Saks & Co v. Williams

• Court: Court of Appeals for the Fifth Circuit
• Decided: July 3, 2001
• Docket: 00-21131
• Status: Unpublished

Opinion

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 00-21131

Summary Calendar

SAKS & CO. d/b/a SAKS FIFTH AVENUE, Plaintiff-Appellant,

versus

JAMES W. WILLIAMS & ELIZABETH WILLIAMS, Defendants-Appellees.

Appeal from the United States District Court For the Southern District of Texas (H-99-CV-4028)

June 29, 2001 Before HIGGINBOTHAM, WIENER, and BARKSDALE, Circuit Judges.

PER CURIAM:*

Saks sued defendants in state court to collect past due

amounts on defendants’ credit card. Saks won a judgment in state

court for approximately $640,000. In a separate proceeding,

defendants settled a federal case against CMS Generation Co. and

CMS Gas Transmission and Storage Co. That settlement, which

provided for payments from CMS to defendants, contained a

reservation of jurisdiction in the federal court. Saks applied to

* 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 R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5TH CIR.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. the state court for post-judgment relief, asking that the

settlement proceeds be seized. Defendants removed. During the

pendency of the case in federal court, Saks and defendants entered

into a settlement agreement. The district court therefore

dismissed the action, without prejudice to the right of Saks to

move for reinstatement within 90 days if the settlement was not

consummated. Saks appeals.

Saks first argues that the district court lacked jurisdiction.

While defendants have not made any arguments before this court to

demonstrate the existence of jurisdiction, “[t]he jurisdiction of

a United States District Court cannot be created, increased or

diminished by . . . agreement or stipulation of the parties.”1

Accordingly, we independently review the basis for jurisdiction.

It appears from the record that the district court asserted

jurisdiction on a theory of supplemental jurisdiction. A district

court may exercise supplementary jurisdiction “to secure or

preserve the effects of a judgment” previously rendered by that

court, even where “the federal district court would not have

jurisdiction over the second action if it had been brought as an

original suit.”2 As this action sought to seize the proceeds of a

1 Labiche v. Louisiana Patients’ Compensation Fund Oversight Bd., 69 F.3d 21, 22 (5th Cir. 1995) (emphasis added). 2 Manges v. McCamish, Martin, Brown & Loeffler, 37 F.3d 221, 224 (5th Cir. 1994).

2 settlement approved by a federal court, we hold that supplemental

jurisdiction was properly asserted.3

Saks next argues that defendants did not remove in a timely

manner. 28 U.S.C. § 1446 requires a plaintiff to remove within 30

days of receipt of the cause of action; or if the original case is

not removable, within 30 days of receipt of the pleading which

established removability. Saks contends that the original service

of citation occurred on December 3, 1998, while removal did not

occur until November 18, 1999. According to Saks, removal was

therefore untimely. This argument is disingenuous at best. The

complaint served in December stated only that defendants owed

credit card debt, and made no claim against any settlement

proceedings. It was not until November 2, 1999 that Saks sought a

turnover order directed at the seizure of the settlement proceeds.

Removal occurred 16 days later. This removal was timely.

Having resolved the jurisdictional issues in this case, we

turn to the merits. The gravamen of Saks’s appeal is that by

dismissing the action, the district court called into question the

validity of the state court judgment awarding Saks approximately

$640,000. This concern is misplaced. As the petition for removal

makes clear, only the action for post-judgment relief was removed.

The removal petition states that the action being removed was

3 Saks argues, as a separate issue, that the district court abused its discretion in not ruling on the motion to remand. This is merely a regurgitation of Saks’s subject matter jurisdiction argument, and fails for the same reason.

3 “filed on November 2, 1999.” That is the date upon which the

petition to turn over settlement proceeds was filed. Moreover,

that is after the date upon which final judgment on the merits of

Saks’s initial lawsuit against defendants was entered. The removal

petition states that the action “seeks to assert a claim on behalf

of Saks to the settlement proceeds in the case over which Judge

Werlein continues to exercise jurisdiction.” These excerpts make

clear that the civil action against defendants for non-payment of

credit card debt was not removed, nor was it dismissed by the

district court. All that was removed, and later dismissed, was the

suit for post-judgment relief.

Accordingly, the district court’s disposition of this case

does not impact the final judgment in Saks’s state court case

against defendants. Saks’s argument in this appeal is therefore

without merit.

AFFIRMED.