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04-1495 Kircher v. Putnam Funds Trust

By: dmc-admin//July 6, 2004//

04-1495 Kircher v. Putnam Funds Trust

By: dmc-admin//July 6, 2004//

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“In both Carnegie-Mellon and Quackenbush the district judge found the removal proper but concluded that the state court should handle some issues. In Carnegie-Mellon the remand reflected limits to the supplemental jurisdiction, and in Quackenbush the district judge concluded that abstention was appropriate so that the state judiciary could resolve points of state law. In both cases the Supreme Court reviewed the decision on the merits, treating a remand as unaffected by §1447(d) when the propriety of the removal was not in doubt.

“This suit was properly removed. The district judge made a substantive decision under authority granted by a federal statute. It follows that the remand is unaffected by §1447(d). This makes practical sense too. The goal of that statute is that a contest about what forum should resolve the dispute be wrapped up quickly, so that the litigation can get under way. Appellate consideration of what amounts to a venue dispute slows things down to little good end, for the state court is competent to address the merits. SLUSA means, however, that one specific substantive decision in securities litigation must be made by the federal rather than the state judiciary. Appellate review of decisions under §77p(b) will promote accurate and consistent implementation of that statute, at little cost in delay beyond what the authorized removal itself creates. Yet if the remand is deemed non-appealable, then a major substantive issue in the case will escape review-for SLUSA ensures that only the federal judiciary makes the §77p(b) decision. Normal remands, for which §1447(d) is designed, leave all substantive issues open to plenary resolution in the state court (and, if necessary, the Supreme Court of the United States). That’s not how SLUSA works; it is now or never for appellate review of the question whether an action under state law is preempted. In the unusual securities class action where expedition is vital, we can accelerate the appeal’s disposition. See Abney v. United States, 431 U.S. 651, 662 & n.8 (1977).”

Appeal from the United States District Court for the Southern District of Illinois, Herndon, J., Easterbrook, J.

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