Haffley v. Nationwide Mtl Ins

• Court: Court of Appeals for the Fifth Circuit
• Decided: May 22, 2003
• Docket: 02-41278
• Status: Unpublished

Opinion

United States Court of Appeals Fifth Circuit F I L E D UNITED STATES COURT OF APPEALS May 21, 2003 FOR THE FIFTH CIRCUIT ____________________ Charles R. Fulbruge III Clerk No. 02-41278 Summary Calendar ____________________

DAVID HAFFLEY, Deceased; MARY LOU HAFFLEY; KATRINA KAY HAFFLEY,

Plaintiffs-Appellees,

versus

NATIONWIDE MUTUAL INSURANCE CO.; JOHN VEALE; NATIONWIDE INSURANCE CO.,

Defendants-Appellants. _________________________________________________________________

Appeal from the United States District Court for the Eastern District of Texas (6:02-CV-197) _________________________________________________________________

Before BARKSDALE, DeMOSS, and BENAVIDES, Circuit Judges.

PER CURIAM:*

Nationwide appeals the remand of this action, pursuant to 28

U.S.C. § 1447(c), to Texas state court. Alternatively, it

petitions for mandamus relief. Nationwide also appeals the

district court’s awarding plaintiff costs and fees related to

Nationwide’s removal.

Judy Chaney, pursuant to a turnover order through which she

obtained the Haffleys’ rights against Nationwide, brought suit in

* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4. Texas state court. She alleged: (1) unfair claim settlement

practices under, inter alia, Art. 21.21, § 4(10) of the Texas

Insurance Code; (2) breach of the duty to settle; and (3) violation

of the Texas Deceptive Trade Practices Act (DTPA). Chaney also

sought a declaratory judgment that a release signed by the Haffleys

regarding these claims was invalid. Nationwide removed to federal

court, contending that its employee, Veale, had been fraudulently

joined to defeat diversity jurisdiction. As noted, the case was

remanded to state court.

“Our standard of review as to determinations of jurisdiction

is plenary.” Bogle v. Phillips Petroleum Co., 24 F.3d 758, 760

(5th Cir. 1994)(citation omitted). "An 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). However, only those

cases remanded for grounds described in § 1447(c) are immune to

review under § 1447(d). Thermtron Prods., Inc. v. Hermansdorfer,

423 U.S. 336, 345-46 (1976), abrogated on other grounds,

Quackenbush v. Allstate Ins. Co., 517 U.S. 706 (1996). Lack of

subject matter jurisdiction is a § 1447(c) ground. E.g. Heaton v.

Monogram Credit Card Bank of Georgia, 231 F.3d 994, 997 (5th Cir.

2000), cert. denied, 533 U.S. 915 (2001). The district court

determined that it lacked diversity jurisdiction and, pursuant to

§ 1447(c), remanded the action to state court. Therefore, this

court has no jurisdiction to review that decision whether through

appeal, see 28 U.S.C. § 1447(d), or through a petition for a writ of mandamus, e.g. Linton v. Airbus Industrie, 30 F.3d 592, 599 (5th

Cir.), cert. denied, 513 U.S. 1044 (1994).

An award of fees and costs relating to a motion to remand is

reviewed for abuse of discretion. Valdes v. Wal-Mart Stores, Inc.,

199 F.3d 290, 292 (5th Cir. 2000). The award is proper if the

removing party had no “objectively reasonable grounds to believe

the removal was legally proper”. Id. at 293.

The district court stated: “Since Defendants failed to address

all Plaintiffs’ claims, Defendants could not objectively believe

that removal was legally proper”. The district court held

defendants failed to address plaintiffs’ claims under the Texas

Uniform Fraudulent Transfer Act (TUFTA) “and only address[ed] the

Texas [DTPA] under the issue of collateral estoppel”. Regarding

the release that defendants claim immunizes them from suit, the

district court stated defendants “never address[ed] Plaintiffs’

claims of fraud, duress, or lack of consideration”.

Regarding TUFTA, none of the plaintiffs’ pleadings assert a

claim under the Act, nor do plaintiffs contend on appeal that they

did so. As to plaintiffs’ DTPA claim, it is tied to the Art. 21.21

claim, which the district court found to only “possib[ly]”

constitute a state cause of action. See TEX. BUS. & COM. CODE §

17.50(a)(4). Finally, defendants, in responding to plaintiffs’

remand motion, addressed plaintiffs’ claims of fraud, duress and

lack of consideration with regard to the release by contending

there was no evidence to support such claims. In this regard, the defendants attached an affidavit by Haffley to show those claims

were invalid.

Because the district court based its determination that

defendants could not objectively believe that removal was proper on

the defendants’ failure to address the above issues, it abused its

discretion in awarding costs and fees to plaintiffs.

DISMISSED IN PART; VACATED IN PART