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Porter Trust v. Rural Water Sewer and Solid 1, 607 F.3d 1251, 10th Cir. (2010)
Porter Trust v. Rural Water Sewer and Solid 1, 607 F.3d 1251, 10th Cir. (2010)
June 9, 2010
PUBLISH
Elisabeth A. Shumaker
Clerk of Court
Before McKAY, Circuit Judge, BRORBY, Senior Circuit Judge, and EBEL,
Circuit Judge.
The plaintiffs are landowners whose property lies within the boundaries of
the water and sewer district served by the defendant, Rural Water Sewer and
Solid Waste Management District No. 1, Logan County, Oklahoma (Logan 1). 1
Unhappy with the estimated cost of initiating and receiving services from
Logan 1, plaintiffs filed a petition with the Logan County Board of County
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument.
1
court.
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313 U.S. 100, 104 (1941), it contends that whether an action is a civil action
within a state court for 1441 purposes turns on federal law, not state law.
As Logan 1 appears to recognize, however--judging from its own citations to state
statutes and case law in support of this argument--a states characterization of its
own entity cannot simply be disregarded. The Oklahoma Supreme Courts
reasons for characterizing a board of county commissioners as an executive body
rather than a court are entitled to consideration as persuasive authority. See
Commrs of Road Improvement Dist. No. 2 v. St. Louis SW Ry. Co., 257 U.S. 547,
558 (1922).
But even if federal law ultimately supplies the test for determining what
is a state court, Logan 1 must still show that it had an objectively reasonable
basis under federal law for seeking removal. In an effort to make this
showing, Logan 1 cites a decision of this court noting that when determining
de-annexation, an Oklahoma board of county commissioners acts in a judicial or
quasi-judicial capacity. Pittsburg County Rural Water Dist. No. 7 v. City of
McAlester, 358 F.3d 694, 702, 708 (10th Cir. 2004). This factual assertion, of
course, does not resolve the entire inquiry. Logan 1 must also show that as a
legal matter, an administrative entity like the Board that exercises judicial
functions should be treated as a state court for purposes of 1441(a).
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To make this showing, Logan 1 contends that under federal law, it is the
function exercised by an entity rather than its formal structure that determines
whether that entity is a state court. But as will be seen, Logan 1s functional
test is incompatible with the plain language of the removal statute.
In support of the functional test, Logan 1 cites a number of older cases,
most of which involve removal from state administrative agencies, contending
that their reasoning that focuses on function rather than form also applies to the
Board. Kolibash v. Committee on Legal Ethics, 872 F.2d 571, 576 (4th Cir. 1989)
(applying 28 U.S.C. 1442(a)); Floeter v. C.W. Transp., Inc., 597 F.2d 1100,
1101-02 (7th Cir. 1979); Baughman v. Bradford Coal Co., 592 F.2d 215, 217-19
(3d Cir. 1979); Volkswagen de Puerto Rico, Inc. v. Puerto Rico Labor Relations
Bd., 454 F.2d 38, 43-44 (1st Cir. 1972); Corwin Jeep Sales & Service, Inc. v.
Am. Motors Sales Corp., 670 F. Supp. 591, 594 (M.D. Pa. 1986); Tool & Die
Makers Lodge No. 78 Intl Assn of Machinists v. Gen. Elec. Co. X-Ray Dept,
170 F. Supp. 945, 949-50 (E.D. Wis. 1959). None of these cases involves a board
of county commissioners adjudicating a de-annexation proceeding. Moreover, in
light of the plain language of 1441, which permits removal only from a state
court, we do not find their legal reasoning persuasive.
More recent authority has rejected or severely limited the functional test
in favor of a standard application of the canons of statutory construction. This
better analysis begins (and ends) with 1441s plain language, which permits
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removal only from a state court, which necessarily implies that the entity must
be a court . . . [not] an administrative agency . . . that . . . conducts court-like
adjudications. Ore. Bureau of Labor, 288 F.3d at 418. Even courts that once
applied the functional test now appear to have repented to some degree. See Sun
Buick, Inc. v. SAAB Cars USA, Inc., 26 F.3d 1259, 1261-67 (3d Cir. 1994)
(casting serious doubt on functional test; distinguishing Baughman in 1441(a)
removal context); Borough of Olyphant v. Pa. Power & Light Co.,
269 F. Supp. 2d 601, 602-03 (M.D. Pa. 2003). Cf. Wirtz Corp. v. United
Distillers & Vintners N. Am., Inc., 224 F.3d 708, 713 (7th Cir. 2000) (limiting
holding in Floeter to particular facts of that case).
Having determined that the appropriate test involves application of the
plain language of 1441(a) rather than a functional test, we now apply that plain
language to the facts of this case. Although the Board exercises a judicial
function in de-annexation proceedings, it is an administrative rather than a
judicial entity. Under the plain language test, it does not fit the definition of a
state court for purposes of 1441(a).
We conclude that neither the unpublished case cited by Logan 1, nor the
federal nature of the characterization of what is a state court, nor application
of the functional test, provides Logan 1 with the required showing of an
objectively reasonable basis for seeking removal sufficient to require reversal.
Logan 1 has failed to demonstrate an abuse of discretion by the district court in
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