# Petition for Writ of Certiorari — Piekarski v. Home Owners Saving Bank, F. S. B.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1992
- **Citation:** 506 U.S. 872

## Text

92-244

No,

In the
Supreme Court of the United States
October Term, 1991

PETER R. PIEKARSKI,

Petitioner.

HOME OWNERS SAVING BANK, F:S.B.,
and M. GENE DONLEY,
Respondents.

PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE EIGHTH CIRCUIT

PETITION FOR WRIT OF CERTIORARI

William P. Luther

Counsel of Record

4624 IDS Center

80 South Eighth Street
Minneapolis, Minnesota 55402
(612) 338-1931

Attorney for Petitioner

1992 — Bachman Legal Printing, 835 Second Ave. So., Mpls., MN 55402 — (612) 339-9518
@ FAX 612-337-8053

QUESTIONS PRESENTED

I. Whether the Resolution Trust
Corporation, under the removal
provisions of FIRREA, + has an absolute
right to remove a state court action a
second time, independent of the common
law and statutory limitations imposed

on other litigants.

II. Whether the exercise of

federal court jurisdiction under
FIRREA, as applied to Piekarski’s
solely state law claims, violates
principles of federalism and due
process, when the case is removed to

Minnesota federal district court after

lfhe Financial Institutions

Reform, Recovery, and Enforcement Act
of 1989 (*“FIRREA”), Pub.L.No. 101-73,
103 Stat. 183 et. seq.

liability has been determined by the
state trial court, is remanded to the
state court, is removed again to the
District Court for the District of
Columbia on grounds existing at the
time of the first removal, and is
finally transferred back to the
Minnesota federal district court (a
court which had declined to transfer
the case to the transferor court in
the first instance, a court where the
action could not “have been brought”
originally, and a court that
subsequently dismissed the distant
parent company under federal

receivership).

III. Whether collateral papers

filed at the same time as an actual

ii

notice of appeal may serve as the
functional equivalent of the notice of

appeal.

iii

TABLE OF CONTENTS

Table of Authorities .
Opinions Below
Jurisdiction... .
Statute Involved ..
Statement of Case... .
Reasons for Granting Writ

Es Certiorari Should Be
Granted to Remedy an
Improvident Exercise of
Federal Court
Jurisdiction .....

ake Certiorari Should Be
Granted to Remedy an
Unconstitutional Exercise
of Federal Court
DUREGGSOCIOR 1 2 + st

III. Certiorari Should Be
Granted to Resolve a
Conflict Between
Caveat Gomres . « « 6 «

Pe a ee eee

17

17

36

53

TABLE OF AUTHORITIES

United States Constitution

U.S. Const. amend. V

U.S. Const. amend. X

Federal statutes

12

28

28

28

28

28

28

28

28

U.S.C. §1441
U.S.C. $1254
U.S.C. §1404
U.S.C. §1406
U.S.C. §1446
U.S.C. §1447
U.S.C. §1631
U.S.C. §1738

U.S.C. §2403

Federal Decisions

Allen Archery,

ine.

Vv.

Precision Shooting Equip.,

857

F.2d 1176,

(7th Cir. 1988)

°

S$7-63

Atlantic Coast Line Ry.
Co. v. Bhd. of Locomotive

Engrs

398 U.S. 281 (1970) a» « «= 28-52

Christianson v. Colt Indus.
Operating Corp.
U.S48800 (1988). ...... 35

Crane v. Hahlo
258 U.S. 142 (1922) eo © «© « 45,

Dura Systems, Inc. v.

Rothbury Inv., Ltd.,
886 F.2d 551 (3rd Cir. 1989)

cert. denied, 493 U.S.
1046 (1990) woe *

Federal Deposit Ins. Corp.

v. Santiago Plaza
598 F.2d 634, (1st Civ.

48

58

1979) . 2. sks ee ews s See

Federal Deposit Ins. Corp.
v. Sellards

731 F.Supp. 1300
(N.D.Tex. 1990) . « «© += ss « 49,

Federal Sav. & Loan Ins.

Corp. v. Griffin

935 F.2d 691 (5th Cir.

19933 . s+ *® s+ « © *% © 4 © se & @

Federal Sav. & Loan Ins.

Corp. v. Templeton

700 F.Supp. 456 (S.D.Ind.

19GG3 2s & tee hues © & & SS

vi

50

49

Federal Savings and Loan

Ins. Corp. v. Westgate

Partners 726 F.Supp. 807

(D.Colo. 1989) ~- - + + + © + » 30

Fritzlen v. Boatsmen’s Bank,
212 U.S. 364 (1909) ..--+ + + 20

Good Samaritan Hosp.

v. Sullivan,

952 F.2d 1017,

(8th Cir. 1991) ae ae ae ae ee 56-59

Griffon v. United States

Dept. of Health and Human

Services, 802 F.2d 146

(5th Cir. 1986) ..+--+-+-+-+-+ 39

Hallowell v. Commons
239 U.S. 506 (1916) . - »- + «= « 39

Hartford Casualty Ins. Co.
v. Bora-Warner Corp.
913 F.2d 419 (7th Cir. 1990) .. 58

Hellon & Assocs. Inc. V.
Phoenix Resort Corp.
755 F.Supp. 280 (D.Ariz. 1990).. 37

Hoffman v. Blaski,
363 U.S. 335 (1960) .~. - - «© + = io

Kirkbride v. Continental
Cas. Co., 933 F.2d 729
(9th Cir. 1991) ...-+ + + +21 ,23

vii

Kulbeth v. Woolnought,
324 F.Supp. 908

(Ree OOTEY lk se ee ss os 2

Mariani-Giron v. Acevedo
Ruiz, 877 F.2d 1114,
[eee Gare Beeeh es se ee ehlhw hmv hl t™lhCUHD

Minority Employees v.

Tenn. Dept. of Emp. Sec.,
901 F.2d 1327

(6th Cir. 1990) oe a a | |

Mountain Ridge State Bank

v. Investor Funding
763 F.Supp. 1282

eo ee et”) re

Northshore Development,
Inc. v. Lee, 835 F.2d 580,
583 (5th Cir. 1988) a a a ae 52

O’Bryan v. Chandler,
496 F.2d 402 (10th Cir.

1974) o . e = . . . * . . . ° 32

Pension Benefit Guar.
Corp. v. R.A. Gray & Co.
467 U.S. 717 (1984) ~~“ * 40, 44

Pope v. Cheney,
22 F. 177 (S.D. Iowa 1884). .20, 28

Powers v. Chesapeake
& Oh}: Oh @ Ry.
169 U.S. 92 (1898) ae a ee ee

viii

Pride v. Verango River
Corp., 916 F.2d 1250

(7th Cir. 1990), cert.
denied, 111 S.Ct. 1696
2 re ee ae ee

Resolution Trust Corporation
v. Lightfoot, 938 F.2d 65
(7th Cir. 1991) . +--+ ++ + 29,

Resolution Trust Corporation

v. Westgate Partners, Ltd.

937 F.2d 526, 531

(10th Cir. 1991) ..---. 41,

St. Paul and Chicago
R.Co. v. McLean,
108 U.S. 212 (1883) : «es

Sunbelt Sav. v. Bent Trail
Phase IV Joint Venture

907 F.2d 1569

(Sth Cir. 1990) ..- -

Sweeney v. Resolution Trust
Corp., 765 F.Supp. 33
(D.Comm. 1991) - ++ +-+se-s

The Texas Plumbing Company
v. Zurn Indus. Inc.,

168 F.Supp. 144
(N.D.Tex. 1958) .

Thermtron Products Vv.
Hermansdorfer, 423 U.S.
336, (1976) - +--+ ++ ees 38,

ix

60

30

43

19

46

31

o2l

39

Torres v. Oakland

Scavenger Co., 487 U.S.
342 (21968) . «© «© © © © © « «© §§=-60

Triland Holdings & Co. v.

Sunbelt Service Corp.
884 F.2d 205 (5th Cir. 1989) . . 46

Woburn Five Cents Sav.
Bank v. Robert M. Hicks
930 F.2d 965 (1st Cir. 1991). . .29

Younger v. Harris
401 U.S. 37 (1971) . ee © -« 38

Other Authority

Bank/Thrift Litigation and

Enforcement News,

VOL. 2, MO. 22. « «© « «© «© 25, 30, 34
FemeMsP JF see ssn sine scses
Tomemee BE «+ «6 2 «+ &@ © & 6 6 ee 51
59 Fordham L. Rev. S339 (1991). . . 33
Grafman, A New S & L Venue

Game, Nat’1] L.J.,
Jan. 14, 1991 . © 6 *& © & * 36, 42

H.R. Reg. No. 54(TI)
101lst Cong., ist Sess,
seu €S0Ge) & « «8 6 « « 6 6 se, 22, 62

IN THE SUPREME COURT OF
THE UNITED STATES
October Term, 1992
No.

Peter R. Piekarski,
Petitioner
vs.

Home Owners Savings Bank, F.S.B.
and M. Gene Donley,

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO
THE SUPREME COURT OF THE UNITED STATES

To the Honorable, the Chief Justice

and Associate Justices of the

Supreme Court of the United States:
Peter R. Piekarski, the petitioner

herein, prays that the writ of

certiorari issue to review the

judgment of the United States Court of

Appeals for the Eighth Circuit, and/or
the judgment of the United States
District Court for the District of
Columbia.
OPINIONS BELOW

The opinion of the United States
Court of Appeals for the Eighth
Circuit is reported at 956 F.2d 1484
(8th Cir. 1992) and is printed in
Appendix A hereto, infra, page A-1.
The judgments of the United States
District Court for the District of
Minnesota are reported at 759 F.Supp
542 (D.Minn. 1991), 755 F.Supp 859
(D.Minn. 1991), and 752 F.Supp. 1451
(D.Minn 1990) and are printed in
Appendix A hereto, infra, pages A-72,
A-105 and A-146 respectively. The

judgment of the United States District

2

Court for the District of Columbia
is reported at 743 F. Supp- 38 (D.D.C.
1990) and is printed in Appendix A

hereto, infra, page A-262.

JURISDICTION

The judgment of the United States
Court of Appeals for the Eighth
Circuit was entered on February 28,
1992. A timely petition for rehearing
was denied on April 8, 1992.
(Appendix A, infra, page A-315). The
jurisdiction of the Supreme Court is
invoked pursuant to 28 U.S.C.
§1254(1). In addition, this Court has
jurisdiction to determine whether
federal jurisdiction has been

improvidently exercised below.

CONSTITUTIONAL AND STATUTORY
PROVISIONS INVOLVED

Petitioner states that 28 U.S.C.
§2403(a) may be appiicable.

This case involves the Fifth
Amendment to the Constitution of the
United States, which provides as
follows:

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 any
person be subject for the same
offence to be twice put in
jeopardy of life or limb; nor
shall be compelled in any
criminal case to be a witness
against himself, nor be deprived
of life, liberty, or property,
without due process of law; nor
shall private property be taken
for public use, without just
compensation.

This case involves the Tenth Amendment
to the Constitution of the United
States, which provides as follows:

The powers not delegated to the
United States by the
Constitution, nor prohibited by
it to the States, are reserved to
the States respectively, or to
the people.

This case involves 12 U.S.C.
§1441a(1), which provides as

follows:

» (1) Power to remove; jurisdiction
(1) In general

Notwithstanding any other
provision of law, any civil
action, suit, or proceeding to
which the Corporation is a party
shall be deemed to arise under
the laws of the United States,
and the United States district
courts shall have original
jurisdiction over such action,
suit, or proceeding.

—<_

(2) Corporation as party

The Corporation shall be
substituted as a party in any
civil action, suit, or proceeding
to which its predecessor in
interest was a party with respect
to institutions which are subject
to the management agreement dated
February 7, 1989, among the
Federal Savings and Loan

. Insurance Corporation, the
Federal Home Loan Bank Board and
the Federal Deposit Insurance
Corporation.

(3) Removal and remand

The Corporation may, without
bond or security, remove any such
action, suit, or proceeding from
a State court to the United
States District Court for the
District of Columbia, or if the
action, suit, or proceeding
arises out of the actions of the
Corporation with respect to an
institution for which a
conservator or a receiver ha:
been appointed, the United States
district court for the district
where the institution’s principal
business is located. The removal
of any action, suit, or
proceeding shall be instituted --

Ke °°

(A) not later than 90 days
after the date the Corporation is
substituted as a party, or

(B) not later than 30 days
after the date suit is filed
against the Corporation, if such
suit is filed after August 9,
1989.

The Corporation may appeal any
order of remand entered by a
United States district court.

STATEMENT OF THE CASE

The Procedural Facts

This case was commenced in Hennepin
County District Court, State of
Minnesota. The defendants then
transferred the case to Otter Tail
County District Court, State of
Minnesota. The state trial judge
found liability on four separate
grounds following a unanimous verdict
from an advisory jury. The jury found
all sixteen issues in favor of
Piekarski including two grounds for
punitive damages against individual
defendant Donley. See State Trial
Findings, reprinted in Appendix A, 752
F.Supp. 1451, 1458-70 (D.Minn. 1990).

After the liability determination,

but before the damages portion of the

8

a

bifurcated trial, the defendants
removed the action to the United
States District Court for the District
of Minnesota based on the federal
receivership of a distant parent
company, Home Owners of Boston.* That
court, J. Devitt, remanded the case
back to the state court, on
plaintiff’s motion, interpreting 12
U.S.C. §1441a(1) as requiring removal
exclusively to the United States
District Court for the District of
Columbia. See Memorandum and Order,
6/12/90, pp. 2-5, reprinted in

Appendix A, infra p. A-330. Judge

2 Home Owners-Boston is the parent
company of Knutson Mortgage Company
(headquartered in Minneapolis), and
Knutson Mortgage Company is in turn
the parent company for Home Owners-
Fergus Falls.

Devitt also denied defendants’ motion
to transfer venue to the United States
District Court for the District of
Columbia because, despite the fact
that the “court [had] the power to
transfer under the act”, 2
“"{cjonsiderations of equity and
judicial economy weigh[ed] against
transfer.” Id. at 5.

Defendants next removed the case to
the United States District Court for
the District of Columbia. Piekarski
moved for remand, and the defendants
filed a motion to transfer the case
back to the United States District
Court for the District of Minnesota.

That court, J. Hogan, could “see no

3 pursuant to either 28 U.S.C. §1631
or 28 U.S.C. §1406(a).

10

reason to interrupt [the] on-going
state proceeding to grant the RTC the
‘benefit’ of a federal forum;” nor
could it see any “potential for abuse
by allowing the RTC to defend such an
action in state court.” 743 F.Supp.
38, 43, n.6 (D.D.C. (1990)). However,
it denied Piekarski’s motion to
remand, holding that FIRREA afforded
the "RTC the absolute right, to remove
to federal court, subject to the time
limitations imposed in the statute.”
Id. at 42. Judge Hogan concluded that
"Congress would be wise to revisit the
FIRREA removal provisions to consider
whether a federal forum is necessary
in every case involving the RTC
(particularly those involving only

issues of state law).” Id. at 44.

ll

The court then transferred the case
to the United States District Court
for the District of Minnesota, in an
acknowledged “exercise in legal
gymnastics,” pursuant to 28 U.S.C.
§1404(a). Id. Fearing that an
improvidently exercised transfer
would, in combination with the
arguments against the propriety of the
second removal, deny the transferee
court jurisdiction to render a
judgement in his favor, Piekarski
"oppos[(ed] the transfer.” Id. at 42.
Judge Hogan phrased the “crucial
question [as] whether or not
the federal court in Minnesota [was] a
district where this action "might have
been brought.” Id. He observed that

“{(hjad the RTC been named as a

12

defendant at the commencement of the
suit, the suit ‘might have been
brought’ in Minnesota.” Id. at 43.

The RTC could not have been named at
the commencement of the suit, however,
since the parent company in Boston was
not under federal receivership until
well after the trial had begun.
Nonetheless, Judge Hogan held that the

dictates of Hoffman v. Blaski, 363

U.S. 335 (1960),* are limited to its

particular facts and that a

4 tn Hoffman, this Court held that the
phrase “where it might have been
brought” carnot be interpreted to mean
"where it may now be rebrought, with
defendants’ consent.” 363 U.S. at
342, 343. Judge Hogan held that
Hoffman is properly limited by the
phrase “with defendants’ consent”
because clearly he interpreted the
phrase to include where it may now be
rebrought.

retrospective impossibility satisfied

the meaning of 28 U.S.C. §1404(a). Id.
at 42-43.

Piekarski again contested the
second removal, transfer, and exercise
of jurisdiction over his purely state
law claims in another motion to remand
when the case was returned to the
United States District Court for the
District of Minnesota. That motion was
denied, without a published opinion,
but Piekarski prevailed in the damages
portion of the trial. See 752 F.Supp.
1451 (D.Minn. 1990). Piekarski also
prevailed in post-trial motions to
have the state court liability
determinations overturned. See 759
F.Supp. 542 (D.Minn. 1991). The court
did however amend the judgment to

14

dismiss the only defendant under

federal receivership, Home Owners~
Boston. Id. at 546. At every
opportunity prior to that judgment
Piekarski contested the federal
jurisdiction over his claims. As
FIRREA only grants the RTC appellate
review of motions to remand that are
granted, this is Piekarski’s first
opportunity to appeal the exercise of
jurisdiction over his claims. See 12
U.S.C. §1441(1) (3).

Home Owners-Fergus Falls appealed
the district court decision by filing
a Notice of Appeal on April 5, 1991.
The Notice of Appeal did not name
individual defendant Donley as an
appellant. Although the Eighth
Circuit Court of Appeals contacted

15

Donley’s counsel well within the 30-

day appeal period, and advised him of
the possible insufficiency of the “et.
al” designation on the Notice of
Appeal, Donley nevertheless failed to
appeal within that period.

Thereafter, Donley filed an Amended
Notice of Appeal on May 2, 1991 and
requested Judge Devitt to accept the
appeal claiming excusable neglect on
the part of his counsel. Judge
Devitt, finding no basis for the
request, denied it. See Order, 4-90-
661, pp. 3-5, Appendix A, infra page
A-368. However, upon entertaining the
issue on the merits, the Eighth
Circuit Court of Appeals held that
Appellant’s Information Form A, an

accompanying paper which listed Donley

16

as a party appealing the judgment,

satisfied a “functional equivalent”
exception to the particularity

requirement of Federal Rule of

Appellate Procedure 3(c). See 956
F.2d 1484, 1486, n. 1 (8th Cir. 1992).
The Court went on to reverse all
findings of liability against the

defendants.

REASONS FOR GRANTING THE WRIT
I.

Certiorari Should Be Granted to
Remedy an Improvident Exercise of
Federal Court Jurisdiction.

This case, based exclusively on
state law claims, was commenced on
November 18, 1988. The trial was

bifurcated between liability and

damages with an advisory jury sitting

17

during the liability phase. On
February 20, 1990, the state trial
court issued its findings of fact,
conclusions of law and order for
judgment against the defendants.
Reprinted in Appendix A, p.___, 752
F.Supp. 1451, 1458-70 (D.Minn 1990).
On April 27, 1990, the Office of
Thrift Supervision was appointed
conservator for Home Owners-Boston,
the parent company of Home Owners-
Fergus Falls’ parent company Knutson
Mortgage Company.

The action was originally removed
to the United States District Court
for the District of Minnesota by
notice of removal on May 7, 1990.
Judge Devitt remanded the case to

state court on June 12, 1990, because

18

the "defendants could only have

removed to the United States District
Court for the District of Columbia”,
and he refused to transfer it there
because “equity and judicial economy
weighed against transfer.” Memorandum
and Order, Civ. 3-90-248, Reprinted in
Appendix A, P- A-330, pp. 4-5-
However, on June 15, 1990, the
defendants removed the action a second
time to the United States District
Court for the District of Columbia.

Traditionally, courts have
prohibited second removals that are
based either on the same grounds

rejected previously, St- Paul and

Chicago R. Co. v. Mclean, 108 U.S.

212, 217 (1883), OF based on grounds
that existed at the time of the first

19

removal. Pope v. Cheney, 22 F. 177,

178-179 (S.D. Iowa 1884). Implicit in
those prohibitions are the strict
conditions under which a defendant may
seek a second removal under 28 U.S.C.
§1446(b) and the common law doctrine
codified therein. See Fritzlen v.
Boatsmen’s Bank, 212 U.S. 364, 372
(1909); Powers v. Chesapeake & Ohio
Ry., 169 U.S. 92 (1898). "These cases
[and Section 1446(b)] stand for the
proposition that a defendant who fails
in an attempt to remove on the initial
pleadings can file a removal petition
when subsequent pleadings or events
reveal a new and different ground for
removal.” ed e ,

v. Santiago Plaza, 598 F.2d 634, 636

(lst Cir. 1979) (emphasis in original)
20

Case law uniformly holds that where
the grounds relied upon for a second
removal existed at the time of the
first removal, the defendants are
foreclosed from asserting such a basis

for removal. See The Texas Plumbing

Company _v. Zurn Industries, Inc., 168

F.Supp. 144, 145 (N.D.Tex. 1958); see

also Kulbeth v. Woolnought, 324

F.Supp. 908, 911 (S.D.Tex. 1971).
Prior to FIRREA, courts also gave
effect to those requirements when
interpreting removals by federal
banking agencies. See Santiago Plaza,
598 F.2d 634, 636 (1st Cir. 1979).
The only circuit court to discuss the
issue after the passage of FIRREA was
cautious of the prohibitions against

second removals. Kirkbride v.

21

Niet

Continental Cas. Co., 933 F.2d 729,
732 (9th Cir. 1991) (Santiago
satisfied because “subsequent
pleadings or events revealed a new and
different ground for removal.”).

In the present case, the United
States District Court for the District
of Columbia erroneously rejected the
second removal limitation. It noted
that ”“FIRREA does not prohibit a party
from correcting the defective removal
attempted to a court,” and thereby
reasoned that it affords the "RTC the
absolute right to remove to federal
court, subject to the time limitations
imposed in the statute.” 743 F.Supp.
38, 41-42 (D.D.C. 1990). By allowing
the second removal of this action

under the “absolute right” rationale,

22

| ian iaieaeaiiiatiaaiaaiaicaaaiaaiias

the court (1) ignored the common law
prohibition against second removals;
(2) abrogated the purpose of the time
period allowed for removal; and (3)
failed to recognize that the general
statutory procedure provisions
supplement FIRREA, especially on
issues where FIRREA is silent.
Although FIRREA does not prohibit
second removals, the common law
prohibits a second attempt at removal
that is not “new and different.” See
Santiago, 598 F.2d 634, 636 (1st Cir.
1979) (citing the common law origins) ;

see also Kirkbride, 933 F.2d at 732

(9th Cir. 1991) (FDIC petition did not
violate any common law prohibition
against successive removals). A
procedural avenue to another federal

23

district court can only be “new” if it
didn’t exist at the time of the first
removal. Thus, since all statutory
bases for removal existed from the
outset of the RTC’s appointment as
receiver for Home Owners-Boston, a
second attempt at removal is
prohibited. The rule properly places
the risks and uncertainties
surrounding the interpretation of the
provisions on the party choosing to
invoke its protections-the RTC. In
addition, litigants lacking the
federally funded muscle of the RTC
may, in good faith, challenge a
removal without the chilling
possibility of a second attempt,

and perhaps a return to the same

24

’

venue.”
Allowing the RTC to remove this

action a second time resulted in an

abrogation of the purpose of the
FIRREA time provision. Using the 90

day time limit® to facilitate second

> see Bank/Thrift Litigation and
Enforcement News, RTC Solves Its
Removal Problem -- Maybe & Sort Of,
Vol. 2, MO. 22, P- 2. 4 (discussing
this case and concluding that “counsel
thinking of opposing the government ’s
removal motions” will be forced to
consider that "their cases will end up
in federal court anyway, in their
local district or even in
Washington.”).

6 12 u.S.C. §1441a(1) (3) provides in
relevant part:

The removal of any action, suit, or
proceeding shall be institued --

(a) Not later than 90 days after the
date the Corporation is substituted as
a party, or (b) Not later than 30 days
after the date suit is filed against
the Corporation, if such suit is filed
after August 9, 1989.

25

|

removals runs counter to the purpose
of that provision. The extended
removal period is meant to allow the
RTC to familiarize itself with the
litigation prior to removal, not to
test the removal waters. The
legislative history reflects that the
ability of the FDIC to stay
proceedings for 45 days upon its
appointment as conservator or receiver
for the failed institution provides
the same rationale as the extension of
the RTC removal time. “”The
appointment of a conservator or
receiver can often change the
character of the litigation; the stay
gives the FDIC a chance to analyze

pending matters and decide how best to

26

proceed.” Plainly, the purpose of
the extra period is to allow the
RTC time to determine “how best to
proceed”.

When the RTC first exercises the
right of removal that purpose is fully
satisfied. A second removal outside
of the 30 days normally allowed®
simply facilitates the abuse of the
provision. The law against second
removals is designed to curb such
abuse. Ignoring such considerations
enables parties to use removal "as a

means of delay and protracting

litigation to the manifest injury of

7 H.R. Rep. No. 54(I), 101st Cong.,
lst Sess. 331 (1989), reprinted in
1989 U.S. Code Cong. and Admin. News
(103 Stat. 86, 127).

8 15 U.S.C. §1441a(1) (3) (b)-

27

Jit le

the other parties in interest.” Pope

v. Cheney, 22 F. 177, (S.D. Iowa.
1884).

Most importantly, the United States
District Court for the District of
Columbia’s refusal to apply the
prohibitions against second removals
to FIRREA, absent such a directive in
FIRREA itself, ignores what other
courts have nearly universally
accepted -- that general federal
statutory procedure provisions must
supplement FIRREA, especially and
necessarily where that statute is
Silent. The RTC removal provisions
cannot be wholly independent from the
general provisions because it is
impractical to expect every statute

that changes some removal provisions

28

to address all of the exhaustive

considerations.

Courts have concluded that there
would be no reason to enumerate the
specific changes if Congress meant for
FIRREA to be completely independent of
the general removal provisions. see

Resolution Trust Corporation Vv.

Lightfoot, 938 F.2d 65, 68 (7th Cir.

1991); see also Woburn Five Cents Sav.

Bank v. Robert M. Hicks, Inc., 930

F.2a 965, 968 (1st Cir. 1991)
(applying the same reasoning to
interpret the FDIC removal procedures
with guidance from the general removal
statute). Lightfoot represents the
prevailing view that the FIRREA
provisions supplement the general
statutory procedural provisions, not

29

Supplant them. 938 F.2d 65, 68 (7th

Cir. 1991) .? Even a court that

prescribed to Judge Hogan’s “absolute

9 Note that under Lightfoot the
defendants would have been successful
in their first effort to remove this
case to the United States District
Court for the District of Minnesota
pursuant to 28 U.S.C. §1441(a).
However, that does not vitiate the
fact that the second removal was
improper.

Moreover, at the time of the first
removal the district courts were
denying the RTC use of 28 U.S.C.

§1441(a). See Federal Sav. and Loan

Ins. v. Westgate Partners, 726 F.Supp.
807, 809 (D.Colo. 1989). Since this

was the first case in which the RTC
attempted a second removal to the
District Court for the District of
Columbia, Piekarski could not have
anticipated the procedural nightmare
to follow. See Ba nk/TOxAet Litigation
and cemen RTC Solves s

Vv em -- e Of,
Vol. 2, No. 22, p. 1,4 (not until
after this case would "counsel
thinking of opposing the government’s
removal motions” . . . consider that
“their cases will end up in federal
court anyway, in their local district
or even in Washington”.).

30

right to remove” recognized that the

general procedural provisions
supplement FIRREA and implicitly
acknowledged that a second removal to
the District Court for the District of
Columbia would be an improvident
exercise of jurisdiction under 28

U.S.c. §1446. See Sweeney V.-

Resolution Trust Corp., 765 F.Supp.

33, 35 (D.Mass. 1991) .29

10 tn Sweeney, the court dismissed
plaintiff’s motion to remand as
untimely under 28 U.S.C. §1447(c).
Moreover, the court implicitly
recognized that a subsequent removal
to the District Court for the District
of Columbia, if remand were granted,
should be unsuccessful. Id. If not,
the plaintiff could simply anticipate
being cast out to the District of
Columbia, only to be reeled in under
28 U.S.C. §1404(a).- If the Sweeney
court thought that that was a likely
scenario then plaintiffs’ untimely-
motion to remand should have been
characterized as wise rather than
untimely.

31

Where a second removal fails to

present new and different grounds as
required by 28 U.S.C. §1446(b),
Congress has directed that such
actions be remanded to the state

courts. See O’Bryan v. Chandler, 496

F.2d 403, 409 (10th Cir. 1974) ("there
must be both an amended pleading or
paper and a ground for asserting
removability that exists for the first
time.”) As such, Congress has
effectively declined jurisdiction to
the federal courts where defendants
fail to satisfy that mandate.

This case has cast the FIRREA

removal issue into waters that have

32

spawned absurd consequences. ++ In

order to mitigate the absurd outcomes,
the United States District Court for
the District of Columbia developed a
transfer remedy. Under the general
transfer provision, courts may
transfer cases to "any other district
or division where it might have been
brought” for the convenience of the
parties. 28 U.S.C. §1404(a). The
District Court for the District of
Columbia broadly construed that
provision, allowing transfer of this

case back to the District Court for

11 See Josel, The Resolution Trust
Corporation: Waste Management and the

isis, 59 Fordham L. Rev. S339,
n. 179 (1991) (summarizing other cases
of purely state law origins that have
matriculated through the United States
District Court for the District of
Columbia).

33

the District of Minnesota which (as

interpreted) was instructed to decline
jurisdiction in the first instance.
While remedying the immediate
inconvenience, the transfer created an
anomalistic result which admittingly
was “an onset in legal gymnastics.”
743 F.Supp. 38, 44 (D.D.C. 1990).
Moreover, that result will likely
discourage litigants from contesting
an RTC removal to a federal court in
the state where the action was
pending. See Bank/Thrift Litigation
and Enforcement News, RTC Solves Its
Removal Problem-- Maybe & Sort Of,
Vol. 2, No. 22, p. 1, 4. Contesting
the removal allows the RTC to flex its
federally-funded muscles, often at the

expense of other litigants. This
34

Court has noted that such a "vicious

circle of litigation” is disfavored.

Christianson v. Colt Industries

Operating Corp., 486 U.S. 800, 816
(1988).

That vicious circle of litigation
is broken if the abuses regarding
second removals are curbed. The
common law and statutory doctrines
restricting second removals prohibit
the accommodation made to the
defendants, allowing them to remove
this action a second time.

Permitting second removals promises to
give the RTC carte blanche to abuse
the removal process to the prejudice
of other litigants. This Court should
grant Certiorari to determine whether
the second removal and transfer of

35

this action was improvidently taken so
as to deny the federal courts
jurisdiction to render judgment in
this case, or whether the RTC has in
fact an ”absolute right to remove,”
immune from the statutory and common
law limitations imposed on other
litigants.
II.

Certiorari Should Be Granted to Remedy
an Unconstitutional Exercise of
Federal Court Jurisdiction.

Commentators have already speculated
that the procedural history of this
12

case raises due process concerns.

Moreover, other courts have stated

le See Josel, The Resolution Trust

Corporation: Waste Management and the
S & L Crisis, 59 Fordham L. Rev. S339

(1991); see also Grafman, A New S & L
Venue Game, Nat’l L.J., Jan. 14, 1991,
at 13, 14.

36

| iis

"reservations about remanding a matter
involving only state law issues that
will probably be removed to the
District of Columbia, only to be
transferred back to this Court after
one of the parties files a motion to
transfer,” but ”“[{s]till, the Court
sees no other way to interpret
Congressional intent with regard to
FIRREA’s removal provision.” He n &

Assocs. Inc v. Phoenix Resort Corp.,

755 F.Supp. 280, 284 (D.Ariz. 1990).
The issue is now ripe for a
determination of whether that
“Congressional intent”, if any, can be
applied to the facts and circumstances
of this case and still pass

constitutional muster.

37

———<

At first blush, this case appears
best pigeonholed in notions of comity
and federalism through application of
the abstention doctrine which has
grown up around those interests. See

Younger v. Harris, 401 U.S. 37, 44-45

(1971). Clearly such a discretion
would have been exercised in this case
because Judge Hogan stated that he
could “see no reason to interrupt an
on-going state proceeding,” .. . nor
"potential for abuse by allowing the
RTC to defend such an action in state
court.” 743 F.Supp. 38, 43, n.6
(D.D.C. 1990). However, since this
Court’s decision in Thermtron Products
v. Hermansdorfer, courts have been
prohibited from remanding cases

properly removed for discretionary

38

reasons not authorized by the
controlling statute. 423 U.S. 336,
345, n.9. (1976). Thermtron was not
an extraordinary result on its
facts, }3 but nonetheless, the District
Court for the District of Columbia
used that rule to foreclose any
equitable considerations in the remand
decision. 743 F.Supp. 38, 42 (D.D.C.
1990).

This Court has noted that a change
in forum is a procedural

consideration. Hallowell v. Commons,

239 U.S. 506 (1916); see also Griffon

v. United States Dept. of Health and

Human Services, 802 F.2d 146, 152 (5th

13 In Thermtron, the district court

remanded the case soleiy because the
judge faced an over-crowded docket.

423 U.S. 336, 339 (1976).

39

Ji sietineiiiiieaiiiee

Cir. 1986). However, in order to
withstand scrutiny under the Fifth
Amendment’s due process clause a
statute must have a legislative
purpose, applied in a manner that is
neither harsh nor oppressive. Pension

Benefit Guaranty Corp. v. R.A. Gray &

Co., 467 U.S. 717, 733 (1984). The

removal provisions in FIRREA did not
Simply work a change in forum in this
case, but rather snatched

Piekarski’s state court liability
victory out of the state courts into
such a federal procedural quagmire
that due process mandates that a
discernable purpose justify that
result. Courts have struggled to

discern the possible congressional

intent behind the FIRREA removal
40

provisions, or at least have sought a
common sense harmony between FIRREA
and removal actions generally. See

Resolution Trust Corporation v.

Westgate Partners, Ltd., 937

F.2d 526, 531 (10th Cir. 1991).
However, in this case there is simply
no rational basis for applying
the FIRREA removal provisions. The
fact that some courts have sought to
solve the problem by extending the
general removal provision to the RTC
does not vitiate the unconstitutional
application of the FIRREA provision to

this case.14

14 the Seventh Circuit has held that
28 U.S.C. §1441(a) is available to the
RTC absent explicit language to the
contrary. See Resolution Trust
Corporation v. Lightfoot, 938 F.2d 65,
67, 68 (7th Cir. 1991).

41

Although some areas of FIRREA are
characterized by *“voluminous*?>
legislative history, the FIRREA
removal provisions are afforded only a
repetition of the language itself. +°
That lack of apparent thought is
consistent with what a commentator has
Gubbed as the "“S & L hopscotch” and
concluded that ”“[i]ntentionally or
not, FIRREA legislation can create a
highly eccentric Rube Goldberg cartoon
version of due process.” Grafman, A

New S&L Venue Game, Nat’]l L.J., Jan.

14, 1991, at 13, 14. In fact, a

15 See Mountain Ridge State Bank v.

Investor Funding, 763 F.Supp. 1282,
1289 (D.N.J. 1991).

16 see H.Rep.No. 54(I), 101st Cong.,
lst Sess. 362 (1989), U.S. Code Cong.
& Admin.News 1989, pp. 86, 158.

42

Congressional intent or purpose, even

if possible to discern, has been

virtually abandoned in the judicial

construction of the provision.?? “One
thing, though, is crystal clear. This
newly evolving game of legal hopscotch

makes no sense.” Id.

17 For example, in Westgate, the RTC
had removed the action to its
institution’s principle place of
business and argued that it could do
so under the provisions of FIRREA. 937
F.2d 526 (10th Cir. 1991). The Court
rejected that argument under the
statute’s plain meaning. Id. at 529.
More importantly for present purposes,
the court commented that it is
unnecessary to discern a logical
congressional intent from the FIRREA
removal provision, concluding that “so
long as Congress remains faithful to
the Constitution, it is free to enact
any number of foolish statutes.” Id.

While statutory construction may
not mandate a discernable purpose, due
process does.

43

A statute will withstand scrutiny
under the due process clause of the
Fifth Amendment if Congress enacts it
pursuant to a rational legislative
purpose, in a manner that is neither

harsh nor oppressive. Pension Benefit

Guaranty Corp. v. R. A. Gray & Co.,

467 U.S. 717, 733 (1984). Assuming
the FIRREA removal provisions have a
discernible purpose, the application
of those provisions to the present
case was sufficiently offensive to
raise due process concerns. In this
case, the removal of solely state law
claims after a state court
determination of liability, followed
by another removal after the first
attempt failed, was based solely on

the federal receivership of a distant

44

parent company that was never involved
substantively in the case.

In addition to requiring a
legitimate purpose and rational
application of the FIRREA removal
provisions to the present action, due
process dictates that retroactive
application of new procedural
provisions must afford the burdened
party a “substantial and efficient

remedy.” Crane v. Hahlo, 258 U.S. 142,

147 (1922). This constitutional
protection is appropriate to the facts
of this case because much of the
inefficiency is a product of the
retroactive application of FIRREA.
Courts have held that the

jurisdictional provisions of FIRREA

must be applied retroactively, as in
45

the present case, to cases filed
before the passage of FIRREA. See

Triland Holdings & Co. v. Sunbelt
Service. Corp., 884 F.2d 205, 206-07

(Sth Cir. 1989). However, that fact
does not absolve the constitutional
limitations imposed by due process,
but rather should heighten the
inquiry.

The only case to address the issue
has rejected the due process challenge

based on a lack of compelling

procedural hardship. See Sunbelt

Savings v. Bent Trail Phase IV Joint

Venture, 907 F.2d 1569, 1571 (5th Cir.
1990) (substantial and efficient
remedy provided by FIRREA). By
contrast, this case has been the

ultimate RTC "guinea pig”, see supra

46

note 9 and accompanying text, and its

procedural history has left an actual
"bent trail” from the state trial
court to the federal district court in
Minnesota, back to the state trial
court, across the country to the
federal district court in Washington,
D.C., and then back again to the
federal district court in Minnesota.
Moreover, the damages portion of the
trial required the repetition of a
substantial amount of evidence, 759
F.Supp. 542, 545 (D.Minn. 1991)
(damages portion of trial requiring
Judge Devitt to become “relatively
familiar with that portion of the
liability record pertaining to
plaintiff’s retaliatory discharge

claim”), and defendants post-trial

47

motions effectively forced the
plaintiff to fund a response to an
attempted "microscopic reexamination
of the entire liability record.” Id.
As such, the retroactive application
of the FIRREA removal powers to this
case offends the “efficiency”
guarantee embodied in due process.

See Crane v. Hahlo, 258 U.S. 142, 147

(1922).

The next constitutional hurdle that
the FIRREA removal provisions must
clear is the limitation embodied in
federalism. One federal district
court has suggested that removal of a
state court decision to a federal

district court runs contrary to the

nature of our federalist system.

Federal Deposit Ins. Corp. v.

4&

Sellards, 731 F.Supp. 1300, 1301-04

(N.D.Tex. 1990) .28 Another federal
district court has granted a motion to
remand based on "consideration to the
values of federalism and comity, as
embodied in the Full Faith and Credit

Act, 28 U.S.C. §1738.”" Federal Sav. &

Loan Ins. Corp. v. Templeton, 700
F.Supp. 456, 457-58 (S.D.Ind. 1988).

In this case the only federal interest
was a receivership interest over a
distant parent company that was

ultimately dismissed from the

18 The court had another means of
disposing of the removal issue and
thus avoided the constitutional issue.
Id. at 1304.

lawsuit.?9

The federalism concern in this
context arises in part from the fact
that lower federal courts possess no
power to sit in direct review of state

court decisions. See Atlantic Coast

Line Ry. Co. v. Brotherhood of

Locomotive Engineers, 398 U.S. 281,
296 (1970). In fact, Judge Devitt was

concerned that his review of the state

court liability determinations in this

19 the power to remove is evaluated at
the time of removal, and the dismissal
of one of the parties by the time of
appeal does not normally affect the
propriety of removal. See Federal

Sav. & Loan Ins. Corp. v. Griffin, 935
F.2d 691, 695 (5th Cir. 1991).

However, in this case it wasn’t the
dismissal of the federal interest in
the case, but rather its remoteness
that heightens the federalism
concerns.

50

case raised such an issue. 759 F.Supp
542, 545 (D.Minn. 1991) ("this court
does not occupy an appellate rank vis-
a-vis the state district court”).
Under the reasoning of this Court in
Atlantic Coast Line, if a federal
interest is sufficiently affected by a
state trial court liability
“determination it may seek vindication
of that right in the state “appellate
courts and ultimately, if necessary,
in this Court.” 398 U.S. at 296.

Judge Devitt entertained defendants
post-trial motions pursuant to Federal
Rule of Civil Procedure 60(b). 759
F.Supp. 542, 543 (D.Minn. 1991). The
Fifth Circuit has said that "a state
court judgment in a case properly
removed can be vacated under Rule

51

| |

60(b).” Northshore Development, Inc.
v. Lee, 835 F.2d 580, 583 (5th Cir.

1988). The Sellards court criticized

that blanket statement because the
authority for making it was based on
cases seeking relief from default
judgments. 731 F.Supp. at 1303-04,
n.9.°9 since Piekarski prevailed on
those post-trial motions the
federalism interest appears less
offended. However, even if such an
after the fact analysis were proper,
the limitations embodied in Atlantic

Coast Line extend beyond the initial

20 The court reasoned that a “default
judgment is a far cry, however, from a
state court judgment reached by the
state judge after consideration by
that judge of the parties’
appearances, pleadings, motions and
oral argument.” Id.

52

PUBLISHER'S

ORIGINAL P/

NOTE:

offensive act to appellate review. 398
U.S. at 296.

In sum, this Court should grant
Certiorari to determine whether the
retroactive application of the FIRREA
removal provisions to this action (1)
was pursuant to a rational
Congressional purpose and applied in
an inoffensive manner as required by
due process; and/or (2) provided a
substantial and efficient remedy as
required by due process; and/or (3)
can be reconciled with concerns of

federalism.
til.

Certiorari Should Be Granted to
Resolve a Conflict Between Circuit
Courts.

Federal Rule of Appellate Procedure

3(c) requires that a notice of appeal

“shall specify the party or parties
54

SINATION IS NOT CONTINUOUS.

taking the appeal.” A notice of
appeal which designates a party by
only “et al.” is defective as to that
party. Torres v. Oakland Scavenger
Co., 487 U.S. 312, 317-18 (1988).
However, the circuit courts disagree
as to whether a collateral paper cures
a defective notice.

The dispute is sparked by language
in Torres which has given rise to a
"functional equivalency” exception.
This Court stated that "if a litigant
files senein in a fashion that is
technically at variance with the
letter of a procedural rule, a court
may nonetheless find that the litigant
has complied with the rule if the

litigant’s action is the functional

equivalent of what the rule requires.”
55

id. at 316-17. The Eighth Circuit,
both in the present case and in
another, has extended this exception
to the circumstance where the
collateral paper is filed at the same
time as the notice of appeal. 956 F.2d
1484, 1486 (8th Cir. 1992) (citing

Good Samaritan Hosp. v. Sullivan, 952

F.2d 1017, 1021-23 (8th Cir. 1991)).
In contrast, the Seventh Circuit
has stated that the above cited
language in Torres “insofar as it
pertains to Rule 3(c), is designed for
the case where the litigant fails to
file a notice of appeal, but files
another paper that is its functional
equivalent. It is not designed for
the case--this case and Torres--where
the litigant has filed a notice of

56

appeal and failed to name all the

appellants.” Allen Archery, Inc. v.

Precision Shooting Equip., 857 F.2d
1176, 1177 (7th Cir. 1988). Thus, the

Seventh Circuit holds that the
“appellant must be named in the notice
of appeal; naming him in the

caption, or in collateral

documents .. . will not do.” Ia.21

21 It is with this blanket prohibition
with which other circuit courts have
disagreed with the Seventh Circuit.
However, the disagreement has
primarily focused on whether listing a
party in the caption of the notice
itself is sufficient, not whether
collateral documents are sufficient
when an actual notice of appeal is
present. See Minority Employees v.
Tenn. Dept. of Emp. Sec., 901 F.2d
1327, 1335 (6th Cir. 1990) (corporate
plaintiff stated in the caption of the
notice is properly before the court) ;
see also Lani-Gi Vv

Ruiz, 877 F.2d 1114, 1116 (1st Cir.
1989) (caption should be viewed as part

57

The Eighth Circuit in Good
Samaritan explicitly rejected the

approach in Allen Archery. Good

Samaritan, 952 F.2d at 1022, n. 5.2?

The primary authority cited for the

Eighth Circuit approach is Dura
stems c. v. Rothbury Inv td.,

886 F.2d 551, 555 (3d. Cir. 1989),

of the entire notice). In fact, the
Seventh Circuit has retracted its
position with regard to the caption.
See ord Casualty Ins. Co. v.

Borg-Wasner Corp., 913 F.2d 419, 423
(7th Cir. 1990).

22 The circuit court below simply
adopted the holding in Good Samaritan
as its own, 956 F.2d 1484, 1486, n.1
(8th Cir. 1992), and therefore it is
the analysis supporting that decision
that is at issue in this case.
Moreover, it was a decision that was
filed after oral arguments were heard
in the present case, and therefore its
applicability and reasoning was

never briefed by the parties.

58

cert. denied, 493 U.S. 1046 (1990),

which held that a consent order could
serve as the functional equivalent of
a notice when filed within the time
for appeal. The court in Good

Samaritan stated that ”“[w)hile this is

a case of first impression in this
circuit, we agree with other circuits
which have held that additional
documents filed within the statutory
period for notices of appeal are the
functional equivalent of a notice of
appeal and, therefore, serve as a
notice of appeal.” 952 F.2d at 1022.
The Eighth Circuit has held in this
case and Good Samaritan that
collateral papers filed at the same

time as an actual notice of

59

appeal can serve as the functional
equivalent of the notice.

Therefore, this case heightens the
concern expressed in Allen Archery
that the functional equivalency
language in Torres is "designed for
the case where the litigant fails to
file a notice of appeal, but files
another paper that is its functional

equivalent.” 857 F.2d at 1177; see

also Pride v. Venango River Corp., 916
F.2d 1250, 1251-53 (7th cir. 1990),

cert. denied 111 S.Ct. 1696 (rejecting

the functional equivalency exception
where an actual notice of appeal is
filed). While a Consent Order granted
by the appellate court itself may
serve as the functional equivalent of

an actual notice of appeal, Dura

60

Systems Inc., 886 F.2d at 554-55, a
collateral paper filed at the same
time as an actual defective notice of
appeal creates ambiguity. The Court
of Appeals below stated that the
collateral document “unambiguously
listed Donley as a party appealing the
final judgment.” 956 F.2d at 1486,
n.1. However, Donley’s absence was
just as “unambiguous” from the notice
of appeal itself. Therefore, whatever
application the functional equivalency
exception has to later functionally
equivalent papers received within the
time period of appeal (which can be
viewed as a separate invocation of the
court’s jurisdiction), it has no

application in this case. See

Minority Employees v. Tenn. Dept. of

61

Emp. Sec., 901 F.2d 1327, 1336 (6th
Cir. 1990) (any ambiguity or
inconsistency will defeat the
functional equivalency wenentien) «

In this case the court clerk
advised the defendants of the possible
deficiency well within the time for
appeal. Nonetheless, individual
defendant Donley failed to correct the
defect within that time period. See
Affidavit of Lawrence P. Schaefer
(Appendix A, infra, page 295). Given
the extraordinary lengths to which the
defendants went in attempting to
exercise federal court jurisidiction,
it is most appropriate that this court
“insist on punctilious, literal, and
exact compliance with the requirement

in Rule 3(c) that the notice of appeal

62

(or its functional equivalent, if but
only if no notice of appeal is filed)
‘shall specify the party or parties

taking the appeal’.” Allen Archery,

857 F.2d at ii7?.«

In sum, the circuit courts disagree
as to whether a collateral paper can
serve as the functional equivalent of
a notice of appeal when an actual
notice of appeal, defective as to one
of the parties, is simultaneously
filed. Piekarski deserves review of
this issue to settle this important
dispute, and to correct the erroneous
exercise of jurisdiction over

individual defendant Donley.

CONCLUSION

Wherefore, petitioner respectfully

63

prays that a writ of certiorari be
granted.
Respectfully submitted,
WILLIAM P. LUTHER
4624 IDS Center
80 South Eighth Street
Minneapolis, MN 55402
(612) 338-1931

Attorney for Petitioner

64

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386011_1107%3A1. Public record. Not legal advice.