Carlsbad Technology, Inc. v. HIF Bio, Inc., 556 U.S. 635 (2009)
SYLLABUS
OCTOBER TERM, 2008
CARLSBAD TECHNOLOGY, INC. V. HIF BIO, INC.
SUPREME COURT OF THE UNITED STATES
CARLSBAD TECHNOLOGY, INC. v. HIF BIO, INC., et al.
certiorari to the united states court of appeals for the federal circuit
No. 07–1437. Argued February 24, 2009—Decided May 4, 2009
Respondents filed a state-court suit alleging that petitioner had violated state and federal law in connection with a patent dispute. After removing the case to Federal District Court under 28 U. S. C. §1441(c), which allows removal if the case includes at least one claim over which the federal court has original jurisdiction, petitioner moved to dismiss the suit’s only federal claim, which arose under the Racketeer Influenced and Corrupt Organizations Act (RICO). Agreeing that respondents had failed to state a RICO claim upon which relief could be granted, the District Court dismissed the claim; declined to exercise supplemental jurisdiction over the remaining state-law claims under §1367(c)(3), which allows such a course if the court “has dismissed all claims over which it has original jurisdiction”; and remanded the case to state court. The Federal Circuit dismissed petitioner’s appeal, finding that the remand order could be colorably characterized as based on a “lack of subject matter jurisdiction” over the state-law claims, §1447(c), and was therefore “not reviewable on appeal,” §1447(d).
Held: A district court’s order remanding a case to state court after declining to exercise supplemental jurisdiction over state-law claims is not a remand for lack of subject-matter jurisdiction for which appellate review is barred by §§1447(c) and (d). With respect to supplemental jurisdiction, a federal court has subject-matter jurisdiction over specified state-law claims, see §§1367(a), (c), and its decision whether to exercise that jurisdiction after dismissing every claim over which it had original jurisdiction is purely discretionary, see, e.g., Osborn v. Haley, 549 U. S. 225, 245. It is undisputed that when this case was removed, the District Court had original jurisdiction over the federal RICO claim under §1331 and supplemental jurisdiction over the state-law claims, which were “so related to claims … within such original jurisdiction that they form[ed] part of the same case or controversy,” §1367(a). On dismissing the RICO claim, the court retained its statutory supplemental jurisdiction over the state-law claims. Its decision not to exercise that statutory authority was not based on a jurisdictional defect, but on its discretionary choice. See Chicago v. International College of Surgeons, 522 U. S. 156, 173. Pp. 3–6.
508 F. 3d 659, reversed and remanded.
Thomas, J., delivered the opinion for a unanimous Court. Stevens, J., and Scalia, J., filed concurring opinions. Breyer, J., filed a concurring opinion, in which Souter, J., joined.
OPINION OF THE COURT
CARLSBAD TECHNOLOGY, INC. V. HIF BIO, INC.
556 U. S. ____ (2009)
SUPREME COURT OF THE UNITED STATES
NO. 07-1437
CARLSBAD TECHNOLOGY, INC., PETITIONER v. HIF BIO, INC., et al. on writ of certiorari to the united states court of appeals for the federal circuit [May 4, 2009] Justice Thomas delivered the opinion of the Court. In this case, we decide whether a federal court of appeals has jurisdiction to review a district court’s order that remands a case to state court after declining to exercise supplemental jurisdiction over state-law claims under 28 U. S. C. §1367(c). The Court of Appeals for the Federal Circuit held that appellate review of such an order is barred by §1447(d) because it viewed the remand order in this case as resting on the District Court’s lack of subject-matter jurisdiction over the state-law claims. We disagree and reverse the judgment of the Court of Appeals. I In 2005, respondents filed a complaint against petitioner and others in California state court, alleging that petitioner had violated state and federal law in connection with a patent dispute. Petitioner removed the case to the United States District Court for the Central District of California pursuant to §1441(c), which allows removal of an “entire case” when it includes at least one claim over which the federal district court has original jurisdiction. Petitioner then filed a motion to dismiss the only federal claim in the lawsuit, which arose under the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U. S. C. §§1961–1968, for failure to adequately allege a pattern of racketeering. HIF Bio, Inc. v. Yung Shin Pharmaceuticals Indus. Co., 508 F. 3d 659, 662 (CA Fed. 2007). The District Court agreed that respondents had failed to state a RICO claim upon which relief could be granted and dismissed the claim pursuant to Federal Rule of Civil Procedure 12(b)(6). The District Court also declined to exercise supplemental jurisdiction over the remaining state-law claims pursuant to 28 U. S. C. §1367(c)(3), which provides that a district court “may decline to exercise supplemental jurisdiction over a claim” if “the district court has dismissed all claims over which it has original jurisdiction.” The District Court then remanded the case to state court as authorized by this Court’s decision in Carnegie-Mellon Univ. v. Cohill, 484 U. S. 343 (1988). Petitioner appealed to the United States Court of Appeals for the Federal Circuit, arguing that the District Court should have exercised supplemental jurisdiction over the state-law claims because they implicate federal patent-law rights. 508 F. 3d, at 663. The Court of Appeals dismissed the appeal, finding that the remand order could “be colorably characterized as a remand based on lack of subject matter jurisdiction” and, therefore, could not be reviewed under §§1447(c) and (d), which provide in part that remands for “lack of subject matter jurisdiction” are “not reviewable on appeal or otherwise.” See id., at 667. This Court has not yet decided whether a district court’s order remanding a case to state court after declining to exercise supplemental jurisdiction is a remand for lack of subject-matter jurisdiction for which appellate review is barred by §§1447(c) and (d). See Powerex Corp. v. Reliant Energy Services, Inc., 551 U. S. 224, 235, n. 4 (2007) (“We have never passed on whether Cohill remands are subject-matter jurisdictional for purposes of … §1447(c) and §1447(d)”). We granted certiorari to resolve this question, 555 U. S. ___ (2008), and now hold that such remand orders are not based on a lack of subject-matter jurisdiction. Accordingly, we reverse the judgment of the Court of Appeals and remand for further proceedings. II Appellate review of remand orders is limited by 28 U. S. C. §1447(d), which states: “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.” This Court has consistently held that §1447(d) must be read in pari materia with §1447(c), thus limiting the remands barred from appellate review by §1447(d) to those that are based on a ground specified in §1447(c). See Thermtron Products, Inc. v. Hermansdorfer, 423 U. S. 336, 345–346 (1976); see also Powerex, supra, at 229; Quackenbush v. Allstate Ins. Co., 517 U. S. 706, 711–712 (1996); Things Remembered, Inc. v. Petrarca, 516 U. S. 124, 127 (1995).*
556 U. S. ____ (2009)
CARLSBAD TECHNOLOGY, INC. V. HIF BIO, INC.
556 U. S. ____ (2009)
SUPREME COURT OF THE UNITED STATES
NO. 07-1437
CARLSBAD TECHNOLOGY, INC., PETITIONER v. HIF BIO, INC., et al. on writ of certiorari to the united states court of appeals for the federal circuit [May 4, 2009] Justice Stevens, concurring. In his dissenting opinion in Thermtron Products, Inc. v. Hermansdorfer, 423 U. S. 336, 360 (1976), then-Justice Rehnquist remarked that he could “perceive no justification for the Court’s decision to ignore the express directive of Congress in favor of what it personally perceives to be ‘justice’ in this case.” He began his dissent with a comment that is also applicable to the case before us today: “The Court of Appeals not unreasonably believed that 28 U. S. C. §1447(d) means what it says. It says: ‘An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise … .’ ” Id., at 354. Today, as in Thermtron, the Court holds that §1447(d) does not mean what it says. If we were writing on a clean slate, I would adhere to the statute’s text. But Thermtron’s limiting construction applies equally to this case as it did to Powerex Corp. v. Reliant Energy Services, Inc., 551 U. S. 224, 229–230 (2007), Quackenbush v. Allstate Ins. Co., 517 U. S. 706, 711–712 (1996), and Things Remembered, Inc. v. Petrarca, 516 U. S. 124, 127–128 (1995), and stare decisis compels the conclusion that the District Court’s remand order is reviewable notwithstanding §1447(d)’s unambiguous contrary command. The Court’s adherence to precedent in this case represents a welcome departure from its sometimes single-minded focus on literal text. Accordingly, I join the Court’s opinion.
556 U. S. ____ (2009)
CARLSBAD TECHNOLOGY, INC. V. HIF BIO, INC.
556 U. S. ____ (2009)
SUPREME COURT OF THE UNITED STATES
NO. 07-1437
CARLSBAD TECHNOLOGY, INC., PETITIONER v. HIF BIO, INC., et al. on writ of certiorari to the united states court of appeals for the federal circuit [May 4, 2009] Justice Breyer, with whom Justice Souter joins, concurring. I join the Court’s opinion. I write separately to note an anomaly about the way 28 U. S. C. §1447 works. In this case, we consider a District Court’s decision not to retain on its docket a case that once contained federal law issues but now contains only state law issues. All agree that the law grants the District Court broad discretion to determine whether it should keep such cases on its docket, that a decision to do so (or not to do so) rarely involves major legal questions, and that (even if wrong) a district court decision of this kind will not often have major adverse consequences. We now hold that §1447 permits appellate courts to review a district court decision of this kind, even if only for abuse of discretion. Contrast today’s decision with our decision two Terms ago in Powerex Corp. v. Reliant Energy Services, Inc., 551 U. S. 224 (2007). In that case, we considered a District Court’s decision to remand a case in which a Canadian province-owned power company had sought removal—a matter that the Foreign Sovereign Immunities Act of 1976 specifically authorizes federal judges (in certain instances) to decide. See §§1441(d); 1603(a). The case presented a difficult legal question involving the commercial activities of a foreign sovereign; and the District Court’s decision (if wrong) had potentially serious adverse consequences, namely preventing a sovereign power from obtaining the federal trial to which the law (in its view) entitled it. We nonetheless held that §1447 forbids appellate courts from reviewing a district court decision of this kind. Id., at 238–239. Thus, we have held that §1447 permits review of a district court decision in an instance where that decision is unlikely to be wrong and where a wrong decision is unlikely to work serious harm. And we have held that §1447 forbids review of a district court decision in an instance where that decision may well be wrong and where a wrong decision could work considerable harm. Unless the circumstances I describe are unusual, something is wrong. And the fact that we have read other exceptions in the statute’s absolute-sounding language suggests that such circumstances are not all that unusual. See Osborn v. Haley, 549 U. S. 225, 240–244 (2007); Thermtron Products, Inc. v. Hermansdorfer, 423 U. S. 336, 350–352 (1976). Consequently, while joining the majority, I suggest that experts in this area of the law reexamine the matter with an eye toward determining whether statutory revision is appropriate.
SCALIA, J., CONCURRING
CARLSBAD TECHNOLOGY, INC. V. HIF BIO, INC.
556 U. S. ____ (2009)
SUPREME COURT OF THE UNITED STATES
NO. 07-1437
CARLSBAD TECHNOLOGY, INC., PETITIONER v. HIF BIO, INC., et al. on writ of certiorari to the united states court of appeals for the federal circuit [May 4, 2009] Justice Scalia, concurring. The Court today does nothing more than accurately apply to the facts of this case our holding in Thermtron Products, Inc. v. Hermansdorfer, 423 U. S. 336 (1976). Ante, at 3–6.*