Fourth Circuit Finds District Court’s Decision Remand to State Court for Lack of SMJ Not Reviewable in Iraq Contractor Case

BNA’s United States Law Week reported in Vol. 75, No. 11 (Sept. 26, 2006) on the case In Re Blackwater Consulting LLC, --- F.3d ----, 2006 WL 2439755 (4th Cir. Aug. 24, 2006). Here is an excerpt from the case:

The district court's remand order in this case clearly falls within the ambit of § 1447(c)'s requirement of remand in the absence of subject matter jurisdiction. The court first concluded that the DBA [Defense Base Act] did not completely preempt overlapping state law and thus did not create a federal question. Nordan, 382 F.Supp.2d at 807-11. It then reasoned that Blackwater's assertion of a unique federal interest in the adjudication of Nordan's claims likewise did not confer federal removal jurisdiction. Id. at 811-13. The district court cited the untenability of these two suggested jurisdictional bases as the source of its decision to remand the case. "[T]his court lacks subject matter jurisdiction over this cause of action.... [W]here the court finds no basis for subject matter jurisdiction, § 1447(c) compels the court to remand this action to state court.... Accordingly ... remand, rather than dismissal for lack of subject matter jurisdiction, is proper." Id. at 813-14.

To conclude that the remand order was issued pursuant to § 1447(c), we need not delve into whether the district court was correct to hold that it lacked subject matter jurisdiction over the removed action. Rather, an order is issued pursuant to section § 1447(c) if the district court perceived that it was without jurisdiction over the cause. See, e.g., Mangold, 77 F.3d at 1450 (holding that courts must "look past contextually ambiguous allusions and even specific citations to § 1447(c) to determine by independent review of the record the actual grounds or basis upon which the district court considered it was empowered to remand"). Furthermore, as we have noted, § 1447(d)'s jurisdictional bar applies with equal force to unassailably correct and "manifestly, inarguably erroneous" orders of remand. Id. Because the reasoning behind the district court's remand order in this case indicates the court's belief that it lacked subject matter jurisdiction upon removal, we conclude that the remand order was issued pursuant to § 1447(c) and, consequently, that § 1447(d) prohibits our review of that order.

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