In the Supreme Court’s latest opinion, Royal Canin U.S.A. Inc. v. Wullschleger, the court takes us back to basics on the basis for federal question and supplemental jurisdiction.
Anastasia Wullschleger initially brought this lawsuit against Royal Canin U.S.A. Inc. in state court, asserting both federal and state law claims. Royal Canin removed the case to federal court. Wullschleger, desiring her case to be resolved in state court, then amended her complaint to drop the federal claims, leaving only state law claims. She petitioned the federal district court to remand to state court, but the district court denied her request. The Eighth Circuit reversed.
The U.S. Supreme Court granted certiorari to resolve a circuit split.
The issue before the court was whether, in a case removed from state to federal court, an amended complaint that drops all federal claims divests the federal court of jurisdiction. The court held yes — when a plaintiff amends a removed complaint to delete the federal claims that provided the basis for removal, the case must go back to state court.
In support of its holding, the court pointed to several federal statutes — including the Class Action Fairness Act (CAFA), 28 U.S.C. § 1332(d) — in which Congress regards amendments to pleadings as having the potential to change jurisdiction. The court reasoned that “[w]hen a plaintiff, after removal, cuts out all her federal-law claims, federal-question jurisdiction dissolves. And with any federal anchor gone, supplemental jurisdiction over the residual state claims disappears as well.” The court affirmed the judgment of the Eighth Circuit Court of Appeals.
Before Royal Canin’s ruling, the Eleventh Circuit and many other circuits had held that jurisdiction in a removed case must be decided based on the original complaint, not the amended complaint.
The Supreme Court’s new ruling will likely impact jurisdiction in class actions removed to federal court under CAFA. If the plaintiff amends the complaint to change the class definition to, for example, make a nationwide class action a state-only class action, the federal court may be required to remand to state court under this ruling.
