LII Bulletin Previews Today's Supreme Court Oral Argument in Kircher v. Putnam Funds Trust

Cornell’s LII Bulletin posted the following preview of the oral argument that took place today for Kircher v. Putnam Funds Trust (05-409):

JURISDICTION, APPELLATE REVIEW OF REMAND ORDERS, SUBJECT MATTER JURISDICTION, SLUSA, 28 U.S.C. § 1447(d), 15 U.S.C. §77p(b)

Kircher v. Putnam Funds Trust (05-409)
Oral argument date: April 24, 2006

Petitioners are a group of investors who owned shares in mutual funds offered or advised by respondents, Putnam Funds Trust. These investors brought a class action suit in Illinois state court asserting breach of fiduciary duty and alleging that the mutual funds set prices in a way that allowed arbitrageurs to exploit differences in prices to the detriment of long-term investors. The respondents removed the suit to federal court pursuant to the Securities Litigation Uniform Standards Act (SLUSA). The judge then remanded the case to state court because the petitioners had not alleged a loss “in connection with the purchase or sale of securities” as required under the Act. Pursuant to 28 U.S.C. § 1447(d), such a remand is not appealable if the remand is for lack of subject matter jurisdiction. The Seventh Circuit, in conflict with previous decisions by the Second, Ninth, and Eleventh Circuits, ruled that the remand was reviewable because the basis of the SLUSA remand was not lack of subject matter jurisdiction, and therefore 28 U.S.C. § 1447(d) does not apply. In deciding this case, the Supreme Court will address whether 28 U.S.C. § 1447(d) bars appellate review of remand orders in suits removed under statutes such as SLUSA.

The full preview is available at http://www.law.cornell.edu/supct/cert/05-409.html.