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Caterpillar
v Lewis
519 U S. 61 [1996]
Author:- Sam
Biers
Relevant
Facts: Lewis, a Kentucky resident, commenced this
civil action in Kentucky state court after sustaining personal
injuries while operating a bulldozer. Asserting state-law claims,
Lewis named as defendants both the manufacturer of the
bulldozer--petitioner Caterpillar Inc., a Delaware corporation
with its principal place of business in Illinois--and the company
that serviced the bulldozer--Whayne Supply Company, a Kentucky
corporation with its principal place of business in Kentucky.
Liberty Mutual, a MA corporation, intervened later as an
additional Pl, asserting subrogation claims against Whayne and
Caterpillar. Lewis entered into a settlement agreement w/ Whayne,
which allowed Whayne to be dismissed as a Df. With 1 day to spare
the statutory req. Caterpillar filed a notice of removal to Fed
D. CT in Kentucky, based on complete diversity after Whayne
exited the case post-settlement.
Legal
Issue(s): Whether a district court's error in failing to remand a
case improperly removed is fatal to the ensuing adjudication if
federal jurisdictional requirements are met at the time judgment
is entered?
Court’s
Holding: No
Procedure: Lewis
objected to removal and moved to remand to state ct. (Liberty had
not settled its subrogation w/ Whanye yet). D Ct denied
that motion without addressing argument. 3 yrs later
Liberty and Whayne settled. Jury trial followed, verdict
for Caterpillar. Sixth Circuit vacated the judgment,
concluding that, absent complete diversity at the time of
removal, the District Court lacked subject- matter
jurisdiction. 6th erred in resting its decision
on the absence of subject matter jurisdiction. Reversed and
remanded.
Law
or Rule(s): Motion for remand for defects in removal must be made
within 30 days. District court orders remanding cases to
state courts are not reviewable on appeal or
otherwise. Despite a denial of a motion to remand if
a jurisdictional defect remains uncured, the judgment must be
vacated.
Court
Rationale: At the time of trial there was complete diversity and
federal subject matter jurisdiction. Caterpillar failed to
meet the 1441 req that the case be fit for federal adjudication
at the time the removal petition is filed. Lewis timely
filed motion for remand and did all that was req to preserve his
objection to removal. No jurisdictional defect lingered through
judgment in the District Court. The procedural requirements
for removal remain enforceable by the federal trial court judges
to whom those requirements are directly addressed. The well
advised Df will foresee the likely outcome of an unwarranted
removal = a swift and nonreviewable remand order attended by the
displeasure of a district court whose authority has been
improperly invoked.
Plaintiff’s
Argument: Removal of the case when diversity was incomplete is a
jurisdictional defect therefore the court lack subject matter
jurisdiction. Adherence to the rules Congress prescribed for
removal would have kept the case in state court.
Defendant’s
Argument: At the time of trial and judgment complete diversity
existed because of the change in parties, ie. Whayne’s
absence, which cured the procedural misstep.
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