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Hunt v. Acromed Corp.

filed: April 16, 1992; As Corrected April 20, 1992.

THOMAS HUNT, MARIA HUNT
v.
ACROMED CORPORATION, APPELLANT



On Appeal from the United States District Court for the Eastern District of Pennsylvania. (D.C. Civil No. 91-4139)

Before: Greenberg and Scirica, Circuit Judges, and Debevoise, District Judge*fn*

Author: Greenberg

Opinion OF THE COURT

GREENBERG, Circuit Judge.

Appellant Acromed Corporation appeals from an order entered on September 4, 1991, denying its motion to amend its notice of removal of this action from the Court of Common Pleas of Philadelphia County to the United States District Court for the Eastern District of Pennsylvania. The district court denied the motion on the ground that it lacked jurisdiction and, as we agree, we will dismiss the appeal.

The facts of the case are not in dispute. The appellees, Thomas Hunt and Maria Hunt, who are husband and wife and are citizens of Pennsylvania, brought a damages action against Acromed on or about June 19, 1991, by filing a complaint in the common pleas court alleging that Thomas Hunt had been injured when a supporting screw used in a posterior spinal fusion performed on him fractured. Acromed allegedly manufactured, supplied and/or sold the screw and thus the Hunts asserted that it was liable to them on theories of negligence, strict liability and breach of warranty. The complaint gave Acromed's address as being in care of a registered agent in Cleveland, Ohio. On June 28, 1991, Acromed filed a timely notice of removal in the district court pursuant to 28 U.S.C. § 1446(a) in which it recited that the Hunts are citizens of Pennsylvania and Acromed "is a corporation organized and existing under and by virtue of the laws of the State of Ohio, with a principal place of business in Cleveland, Ohio at [3303 Carnegie Avenue]." Therefore, Acromed requested removal on the basis of diversity of citizenship under 28 U.S.C. § 1332.

On July 24, 1991, the district court entered an order remanding the case to the common pleas court because the notice of removal set forth Acromed's state of incorporation and where it has " a principal place of business." (emphasis added). The court regarded this notice as insufficient because, for purposes of diversity of citizenship under 28 U.S.C. § 1332(c)(1), a corporation "shall be deemed to be a citizen of any State by which it has been incorporated and of the State where it has its principal place of business . . . ." (emphasis added). In its order the district court cited Kelly v. United States Steel Corp., 284 F.2d 850, 853 (3d Cir. 1960); Campbell v. Associated Press, 223 F. Supp. 151, 153-54 (E.D. Pa. 1963); and Kaufman v. General Ins. Co., 192 F. Supp. 238, 240-42 (S.D. Cal. 1961), as supporting the distinction it drew between "a" and "its" principal place of business. Significantly, pursuant to 28 U.S.C. § 1447(c), the clerk of the district court sent a certified copy of the order of remand on July 24, 1991, to the Philadelphia prothonotary who serves as the clerk of the common pleas court.

On July 29, 1991, Acromed filed a motion in the district court seeking reconsideration of the order of July 24, 1991, and also filed an amended notice of removal asserting that Acromed had "its" principal place of business in Ohio. In an accompanying memorandum of law, Acromed acknowledged that the district court "properly" relied on Campbell and Kelly in remanding the matter and further conceded that Acromed erroneously set forth that it had "a" principal place of business in Cleveland. It asserted, however, that "its" principal place of business was in that city. In addition to acknowledging that the original notice of removal was defective, Acromed concedes that the amended notice of removal was not filed within the 30-day limit provided in 28 U.S.C. § 1446(b), as it contends in its brief on this appeal that the amended notice "was filed within five (5) days of the expiration of the 30-day statutory period set forth in [28 U.S.C. § 1446(b)] and . . . should have been accepted on the basis of a de minimis non curat lex exception."*fn1

On July 31, 1991, the district court signed an order denying the motion for reconsideration and reciting that the amended notice of removal was untimely. The order further set forth that the court "lacks subject matter jurisdiction."

On August 2, 1991, Acromed filed a motion seeking leave "to file an Amended Notice of Removal to correct the technically defective allegation set forth in its original Notice of Removal." In support of this application for relief, it relied on Fed. R. Civ. P. 15(a) which provides that leave to amend "shall be freely given when Justice so requires," and 28 U.S.C. § 1653 which provides that "defective allegations of jurisdiction may be amended, upon terms, in the trial or appellate courts." It also urged that the district court had diversity jurisdiction and that the "great weight of judicial authority favors the rule that amendments to removal petitions should be permitted to implement the spirit of the statute*fn2 where the jurisdictional facts do indeed exist, and the parties are in law entitled to invoke the jurisdiction of the Federal Court."*fn3 By order of September 3, 1991, entered on September 4, 1991, the district court denied the motion in an order which again indicated that it lacked subject matter jurisdiction. Acromed has appealed from the order of September 4, 1991.

When we examined Acromed's brief and the record, it appeared to us that there might be a jurisdictional problem which Acromed had not addressed.*fn4 While the brief urged that the district court abused its discretion when it denied Acromed's motion to file an amended notice of removal, it ignored the circumstance that, as we previously indicated, on July 24, 1991, a certified copy of the order of remand was sent by the clerk of the district court to the Philadelphia prothonotary. The clerk's action implicated 28 U.S.C. § 1447(c) which provides that "[a] certified copy of the order of remand shall be mailed by the clerk to the clerk of the State court. The State court may thereupon proceed with such case." We thus brought Browning v. Navarro, 743 F.2d 1069, 1078 (5th Cir. 1984), to Acromed's attention and asked for comment on it in light of the court's Conclusion in that case, which considered that section and concluded that "the federal court is completely divested of jurisdiction once it mails a certified copy of the order to the clerk of the state court." (footnote omitted). In response, Acromed filed a jurisdictional statement which addressed the effect on its right to appeal of 28 U.S.C. § 1447(d), and which largely repeated the arguments in its brief.*fn5 Acromed did not cite Browning, however, or address the jurisdictional problem created by the clerk's physical act of mailing the certified copy of the order of remand to the prothonotary.

In fact, there is no answer to the jurisdictional problem identified in Browning, which holds:

It is axiomatic that remanding a case to state court terminates the jurisdiction of a federal bankruptcy or district court over that case. United States v. Rice, 327 U.S. 742, 66 S. Ct. 835, 90 L. Ed. 982 (1946) (applying 28 U.S.C. § 71); Robertson v. Ball, 534 F.2d 63, 66 n.5 (5th Cir. 1976) ('Once the federal district court considers the proper factors and decides to remand, the action should go forward in state court without the further delay of appeal, and without regard to whether the federal district court was correct or incorrect.'); 14 C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure: Jurisdiction § 3739 (1976 & Supp. 1983); cf. E.D. Systems Corp. v. Southwestern Bell Telephone Co., 674 F.2d 453 (5th Cir. 1982) (federal court lost jurisdiction as to claims it remanded to state court, but retained jurisdiction over proceedings excepted from the remand order). Even a federal court, persuaded that it has issued an erroneous remand order, cannot vacate the order once entered. In re La Providencia Development Corp., 406 F.2d 251 (1st Cir. 1969). The federal court is completely divested of jurisdiction once it mails a certified copy of the order to the clerk of the state court. See 28 U.S.C. § 1447(c); 1A J. Moore & B. Ringle, Moore's Federal Practice para. 0.169[2.-1], at 697 (2d ed. 1983); 14 C. Wright, A. Miller & E. Cooper, supra, § 3739, at 764-65; see also Bucy v. Nevada Construction Co., 125 F.2d 213 (9th Cir. 1942) (district court could review and set aside its own ...


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