New Split on Appealing Sua Sponte CAFA Remands

The Class Action Fairness Act (often referred to as “CAFA”) permits the removal of certain class actions brought in state court. CAFA includes a special appellate provision—28 U.S.C. § 1453(c)(1)—which gives the courts of appeals discretion to review a district court order “granting or denying a motion to remand a class action to the State court from which it was removed.” Normally these remand decisions come after one of the parties has asked the district court to remand the case. But sometimes district courts remand actions without anyone asking.

In 2013, the Ninth Circuit held that these sua sponte remands fall within § 1453(c)(1), despite them not coming after a party’s motion. But last week, in Ruhlen v. Holiday Haven Homeowners, Inc., a divided Eleventh Circuit held that § 1453(c)(1) does not cover sua sponte remands. As the majority saw things, § 1453(c)(1) applies only to orders that come after a motion. And a remand at the district court’s own initiative—though colloquially referred to as on the district court’s own motion—does not actually come in response to a motion. Section 1453(c)(1)’s plain text thus meant that appellate courts do not even have discretion to review a sua sponte CAFA remand. Dissenting, Judge Rosenbaum contended that the majority’s decision was inconsistent with § 1453(c)(1)’s text and context, and it produced absurd results.

Appealing CAFA Remands

CAFA permits the removal of certain state court class actions to federal court. Absent CAFA’s special appeal provisions, a district court decision on whether or not to remand the removed action would not be immediately appealable. If the district court denies a party’s motion to remand the action, that decision would not be final under 28 U.S.C. § 1291. And if the district court remands the action for a lack of subject-matter jurisdiction, that decision would normally be unreviewable under 28 U.S.C. § 1447(d).

To facilitate the review of these remand decisions, Congress included a provision giving the courts of appeals discretion to review CAFA remands. Section 1453(c)(1) provides that “a court of appeals may accept an appeal from an order of a district court granting or denying a motion to remand a class action to the State court from which it was removed.”

The Remand in Ruhlen

Ruhlen began in state court as a “representative” action under Florida law. Among the plaintiffs’ claims was one under the Americans with Disabilities Act. Given the federal nature of this claim, the defendants removed the case under CAFA.

After removal, the plaintiffs amended their complaint to remove the ADA claim. The district court then sua sponte remanded the action to state court. The district court determined that the amendment eliminated federal-question jurisdiction and that the plaintiffs’ representative action was not a “class action” under CAFA.

The defendants then sought permission to appeal via § 1453(c)(1).

The Majority: No Appellate Jurisdiction Over Sua Sponte CAFA Remands

A majority of the Eleventh Circuit held that the district court’s remand fell outside the scope of § 1453(c)(1), meaning that the court of appeals lacked jurisdiction to even consider the petition to appeal.

The majority rested its decision on § 1453(c)(1)’s text. Again, that provision gives the courts of appeals discretion to review a district court order “granting or denying a motion to remand a class action to the State court from which it was removed.” The statute thus requires that the district court decision come in response to “a motion to remand.” In Ruhlen, there was no motion. The district court remanded the case on its own initiative. With no motion, there was no order that fell within § 1453(c)(1).

The majority went on to explain that a sua sponte remand doesn’t count as one in response to a motion. A motion requires a request from a party. To be sure, “sua sponte” colloquially refers to a district court acting on its own motion. But “that shorthand colloquialism doesn’t accurately capture reality; the court in that instance does not actually request anything of itself, nor does it grant or deny anyone else’s request.” (Cleaned up.) So when a district court “sua sponte orders a remand, it is not ‘granting’ its own ‘motion’ within the meaning of § 1453(c)(1)—any more than it would be ‘denying’ its own motion in the absence of such an order.”

The majority also acknowledged that Congress might have intended to include sua sponte remands within the scope of § 1453(c)(1). But the majority thought that it was bound by the statute’s text. And although the result might be a bit silly, it was no so absurd as to warrant deviating from what the majority saw as clear text.

Judge Rosenbaum’s Dissent: Sua Sponte CAFA Remands Fall Within § 1453(c)(1)

Judge Rosenbaum dissented. She thought that the majority’s “hypertechnical reading” of § 1453(c)(1) was “refuted by the broader view of the common understanding of the statutory language, the clear intention of the statute as revealed by its context, the absurd result of reading the statute as the majority does, and other circuits’ understanding of § 1453(c)(1).”

As to language, sua sponte decisions have long been considered ones on the court’s own motion. It’s thus “fair and reasonable” to construe a sua sponte remand as one “granting . . . a motion to remand a class action” under § 1453(c)(1).

Congress’s intent in § 1453(c)(1)—as revealed by the provision’s context—pointed in the same direction. Congress meant to except CAFA remand decisions from the normal strictures on appellate review:

Congress included the “granting or denying a motion to remand” language to ensure that orders dealing with remand in CAFA cases are not subject to the § 1447(d) jurisdictional bar or to the final-judgment rule. An order denying a motion to remand would obviously not qualify as a “final decision” and would therefore ordinarily be unappealable. 28 U.S.C. § 1291. But in CAFA cases, such orders are subject to immediate appellate review. Congress added the language not to exempt sua sponte orders from review, but to subject all orders about remand to immediate appellate jurisdiction.

In other words, what matters is that the order is one remanding a case removed under CAFA, not whether it came in response to a motion or was at the district court’s own initiative.

Judge Rosenbaum also contended that the majority’s result was absurd. The majority saw in the text a clear intention to distinguish between party-initiated and court-initiated remands. But why on Earth would Congress do that? There’s no logic to the distinction. If Congress intended such an odd result, it could have been more clear by saying that review is available only for orders granting or denying a party’s motion to remand.

A New Split

The Ruhlen majority acknowledged that it was creating a circuit split. In Watkins v. Vital Pharmaceuticals, Inc., the Ninth Circuit held that sua sponte CAFA remands fell within the scope of § 1453(c)(1). The court explained that “[s]ua sponte orders are, literally, orders issued when the court acts ‘on its own motion.’” And insulating sua sponte remands from appellate review “would be inconsistent with CAFA’s clearly expressed intention that class actions are exempt from the general jurisdictional rule that district court remand orders are not reviewable on appeal.”

Also of note, a few courts of appeals have reviewed sua sponte CAFA remands without addressing the jurisdictional issue.

Ruhlen v. Holiday Haven Homeowners, Inc., 2022 WL 701622 (11th Cir. Mar. 9, 2022), available at the Eleventh Circuit and Westlaw.