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Kuntz v. Illinois Central Railroad Co.

January 5, 2007

PHILLIP KUNTZ AND FRANCES J. KUNTZ, PLAINTIFFS,
v.
ILLINOIS CENTRAL RAILROAD COMPANY A/K/A CANADIAN NATIONAL/ILLINOIS CENTRAL RAILROAD, DEFENDANT.



The opinion of the court was delivered by: Murphy, Chief District Judge

MEMORANDUM AND ORDER

This matter, which was recently transferred from the docket of United States Senior District Judge James L. Foreman to the docket of the undersigned United States District Judge, is before the Court sua sponte on reconsideration of Judge Foreman's order denying remand of this case to state court (Doc. 22). The order is VACATED and, pursuant to 28 U.S.C. § 1447(c), this case is REMANDED to the Circuit Court of the Twentieth Judicial Circuit, Perry County, Illinois, for lack of federal subject matter jurisdiction.

INTRODUCTION

This case arises from an incident that occurred on April 3, 2006, in which Phillip Kuntz was injured at a railroad crossing in Perry County, Illinois, when his car was struck by a train owned and operated by Defendant Illinois Central Railroad Company a/k/a Canadian National/Illinois Central Railroad ("ICR"). The complaint in this case, which was filed originally in state court in Perry County on May 26, 2006, alleges that ICR was negligent in connection with the accident by: failing to maintain its crossing by keeping the right of way reasonably clear of brush, shrubbery, trees, and weeds, in violation of 625 ILCS 5/18c-7401(1) and (3) and Ill. Admin. Code Tit. 92, § 1535.205; failing to provide adequate sight distance at the crossing so that motorists could see approaching trains; failing to maintain the crossbucks at the crossing; failing to equip the crossing with additional signage after receiving a recommendation to do so from the Illinois Commerce Commission; failing to maintain the crossing by reason of loose gravel and potholes in the roadway; failing to give motorists adequate warning of approaching trains; failing to stop or slow its train to avoid the accident; failing to sound a proper warning; and failing to maintain a proper lookout. Mr. Kuntz's wife, Plaintiff Frances J. Kuntz, asserts a claim for loss of consortium.*fn1

ICR timely removed the case from state court to this Court, contending that the case arises under federal law. Mr. and Mrs. Kuntz moved for remand of the case to state court for lack of federal subject matter jurisdiction. By order entered November 15, 2006, Judge Foreman, to whom the case was assigned after removal, denied remand. On December 14, 2006, the case was reassigned to the undersigned District Judge. By Order entered December 20, 2006, the Court advised the parties that it had undertaken sua sponte reconsideration of Judge Foreman's order denying remand of the case to state court, and directed the parties in the case to submit any additional authorities pertinent to the existence of subject matter jurisdiction by December 27, 2006. Having reviewed the file in this case, including Judge Foreman's order denying remand, together with all additional submissions by the parties regarding subject matter jurisdiction, the undersigned District Judge concludes that the order denying remand is in error and must be vacated and that this case must be remanded to state court for lack of federal subject matter jurisdiction.

DISCUSSION

A. Legal Standard

It is axiomatic that "[f]ederal courts are courts of limited jurisdiction, with power to hear a case only if such power is granted by the Constitution and authorized by statute, and the presumption is that a case lies outside of this limited jurisdiction." McNichols v. Johnson & Johnson, No. CIV. 06-160-GPM, 2006 WL 3360542, at *1 (S.D. Ill. Apr. 19, 2006). "Because a federal court's jurisdiction is limited, it has a 'nondelegable duty to police the limits of federal jurisdiction with meticulous care.'" Id. (quoting Market St. Assocs. Ltd. P'ship v. Frey, 941 F.2d 588, 590 (7th Cir. 1991)). The limited nature of federal subject matter jurisdiction imposes on federal courts a duty to examine their jurisdiction at every stage of a proceeding, sua sponte if need be. "Jurisdiction is the 'power to declare law,' and without it the federal courts cannot proceed. Accordingly, not only may the federal courts police subject matter jurisdiction sua sponte, they must." Hay v. Indiana State Bd. of Tax Comm'rs, 312 F.3d 876, 879 (7th Cir. 2002) (quoting Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 577 (1999)). Thus, just as subject matter jurisdiction cannot be created through, for example, laches, waiver, or estoppel, see Insurance Corp. of Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702 (1982); Sadat v. Mertes, 615 F.2d 1176, 1188 (7th Cir. 1980), so a federal court has a duty to ascertain the existence or non-existence of subject matter jurisdiction regardless of the representations of the parties. See Capital Fed. Sav. of Am. v. Geldermann & Co., No. 86 C 9232, 1987 WL 7270, at *1 (N.D. Ill. Feb. 24, 1987) (citing Kanzelberger v. Kanzelberger, 782 F.2d 774, 777 (7th Cir. 1986)). See also Commercial Nat'l Bank of Chicago v. Demos, 18 F.3d 485, 487 (7th Cir. 1994) ("We are required to satisfy ourselves not only of our own jurisdiction, but also the jurisdiction of the district court . . . . Further, we must consider the issue sua sponte when it appears from the record that jurisdiction is lacking.").

The standard concerning removal of actions from state court to federal court is equally well established. Removal is governed by 28 U.S.C. § 1441, which provides, in pertinent part, that "any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending." 28 U.S.C. § 1441(a). In other words, "[a] defendant may remove a case to federal court only if the federal district court would have original subject matter jurisdiction over the action." Disher v. Citigroup Global Mkts. Inc., 419 F.3d 649, 653 (7th Cir. 2005), vacated on other grounds, 126 S.Ct. 2964 (2006). The party seeking removal has the burden of establishing federal jurisdiction. See Doe v. Allied-Signal, Inc., 985 F.2d 908, 911 (7th Cir. 1993). "Courts should interpret the removal statute narrowly and presume that the plaintiff may choose his or her forum." Id. Put another way, there is a strong presumption in favor of remand. See Jones v. General Tire & Rubber Co., 541 F.2d 660, 664 (7th Cir. 1976). See also Littleton v. Shelter Ins. Co., No. 99-912-GPM, 2000 WL 356408, at *1 (S.D. Ill. Mar. 9, 2000) ("The removal statute, 28 U.S.C. § 1441, is construed narrowly, and doubts concerning removal are resolved in favor of remand.").

B. Federal Question Jurisdiction

In general, of course, district courts have "original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States." 28 U.S.C. § 1331. The usual test of whether an action arises under federal law for purposes of so-called "federal question" jurisdiction under section 1331 is the "well-pleaded complaint" rule, which provides generally that a case arises under federal law within the meaning of the statute only when federal law appears on the face of a plaintiff's complaint. See Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987); Louisville & Nashville R.R. Co. v. Mottley, 211 U.S. 149, 152-53 (1908). "[T]he paramount policies embodied in the well-pleaded complaint rule . . . [are] that the plaintiff is the master of the complaint, that a federal question must appear on the face of the complaint, and that the plaintiff may, by eschewing claims based on federal law, choose to have the cause heard in state court." Caterpillar, 482 U.S. at 398-99. Importantly, the well-pleaded complaint rule requires generally that a complaint state a claim for relief under federal law. As Justice Holmes explained, "A suit arises under the law that creates the cause of action." American Well Works Co. v. Layne & Bowler Co., 241 U.S. 257, 260 (1916). The purpose of restricting federal question jurisdiction to cases asserting claims for relief under federal law is, in addition to preserving a plaintiff's right to choose his or her forum, to "severely limit[ ] the number of cases . . . that may be initiated in or removed to federal district court, thereby avoiding more-or-less automatically a number of potentially serious federal-state conflicts." Franchise Tax Bd. of State of Cal. v. Construction Laborers Vacation Trust for S. Cal., 463 U.S. 1, 9-10 (1983). The policy underlying the well-pleaded complaint rule of protecting the proper balance of power as between federal and state courts dovetails with the policy favoring narrow construction of removal. As a court of appeals in a sister circuit recognized, "[B]ecause the effect of removal is to deprive the state court of an action properly before it, removal raises significant federalism concerns, . . . which mandate strict construction of the removal statute."

Carpenter v. Wichita Falls Indep. Sch. Dist., 44 F.3d 362, 365-66 (5th Cir. 1995).

In this case the operative complaint is devoid of any reference to federal law. ICR's notice of removal asserts, however, that federal question jurisdiction is proper because the Federal Railroad Safety Act ("FRSA"), 49 U.S.C. §§ 20101-20153, completely preempts the claims alleged in the complaint or, alternatively, FRSA preemption of those claims presents a substantial question of federal law such as to give rise to federal subject matter jurisdiction. Although it is not entirely clear from Judge Foreman's order denying remand, it appears that Judge Foreman found federal question jurisdiction on the basis of complete preemption, without reaching the issue of whether the complaint raises a substantial federal question. The Court will address each of ICR's asserted grounds for federal subject matter jurisdiction in turn.

1. Complete Preemption

In a limited class of cases an action may arise under federal law within the meaning of 28 U.S.C. ยง 1331 even if the complaint in the case asserts no claim for relief under federal law where state law is "completely preempted" by federal law. Complete preemption occurs when "the preemptive force of a [federal] statute is so 'extraordinary' that it 'converts an ordinary state common-law complaint into one stating a federal claim for purposes of the well-pleaded complaint rule.'" Nelson v. Stewart, 422 F.3d 463, 466-67 (7th Cir. 2005) (quoting Caterpillar, 482 U.S. at 393). "Once an area of state law has been completely pre-empted, any claim purportedly based on that pre-empted state law is considered, from its inception, a federal claim, and therefore arises under federal law." Id. at 467. "In such situations, the federal statute . . . not only preempt[s] state law but also authorize[s] removal of actions that sought relief only under state law." Id. Complete preemption is a narrow exception to the well-pleaded complaint rule. The Supreme Court of the United States has found complete preemption as to only four federal laws: the Employee Retirement Income Security Act of 1974, see Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 66-67 (1987); a treaty concerning Indian tribal ...


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