Executive Software North America, Inc. v. United States District Court for the Central District of California

24 F.3d 1545
Court of Appeals for the Ninth Circuit·Decided May 16, 1994·No. No. 93-70679·Published·Cited by 17 cases

Opinions

ORDER

The opinion and dissent filed January 27, 1994, slip op. 853, and appearing at 15 F.3d 1484 (9th Cir.1994), are withdrawn. A new opinion and dissent are filed in their place.

[1548]*1548OPINION

D.W. NELSON, Circuit Judge:

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 plaintiffs pendent state law claims, the district court misapprehended the scope of the supplemental jurisdiction statute, 28 U.S.C.A. § 1367 (West Supp.1992), and failed to undertake the case-specific analysis required by that statute. In addition, Petitioners contend that, on a proper application of section 1367, a remand of their state law claims cannot be justified. Finally, Petitioners assert that mandamus is their only means of remedying this asserted error. For the reasons stated below, we grant the writ, but on narrower grounds than urged by the parties.

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, 42 U.S.C. § 2000(e) et seq. (1988), and (2) a claim under 42 U.S.C. § 1983 (1988), as well as three state-law causes of action, including (1) a claim for unlawful religious and racial discrimination under the California Fair Employment and Housing Act (“FEHA”), Cal. Gov’t Code § 12940 (Deering 1982 & Supp. 1992), (2) a claim of wrongful termination in violation of the California Constitution, Art. I § 7(a), and (3) a claim for negligent supervision.

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 1139-40]; see also 28 U.S.C. § 1367(c); Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343 [108 S.Ct. 614, 98 L.Ed.2d 720] (1988).
The Removing Partyfies) 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 [1549]*1549was 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, 28 U.S.C.A. § 1367 (West Supp. 1992), and if other factors counsel in favor of issuing the writ.

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.” 28 U.S.C. § 1447(d) (1988). In Thermtron Prods., Inc. v. Hermansdorfer, 423 U.S. 336, 96 S.Ct. 584, 46 L.Ed.2d 542 (1976), however, the Supreme Court held that section 1447(d) barred review only of those remand orders “issued under § 1447(c) and invoking the grounds specified therein — that removal was improvident and without jurisdiction,” id. at 346, 96 S.Ct. at 590; see also Gravitt v. Southwestern Bell Tel. Co., 430 U.S. 723, 723-24, 97 S.Ct. 1439, 1439-40, 52 L.Ed.2d 1 (1977) (per curiam) (finding unreviewable a remand order that purported to rely on § 1447(e)). In this circuit, a district court’s order remanding pendent state law claims on discretionary grounds is not considered one made pursuant to section 1447(c). See Lee v. City of Beaumont, 12 F.3d 933, 935 (9th Cir.1993); Sever v. Alaska Pulp Corp., 978 F.2d 1529, 1539 (9th Cir.1992).

In this case, the district court did not provide reasons for remanding the plaintiffs 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).

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Executive Software North America, Inc. v. United States District Court for the Central District of California, 24 F.3d 1545 (9th Cir. 1994).

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