Island Program Designer, Inc., 4 F.3d 57, 60 (1st Cir.1993); see also PAS v. Travelers, 7 F.3d 349, 352-53 (3d Cir.1993) (rejecting the doctrine altogether), in this circuit, to qualify as “collateral” the order must “resolve[ ] the merits of a matter of substantive law apart from any jurisdictional decision,” e.g., Survival Systems, 825 F.2d at 1418 (emphasis added); Whitman, 886 F.2d at 1180. While we do not know the precise reasons that compelled the district court to remand the plaintiff‘s state law claims, the basis of the remand was clearly a discretionary refusal to entertain those claims. See Show Cause Order at 1 (“[J]urisdiction over the state claims depends on whether this Court exercises its discretion to retain [them].“). This is not a decision on a matter of substantive law apart from a jurisdictional decision. See Lee, 12 F.3d at 935-36.
In addition, Petitioners did not attempt certification through the mechanism provided by
Finding no bar to our review of the petition, we turn to its merits.
II. Should Mandamus Issue?
Mandamus is an extraordinary remedy that may be obtained “only ‘to confine an inferior court to a lawful exercise of its prescribed jurisdiction or to compel it to exercise its authority when it is its duty to do so.’ ” Will v. United States, 389 U.S. 90, 95, 88 S.Ct. 269, 273, 19 L.Ed.2d 305 (1967) (quoting Roche v. Evaporated Milk Ass‘n, 319 U.S. 21, 26, 63 S.Ct. 938, 941, 87 L.Ed. 1185 (1943)). To issue the writ, the court must be ” ‘firmly convinced that the district court has erred,’ ” Valenzuela-Gonzalez v. United States Dist. Court, 915 F.2d 1276, 1279 (9th Cir.1990) (quoting Seattle Times v. United States, 845 F.2d 1513, 1515 (9th Cir.1988)), and that “the petitioner‘s right to the writ is ‘clear and indisputable,’ ” id. (quoting Kerr v. United States Dist. Court, 426 U.S. 394, 403, 96 S.Ct. 2119, 2124, 48 L.Ed.2d 725 (1976)). Consequently, we review for clear error and not abuse of discretion. See, e.g., Survival Systems, 825 F.2d at 1418-1419 nn. 1-2; Badham, 721 F.2d at 1171 (“[O]n direct appeal we review the district court‘s order under an ‘abuse of discretion’ standard while under mandamus jurisdiction we employ a more stringent standard of review.” (citation omitted)); cf. Schlagenhauf, 379 U.S. at 110, 85 S.Ct. at 238 (“The writ is appropriately issued ... when there is ‘usurpation of judicial power’ or a clear abuse of discretion[.]’ ” (quoting Bankers Life & Cas. Co. v. Holland, 346 U.S. 379, 383, 74 S.Ct. 145, 148, 98 L.Ed. 106 (1953))).
This circuit has adopted five “objective principles,” United States v. Harper, 729 F.2d 1216, 1221-22 (9th Cir.1984), for guiding determinations concerning when mandamus should issue: “(1) The party seeking the writ has no other adequate means, such as a direct appeal, to attain the relief he or she desires“; “(2) The Petitioner will be damaged or prejudiced in a way not correctable on appeal“; “(3) The district court‘s order is clearly erroneous as a matter of law“; “(4) The district court‘s order is an oft-repeated error, or manifests a persistent disregard of the federal rules“; and “(5) The district court‘s order raises new and important problems, or issues of law of first impression.” Valenzuela-Gonzalez, 915 F.2d at 1279 (quoting In re Allen, 896 F.2d 416, 419-20 (9th Cir.1990) (quoting Bauman v. United States, 557 F.2d 650, 654-55 (9th Cir.1977))).
Although we have written of these five factors that “no single [one] is determinative,” id. at 1279 (citing Bauman, 557 F.2d at 654-55), and that “all five factors need not be satisfied at once,” id. (citing In re Cement Antitrust Litig., 688 F.2d 1297, 1301 (9th Cir.1982), aff‘d mem. sub nom. Arizona v. Ash Grove Cement Co., 459 U.S. 1191, 103 S.Ct. 1173, 75 L.Ed.2d 425 (1983)), it is clear that the third factor, the existence of clear error as a matter of law, is dispositive, see Survival Systems, 825 F.2d at 1418 & 1419 n. 2 (finding all other factors irrelevant after concluding the district court‘s conclusions were legally correct); cf. Harper, 729 F.2d at 1222 (pointing out that the guidelines ” ‘are not meant to supplant reasoned and independent analysis by appellate courts’ ” (quoting In re Cement, 688 F.2d at 1301)). Accordingly, we first examine whether the district court clearly erred. After this discussion, we examine whether the other factors in the mandamus calculus point in favor of granting the writ.
A. Did the District Court Commit Clear Error?
The district court provided no reasons for its remand. However, in its Show Cause Order, the court stated that it did not “interpret Section 1367 as restricting the discretionary factors set forth in Gibbs. Rather, this court interprets Section 1367 as merely allowing this Court, at its discretion, to exercise jurisdiction over supplemental parties, which was previously foreclosed by Finley v. United States, 490 U.S. 545 [109 S.Ct. 2003, 104 L.Ed.2d 593] (1989).” In addition, the district court listed a number of factors that it took as illustrative as permissible bases for remanding pendent state law claims under Gibbs and its progeny, including whether “retention of the state claims requires the expenditure of additional judicial time and effort.”
Based on the text, structure, legislative history, and apparent purpose of section 1367, we find this interpretation of the statute erroneous. Not only does section 1367(a) create a presumption that supplemental jurisdiction should be asserted unless one of the categories specifically enumerated in section 1367(c) applies, but also at least one of the section 1367(c) categories is narrower than its Gibbs counterpart. Consequently, the district court clearly erred by relying on the wrong factors for guiding its discretion.
1. The Gibbs Test and the Origins of Section 1367
United Mine Workers v. Gibbs, 383 U.S. 715, 86 S.Ct. 1130, 16 L.Ed.2d 218 (1966), broadly authorized the federal courts to assert jurisdiction over state law claims when “[t]he state and federal claims ... derive from a common nucleus of operative fact,” the claims are such that a plaintiff “would ordinarily be expected to try them all in one judicial proceeding,” and the federal issues are “substantial[ ].” Id. at 725, 86 S.Ct. at 1138. These three factors confer power on the federal courts under Article III to hear the entire “constitutional” case. See id. The Court added critically, however, that:
[Such] power need not be exercised in every case in which it is found to exist. It has consistently been recognized that pendent jurisdiction is a doctrine of discretion, not of plaintiff‘s right. Its justification lies in considerations of judicial economy, convenience and fairness to litigants.
Id. at 726, 86 S.Ct. at 1139 (footnote omitted). Applying this standard, the Court listed several situations in which declining pendent jurisdiction would be appropriate: (1) when “[n]eedless decisions of state law should be avoided“; (2) when the federal claims are dismissed before trial, or, during the course of a case, when it appears “that a state law claim constitutes the real body of a case, to which the federal claim is only an appendage“; (3) when “state issues substantially predominate, whether in terms of proof, of the scope of the issues raised, or of the comprehensiveness of the remedy sought“; and finally (4) when there are reasons “independent of jurisdictional considerations, such as the likelihood of jury confusion in treating divergent legal theories of relief.” Id. at 726-27, 86 S.Ct. at 1139.
Gibbs subsequently was interpreted as conferring significant discretion on the federal courts to decline or assert jurisdiction over pendent state law claims, limited only by the values of “judicial economy, convenience, fairness, and comity.” See, e.g., Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350, 108 S.Ct. 614, 619, 98 L.Ed.2d 720 (1988) (“As articulated by Gibbs, the doctrine of pendent jurisdiction thus is a doctrine of flexibility, designed to allow courts to deal with cases involving pendent claims in the manner that most sensibly accommodates a range of concerns and values.” (emphasis added)); see also id. at 351, 108 S.Ct. at 619 (“[G]ibbs establishes that the pendent jurisdiction doctrine is designed to enable courts to handle cases involving state-law claims in the way that will best accommodate the values of economy convenience, fairness and comity, and Gibbs further establishes that the Judicial Branch is to shape and apply the doctrine in that light.” (emphasis added)). Numerous lower court decisions illustrate this broad view of discretion. See, e.g., Harrell v. 20th Century Ins. Co., 934 F.2d 203, 205-06 (9th Cir.1991) (emphasizing the importance the Court in Gibbs and Carnegie-Mellon placed on the values of “economy, convenience, fairness, and comity“). See generally 13B Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure, Sec. 3567.1, at 122-127 & nn. 13-16 (1984) (citing cases); id. at 26-27 nn. 13-16 (Supp.1992) (same).
As noted by many commentators, the primary deficiency of Gibbs was that it blurred the question of the power of the federal courts to entertain pendent claims under Article III with the question of congressional statutory authorization of such jurisdiction. See generally Paul M. Bator, Daniel J. Meltzer, Paul J. Mishkin & David L. Shapiro, Hart and Wechsler‘s The Federal Courts and the Federal System 1044-52 (3d ed. 1988) [hereinafter Hart and Wechsler]. The Supreme Court‘s subsequent decision in Finley v. United States, 490 U.S. 545, 109 S.Ct. 2003, 104 L.Ed.2d 593 (1989), highlighted the problems of an absence of firm statutory authority, for the Court refused to find the assertion of jurisdiction over pendent parties permissible absent congressional authorization even when federal jurisdiction was exclusive, see id. at 549-56, 109 S.Ct. at 2006-10.
Prior to Finley, a number of lower federal courts had permitted pendent-party jurisdiction as long as Congress had not “expressly or by implication negated its existence,” Aldinger v. Howard, 427 U.S. 1, 18, 96 S.Ct. 2413, 2422, 49 L.Ed.2d 276 (1976). See generally 13B Wright & Miller, supra, Sec. 3567.2 at 30-32 & n. 44 & Supp.1992 at 36 nn. 34-35 (collecting cases). Finley, however, appeared to articulate the opposite presumption: that unless Congress affirmatively conferred pendent-party jurisdiction, it would not be permitted. Indeed, a number of courts interpreted Finley “as putting an end to [pendent-party] jurisdiction,” id. Sec. 3567.2, at 30; see also id. at 32-33 n. 49 (citing cases), as well as threatening aspects of ancillary jurisdiction, see id. Sec. 3567.2, at 30. As a result, Finley evoked severe criticism. See generally Hart and Wechsler, supra, at 134-36 (Supp.1993); Richard B. Freer, Compounding Confusion and Hampering Diversity: Life after Finley and the Supplemental Jurisdiction Statute, 40 Emory L.J. 445, 464-68 (1991). In response, the Federal Court Study Committee, established by Congress in 1988, made an express recommendation to provide a statutory basis for pendent, ancillary, and pendent-party jurisdiction in a “supplemental” jurisdiction statute. See Report of the Federal Court Study Committee 47-48 (Apr. 2, 1990) [hereinafter FCSC Report]. Subsequently, Congress enacted such a statute,
2. The Relationship of Section 1367 to Gibbs
Initially, we must determine whether, as Petitioners contend, the section 1367(c) factors are the exclusive means by which supplemental jurisdiction, if permitted by sections 1367(a) and (b), can be declined, and whether the scope of those factors is narrower than the Gibbs standard. “We begin our analysis, as we must,” with the statute‘s text and structure. E.g., Mount Graham Red Squirrel v. Madigan, 954 F.2d 1441, 1451-1453 (9th Cir.1992).
a. Statutory Text and Structure
1.
On its face, section 1367 appears to make at least two changes to the Gibbs standard. First, although it retains the basic division between power and discretion, the structure of 1367 reveals a different emphasis. Gibbs stressed that courts have discretion to exercise the power conferred upon them under Article III to hear pendent state law claims. See Gibbs, 383 U.S. at 726, 86 S.Ct. at 1139. Section 1367(a), however, appears to make supplemental jurisdiction mandatory by its language that “the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution.”
- the claim raises a novel or complex issue of State law,
- the claim substantially predominates over the claim or claims over which the district court has original jurisdiction,
- the district court has dismissed all claims over which it has original jurisdiction, or
- in exceptional circumstances, there are other compelling reasons for declining jurisdiction.
We agree with a number of courts that have found this structural difference evinces an intent on the part of Congress to create a presumption that, if power exists under section 1367(a) and is not stripped by section 1367(b), supplemental jurisdiction must be asserted by a district court unless a factor specifically listed in section 1367(c) applies. See, e.g., Growth Horizons, Inc. v. Delaware County, 983 F.2d 1277, 1285 n. 14 (3d Cir.1993) (“The language in Sec. 1367 expressly ... states that ... federal courts shall exercise supplemental jurisdiction over pendent claims arising out of the same case or controversy and may decline to exercise jurisdiction [as provided by
Moreover, at least one of the discretionary factors provided in the statue for declining supplemental jurisdiction is narrower than its Gibbs counterpart. Although Gibbs, as discussed above, was interpreted as permitting a district court to decline or exercise jurisdiction over pendent state law claims when to do so would be consistent with the values of “economy, convenience, fairness, and comity,” the catch-all provided in section 1367(c)(4) permits a court to decline supplemental jurisdiction only when in “exceptional circumstances, there are other compelling reasons for declining jurisdiction,”
2.
Other courts have come to a different conclusion. For instance, the Seventh Circuit has concluded that “the new statute [was] intended to codify rather than to alter the judge-made principle[ ] of pendent ... jurisdiction.” Brazinski v. AMOCO Petroleum Additives Co., 6 F.3d 1176, 1182 (7th Cir.1993) (emphasis added); see also Palmer v. Schwan‘s Sales Enters., Inc., 1993 WL 390053, at * 1-* 5, 1993 U.S.Dist. LEXIS 14069, at * 4-* 12 (D.Kan. Sep. 27, 1993) (stating that “[s]ection 1367(c) codifies the discretionary basis [identified in Gibbs ] for declining pendent jurisdiction” and interpreting section 1367(c)(4) by reference to the Gibbs catch-all); cf. Whalen v. Carter, 954 F.2d 1087, 1097 n. 10 (5th Cir.1992) (“It is unclear whether [section 1367] merely codifies the pendent jurisdiction doctrine or actually changes the doctrine in some fashion.“); Pro-Choice Network v. Project Rescue, 828 F.Supp. 1018, 1027 n. 7 (W.D.N.Y.1993) (noting that “the statute providing for supplemental jurisdiction essentially codified existing caselaw on the subject of pendent jurisdiction” (alternations and internal quotations omitted)). Thus, it is necessary to examine the legislative history to determine if congressional intent is clearly expressed. See, e.g., Crandon v. United States, 494 U.S. 152, 158, 110 S.Ct. 997, 1001, 108 L.Ed.2d 132 (1990); Mount Graham Red Squirrel, 954 F.2d at 1452.
b. Legislative History and Statutory Purpose
Section 1367 was passed as Sec. 310 of Title III of the Judicial Improvements Act of 1990, Pub.L. No. 101-650, 104 Stat. 5089, 5113-14 (1990). The intent of Congress, apparently, was “to implement the noncontroversial recommendations of the Federal Courts Study Committee,” 150 Cong.Rec. H13313 (daily ed. Oct. 27, 1990) (statement of Rep. Kastenmeier), which was charged in 1988 with undertaking a complete study of the federal and state court systems, see Judicial Improvements and Access to Justice Act of 1988, Pub.L. No. 100-702, 120 Stat. 4642, 4644. The Federal Court Study Committee, although recommending the codification of supplemental jurisdiction, did not prepare a statute. See FCSC Report, supra, at 47-48. Rather, the statute was drafted by a number of law professors and underwent several revisions before passage. See generally Wolf, supra, at 16-20. In the end, however, section 1367(c) received only one paragraph in the House Report that accompanied the final version of the statute:
[Section 1367] codifies the factors that the Supreme Court has recognized as providing legitimate bases upon which a district court may decline jurisdiction over a supplemental claim. Subsection (c)(1)-(3) codifies the factors recognized as relevant under current law. Subsection (c)(4) acknowledges that occasionally there may exist other compelling reasons for a district court to decline supplemental jurisdiction, which the subsection does not foreclose a court from considering in exceptional circumstances.
H.R. No. 734, 101st. Cong., 2d Sess. 29 (1990), reprinted in 1990 U.S.C.C.A.N. 6802, 6860, 6875 [hereinafter House Report].7
This paragraph has its defects. On the one hand, it states that section 1367(c) as a whole codifies the factors recognized by Gibbs and its progeny for declining to exercise supplemental jurisdiction, but specifically separates section 1367(c)(1)-(3) from section 1367(c)(4) and thereby implies that the latter is not one “recognized under current law.” Thus, this passage does not contradict our conclusion that section 1367(c)(4) was not intended to restate the preexisting Gibbs standard. Indeed, the last sentence of the passage supports the conclusion that section 1367(c)(4) means precisely what it says: that outside of remands or dismissals based upon section 1367(c)(1)-(3), there must be “compelling reasons” in “exceptional circumstances” to justify not exercising supplemental jurisdiction. Accordingly, the most that can be said of the House Report is that, as one commentator has put it, it is “misleading” “insofar as it characterizes the subsection (c) factors as simply a restatement of the factors discussed in Gibbs as pertinent to the district court‘s decision.” Oakley, supra, at 767 n. 118 (emphasis added).8
That section 1367(c)(4) narrows the Gibbs catch-all is also strongly supported by a comparison of the final version of section 1367(c)(4) with the version of the statute submitted by Professors Thomas Rowe, Stephen Burbank, and Thomas Mengler. In this prior version, prepared in response to the original draft of the statute which contained no catch-all, section 1367(c) read almost precisely as it does now except that subsection 1367(c)(4) provided that supplemental jurisdiction may be declined if “there are other appropriate reasons, such as judicial economy, convenience, and fairness to the litigants, for declining jurisdiction.” Federal Courts Study Committee Implementation and Civil Justice Report Act: Hearings on H.R. 5381 Before the Subcomm. on Courts, Intellectual Property, and the Administration of Justice, 101st Cong., 2d Sess. 722 (1991) [hereinafter Hearings]. This version of section 1367(c)(4), which ultimately was rejected, of course restated the Gibbs catch-all. The change from the Gibbs catch-all to a “compelling reason” standard in the final text of the statute strongly indicates that the two standards are not coextensive, but that the latter is narrower.9
Finally, although it is true that
Consistent with this objective, another purpose of the Act was to cabin the discretion enjoyed by the lower courts under Gibbs to dismiss pendent state law claims. Commentators have noted that prior to the enactment of
c. Conclusion
1.
We conclude that section 1367 creates a presumption that supplemental jurisdiction should be asserted unless the specific factors enumerated in section 1367(c) are invoked, and that section 1367(c)(4) is narrower than the Gibbs catch-all. Therefore, the district court clearly erred. First, the district court stated that it did not believe that section 1367(c) altered the scope of its discretion under Gibbs and failed to recognize that section 1367(a) compelled the exercise of supplemental jurisdiction unless a section 1367(c) factor applied. Second, the court‘s description of the factors that it believed would justify an exercise of discretion not to entertain the state law claims included situations in which “retention of the state claims [would] require[ ] the expenditure of substantial judicial time and effort.” Because 1367(c)(4) narrows the Gibbs catch-all, however, reliance on this factor alone would have been impermissible.
2.
The fact that the district court applied the wrong legal standard would not require us necessarily to vacate the remand order if we could determine from the remand order that the factors that the court did rely upon were permissible ones. Cf. Hondo Nat‘l Bank v. Gill Savs. Ass‘n, 696 F.2d 1095, 1102 (5th Cir.1983). In this case, however, such a determination is infeasible, because the district court failed to provide reasons for its decision and the basis is not self evident. Accordingly, we turn to whether the other factors in the mandamus calculus indicate that the writ should issue to correct the district court‘s errors.
B. Is there Unrectifiable Prejudice?
We agree with Petitioners that failure to issue mandamus if otherwise appropriate would result in prejudice that could not be rectified on appeal. Permitting the remand order to stand would result in splitting the adjudication of the plaintiff‘s claim between the state and federal systems; this would impose a significant burden on both parties. Moreover, due to the closely related nature of the state and federal causes of action in this case, there is a strong possibility that the action that first comes to judgment will have issue-preclusive effect on the other action. Finally, the remand order effectively is unappealable after final judgment because once the state court proceedings have begun, it is highly unlikely that they could be enjoined on the grounds that the district court originally erred in failing to assert jurisdiction over the state law claims.
C. Are there Other Adequate Means to Attain Relief?
As noted above, Petitioners failed to seek certification pursuant to section 1292(b). Arguably, then, Petitioners have an alternative “adequate means ... to attain the relief ... desired.” Valenzuela-Gonzalez, 915 F.2d at 1276 (internal quotations omitted). Petitioners’ explanation for this omission is that an order that remands pendent state law claims cannot be a “controlling question of law” that could “materially affect the eventual outcome of the litigation” as required by section 1292(b). Petitioners’ Brief at 8 (internal quotations omitted). However, we need not decide whether, in this case, section 1292(b) certification was available. Even if it were, we would not find it to preclude mandamus because seeking certification is not a prerequisite for obtaining mandamus, see supra p. 1488, and all the other factors relevant to whether mandamus should issue point in favor of granting the writ. Cf. Caleshu v. Wangelin, 549 F.2d 93, 96 n. 5 (8th Cir.1977) (“We do not think we are about to require that petitioner first seek interlocutory review when mandamus is clearly an appropriate remedy.“).
D. Remaining Factors
It is clear to us that the district court‘s errors in this case are “likely to be ‘oft repeated.’ ” Valenzuela-Gonzalez, 915 F.2d at 1279 (emphasis added). Although there is no evidence of the extent to which district courts have interpreted section 1367 erroneously, this certainly is the type of error that is likely to persist if the appropriate standards are not clarified. Moreover, the relationship between section 1367 and the Gibbs regime is clearly an important issue that has not directly been passed upon by this circuit.11 Therefore, issuing the writ would advance this circuit‘s policy that “mandamus is particularly appropriate when [a court] is called upon to determine the construction of a federal procedural rule in a new context.” Valenzuela-Gonzalez, 915 F.2d at 1279 (citing, inter alia, Schlagenhauf v.
Holder, 379 U.S. 104, 111, 85 S.Ct. 234, 238, 13 L.Ed.2d 152 (1964)). Finally, because numerous cases involve supplemental jurisdiction, granting the writ to resolve the issues considered above would “substantially aid the administration of justice.” City of Las Vegas v. Foley, 747 F.2d 1294, 1296 (9th Cir.1984).
E. The Scope of Relief
Accordingly, we conclude that the issuance of the writ in this case is appropriate. We hold that the district court clearly erred by misapprehending the appropriate source and scope of its discretion. Thus, we vacate the remand order entered by the district court. We wish to make clear, however, that nothing in the above analysis is meant to indicate whether or not supplemental jurisdiction in this case is inappropriate; it remains the duty of the district court to consider the propriety of pendent jurisdiction “at every stage of the litigation,” Carnegie-Mellon, 484 U.S. at 350, 108 S.Ct. at 619, after proper consideration of section 1367.
Conclusion
To recapitulate, we hold that the district court clearly erred in concluding that the enactment of
For the above reasons, the writ of mandamus is GRANTED, and an order shall be entered VACATING the remand order entered by the district court.
LEAVY, Circuit Judge, dissenting:
I dissent.
Prior to the passage of
As part of an attempt to remedy “mounting public and professional concern with the federal court‘s congestion, delay, expense, and expansion,” the Chief Justice, at the direction of Congress, appointed the Federal Courts Study Committee to, among other things, propose a solution to those problems. Report of the Federal Court Study Committee, at 3 (April 2, 1990) (hereinafter “Committee Report“). The Committee was “not asked to propose changes in substantive law.” Id. Rather, the “proposals [were to be] incremental, not radical; we have explicitly foresworn radical proposals.” Id. at 4.
To overcome the restrictions on supplemental jurisdiction created by Finley v. United States, 490 U.S. 545, 109 S.Ct. 2003, 104 L.Ed.2d 593 (1989), the Committee wished to “plac[e] a firm statutory foundation under ‘pendent party jurisdiction,’ which enables a federal claimant to name as a defendant a party against whom the claimant has a related claim under state law, in order to be able to present the entire case in one court (and that a federal court).” Id. at 15. Thus the Committee advocated legislation to give the courts the authority “to hear and determine, without an independent basis of federal jurisdiction, claims related to matters properly before them.” Id. at 47. The Committee intended that the legislation commit the exercise of supplemental jurisdiction to the discretion of the district courts:
These supplemental forms of jurisdiction which may be exercised in the discretion of the federal courts, enable them to take full advantage of the rules on claim and party joinder to deal economically--in single rather than multiple litigation--with matters arising from the same transaction or occurrence. Pendent and ancillary jurisdiction may be used with respect either to additional claims between parties already before the courts (as with compulsory counterclaims) or to claims bringing in new parties (as with impleader of a third-party defendant).
Id. (emphasis added).
I. Section 1367(a)
In line with the Committee‘s intent to codify supplemental jurisdiction,
Except as provided in subsections (b) and (c) or as expressly provided otherwise by Federal statute, in any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution. Such supplemental jurisdiction shall include claims that involve the joinder or intervention of additional parties.
(Emphasis added.)
II. Section 1367(c)
While
- the claim raises a novel or complex issue of State law,
- the claim substantially predominates over the claim or claims over which the district court has original jurisdiction,
- the district court has dismissed all claims over which it has original jurisdiction, or
- in exceptional circumstances, there are other compelling reasons for declining jurisdiction.
The House Report that accompanied the final version of the statute explains the goal of
[
Section 1367(c) ] codifies the factors that the Supreme Court has recognized as providing legitimate bases upon which a district court may decline jurisdiction over a supplemental claim. Subsection (c)(1)-(3) codifies the factors recognized as relevant under current law. Subsection (c)(4) acknowledges that occasionally there may exist other compelling reasons for a district court to decline supplemental jurisdiction, which the subsection does not foreclose a court from considering in exceptional circumstances.
H.R. No. 734, 101st Cong., 2d Sess. 29 (1990), reprinted in 1990 U.S.C.A.A.N. 6860, 6875. To say that “[s]ubsection (c)(1)-(3) codifies the factors recognized as relevant under current law” is a recognition that the factors in Gibbs; i.e. judicial economy, convenience and fairness to litigants, and comity, Gibbs, 383 U.S. at 726, 86 S.Ct. at 1139, are incorporated in the statute.
The House Report speaks of “factors” recognized under current law. It also speaks of “reasons” for a court to decline jurisdiction which the subsection “does not foreclose a court from considering in exceptional circumstances.” (Emphasis added.) None of the language of the House Report suggests that the “factors” are threshold requirements that must be met before the court is allowed to exercise its discretion. To the contrary, the use of the word “factors” indicates that guidelines for exercising discretion are being codified.
I do not believe the legislation was intended to abandon the doctrine of pendent jurisdiction as “a doctrine of flexibility, designed to allow courts to deal with cases involving pendent claims in the manner that most sensibly accommodates a range of concerns and values.” Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350, 108 S.Ct. 614, 619, 98 L.Ed.2d 720 (1988). In line with the broad discretion conferred by
The intent of Congress was “to implement the noncontroversial recommendations of the Federal Courts Study Committee.” 150 Cong.Rec. H13313 (daily ed. Oct 27, 1990) (statement of Rep. Kastenmeier). Both the Federal Courts Study Committee and Congress clearly expressed their intention that a statutory basis for Gibbs be provided, that the implementation of that goal was to be “noncontroversial,” not “radical,” and that no changes in substantive law were proposed. The language of the statute and its legislative history are consistent, but the majority has chosen a radical approach to the application of the statute by compelling district courts to exercise supplemental jurisdiction. Although a codification of Gibbs may not conform to what one law professor thought should happen with supplemental jurisdiction, see Federal Courts Study Committee Implementation and Civil Justice Report Act: Hearings on H.R. 5381 Before the Subcomm. on Courts, Intellectual Property, and the Administration of Justice, 101st Cong., 2d Sess., at 708 (1991) (the letter of Prof. Thomas M. Mengler), nowhere in the legislative history does it appear that Congress intended to change the standards of Gibbs, or that district courts were being compelled to exercise supplemental jurisdiction.
Contrary to what the majority suggests, the Third Circuit has correctly interpreted
Subsection [1367] (c) ... provides that a district court may, in its discretion, decline to exercise jurisdiction if any of four conditions [of section 1367(c) ] are met ... In making its determination, the district court should take into account generally accepted principles of “judicial economy, convenience, and fairness to the litigants.”
(quoting United Mine Workers v. Gibbs, 383 U.S. 715, 726, 86 S.Ct. 1130, 1139, 16 L.Ed.2d 218 (1966)). The Third Circuit explains:
“Whether a dismissal of the touchstone claim should bring about a dismissal ... of the dependent claim for want of supplemental jurisdiction would hinge on the moment within the litigation when the dismissal of the touchstone claim takes place and on the other surrounding circumstances.... [I]f the dismissal of the main claim occurs late in the action, ... knocking [the dependent claims] down with a belated rejection of supplemental jurisdiction may not be fair.”
Id. at 1284-85 (quoting David D. Siegel, Practice Commentary, appended to
Because the Gibbs standards survived the enactment of
ORDER
April 18, 1994.
The mandate, filed January 27, 1994 in this case, is hereby RECALLED and VACATED.
Notes
When a district judge, in making in a civil action an order not otherwise appealable under this section, shall be of the opinion that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that immediate appeal from the order may materially advance the ultimate termination of the litigation, he shall so state in writing in such order. The Court of Appeals .. may thereupon, in its discretion, permit an appeal to be taken from such an order....
The complete text of
(a) Except as provided in subsections (b) and (c) or as expressly provided otherwise by Federal statute, in any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution. Such supplemental jurisdiction shall include claims that involve the joinder or intervention of additional parties.
(b) In any civil action of which the district courts have original jurisdiction founded solely on section 1332 of this title, the district courts shall not have supplemental jurisdiction under subsection (a) over claims by plaintiffs against persons made parties under Rule 14, 19, 20, or 24 of the Federal Rules of Civil Procedure, or over claims by persons proposed to be joined as plaintiffs under Rule 19 of such rules, or seeking to intervene as plaintiffs under Rule 24 of such rules, when exercising supplemental jurisdiction over such claims would be inconsistent with the jurisdictional requirements of section 1332.
(c) The district courts may decline to exercise supplemental jurisdiction over claims under subsection (a) if--
(1) the claim raises a novel or complex issue of State law,
(2) the claim substantially predominates over the claim or claims over which the district court had original jurisdiction,
(3) the district court has dismissed all claims over which it has original jurisdiction, or
(4) in exceptional circumstances, there are other compelling reasons for declining jurisdiction.
(d) The period of limitations for any claim asserted under subsection (a), and for any other claim in the same action that is voluntarily dismissed at the same time as or after the dismissal of the claim under subsection (a), shall be tolled while the claim is pending and for a period of 30 days after it is dismissed unless State law provides for a longer tolling period.
(e) as used in this section, the term “State” includes the District of Columbia, the Commonwealth of Puerto Rico, and any territory or possession of the United States.
Judge Leavy in his dissent suggests that we misread Growth Horizons because this “footnote ... misreads the statute.” Dissent at 1499-1500. However, nothing in our analysis contradicts that of the Growth Horizons court. As explained below, see infra note 6, it appears that
More fundamentally, Judge Leavy‘s assertion that
Our interpretation of
Thus, we do not believe our holding is in tension with our prior decision in Imagineering, Inc. v. Kiewit Pac. Co., 976 F.2d 1303 (9th Cir.1992), cert. denied, --- U.S. ----, 113 S.Ct. 1644, 123 L.Ed.2d 266 (1993). There, we held that