Federal Circuit Cannot Review a Remand Order Based on Lack of Subject Matter Jurisdiction

Vermont v. MPHJ Tech. Invests. LLC, ___ F.___ (Fed. Cir. Aug. 11, 2014) (Prost, NEWMAN, Hughes) (D. VT. ) (2 of 5 stars)

Federal Circuit motions panel dismisses petition for writ of mandamus and appeal from district court's order remanding case to state court.

MPHJ wrote to various Vermont non-profits requesting they confirm non-use of MPHJ's patents, or take a license. The State of Vermont sued in State court, alleging unfair and deceptive trade practices under the Vermont Consumer Protection Act. MPHJ removed the case to district court, asserting federal question and diversity jurisdiction. Vermont moved to remand for lack of subject matter jurisdiction, and the district court granted Vermont's motion under 28 U.S.C. § 1447(c) because the complaint did not raise a substantial question of patent law and that MPHJ's preemption assertion was a defense, which cannot provide a basis for federal subject matter jurisdiction.

The Federal Circuit determined that, under § 1447(d), it could not review the district court's remand order for lack of subject matter jurisdiction. 28 U.S.C. § 1447(d) provides that "[a]n order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise," and the Supreme Court has determined that the bar under § 1447(d) applies only to grounds under § 1447(c), i.e., a defect in the removal procedure or lack of subject matter jurisdiction. Because the district court dismissed for lack of subject matter jurisdiction, the bar against appellate review applies and the Federal Circuit lacked jurisdiction.