Petition for Writ of Certiorari — Sanger-Harris v. Richards

> . c paprere Qourt, UST

86 1987 lf ETL Eb

IN THE a CLERK

Supreme Court of the Wnited States

OCTOBER TERM, 1986

SANGER-HARRIS, A Division of Federated Department

Stores, Inc.,

Petitioner,

Vv.

ANN RICHARDS, Treasurer of the State of Texas,

Respondent.

On Petition for a Writ of Certiorari

To the United States Court of Appeals

for the Fifth Circuit

PETITION FOR A WRIT OF CERTIORARI

CHARLES J. SULLIVAN

Counsel of Record

5005 Woodway

P.O. Box 2482

Houston, Texas 77252

(713) 871-1185

ANTHONY J. SADBERRY

5005 Woodway

P.O. Box 2482

Houston, Texas 77252

(713) 871-1185

Meebibliind . "

: I

QUESTIONS PRESENTED FOR REVIEW

1. Is a remand motion, which was not served upon the peti-

tioner, and the related remand order issued in respect thereto,

which contains the words “removed improperly and without

jurisdiction,” excluded from the Fifth Amendment due process

guaranty of “receipt of notice and opportunity to be heard” pur-

suant to the provisions of 28 U.S.C. § 1447(d) and this court’s

decision in Thermtron Products Inc. v. Hermansdorfer, 423

U.S. 336 (1976)?

2. Ifthe District Court is given timely notice that its remand

order containing the clause “said cause was removed improperly

and without jurisdiction” is based upon a remand motion that

was not served upon the Petitioner, does the District Court have

the power and obligation to correct its constitutionally defective

remand order?

il

TABLE OF CONTENTS

PAGE

(usstions Pemeeeee os o d ee

wehe af COME... 2 os ik eck ee i

eee OT AROS «CW Ls ill

ME. ise

Constitutional and Other Provisions Involved ......... 2

seatement of the Case . wo c cock cei vec cdenses 3

Reasons for Granting the Writ ................... 9

POU aia 5 UG oe eee 12

| I rt ay A-1 thru 1-9

TABLE OF AUTHORITIES

PAGE

Armstrong V. Manzo, 380 U.S. 545 (1965) ........... 15

Baldwin v. Haile, 68 U.S. 223 (1863) ................ 14

Bucy v. Nevada Construction Co., 125 F.2d 213 (9th

YG A ie pe lt a a 16, 17

Carson Vv. Durham, 121 U.S. 42! (1887) .....000..... 13, 18

Expedition Unlimited Acquatic Enterprises, Inc. v.

Smithsonian Institute, 500 F.2d 808 (Sth Cir. 1974) . 18

Fuentes v. Shevin, 407 U.S. 67 (1972), reh’g denied,

TDs ec ed cde cbc cece 10, 12, 14, 15

Hovey v. Elliott, 167 U.S. 409 (1897) ............... 9, 16

In re La Providencia Development Corp., 406 F.2d 251

RE es re 16, 17

In re Merrimack Mutual Fire Insurance Co., 587 F.2d

a vs aba be we nie a ed's 12

Joint Anti-Fascist Refugee Committee v. McGrath, 341

U.S. 123 (1950) (Frankfurter, J.. concurring) ....... 10, 19

Klapprott v. United States, 335 U.S. 601 (1949) ...... 18, 19

McVeigh v. United States, 78 U.S. (11 Wall) 259

ee we es ies nce aed 2 ow 8 9

Mullane v. Central Hanover Bank & Trust Co., 339

Nn ahr ae bale alk wo ha 16

Shell Oil Co. v. Texas, 442 S.W.2d 47 (Tex.Civ.App.-

Sueeees pum, Wrst Ol @. W.f.6.).................... 10

Southern Pacific Transport Co. v. Texas, 380 S.W.2d

123 (Tex.Civ.App.-Houston 1964, writ ref'd)........ 10

Texas Vv. New Jersey, 397 U.S. 674 (1965) ........... 5, 10

Thermtron Products, Inc. v. Hermansdorfer, 423 U.S.

| 1, 4,9, 10, 11, 12, 13, 14, 15, 17, 19

Trent Realty Association v. First Federal Savings Loan

Association, 657 F.2d 29 (3rd Cir. 1981) ........... 12

United States v. Rice, 327 U.S. 742 (1946) ........... 14

Wayne United Gas Co. v. Owens-Illinois Glass Co., 300

ee kk yk kk ask we dd ace eens 18

iv

PAGE

Wilson v. Republic Iron & Steel Co., 257 U.S. 92

SORE Er eee ee ee ie een ke 12, 13, 19

Windsor v. McVeigh, 93 U.S. 277 (1876)............. 10, 16

CONSTITUTIONAL PROVISIONS

ce es, ee FR dB ee a rns 2

U.S. CONST. amend.V............. 9, 11, 12, 13, 16, 17, 18

STATUTES

Be She CRE ED ao cs orale exe eaks 2

eee RD on ees Sree ek ace 2

28 U.S.C. § 1446(a), (b), (d), (e) (1965) ......... 2, 9, 10, 15

28 U.S.C. § 1447(c), (d), (1964) .. 2,9. 10,12, 14,15, 16,1718

ee es NPN ooo sb ede Ses oe be loulb owen 2

FR aS eR a Een 3 2,17, 18

de A a SR eee 3 18, 13,8

OM yet kk sie nnueaennanaan 2, 10, 15

go ae a ag 9 ee rere 2,17, 18

FED. R. CIV. P. 60(b)(1), 60(b)(3) and 60(b)(6) 2, 16, 17, 18

TEXAS PROP. CODE ANN., § 72, 74 (Vernon 1987). 5

MISCELLANEOUS

DOPE. O04, 73 URE. C190S). ke... ccs. 2

1A. J. MOORE & B. RINGLE, MOORE’S

FEDERAL PRACTICE 10.157[13](2d. ed. 1987)... 11

1A. J. MOORE & B. RINGLE, MOORE’S

FEDERAL PRACTICE 14 0.169[21] at 697, (2d. ed.

BNNs bau suk oa eure Mee Va age waue s 16-17

Federated Department Stores v. Richards, No. H-86-

2759 (S.D. Tex. filed July 19, 1986) (dismissed)... ... 6

Getty Oil Co. v. Richards, No. C-85-335 (S.D. Tex.

PB ES IRE PPR rere ay) nial ree 5, 10

Richards v. Sanger Harris, No. 400,639 (Dist. Ct. of

Travis County, 126th Judicial District of Texas, Oct.

Ret tates a ircice ed nto 4

IN THE

Supreme Court of the United States

OCTOBER TERM, 1986

SANGER-HARRIS, A Division of Federated Department

Stores, Inc.,

Petitioner,

v.

ANN RICHARDS, Treasurer of the State of Texas,

Respondent.

On Petition for a Writ of Certiorari

To the United States Court of Appeals

for the Fifth Circuit

PETITION FOR A WRIT OF CERTIORARI

The Petitioner respectfully prays that a writ of certiorari be

issued to review the judgment of the United States Court of

Appeals for the Fifth Circuit affirming the trial court’s order

remanding this case to the state court from which it was

removed.

JURISDICTION

A per curiam opinion and related judgment were entered on

March 11, 1987 by the United States Court of Appeals for the

Fifth Circuit affirming the trial court’s order remanding this

case to the state court from which it was removed on the ground

that this case was removed “improperly and without jurisdic-

tion.” A copy of the trial court order, the Fifth Circuit’s per

curiam opinion and judgment affirming such dismissal order and

2

order denying Suggestion for Rehearing En Banc by the Appel-

lant are attached as Appendices A through D and appear at

pages A-1 through D-2.

A timely Suggestion for Rehearing En Banc was filed on

March 25, 1987 and was denied by the Fifth Circuit on April 30,

1987. The Petition for a Writ of Certiorari has been filed within

the 60 day period after the denial on April 30, 1987 of the

Suggestion for Rehearing En Banc.

This Court’s jurisdiction is invoked under 28 U.S.C.

§ 1254(1)(1948).

CONSTITUTIONAL AND OTHER PROVISIONS INVOLVED

This case involves:

1) U.S. CONST. art. III, § § 1,2.

2) U.S. CONST. amend. V.

3) 28 U.S.C. § 1254(1)(1948).

4) 28 U.S.C. § 1291(1958).

5) 28 U.S.C. § 1446(a), (b), (d), (e) (1965).

6) 28 U.S.C. § 1447(c), (d), (1964).

7) 28 U.S.C. § 2201(1978).

8) Sup. Ct. R. 20.4, 28 U.S.C. (1980).

9) FED. R. CIV. P. 1

10) FED. R. CIV. P. 5.

11) FED. R. CIV. P. 7.

12) FED. R. CIV. P. 59(a) (d)

13) FED. R. CIV. P. 60(b)

The foregoing provisions are set forth verbatim in the Appen-

dix. (Appendix I-1 through I-9)

3

STATEMENT OF THE CASE

Action by the trial court and the Fifth Circuit

On October 3, 1986, the United States District Court for the

Western District of Texas — Austin Division, (“trial court’’),

acted upon the Respondent’s remand motion containing a

false/incorrect certification that a copy of the Respondent's

September 12, 1986 remand motion’ had been served upon the

Petitioner. Jurisdiction vested in the trial court pursuant to 28

U.S.C. §§ 1331 and 1332 and removal of the case was

approprate under 28 U.S.C. § 1441. The trial court entered its

‘The Respondent's “Motion to Remand and Memorandum in Sup-

port Thereof” filed on September 12, 1986 contained the following

false and incorrect Certificate of Service:

“I hereby certify that a true and correct copy of the above and

foregoing Motion to Remand and Memorandum in Support

Thereof has been served on all parties to this docket on this the

12th day of September, 1986.” ~

/s/ Jerry Benedict

Jerry L. BENEDICT

Assistant Attorney General

State and County Division

P.O. Box 12548

Austin, Texas 78711-2548

State Bar No. 002129300

Attorney for Defendant

A similar false/incorrect certificate of service was attached to

“Cross-Defendant’s Motion to Dismiss Cross-Plaintiffs Counter-

suit pursuant to Rule 12 F.R.C.P.” that had been filed by the

Respondent on September 12, 1986. The Petitioner did not learn of

the existence of the dismissal motion until the preparation of its

Appellant’s Brief for submission to the Fifth Circuit.

An incomplete certificate of service that omitted the Petitioner's

counsel's name and address was attached to the “Appellee’s

Response to Appellent’s Suggestion for Rehearing En Banc” that

was filed by the Respondent on April 20, 1987. During the course

of a proceeding in a state court a comment was made to the

Respondent's counsel about the Petitioner’s failure to receive a

copy of the Response. An investigation was made by the Respon-

dent’s counsel and a copy of the Response was mailed by Respon-

dent’s counsel to the Petitioner's counsel on April 28, 1987.

4

October 3, 1986 order remanding the declaratory judgment

action’ filed by the Respondent and the Petitioner /Cross-Plain-

tiffs Original Counterclaim to the Travis County, Texas, Dis-

trict Court from which it had been removed’ on the grounds that

the “cause had been removed improperly and without

jurisdiction.”

After the trial court’s denial of the Petitioner's Motion for a

New Trial and the denial of the Joint Motion for Relief filed by

the Petitioner and the Respondent, the Petitioner filed and per-

fected a timely appeal to the United States Court of Appeals for

the Fifth Circuit in respect to the trial court’s remand order. The

Fifth Circuit in a per curiam opinion affirmed the trial court’s

remand order on the ground that under the rule of Thermtron

Products, Inc. v. Hermansdorfer, 423 U.S. 336 (1976) the Fifth

Circuit was precluded from reviewing the trial court’s remand

order under any circumstances and stated (Appendix B):

This appeal seeks review by us of an order of the trial

court remanding this case to state court on the ground that

it was removed “improvidently and without jurisdic-

tion,” ...—orders which recite the magic words that we

quote above—are “not subject to challenge in the court of

appeals by appeal, by mandamus, or otherwise.” (citation

omitted.)

* * *

The Thermtron court does not say that we cannot review

orders purporting to remand on this basis on certain

* Richards v. Sanger Harris,, No. 400,639, (Dist. Ct. of Travis

County, 126th Judicial District of Texas, Oct. 3, 1986), a declara-

tory judgment action by the State Treasurer seeking the right to

examine for an indefinite number of years the records of the Sanger

Harris Division in respect to its compliance with the

escheat /abandoned property law of the State of Texas.

* Richards v. Sanger Harris, No. 400,639 (Dist. Ct. of Travis

County, 126th Judicial District of Texas, Oct. 3, 1986). The declar-

atory judgment action by the State Treasurer was removed to the

United States District Court for the Western District of Texas,

Austin Division, in the proceeding Civil Action No. A-86-CA-454.

5

grounds, or for certain faults; for constitutional infirmitites,

but not for statutory ones: it says that we cannot review

them at all. There it ends.

Chronology of events

For the years covered by the declaratory judgment action the

Petitioner timely filed reports describing property subject to

escheat under the TEXAS PROP. CODE ANN., Title 6.

Escheat, (Vernon 1987)(“Escheat Act’) and describing prop-

erty for which the Petitioner had no reporting obligation for the

reason that title to such property had vested in the Petitioner

under applicable Texas statutes of limitation.

In order to resolve a controversy involving the possible escheat

of unclaimed mineral proceeds in the fall of 1985, Getty Oil Co.

and thirty other oil companies commenced a declaratory judg-

ment‘ action (“Getty case”) to have the Texas Escheat Act

declared unconstitutional on numerous grounds. The case was

compromised and settled® on the eve of trial on January 8, 1986.

‘ Getty Oil Co. v. Richards, No. C-85-335, (S.D. Tex. Jan. 8, 1986).

Included among the 31 plaintiffs were Getty Oil Company, Atlantic

Richfield, Inc., Conoco, Inc., Texaco, Inc., Mobil Oil Corporation,

Union Oil Company, Phillips Petroleum Co. and Exxon ae

U.S.A. The 31 oil companies claimed that the Escheat Act violated

the plaintiff's due process rights, was void under the Supremacy

Clause and this court’s decision in Texas v. New Jersey, 379 US.

674 (1965), denied the plaintiffs equal protection under the laws,

deprived the plaintiff's of their vested rights under Texas’ statutes

of limitation and constituted a retroactive law that was void under

the Texas Constitution.

The settlement agreed to by the State Treasurer and the Attorney-

General of the State of Texas was predicated upon Texas’ express

recognition of the principles of Texas v. New Jersey, 397 U.S. 674

(1965), an agreement that the oil companies would immediately

commence remitting unclaimed mineral proceeds and that 29 of the

oil companies would not report and remit debts which accrued prior

to 9/1/80 and 2 of the oil companies (Mobil and Union) would

remit mineral proceed debts which accrued prior to 9/1/79 and

9/1/78, respectively, and that the state would not audit the oil

companies for the handling of unclaimed mineral proceed debts

accrued prior to 9/1/80.

o

6

On April 28, 1986 the representatives of the Respondent noti-

fied the Petitioner, a Delaware corporation, that commencing on

May 27, 1986 they would examine the books of the Petitioner’s

Sanger Harris Division (““Sarger’’) to ascertain the Petitioner's

compliance with Texas laws pertaining to the escheat of and the

abandonment of personal property. On May 26, 1986 the scope

of the Respondent’s examination was modified and enlarged. In

view of the January 8, 1986 settlement agreed to by the Respon-

dent in the Getty case, the Petitioner advised the Respondent

that it would allow an examination of its books and records for

the period after September 1, 1981, but that it would not allow

its books to be examined for the period prior to September 1,

1981, the first date on which Texas’ new statutory four year

dormancy period for presumptively abandoned property would

be effective.

On July 15, 1986 the Respondent filed its declaratory judg-

ment action seeking a declaration of its rights to examine

Sanger’s books and records to ascertain if the Petitioner had

reported and remitted to the State of Texas each and every item

of unclaimed property after it had been on the Petitioner’s books

for a period of years, i.e. at least back to 1961.

On August 21, 1986° the Petitioner filed in this case its Peti-

tion for Removal of Civil Action to the United States District

*On July 19, 1986 the Petitioner had filed a complaint in the United

States District Court for the Southern District of Texas-Houston

Division styled, ‘Federated Dept. Stores v. Richards, No. H-86-

2759 (S.D. Tex. filed July 19, 1986) (dismissed), (Houston case),

seeking a declaratory judgment in respect to the State Treasurer

and the Attorney General of the State of Texas in respect to Texas’

escheat act and a temporary restraining order or preliminary

injunction seeking to prevent the Respondent from enforcing or

attempting to enforce Texas’ escheat laws on the same grounds set

forth in Petitioner’s Original Counterclaim in the case removed to

the trial court in this case.

On July 28, 1986, the Respondent filed in the Houston case

Defendant’s Motion to Dismiss pursuant to FED R. CIV. P.

12(b)(6) and Response to Plaintiffs Application for Temporary

\

Court for the Western District of Texas-Austin Division, where

this case was assigned Cause No. A-86-CA-454. On the same

date the Petitioner filed its Answer to the Plaintiffs Original

Petition and Cross Plaintiffs Original Counterclaim, in which

counterclaim the Petitioner challenged the constitutionality of

“the Texas Escheat Act as violating the contract, supremacy, just

compensation and due process clauses of the Constitution of the

United States, as subjecting the Petitioner to multiple liability to

different states for the same intangible property, as requiring the

reporting and delivery to Texas of property with respect to which

the indemnification provisions of the unclaimed property laws

are inadequate to protect the Petitioner from multiple liability,

and by denying the Petitioner equal protection of the law.

Contemporaneously with the filing of the Respondent’s

remand motion on September 11, 1986 the Respondent filed a

motion to dismiss the Petitioner’s original counterclaim, which

motion contained a false/incorrect certification that the Respon-

dent had served a copy of the dismissal motion upon the Peti-

tioner. The Petitioner learned of the existence of the dismissal

motion during the preparation of its Appellant’s Brief for sub-

mission to the Fifth Circuit.

On October 3, 1986 the trial court entered its order remand-

ing the declaratory judgment action to the state court from

which it was removed. The remand order was received in the

office of the Petitioner’s counsel on October 6, 1986 at which

time telephone inquiries were made about the entry of the

Restraining Order (“Dismissal Motion”). On July 28, 1986 the

Court in the Houston case orally denied Petitioner’s Request for a

temporary restraining order or preliminary injunction. On August

7, 1986 the Court issued its written order denying the request for a

temporary restraining order and instructed the Petitioner to

respond to the Dismissal Motion within twenty (20) days, which

response was timely filed by the Petitioner. On March 25, 1987 the

court dismissed the complaint on the grounds of abstention and that

there were numerous issues that the courts of Texas should decide

rather than a federal court.

es ee

8

remand order to the Respondent’s counsel, the Clerk’s office for

the Austin Division of the United States District Court, and the

law clerk for United States District Court Judge Nowlin, who

signed the order. The views developed during the foregoing tele-

phone discussions led to the filing of a Motion for New Trial and

a Joint Motion for Relief from Order.

On October 14, 1986 the Petitioner filed in this case its

Motion for New Trial (Appendix E) on the grounds that the

Petitioner had not received a copy of the remand motion either

by certified mail, regular mail or by any other manner of deliv-

ery, that conferences with attorneys for the Respondent revealed

that the records of the Respondent’s attorneys did not show that

the remand motion was in any manner served upon counsel for

Petitioner and that the Respondent’s failure to serve a copy of

the remand motion upon the Petitioner denied the Petitioner due

process and the opportunity to present to the trial court its

defenses on the merits. On October 22, 1986 the trial court

entered its Order stating that Petitioner’s motion for New Trial

was not meritorious, should be denied and that the court no

longer had jurisdiction in this cause. (Appendix F)

On October 27, 1986 the Petitioner and the Respondent filed

a Joint Motion for Relief from Order (Appendix G) pursuant to

FED. R. CIV. P. 60(b)(1) on the grounds that as a result of

mistake or inadvertence, the Petitioner had not been served with

a copy of the remand motion that had been filed, so that the

Petitioner was not extended the opportunity to file a responsive

pleading on the merits in respect to the remand motion and

consequently the Petitioner was denied its rights to due process

and its right to be heard in the trial court. On December 8, 1986

the trial court entered its Order denying the Joint Motion for

Relief from Order on the grounds that it was not meritorious, for

the reason that in the order of remand the trial court had stated

that the remand was based “upon the ground that said cause was

removed improperly and without jurisdiction. Consequently, the

9

Court is of the opinion that it has no jurisdiction to entertain this

Motion.” (Appendix H)

A timely notice of appeal was filed by the Petitioner and

updated supplemental Notices of Appeal were filed in respect to

the trial court’s orders dated October 3, 1986, October 22, 1986

and December 8, 1986 denying the Petitioner relief from the

remand order.

REASONS FOR GRANTING THE WRIT

A writ should be granted to cure a direct violation of the

Petitioner’s due process right to notice and right to an opportu-

nity to be heard. The Fifth Amendment due process guaranty of

the “right to receive notice and to have an opportunity to be

heard” is not a tentative or discretionary guaranty and should

not be accorded such treatment. From the time of this Court’s

earliest due process decisions, the right to a hearing has been

regarded as a fundamental aspect of “‘the first principles of the

social compact and of the right administration of justice.”

McVeigh v. United States, 78 U.S. (11 Wall.) 259, 267 (1870).

The right to be heard is a fundamental and elementary principle

of the judicial function of the United States and such principle

has its roots in both Roman law and the common law. Hovey v.

Elliott, 167 U.S. 409, 415-418 (1897).

The trial court’s orders and the Fifth Circuit’s judgment in

this case rest upon the mistaken premise that by a long series of

decisions culminating in this Court’s Thermtron decision, a

defendant’s Fifth Amendment due process guaranty of receipt of

notice and an opportunity to be heard is inapplicable to removal

cases arising under 28 U.S.C. § 1446 (1964) and 28 U.S.C.

§ 1447 (1965). The trial court orders reflect the trial court’s

incorrect conclusion that it lacked jurisdiction to correct its

invalid order. The Fifth Circuit judgment reflects the position

that regardless of the existence of the constitutional guaranty of

due process, the Fifth Circuit, as an appellate court, is barred by

10

this Court’s Thermtron decision from seeing that the Petitioner

enjoys its right to due process.

The Petitioner complied with the provisions of 28 U.S.C.

§ 1446. The Respondent did not comply with 28 U.S.C. § 1447

for the reason that she ineffectually complied with FED. R. CIV.

P. 5 and 7. The Respondent’s failure to comply with FED. R.

CIV. P. 5 and 7 prevented the Respondent’s effective invocation

of § 1447(c). The trial court’s issuance of its remand order, after

receipt of the Respondent’s remand motion that contained a

false/incorrect certification that the remand motion had been

served upon the Petitioner, violated the Petitioner’s procedural

due process rights and should be reversed. Fuentes v. Shevin,

407 U.S. 67 (1972), reh’g denied, 409 U.S. 902 (1972). Since

notice was not given to the Petitioner of the filing of the remand

motion, the trial court had no jurisdiction to issue its remand

order. Windsor v. McVeigh, 93 U.S. 277, 278 (1876); Joint

Anti-Fascist Refugee Committee v. McGrath, 341 U.S. 123,

170172 (1950) (Frankfurter, J., concurring). The remand order

was void ab initio because of the failure to comply with the

procedural due process “notice of hearing” guaranty of the Fifth

Amendment to the Constitution of the United States.

The Petitioner made a value judgment in this case that the

issues presented by the Respondent’s declaratory judgment

action would be best resolved in federal court in light of the

settlement in the Getty case and the uncertainty about Texas’

planned Escheat Act enforcement activities.’ The right to

"The State Treasurer had declared her intention to have a vigorous

enforcement of the Escheat Act which had not been amended to

correct the deficiencies in the Act, that were revealed by the deci-

sion in Texas v. New Jersey, 379 U.S. 674 (1965). At the same

time, the State Treasurer had also indicated her intention to chal-

lenge the correctness/applicability of the decisions in Shell Oil Co.

v. Texas, 442 S.W.2d 47 (Tex.Civ.App. — Houston 1969, writ

ref'd, n.r.e.) and Southern Pacific Transport Co. v. Texas, 380

S.W.2d 123 (Tex.Civ.App. — Houston 1964, writ ref'd), which

decisions prevented the State of Texas from claiming derivative

1]

remove a case to federal court is a statutory right which cannot

be disregarded if the statutory prerequisites for removal are met.

Thermtron, 423 U.S. at 344. The decision to remove a case to

federal court is mainly a reflection of the defendant’s counsel’s

concern over “the practicalities involved in litigating his particu-

lar cases.” 1A J. MOORE & B. RINGLE, MOORE’S FED-

ERAL PRACTICE 14 0.157[13] (2d ed 1983).

The failure to give notice of the filing of motions and other

documents will occur under a variety of circumstances.* It is not

possible to state with certainty whether the exclusion of remand

orders from the receipt of notice and opportunity to be heard

protection of the due process guaranty of the Fifth Amendment

will result in the future in one or more situations where notice of

the filing of a remand motion or other orders will be withheld

intentionally or unintentionally from the opposing party. The

self-serving benefits attributable to the failure to give notice are

predictable, and are illustrated by the instant case, where notice

of the filing of the remand order was not given to the Petitioner

and the Respondent was unwilling to dismiss its declaratory

judgment action and forego the strategic procedural gain that

occurred when the trial court accepted and acted upon the

Respondent’s false/incorrect certification that the Petitioner had

been notified of the filing of the remand motion.

It can be expected that advocates confronted with other types

of due process problems may seek to capitalize on instances of

intentional or unintentional conduct with the hope of creating

additional situations where the applicability or inapplicability of

the due process guaranty may produce the same type of or a

similiar advantage as that received by the Respondent in this

case, for example, fraud in the designation of parties in order to

escheat rights to property that the original owner/claimants of the

property were barred from receiving under applicable Texas stat-

utes of limitation.

* See footnote 1, supra.

12

demonstrate or refute diversity of citizenship or the concealment

of the existence of a federal question. Wilson v. Republic Iron

Steel Co., 257 U.S. 92, 97 (1921).

ARGUMENT

I.

28 U.S.C. 1447(d) and the decision in Thermtron are extreme

statements of legislative and judicial policy about the remand

process that are subject to and circumscribed by the procedural

due process notice and hearing guaranty of the Fifth Amendment

to the Constitution of the United States.

Due process rights, § 1447(c) determinations, § 1447(d) limita-

tions, and Thermtron principles are consistent

The remand order in this case was not issued sua sponte as a

result of the trial court’s independent review of and concern

about the petition for removal. Trent Realty Association v. First

Federal Savings Loan Association, 657 F.2d 29, 31, 36 (3rd Cir.

1981). The remand order was not a Thermtron-type order issued

by the trial court on its own initiative and after notice to and a

hearing for and with the parties, at which hearing the court

Getermined that the congestion of its trial docket made it appro-

priate to remand the case to the state court where a prompt trial

could be held. Thermtron, 423 U.S. at 339, 340. The trial court’s

order was formulated in circumstances where § 1447(c) was not

operative.

The remand order fell within the procedural due process pro-

tection of the Fifth Amendment. Fuentes, 407 U.S. at 80. The

remand order contains the holding by the trial court that the

case was “remanded improperly and without jurisdiction” which

brings it within the apparent and extreme prohibitory ambit of

Thermtron. See also, In re Merrimack Mutual Fire Insurance

Co., 587 F.2d 642, 647 (Sth Cir. 1978). This court is the final

arbiter of the dichotomy, if any there be, that results from the

13

interplay of the Fifth Amendment and this Court’s decision in

Thermtron.

A dichotomy does not exist between the constitutional guar-

anty of appropriate due process notice and the decision in the

Thermtron case. Rather the problem that exists is one that is

attributable to the failure of the trial and appellate courts to

recognize and adhere to the bellwether principle of this Court to

recognize, respect and enforce the constitutional guaranty of due

process.

The removal of the instant case having been accomplished, the

issues raised by the Respondent’s remand motion should have

been “heard and determined by the district court.” Wilson, 257

U.S at 97. Just as the right of removal cannot be defeated by a

fraudulent joinder of a resident defendant having no real connec-

tion with the controversy, the removal in this case should not be

defeated by the processing of a defective remand motion and the

issuance of a constitutionally defective remand order. /d. at 97.

A challenge to the correctness of the removal having been made

by the Respondent, the burden of proving the correctness of the

removal rested upon the Petitioner. Carson v. Durham 121 U.S.

421 (1887). The Petitioner was prepared to discharge that bur-

den of proof but was prevented from doing so by the Respon-

dent’s false/incorrect certification of service. The inclusion of a

false/incorrect certification in the remand motion that notice of

the filing of the remand motion was served upon the Petitioner

should not be the vehicle to defeat the Petitioner’s right to proce-

dural due process in making an effective defense of the removal

action.

Thermtron did not expressly resolve due process issues involved

in remand cases

This case presents the simple question of whether a constitu-

tionally deficient remand order is immune from appellate review.

A literal and incorrect reading of some cases indicates the possi-

bility that remand orders might fall outside the protection of the

14

due process guaranty. “...in order to prevent delay in the trial

of remanded cases by protracted litigation of jurisdictional

issues... Congress immunized from all forms of appellate

review any remand order issued on the grounds specified in

§ 1447(c)...” Thermtron, 423 U.S. at 351; United States v.

Rice, 327 U.S. 742 (1946).

28 U.S.C. § 1447(d) exists within the legal framework of our

constitutional due process guaranties. § 1447(d) is not an abso-

lute rule of law that is immune from judicial scrutiny. Therm-

tron, 423 U.S. at 352. Justice White recognized the Court’s duty

to prevent the development of a judicial gloss or overlay on

§ 1447(d) that would defeat the Congressional intent to prevent

protracted litigation in remand cases. At the same time it was

pointed out that the Court has not construed the present or past

prohibition against review of remand orders so as to extinguish

“the power of an appellate court to correct a district court that

has not merely erred in applying the requisite provision for

remand but has remanded a case on grounds not specified in the

Statute and not touching the propriety of the removal.” /d. at

351, 352. Neither the majority opinion in Thermtron nor Chief

Justice Rehnquist’s dissent dealt with the question of whether

§ 1447(d) immunized against appellate review a remand order

that violated the Petitioner’s procedural due process guaranty of

receipt of notice and an opportunity to be heard in respect to the

Respondent’s remand motion.

Procedural due process cannot be defeated by statute or case

law

The central meaning of procedural due process is: ‘Parties

whose rights are to be affected are entitled to be heard; and in

order that they may enjoy that right they must first be notified.”

Baldwin v. Hale, 68 U.S. 223 (1863); Fuentes, 407 U.S. at 80.

It is fundamental to due process that the right to notice and an

opportunity to be heard “must be granted at a meaningful time

15

and in a meaningful manner.”’ Armstrong v. Manzo, 380 US.

545, 552 (1965); Fuentes, 407 U.S. at 80.

The instant case was properly removed to the United States

District Court of the Western District of Texas in accordance

with the provisions of 28 U.S.C. § 1446(d), (e). Remand

motions, which.do not comply with the service requirements of

FED. R. CIV. P. 5, are not the subject of a specific exception to

or exemption under 28 U.S.C. § 1447(c) or (d).

The Petitioner complied with the provisions of 28 U.S.C.

§ 1446. The Respondent sought to invoke 28 U.S.C. § 1447 and

made an ineffectual compliance with FED. R. CIV. P. 5 and 7.

The Respondent’s failure to comply with FED. R. CIV. P. 5 and

7 prevented the effective invocation of § 1447(c) with the conse-

quence that the Court’s remand order violated the Petitioner's

procedural due process right to receive notice and be given an

opportunity to be heard.

An invalid remand motion cannot form the basis for a valid

remand order

FED. R. CIV. P. 7(b)(1) imposes aga condition precedent to

the invocation of 1447(d), the filing of a written motion that

complies with FED. R. CIV. P. 5. Rule 5 imposes an absolute

obligation upon a party filing a written motion to serve a copy of

such motion upon the opposing party or his attorney. The

Respondent failed to comply with Rule 5 and, therefore, ineffec-

tually sought to invoke § 1447(d).

The trial court’s October 3, 1986 remand order, which states

“Before the Court is Plaintiff Ann W. Richards, Treasurer of

the State of Texas, Motion to Remand” was ineffective to bring

the remand order within the ambit of § 1447(d) and the rule of

the Thermtron. The remand order was not a sua sponte determi-

nation by the trial court on its own initiative that the case was

“removed improvidently and without jurisdiction”, but instead

16

was a direct result of the trial court’s consideration of the

Respondent’s remand motion.

This Court should determine that the Fifth Amendment due

process guaranty preempts and takes precedence over § 1447(d)

and the legislative/judicial policy expressed in respect to such

section.

When notified in a timely fashion that the Petitioner had not

received notice of the filing of the remand motion, the trial court,

whose processes were invoked by the Respondent’s remand

motion, had the power and affirmative obligation to withdraw the

remand order and grant a hearing to the Petitioner in respect to

the issues raised in the remand motion pursuant to the procedural

due process guaranty of the Fifth Amendment to the United

States Constitution, the court’s inherent power over and control

of its own processes and the authority granted the trial court

under FED. R. CIV. P. 60(b).

The trial court’s remand order was constitutionally defective.

It was an order which the court did not have jurisdiction to

enter, for it was entered without notice and without an opportu-

nity for the Petitioner to be heard in respect to the matters

covered by the order. Windsor, 93 U.S. at 277, 278; Hovey, 167

U.S. at 415. There is no issue as to the adequacy of notice in

respect to the motion or order, for the reason that the Petitioner

received no notice of the remand motion and was not given an

opportunity to be heard in respect to the remand motion before

it was acted upon by the trial court. Mullane v. Central Hano-

ver Bank & Trust Co., 339 U.S. 306, 314 (1950).

The entry of and delivery to a state court of a constitutionally

proper order forecloses the trial court from revoking its remand

order. Jn re La Providencia Development Corp., 406 F.2d 251,

252-253 (ist Cir. 1969); Bucy v. Nevada Construction Co., 125

F.2d 213 (9th Cir. 1942); 1A J. MOORE & B. RINGLE,

a ee

17

MOORE'S FEDERAL PRACTICE, 10.169[2-1} at 697 (2d

ed. 1983).

Since the trial court’s remand order was constitutions !ly

defective, it was not a valid order under 28 U.S.C. 1447(c) and

falls outside the reach of the decisions in La Providencia and

Bucy. The issue then becomes “Is there something about a

remand order that places it outside the reach of the due process

protection of the Fifth Amendment and the supervisory author-

ity of this court?” This court has answered “No.” Thermtron,

423 US. at 352.

In the light of the facts in this case, the constitutional guar-

anty of due process, the trial court’s inherent control over its own

processes, the just mandate of FED. R. CIV. P. 1, the trial

court's right to grant a new trial under FED. R. CIV. P. 59(a)

and (d} and the trial court’s right to grant relief from the

remand order on the grounds set forth in FED. R. CIV. P. 60(b),

the trial court had both the power and obligation to withdraw

the remand order and grant the Petitioner a hearing in respect to

the matters raised in the remand motion.

The Petitioner in a timely fashion had:

a) notified the Respondent’s counsel, the U.S. District

Clerk’s office and the office of the trial judge that a remand

order had been entered without notice to the Petitioner; and

b) Sought relief from the remand order by the timely

filing of a Motion for New Trial, under FED. R. CIV. P.

59(a) and a Joint Motion for Relief from Order under

FED. R. CIV. P. 60(b).

c) Appealed to the Fifth Circuit to correct the trial

court’s errors.

The trial court had the power to withdraw its remand order

and set the remand motion for hearing after being timely noti-

fied by its law clerk of the absence of service of notice upon the

Petitioner, by the Petitioner through its Motion for New Trial

and by the Petitioner and Respondent, through their Joint

18

Motion for Relief from Order. Wayne United Gas Co. v. Owens-

Illinois Glass Co., 300 U.S. 131, 137 (1937). The Petitioner's

Motion for New Trial alerted the trial court to the injustice of

the entry of a remand order under circumstances where the Peti-

tioner had no knowledge as to the course of action the trial court

was being requested to take. The Joint Motion for Relief from

Order filed by the Petitioner and Respondent constituted a judi-

cial admission by the Petitioner and Respondent that the

remand motion failed to comply with the service requirements of

FED. R. CIV. P. 5 and that the remand order issued in respect

to the remand motion was constitutionally defective. The just

requirement of FED. R. CIV. P. 1 clearly supports the proposi-

tion that FED. R. CIV. P. 59(a) and 60(b) should be construed

in a way to accomplish justice by giving the Petitioner the oppor-

tunity to prove the correctness of the removal. Carson, 121 U.S.

at 426; Klapprott v. United States, 335 U.S. 601, 615 (1949);

Expedition Unlimited Acquatic Enterprises Inc. v. Smithsonian

Institute, 500 F.2d 808, 809 (Sth Cir. 1974).

The Petitioner took reasonable action to notify the trial court

of its error in order to obtain an appropriate correction of the

remand order. The trial court mistakenly determined that it

lacked authority to correct its error. The problem is analagous to

one involving default judgments. The statutes and rules have

largely left for judicial determination the type of cases in which

hearings and proof should precede default judgments and

accordingly it is the final responsibility of this Court to formu-

late the controlling rules for hearings and proof in respect to

default judgments. Klapprott, 335 U.S. at 611. The Fifth

Amendment mandates that all orders be issued in compliance

with due process of law. §§ 1447(c) and (d) are silent in respect

to the consequences of issuing a remand order when there has

not been compliance with due process of law in respect to the

remand motion which precipitated the issuance of the remand

order. This Court’s decision in Klapprott presupposes authority

19

in both the trial court and the Fifth Circuit to remedy the viola-

tion of the Petitioner's due process right to receive notice and be

given an opportunity to be heard. In the absence of remedial

action by the trial court or the Fifth Circuit, the decision in

Klapprott places the responsibility for corrective clarifying

action upon this Court. /d at 611.

CONCLUSION

Due process of law has many meanings depending upon fac-

tual conditions and the circumstances under which the concept

becomes relevant. McGrath, 341 U.S. at 162-164. In a non-

emergency, non-national security context such as the one

involved in this case where the issue was whether the case should

be remanded to the trial court from which it was removed, there

is no doubt that the failure to give notice of the filing of the

remand motion gave rise to a constitutionally defective remand

order which cannot be allowed to remain in place for it jeopard-

ized the Petitioner’s property interests. The Court should exer-

cise its supervisory authority and require the trial court to con-

duct a hearing in respect to the Remand Motion. Thermtron,

423 US. at 352, Klapprott, 335 US. at 611; Wilson, 257 US.

at 97.

20

DATED June 3, 1987

Respectfully submitted,

CHARLES J.

Counsel of Record for

Petitioner

5005 Woodway

P.O. Box 2482

Houston, Texas 77252

) 871-1185

P.O. Box 2482

Houston, Texas 77252

(713) 871-1185

WILLIAM F. HENRI

SULLIVAN, KING & SABOM,

a professional corporation

5005 Woodway

P.O. Box 2482

Houston, Texas 77252

(713) 871-1185

Of Counsel

21

CERTIFICATE OF SERVICE

I hereby certify that service of the Petition for a Writ of Certi-

orari has been made on opposing counsel by mailing a copy,

certified mail, return receipt requested, to Mr. Jerry L. Benedict

and to Mr. Patrick J. Wiseman, Office of the Attorney General,

P.O. Box 12548, Austin, Texas 78711-2548 this 3a@. day of

June, 1987.

CHARLES U/ SULLIVAN

A-|1

APPENDIX A

IN THE

United States District Court

For THE WESTERN DISTRICT OF TEXAS

AUSTIN DIVISION

ANN RICHARDS, "

Treasurer of the

State of Texas

VS. CIVIL

SANGER-HARRIS, fT No. A-86-CA-454

A Division of

Federated Department

Stores, Inc. 7

ORDER

Before the Court is Plaintiff Ann W. Richards’, Treasurer of

the State of Texas, Motion to Remand. The Court has duly

considered the Motion and is of the opinion that it is meritorious

and should be Granted.

IT IS HEREBY ORDERED that the case of Ann W. Rich-

ards, Treasurer of the State of Texas v. Sanger-Harris, a Divi-

sion of Federated Department Stores, Inc. bb REMANDED to

the 167th District Court of Travis County, Texas, from which it

was removed, upon the ground that said cause was removed

improperly and without jurisdiction.

IT IS FURTHER ORDERED that the Clerk of this Court

furnish the Clerk of said state court with an attested or certified

copy of this order.

SIGNED and ENTERED this 3rd day of October, 1986.

S/ JamMES R. NOWLIN

James R. Nowlin

United States District Judge

B-|

APPENDIX B

ANN RICHARDS, Treasurer of the State of Texas,

Plaintiff-Cross Defendant- Appellee,

VS.

FEDERATED DEPARTMENT STORES, INC.,

Defendant,

SANGER-HARRIS, A Division of Federated Department

Stores, Inc.,

Defendant-Cross Plantiff-Appellant.

No. 86-1797 Summary Calendar.

United States Court of Appeals, Fifth Circuit.

March 11, 1987.

The United States District Court, Western District of Texas,

James R. Nowlin, J., ordered action remanded to state court on

ground that action was removed “improvidently and without

jurisdiction.” Defendant appealed. The Court of Appeals held

that order was not subject to challenge by appeal, by mandamus,

or otherwise.

Removal of Cases West Key Digest 107(9)

Order to remand action to state court on ground that action

was removed “improvidently and without jurisdiction” was not

subject to challenge in the Court of Appeals by appeal, by man-

damus, or otherwise, even if order merely “purported” to

remand on stated grounds. -

Appeals from the United States District Court for the West-

ern District of Texas.

Before GEE, RUBIN, and JOLLY, Circuit Judges.

B-2

PER CURIAM:

The appeal seeks review by us of an order of the trial court

remanding this case to state court on the ground that it was

removed “improvidently and without jurisdiction,” essentially on

the ground that appellant did not recieve notice of the motion to

remand and had no opportunity to oppose it. Assuming that this

is true (as it appears to be), it remains that such orders as that of

the trial court — orders which recite the magic words that we

quote above — are “not subject to challenge in the court of

appeals by appeal, by mandamus, or otherwise.” Thermtron

Products, Inc. v. Hermansdorfer, 423 U.S. 336, 343, 96 S.Ct.

584, 589, 46 L.Ed.2d (1976).’

The Thermtron court does not say that we cannot review

orders purporting to remand on this basis on certain grounds, or

for certain faults; for constitutional infirmities, but not for statu-

tory ones: it says that we cannot review them at all. There it

ends.

AFFIRMED.

* The Court’s opinion, at the page cited, makes plain that the words

are indeed magic ones: the order is proof against review event if it

merely “purports” to remand on the ground quoted.

C-]

APPENDIX C

IN THE

United States Court of Appeals

FOR THE FIFTH CIRCUIT

No. 86-1797

D.C. Docket No. A-86-CA-454

ANN RICHARDS, Treasurer of the State of Texas

Plaintiff-Cross Defendant-Appellee,

VS.

FEDERATED DEPARTMENT STORES, INC.,

Defendant,

SANGER-HARRIS, A Division of Federated Department

Stores, Inc.,

Defendant-Cross Plaintiff-Appellant.

Appeals from the United States District Court for the

Western District of Texas.

Before GEE, RUBIN and JOLLY, Circuit Judges.

. JUDGMENT

This cause came on to be heard on the record on appeal and

was taken under submission on the briefs on file.

ON CONSIDERATION WHEREOF, It is now here ordered

and adjusted by this Court that the order of the District Court

appealed from in this cause is affirmed.

IT IS FURTHER ORDERED that defendant-cross-plaintiff-

appellant to pay plaintiff-cross defendant-appellee the costs on

appeal, to be taxed by the Clerk on this Court.

March 11, 1987

ISSUED AS MANDATE:

D-|

APPENDIX D

IN THE

United States Court of Appeals

For THE FifTH CIRCUIT

No. 86-1797

ANN RICHARDS, Treasurer of the State of Texas,

Plaintiff-Cross Defendant-Appellee,

VS.

FEDERATED DEPARTMENT STORES, INC..,

Defendant,

SANGER-HARRIS, A Division of Federated Department

Stores, Inc.,

Defendant-Cross Plaintiff-Appellant.

Appeals from the United States District Court

for the Western District of Texas

ON SUGGESTION FOR REHEARING EN BANC

(Opinion MARCH 11, 5 Cir., 1987, ......F.2d ..... )

(April 30, 1987)

Before GEE, RUBIN and JOLLY, Circuit Judges.

PER CURIAM:

(“) Treating the suggestion for rehearing en banc as a peti-

tion for panel rehearing, it is ordered that the petition for panel

rehearing is DENIED. No member of the panel nor Judge in

regular active service of this Court having requested that the

Court be polled on rehearing en banc (Federal Rules of Appel-

late Procedure and Local Rule 35), the suggestion for Rehearing

En Banc is DENIED.

( ) Treating the suggestion for rehearing en banc as a peti-

tion for panel rehearing, the petition for panel rehearing is

DENIED. The judges in regular active service of this Court

having been polled at the request of one of said judges and a

D-2

majority of said judges not having voted in favor of it (Federal

Rules of Appellate Procedure and Local Rule 35), the sugges-

tion for Rehearing En Banc is DENIED.

ENTERED FOR THE COURT:

s/ THOMAS GIBBS GEE

United States Circuit Judge

E-]

APPENDIX E

IN THE

United States District Court

For THE WESTERN DISTRICT OF TEXAS

AUSTIN DIVISION

ANN RICHARDS, *

Treasurer of the

State of Texas

VS. Civit ACTION

SANGER-HARRIS, No. A-86-CA-454

A Division of

Federated Department

Stores, Inc.

~_

a

MOTION FOR NEW TRIAL

TO THE HONORABLE JUDGE OF SAID COURT:

COMES NOW, Federated Department Stores, Inc., the

Defendant/Cross Plaintiff, in this cause and files its Motion for

New Trial pursuant to Rule 59, Federal Rules of Civil Proce-

dure and as grounds for such motion would respectfuliy show

unto this court as follows:

Introductory Comment

The Court entered on October 3, 1986, a Order of Remand in

this case. The Order of Remand remanded the entire cause to

the 167th District Court of Travis County, Texas. The

October 3, 1986 Order was based on the Motion to Remand of

Ann W. Richards, Treasurer of the State of Texas. The Court

states in its Order that it considered the Motion to Remand and

was of the opinion that it was meritorious and should be granted.

Defendant/Cross Plaintiff had not and has not received any

Motion to Remand in the instant case either by certified mail,

regular mail, or by any other manner of delivery. The attorneys

E-2

for Defendant/Cross Plaintiff have conferred with Messers.

Benedict and Wiseman, attorneys for Ann W. Richards, Treas-

urer of the State of Texas who have acknowledged that their

records do not reflect that a copy of the Motion to Remand was

in any manner served upon counsel for the Defendant/Cross

Plaintiff. On Friday, October 10, 1986 the counsel for the

Defendant/Cross Plaintiff conferred with Mr. Wiseman in

respect to the problems presented by the October 3, 1986 Order

and indicated that the Defendant/Cross Plaintiff was going to

file remedial pleadings in this case such as this Motion for New

Trial and an Agreed Joint Motion for Reconsideration and

Withdrawal of the October 3, 1986 Order as per his earlier dis-

cussions with Mr. Benedict. Mr. Wiseman and Mr. Benedict

were called on October 13, 1986 to review with them the filing of

this motion and were out of the city and unavailable for

conference.

The grounds for the new trial under Rule 59(a) are the same

grounds which have applied in suits in equity in the Court of the

United States. This Court was confronted with considering the

Motion to Remand without having a responsive pleading from

the Defendant/Cross Plaintiff. Defendant/Cross Plaintiff will

show to the Court, parts and positions of laws that will defeat

the Motion to Remand. Defendant/Cross Plaintiff was denied

the right to respond to the Motion to Remand by the failure to

deliver to it a copy of the Motion to Remand. Accordingly, the

Defendant/Cross Plaintiff has not had an opportunity to present

to this Court any defenses on the merits in respect to the Motion

to Remand.

Conclusion

The failure of Plaintiff to serve upon the Defendant/Cross

Plaintiff, as stated in the Certificate of Service, attached its

Motion to Remand, denied the Defendant/Cross Plaintiff its

rights to due process and rights to be heard in this Court.

E-3

The Motion for New Trial should be granted.

WHEREFORE, it is prayed that (1) the Order of October 3,

1986 in this cause be set aside, (2) Plaintiffs Motion for New

Trial be heard before this Court, (3) the Court set a hearing for

the earliest possible date on the Motion for New Trial, and

(4) Plaintiff be granted such further relief in law and equity that

is appropriate.

Respectfully submitted,

s/ CHARLES J. SULLIVAN

Charles J. Sullivan

Attorney-in-Charge

Of Counsel:

ANTHONY J. SADBERRY

WILLIAM F. HENRI

SULLIVAN, KING & SABOM, P.C.

5005 Woodway, Third Floor

Houston, Texas 77056

(713) 871-1185

E-4

CERTIFICATE OF SERVICE

I hereby certify that on this 13th day of October, 1986 a true

and correct copy of the Plaintiff's Motion for New Trial filed

pursuant to Rule 59, Federal Rules of Civil Procedure was

mailed via Certified Mail, Return Receipt Requested, to Mr. J.

Patrick Wiseman, Assistant Attorney General of the State of

Texas, Chief, State and—-€ounty Division, and Mr. Jerry L.

Benedict, Assistant Attorney General, Courts Building, P. O.

Box 124548, Capitol Station, Austin, Texas 78711 on this the

13th day of October, 1986 and by Federal Express, Receipt

Requested.

S/ CHARLES J. SULLIVAN

Charles J. Sullivan

F-]

APPENDIX F

IN THE

United States District Court

For THE WESTERN DISTRICT OF TEXAS

AUSTIN DIVISION

ANN RICHARDS, 7

Treasurer of the

State of Texas

VS. CIVIL

SANGER-HARRIS, : No. A-86-CA-454

A Division of

Federated Department

Stores, Inc. J

ORDER

Before the Court is Defendant Federated Department Stores,

Inc.’s Motion for New Trial. The Court has duly considered the

Motion and is of the opinion that it is not meritorious and should

be Denied. The Court is of the opinion that it no longer has

jurisdiction in this cause.

ACCORDINGLY, IT IS HEREBY ORDERED that the

Defendant’s Motion is hereby DENIED.

SIGNED and ENTERED this 22nd day of October, 1986.

S/ JAMES R. NOWLIN

James R. Nowlin

United States District Judge

G-1

APPENDIX G

IN THE

United States District Court

For THE WESTERN DISTRICT OF TEXAS

AUSTIN DIVISION

ANN RICHARDS, a

Treasurer of the

State of Texas

VS. a CiviL ACTION

SANGER-HARRIS, No. A-86-CA-454

A Division of ?

Federated Department

Stores, Inc. ,

JOINT MOTION FOR RELIEF FROM ORDER

TO THE HONORABLE JUDGE OF SAID COURT:

COMES NOW, Ann Richards, Treasurer of the State of

Texas, Plaintiff and Federated Department Stores, Inc., the

Defendant/Cross Plaintiff, in this cause and files this their Joint

Motion for Relief From Order pursuant to Rule 60(b)(1), Fed-

eral Rules of Civil Procedure and as grounds for such motion

would respectfully show unto this court as follows:

Introductory Comment

The Court entered on October 3, 1986, an Order of Remand

in this case. The Order of Remand remanded the entire cause to

the 167th District Court of Travis County, Texas. The

October 3, 1986 Order was based on the Motion to Remand of

Ann W. Richards, Treasurer of the State of Texas. The Motion

to Remand, in its Certificate of Service, states that service was

mailed to Attorney for Defendant. The Court states in its Order

that it considered the Motion to Remand and was of the opinion

that it was meritorious and should be granted. Defendant /Cross

G-2

Plaintiff had no notice of the Motion to Remand and did not

appear before the Court.

The Defendant/Cross Plaintiff did not receive a copy of the

Motion to Remand. Plaintiffs records do not indicate that

Defendant/Cross Plaintiff had received the Motion to Remand

in the instant case prior to October 3, 1986 either be certified

mail, regular mail, personal delivery, or by any other manner of

delivery. On Friday, October 10, 1986 the counsel for the

Defendant/Cross Plaintiff conferred with Mr. Wiseman in

respect to the problems presented by the October 3, 1986 Order

and indicated that pursuant to his earlier discussions with

Mr. Benedict the Defendant/Cross Plaintiff would file remedial

pleadings in this case such as this Agreed Joint Motion for

Relief From Order. Mr. Benedict was called on October 17,

1986 to review with him the filing of this motion and agreed to

join in this Motion.

The grounds for relief from the Order under Rule 60(b)(1)

are mistake or inadvertence. This Court was confronted with

considering the Motion to Remand without having a responsive

pleading from the Defendant/Cross Plaintiff. Defendant/Cross

Plaintiff would have filed a responsive pleading if it had been

given notice of the filing of the Motion to Remand. The mistake

or inadvertence on the certificate of service led the Court into

considering only issues raised by the Motion to Remand.

The parties state that Defendant/Cross Plaintiff, because of

mistake or inadvertence, was denied the right to respond to the

Motion to Remand by the failure to deliver to it a copy of the

Motion to Remand. Accordingly, the Defendant/Cross Plaintiff

has not had an opportunity to present to this Court its response,

on the merits, in respect to the Motion to Remand.

Conclusion

The failure of Plaintiff to serve upon the Defendant/Cross

Plaintiff, as stated in the Certificate of Service attached to its

G-3

Motion to Remand, denied the Defendant/Cross Plaintiff its

rights to due process and rights to be heard in this Court.

The Joint Motion for Relief From Order should be granted.

WHEREFORE, it is prayed that (i) the Court set a hearing

for the earliest possible date on the Joint Motion for Relief From

Order, and (2) this Joint Motion for Relief From Order be heard

before this Court, (3) the Order of October 3, 1986 in this cause

be reconsidered, set aside, and withdrawn, and (4) such other

further relief be granted in law and equity that is appropriate.

Respectfully submitted,

S/ CHARLES J. SULLIVAN

Charles J. Sullivan

Attorney-in-Charge

for Sanger- Harris

Of Counsel:

ANTHONY J. SADBERRY

WILLIAM F. HENRI

SULLIVAN, KING & SABOM, P.C.

5005 Woodway, Third Floor

Houston, Texas 77056

(713) Ses-1185

S/ JERRY L. BENEDICT

Jerry L. Benedict

Assistant Attorney General

Attorney General’s Office

Attorney in Charge

for Ann Richards, Treasurer

of the State of Texas

G-4

CERTIFICATE OF SERVICE

I hereby certify that on this 17th day of October, [986 a true

and correct copy of the Plaintiff's Motion for Relief From Order

filed pursuant to Rule 60, Federal Rules of Civil Procedure was

mailed via Certified Mail, Return Receipt Requested, to Mr. J.

Patrick Wiseman, Assistant Attorney General of the State of

Texas, Chief, State and County Division, and Mr. Jerry L.

Benedict, Assistant Attorney General, Courts Building, P. O.

Box 124548, Capitol Station, Austin, Texas 78711 on this the

17th day of October, 1986.

S/ CHARLES J. SULLIVAN

Charles J. Sullivan

H-|

APPENDIX H

IN THE

United States District Court

FOR THE WESTERN DISTRICT OF TEXAS

AUSTIN DIVISION

ANN RICHARDS, 9

Treasurer of the

State of Texas

VS. CIVIL

SANGER-HARRIS, 4 No. A-86-CA-454

A Division of

Federated Depariment

Stores, Inc.

4

ORDER

Before the Court is the Joint Motion for Relief from Order.

The Court has considered the Motion and is of the opinion that

the motion is not meritorious and should be DENIED. This

Cause was remanded on October 3, 1986. In the order of remand

the Court stated that remand was based “upon the ground that

said cause was removed improperly and without jurisdiction.”

Consequently, the Court is of the opinion that it has no jurisdic-

tion to entertain this motion.

ACCORDINGLY, IT IS HEREBY ORDERED that the

Joint Motion for Relief from Order is hereby DENIED.

SIGNED and ENTERED this 8th day of December, 1986.

s/ JAMES R. NOWLIN

James R. Nowlin

United States District Judge

APPENDIX I

U.S. CONST., art. III § 1 and 2

Article III]. The Judiciary

Section |. The judicial Power of the United States, shall be

vested in one supreme Court, and in such inferior Courts as

the Congress may from time to time ordain and establish.

Section 2. The judicial Power shall extend to all Cases, in

Law and Equity, arising under this Constitution, the Laws of

the United States, and Treaties made, or which shall be made,

under their Authority;

U.S. CONST., amend. V.

AMENDMENT V — CAPITAL CRIMES; DOUBLE

JEOPARDY; SELF-INCRIMINATION: DUE PROCESS;

JUST COMPENSATION FOR PROPERTY

No person shall be held to answer for a capital, or otherwise

infamous crime, unless on a presentment or indictment of a

Grand Jury, except in cases arising in the land or naval forces,

or in the Militia, when in actual service in time of War or

public danger; nor shall nay person be subject for the same

offense to be twice put in jeopardy of life or limb; nor shall be

compelled in any criminal case to be a witness against himself,

not be deprived of life, liberty, or property, without due proc-

ess of law; nor sha!l private property be taken for public use,

without just compensation.

28 U.S.C. Section 1254(1):

SECTION 1254. COURT OF APPEALS; CERTIORARI;

APPEAL; CERTIFIED QUESTIONS

Cases in the courts of appeals may be reviewed by the

Supreme Court by the following methods:

(1) by writ of certiorari granted upon the petition of any

party to any civil or criminal case, before or after rendition of

judgment or decree.

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28 U.S.C. Section 1291 (Supp. 1983):

SECTION 1291. FINAL DECISIONS OF DISTRICT

COURTS

The courts of appeals (other than the United States Court of

Appeals for the Federal Circuit) shall have jurisdiction of

appeals from all final decisions of the district courts of the

United States, the United States District Court for the Dis-

trict of the Canal Zone, the District Court of Guam, and the

District Court of the Virgin Islands, except where a direct

review may be had in the Supreme Court. The jurisdiction of

the United Stated Court of Appeals for the Federal Circuit

shall be limited to the jurisdiction described in sections

1292(c) and (d) and 1295 of this title. As amended Apr. 2,

1982, Pub.L. 97-164, Title I, § 124, 96 Stat. 36.

28 U.S.C. Section 1447(a), (b), (d), (e):

SECTION 1446. PROCEDURE FOR REMOVAL

(a) A defendant or defendants desiring to remove any civil

action or criminal prosecution from a State court shall file in

the district court of the United States for the district and

division within which such action is pending a verified petiton

containing a short and plain statement of the facts which enti-

tle him or them to removal together with a copy of all process,

pleadings and orders served upon him or them in such action.

(b) The petition for removal of a civil action or proceeding

shall be filed within thirty days after the receipt by the defend-

ant, through service or otherwise, of a copy of the initial

pleading setting forth the claim for relief upon which such

action or proceeding is based, or within thirty days after the

service of summons upon the defendant if such initial pleading

has then been filed in court and is not required to be served on

the defendant, whichever period is shorter.

If the case stated by the initial pleading is not removable, a

petition for removal may be filed within thirty days after

. 1-3

receipt by the defendant, through service or otherwise, of a

copy of an amended pleading, motion, order or other paper

from which it may first be ascertained that the case is one

which is or has become removable.

* * .

(d) Each petiton for removal of a civil action or proceeding,

except a petition in behalf of the United States, shall be

accompanied by a bond with good and sufficient surety condi-

tioned that the defendant or defendants will pay all costs and

disbursements incurred by reason of the removal proceedings

should it be determined that the case was not removable or

was improperly removed.

(e) Promptly after the filing of such petition for the removal

of a civil action and bond the defendant or defendants shall

give written notice thereof to all adverse parties and shall file a

copy of the petition with the clerk of such State court, which

shall effect the removal and the State court shall proceed no

further unless and until the case is remanded.

* * *

28 U.S.C. Section 1447(c), (d):

SECTION 1447. PROCEDURE AFTER REMOVAL

GENERALLY.

* * *

(c) If at any time before final judgment it appears that the

case was removed improvidently and without jurisdiction, the

district court shall remand the case, and may order the pay-

ment of just costs. A certified copy of the order of remand

shall be mailed by its clerk to the clerk of the State court. The

State court may thereupon proceed with such case.

(d) An order remanding a case to the State court from

which it was removed is not reviewable on appeal or otherwise,

except that an order remanding a case to the State court from

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. which it was removed pursuant to section 1443 of this title

shall be reviewable by appeal or otherwise.

§ 2201

28 U.S.C. Section 2201: :

SECTION 2201. CREATION OF REMEDY

(a) Ina case of actual controversy within its jurisdiction,

except with respect to Federal taxes other than actions

brought under section 7428 of the Internal Revenue Code of

1954 or a proceeding under section 505 or 1146 of title 11,

any court of the United States, upon the filing of an appropri-

ate pleading, may declare the rights and other legal relations

of any interested party seeking such declaration, whether or

not further relief is or could be sought. Any such declaration

shall have the force and effect of a final judgment or decree

and shall be reviewable as such.

Sup. Ct. R. 20.4

RULE 20. REVIEW ON CERTIORARI-TIME FOR

PETITIONING

4. The time for filing a petition for writ of certiorari runs

from the date the judgment or decree sought to be reviewed is

rendered, and not from the date of the issuance of the man-

date (or its equivalent under local practice). However, if a

petition for rehearing is timely filed by any party in the case,

the time for filing the petition for writ of certiorari for all

parties (whether or not they requested rehearing or joined in

the petition for rehearing) runs from the date of the denial of

rehearing or of the entry of a subsequent judgment entered on

the rehearing.

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Fao. ®. Cry. PA:

RULE 1. SCOPE OF RULES

These rules govern the procedure in the United States dis-

trict courts in all suits of a civil nature whether cognizable as

cases at law or in equity or in admiralty, with the exceptions

stated in Rule 81. They shall be construed to secure the just,

speedy, and inexpensive determination of every action.

FED. R. CrV. P. 3

RULE 5. SERVICE AND FILING OF PLEADINGS AND

OTHER PAPERS

(a) Service: When Required. Except as otherwise provided

in these rules, every order required by its terms to be served,

every pleading subsequent to the original complaint unless the

court otherwise orders because of numerous defendants, every

paper relating to discovery required to be served upon a party

unless the court otherwise orders, every written motion other

than one which may be heard ex parte, and every written

notice, appearance, demand, offer of judgment, designation of

record on appeal, and similar paper shall be served upon each

of the parties. No service need be made on parties in default

for failure to appear except that pleadings asserting new or

additional claims for relief against them shall be served upon

them in the manner provided for service of summons in

Rule 4.

In an action begun by seizure of property, in which no per-

son need be or is named as defendant, any service required to

be made prior to the filing of an answer, claim, or appearance

shall be made upon the person having custody or possession of

the property at the time of its seizure.

(b) Same: How Made. Whenever under these rules serv-

ice is required or permitted to be made upon a party

represented by an attorney the service shall be made upon the

attorney unless service upon the party himself is ordered by

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the court. Service upon the attorney or upon a party shall be

made by delivering a copy to him or by mailing it to him at his

last known address or, if no address is known, by leaving it

with the clerk of the court. Delivery of a copy within this rule

means: handing it to the attorney or to the party; or leaving it

at his office with his clerk or other person in charge thereof;

or, if there is no one in charge, leaving it in a conspicuous

place therein; or, if the office is closed or the person to be

served has no office, leaving it at his dwelling house or usual

place of abode with some person of suitable age and discretion

then residing therein. Service by mail is complete upon

mailing.

(d) Filing. All papers after the complaint required to be

served upon a party shall be filed with the court either before

service or within a reasonable time thereafter, but the court

may on motion of a party or on its own initiative order the

depositions upon oral examination and _ interrogatories,

requests for documents, requests for admission, and answers

and responses thereto not be filed unless on order of the court

or for use in the proceeding.

(e) Filing With the Court Defined. The filing of pleadings

and other papers with the court as required by these rules

shall be made by filing them with the clerk of the court, except

that the judge may permit the papers to be filed with him, in

which event he shall note thereon the filing date and forthwith

transmit them to the office of the clerk.

FED. R. CIV. P. 7:

RULE 7. PLEADINGS ALLOWED, FORM OF

MOTIONS

(a) Pleadings. There shall be a complaint and an answer; a

repiy to a counterclaim denominated as such; an answer to a

cross-claim, if the answer contains a cross-claim; a third-party

tie

i i th a RD ae

1-7

complaint, if a person who was not an original party is sum-

moned under the provisions of Rule 14; and a third-party

answer, if a third-party complaint is served. No other pleading

shall be allowed, except that the court may order a reply to an

answer or a third-party answer.

(b) Motions and other Papers.

(1) An application to the court for an order shall be by

motion which, unless made during a hearing or trial, shall be

made in writing, shall state with particularity the grounds

therefor, and shall set forth: the relief or order sought. The

requirement of writing is fulfilled if the motion is stated in a

written notice of the hearing of the motion.

(2) The rules applicable to captions and other matters of

form of pleadings apply to all motions and other papers pro-

vided for by these rules.

(3) All motions shall be signed in accordance with

Rule 11.

FED. R. CIV. P. 59(a)(d):

RULE 59. NEW TRIALS; AMENDMENT OF

JUDGMENTS

(a) Grounds: A new trial may be granted to all or any of

the parties and on all or part of the issues (1) in an action in

which there has been a trial by jury, for any of the reasons for

which new trials have heretofore been granted in actions at

law in the courts of the United States; and (2) in an action

tried without a jury, for any of the reasons for which rehear-

ings have heretofore been granted in suits in equity in the

courts of the United States. On a motion for a new trial in an

action tried without a jury, the court may open the judgment

if one has been entered, take additional testimony, amend

1-8

findings of fact and conclusions of law or make new findings

and conclusions, and direct the entry of a new judgment.

* * *

(d) On Initiative of Court. Not later than 10 days after

entry of judgment the court of its own initiative may order a

new trial for any reason for which it might have granted a new

trial on motion of a party. After giving the parties notice and

an opportunity to be heard on the matter, the court may grant

a motion for a new trial, timely served, for a reason not stated

in the motion. In either case, the court shall specify in the

order the grounds therefor.

* * *

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FED. R. CIV. P. 60(b)(1), 60(b)(3):

RULE 60. RELIEF FROM JUDGMENT OR ORDER

* a *

(b) Mistakes; Inadvertence; Excusable Neglect; Newly Dis-

covered Evidence; Fraud, etc. On motion and upon such

terms as are just, the court may relieve a party or his legal

representative from a final judgment, order, or proceeding for

the following reasons: (1) mistake, inadvertence, surprise, or

excusable neglect; ... (3) fraud (whether heretofore

denominated intrinsic or extrinsic), misrepresentation, or

other misconduct of an adverse party, .. or (6) any other rea-

son justifying relief from the operation of the judgment... .