Webb v. B.C. Rogers Poultry, Inc.

174 F.3d 697, 1999 WL 279903
CourtCourt of Appeals for the Fifth Circuit
DecidedMay 27, 1999
Docket98-50527
StatusPublished
Cited by42 cases

This text of 174 F.3d 697 (Webb v. B.C. Rogers Poultry, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Webb v. B.C. Rogers Poultry, Inc., 174 F.3d 697, 1999 WL 279903 (5th Cir. 1999).

Opinions

JERRY E. SMITH, Circuit Judge:

B.C. Rogers Poultry, Inc., and B.C. Rogers Processors, Inc. (collectively, “B.C.Rogers”), appeal a remand to state court ordered pursuant to the Burford abstention doctrine. Concluding that the court acted without the doctrine’s strictures as defined by the Supreme Court, we reverse.

I.

The State of Texas brought Employers National Insurance Company (“ENIC”), an insurance company regulated under Texas law, into state court, where it was declared insolvent and placed in receivership. Pursuant to the Texas Insurance Code, the state obtained a permanent injunction and order, appointing Jack Webb as Special Deputy Receiver (“SDR”) for ENIC and enjoining any person from interfering with the state receivership court proceedings or the lawful acts of the SDR and from taking any action involving the SDR outside of the state receivership court.

Webb, carrying out his duties as SDR, brought suit in state court against B.C. Rogers, as ENIC policyholders, to collect assets — -unpaid workers’ compensation premiums — allegedly belonging to ENIC. Webb asserts three alternative causes of action: (1) breach of contract, (2) quantum, meruit, and (3) suit on sworn account. He seeks $674,335 in damages, plus interest and attorney’s fees.

B.C. Rogers removed to federal court pursuant to 28 U.S.C. § 1441, alleging original jurisdiction based on diversity of citizenship. See 28 U.S.C. § 1332. Webb sought remand, advancing three grounds: (1)B.C. Rogers had failed to comply with the removal statute, (2) the permanent injunction enjoined B.C. Rogers from litigating the dispute in a forum other than the receivership court, and (3) under the Burford abstention doctrine, the district court should refrain from exercising jurisdiction.1 The district court summarily rejected the first two bases but elected Bur-ford abstention and remanded, holding that

[ajbstention is appropriate in this case, for if this Court were to exercise federal jurisdiction, it could well interfere with the State of Texas’ efforts to effect a coherent policy on a matter of public concern, that is, the collection of assets of an insolvent insurer through a state district court receivership proceeding wherein the state district court retains continuing jurisdiction over the liquidation proceedings.

II.

We always must be certain that our limited jurisdiction encompasses the appeal before us. See Castaneda v. Falcon, 166 F.3d 799, 801 (5th Cir.1999); Jones v. Collins, 132 F.3d 1048, 1051 (5th Cir.1998). We sua sponte requested briefing on the issue and now clarify our jurisdiction.

The order abstaining under Bur-ford and remanding is a final order disposing of all issues. We have jurisdiction, therefore, pursuant to 28 U.S.C. § 1291. See Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 715, 116 S.Ct. 1712, 135 L.Ed.2d 1 (1996); Munich Am. Reinsurance Co. v. Crawford, 141 F.3d 585, 589 (5th Cir.1998), cert. denied, — U.S. -, 119 S.Ct. 539, 142 L.Ed.2d 448 (1998).

In 28 U.S.C. § 1334(d), Congress has denied us jurisdiction over an appeal from a decision to abstain under § 1334(c) [700]*700(allowing abstention, in the interest of comity or respect for state law, from state law causes of action arising under, or related to, title 11). Here, the receivership proceedings in state court arose under the Texas Insurance Code, not the Bankruptcy Code. See Clark v. Fitzgibbons, 105 F.3d 1049, 1051 (5th Cir.1997) (“Insurance companies are ineligible for the protections afforded by the federal Bankruptcy Code. 11 U.S.C. § 109.”). The district court, therefore, did not exercise jurisdiction over the removed action under 28 U.S.C. § 1452(a) (providing for removal of any action over which the court has jurisdiction under 28 U.S.C. § 1334) and 28 U.S.C. § 1334(b) (providing for original jurisdiction in the district courts “of all civil proceedings arising under title 11, or arising in or related to cases under title 11.”). Rather, it based its jurisdiction on diversity of citizenship, found in 28 U.S.C. § 1332. The court’s decision to abstain, then, did not fall within 28 U.S.C. § 1334(c), so § 1334(d) is inapposite.

Similarly, in 28 U.S.C. § 1447(d), Congress denied us jurisdiction over remands pursuant to 28 U.S.C. § 1447(c), which requires a district court to remand if it lacks subject matter jurisdiction or if the removal was defective; conversely, § 1447(d) does not preclude review of remands on other grounds.2 Neither party argues that the district court lacked subject, matter jurisdiction. Rather, they dispute whether the court abused its discretion in abstaining from exercising its jurisdiction. Section 1447(d), therefore, is also inapposite, and we have jurisdiction to consider the appeal.

III.

The Burford doctrine allows a federal court to abstain from exercising its jurisdiction in deference to complex state administrative procedures. The Supreme Court has described the Burford doctrine as follows:

Where timely and adequate state-court review is available, a federal court sitting in equity must decline to interfere with the proceedings or orders of state administrative agencies: (1) when there are “difficult questions of state law bearing on policy problems of substantial public import whose importance transcends the result in the case then at bar”; or (2) where the “exercise of federal review of the question in a case and in similar cases would be disruptive of state efforts to establish a coherent policy with respect to a matter of substantial public concern.”

New Orleans Pub. Serv., Inc. v. Council of New Orleans (“NOPSI”), 491 U.S. 350, 361, 109 S.Ct. 2506, 105 L.Ed.2d 298 (1989) (quoting Colorado River Water Conservation Dist. v. United States,

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Bluebook (online)
174 F.3d 697, 1999 WL 279903, Counsel Stack Legal Research, https://law.counselstack.com/opinion/webb-v-bc-rogers-poultry-inc-ca5-1999.