JUSTICE STEVENS delivered the opinion of the Court.
The question in this case is whether an action filed in a state court to recover damages from a national bank for allegedly charging excessive interest in violation of both "the common law usury doctrine" and an Alabama usury statute
I
Respondents are 26 individual taxpayers who made pledges of their anticipated tax refunds to secure short-term loans obtained from petitioner Beneficial National Bank, a national bank chartered under the National Bank Act. Respondents brought suit in an Alabama court against the bank and the two other petitioners that arranged the loans, seeking compensatory and punitive damages on the theory, among others, that the bank's interest rates were usurious. App. 18-30. Their complaint did not refer to any federal law.
Petitioners removed the case to the United States District Court for the Middle District of Alabama. In their notice of removal they asserted that the National Bank Act, Rev. Stat. § 5197, as amended, 12 U. S. C. § 85,
A divided panel of the Eleventh Circuit reversed. Anderson v. H&R Block, Inc., 287 F.3d 1038 (2002). The majority held that under our "well-pleaded complaint" rule, removal is generally not permitted unless the complaint expressly alleges a federal claim and that the narrow exception from that rule known as the "complete preemption doctrine" did not apply because it could "find no clear congressional intent to permit removal under §§ 85 and 86." Id., at 1048. Because this holding conflicted with an Eighth Circuit decision, Krispin
II
A civil action filed in a state court may be removed to federal court if the claim is one "arising under" federal law. § 1441(b). To determine whether the claim arises under federal law, we examine the "well pleaded" allegations of the complaint and ignore potential defenses: "[A] suit arises under the Constitution and laws of the United States only when the plaintiff's statement of his own cause of action shows that it is based upon those laws or that Constitution. It is not enough that the plaintiff alleges some anticipated defense to his cause of action and asserts that the defense is invalidated by some provision of the Constitution of the United States." Louisville & Nashville R. Co. v. Mottley, 211 U.S. 149, 152 (1908); see Taylor v. Anderson, 234 U.S. 74 (1914). Thus, a defense that relies on the preclusive effect of a prior federal judgment, Rivet v. Regions Bank of La., 522 U.S. 470 (1998), or the pre-emptive effect of a federal statute, Franchise Tax Bd. of Cal. v. Construction Laborers Vacation Trust for Southern Cal., 463 U.S. 1 (1983), will not provide a basis for removal. As a general rule, absent diversity jurisdiction, a case will not be removable if the complaint does not affirmatively allege a federal claim.
Congress has, however, created certain exceptions to that rule. For example, the Price-Anderson Act contains an unusual pre-emption provision, 42 U. S. C. § 2014(hh), that not only gives federal courts jurisdiction over tort actions arising out of nuclear accidents but also expressly provides for removal of such actions brought in state court even when they assert only state-law claims. See El Paso Natural Gas Co. v. Neztsosie, 526 U.S. 473, 484-485 (1999).
We have also construed § 301 of the Labor Management Relations Act, 1947 (LMRA), 29 U. S. C. § 185, as not only pre-empting state law but also authorizing removal of actions
Similarly, in Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58 (1987), we considered whether the "complete preemption" approach adopted in Avco also supported the removal of state common-law causes of action asserting improper processing of benefit claims under a plan regulated by the Employee Retirement Income Security Act of 1974 (ERISA), 29 U. S. C. § 1001 et seq. For two reasons, we held that removal was proper even though the complaint purported to raise only state-law claims. First, the statutory text in § 502(a), 29 U. S. C. § 1132, not only provided an express federal remedy for the plaintiffs' claims, but also in its jurisdiction subsection, § 502(f), used language similar to the statutory language construed in Avco, thereby indicating
Thus, a state claim may be removed to federal court in only two circumstances—when Congress expressly so provides, such as in the Price-Anderson Act, supra, at 6, or when a federal statute wholly displaces the state-law cause of action through complete pre-emption.
III
Count IV of respondents' complaint sought relief for "usury violations" and claimed that petitioners "charged . . . excessive interest in violation of the common law usury doctrine" and violated "Alabama Code § 8-8-1, et seq. by charging excessive interest." App. 28. Respondents' complaint thus expressly charged petitioners with usury. Metropolitan Life, Avco, and Franchise Tax Board provide the framework for answering the dispositive question in this case: Does the National Bank Act provide the exclusive cause of action for usury claims against national banks? If so, then the cause of action necessarily arises under federal law and the case is removable. If not, then the complaint does not arise under federal law and is not removable.
Sections 85 and 86 serve distinct purposes. The former sets forth the substantive limits on the rates of interest that national banks may charge. The latter sets forth the elements of a usury claim against a national bank, provides for a 2-year statute of limitations for such a claim, and prescribes the remedies available to borrowers who are charged higher rates and the procedures governing such a claim. If, as petitioners asserted in their notice of removal, the interest that the bank charged to respondents did not violate § 85 limits, the statute unquestionably pre-empts any common-law or Alabama statutory rule that would treat those rates as usurious. The section would therefore provide the petitioners with a complete federal defense. Such a federal defense, however, would not justify removal. Caterpillar Inc. v. Williams, 482 U.S. 386, 393 (1987). Only if Congress intended § 86 to provide the exclusive cause of action for usury claims against national banks would the statute be comparable to the provisions that we construed in the Avco and Metropolitan Life cases.
In addition to this Court's longstanding and consistent construction of the National Bank Act as providing an exclusive federal cause of action for usury against national banks, this Court has also recognized the special nature of federally chartered banks. Uniform rules limiting the liability of national banks and prescribing exclusive remedies for their overcharges are an integral part of a banking system that needed protection from "possible unfriendly State legislation." Tiffany v. National Bank of Mo., 18 Wall. 409, 412
The judgment of the Court of Appeals is reversed.
It is so ordered.
JUSTICE SCALIA, with whom JUSTICE THOMAS joins, dissenting.
Today's opinion takes the view that because the National Bank Act, 12 U. S. C. §§ 85, 86, provides the exclusive cause of action for claims of usury against a national bank, all such claims—even if explicitly pleaded under state law—are to be construed as "aris[ing] under" federal law for purposes of our jurisdictional statutes. Ante this page. This view finds scant support in our precedents and no support whatever in the National Bank Act or any other Act of Congress. I respectfully dissent.
Unless Congress expressly provides otherwise, the federal courts may exercise removal jurisdiction over state-court actions "of which the district courts of the United States
This so-called "arising under" or "federal question" jurisdiction has long been governed by the well-pleaded-complaint rule, which provides that "federal jurisdiction exists only when a federal question is presented on the face of the plaintiff's properly pleaded complaint." Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987). A federal question "is presented" when the complaint invokes federal law as the basis for relief. It does not suffice that the facts alleged in support of an asserted state-law claim would also support a federal claim. "The [well-pleaded-complaint] rule makes the plaintiff the master of the claim; he or she may avoid federal jurisdiction by exclusive reliance on state law." Ibid. See also The Fair v. Kohler Die & Specialty Co., 228 U.S. 22, 25 (1913) ("Of course the party who brings a suit is master to decide what law he will rely upon"). Nor does it even suffice that the facts alleged in support of an asserted state-law claim do not support a state-law claim and would only support a federal claim. "Jurisdiction may not be sustained on a theory that the plaintiff has not advanced." Merrell Dow Pharmaceuticals Inc. v. Thompson, 478 U.S. 804, 809, n. 6 (1986).
Under the well-pleaded-complaint rule, "a federal court does not have original jurisdiction over a case in which the complaint presents a state-law cause of action, but also asserts that federal law deprives the defendant of a defense he may raise,. . . or that a federal defense the defendant may raise is not sufficient to defeat the claim." Franchise Tax Bd. of Cal. v. Construction Laborers Vacation Trust for Southern Cal., 463 U.S. 1, 10 (1983). Of critical importance here, the rejection of a federal defense as the basis for original federal-question jurisdiction applies with equal force
This Court has twice recognized exceptions to the well-pleaded-complaint rule, upholding removal jurisdiction not-withstanding the absence of a federal question on the face of the plaintiff's complaint. First, in Avco Corp. v. Machinists, 390 U.S. 557 (1968), we allowed removal of a state-court action to enforce a no-strike clause in a collective-bargaining agreement. The complaint concededly did not advance a federal claim, but was subject to a defense of pre-emption under § 301 of the Labor Management Relations Act, 1947 (LMRA), 29 U. S. C. § 185. The well-pleaded-complaint rule notwithstanding, we treated the plaintiff's state-law contract claim as one arising under § 301, and held that the case could be removed to federal court. Avco, supra, at 560.
The only support mustered by the Avco Court for its conclusion was a statement wrenched out of context from our decision in Textile Workers v. Lincoln Mills of Ala., 353 U.S. 448, 457 (1957), that "[a]ny state law applied [in a § 301 case] will be absorbed as federal law and will not be an independent source of private rights." To begin with, this statement is entirely unnecessary to the landmark holding in Lincoln Mills—that § 301 not only gives federal courts jurisdiction to decide labor relations cases but also supplies them with authority to create the governing substantive law. Id., at 456. More importantly, understood in the context of that holding, the quoted passage in no way supports the proposition for which it is relied upon in Avco—that state-law
Other than its entirely misguided reliance on Lincoln Mills, the opinion in Avco failed to clarify the analytic basis for its unprecedented act of jurisdictional alchemy. The Court neglected to explain why state-law claims that are pre-empted by § 301 of the LMRA are exempt from the strictures of the well-pleaded-complaint rule, nor did it explain how such a state-law claim can plausibly be said to "arise under" federal law. Our subsequent opinion in Franchise Tax Board struggled to prop up Avco's puzzling holding:
This passage has repeatedly been relied upon by the Court as an explanation for its decision in Avco. See, e. g., ante, at 7, Caterpillar, supra, at 394; Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 64 (1987). Of course it is not an explanation
Metropolitan Life Ins. Co. v. Taylor, supra, was our second departure from the prohibition against resting federal "arising under" jurisdiction upon the existence of a federal defense. In that case, Taylor sued his former employer and its insurer, alleging breach of contract and seeking, inter alia, reinstatement of certain disability benefits and insurance coverages. Id., at 61. Though Taylor invoked no federal law in his complaint, we treated his case as one arising under § 502 of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U. S. C. § 1132, and upheld the District Court's exercise of removal jurisdiction. 481 U. S., at 66-67.
In reaching this conclusion, the Taylor Court broke no new analytic ground; its opinion follows the exception established in Avco and described in Franchise Tax Board, but says nothing to commend that exception to logic or reason. Instead, Taylor simply relies on the "clos[e] parallels," 481 U. S., at 65, between the language of the pre-emptive provision in ERISA and the language of the LMRA provision deemed in Avco to be so dramatically pre-emptive as to summon forth a federal claim where none had been asserted. "No more specific reference to the Avco rule can be expected," we said, than what was found in § 502(a); and we accordingly concluded that "Congress has clearly manifested an intent to make causes of action within the scope of the civil enforcement provisions of § 502(a) removable to federal
It is noteworthy that the straightforward (though similarly unsupported) rule announced in today's opinion—under which (1) removal is permitted "[w]hen [a] federal statute completely pre-empts a state-law cause of action," ante, at 8, and (2) a federal statute is completely pre-emptive when it "provide[s] the exclusive cause of action for the claim asserted," ibid.—is nowhere to be found in either Avco or Taylor. To the contrary, the analysis in today's opinion implicitly contradicts (by rendering inexplicable) Taylor's discussion of pre-emption and removal. (Avco, as I observed earlier, has no discussion to be contradicted.) Had it thought that today's decision was the law, the Taylor Court need not have taken pains to emphasize the "clos[e] parallels" between § 502(a)(1)(B) of ERISA and § 301 of the LMRA and need not have pored over the legislative history of § 502(a) to show that Congress expected ERISA to be treated like the LMRA. See Taylor, supra, at 65-66 (citing H. R. Conf. Rep. No. 93-1280, p. 327 (1974); 120 Cong. Rec. 29933 (1974) (remarks of Sen. Williams); id., at 29942 (remarks of Sen. Javits)). Instead, it could have rested after noting the "unique pre-emptive force of ERISA," Taylor, supra, at 65. Indeed, it could even have spared itself the trouble of adding
The best that can be said, from a precedential perspective, for the rule of law announced by the Court today is that variations on it have twice appeared in our cases in the purest dicta. Rivet v. Regions Bank of La., 522 U.S. 470, 476 (1998) ("[O]nce an area of state law has been completely pre-empted, any claim purportedly based on that pre-empted state-law claim is considered, from its inception, a federal claim, and therefore arises under federal law" (internal quotation marks omitted)); Caterpillar, 482 U. S., at 393 ("[I]f a federal cause of action completely pre-empts a state cause of action any complaint that comes within the scope of the federal cause of action necessarily `arises under' federal law" (some internal quotation marks omitted)). Dicta of course have no precedential value, see U. S. Bancorp Mortgage Co. v. Bonner Mall Partnership, 513 U.S. 18, 24 (1994), even when they do not contradict, as they do here, prior holdings of the Court.
The difficulty with today's holding, moreover, is not limited to the flimsiness of its precedential roots. As has been noted already, the holding cannot be squared with bedrock principles of removal jurisdiction. One or another of two of those principles must be ignored: Either (1) the principle that merely setting forth in state court facts that would support a federal cause of action—indeed, even facts that would support a federal cause of action and would not support the claimed state cause of action—does not produce a federal question supporting removal, Caterpillar, 482 U. S., at 391, or (2) the principle that a federal defense to a state
In an effort to justify this shift, the Court explains that "[b]ecause [12 U. S. C.] §§ 85 and 86 provide the exclusive cause of action for such claims, there is . . . no such thing as a state-law claim of usury against a national bank." Ante, at 11. But the mere fact that a state-law claim is invalid no more deprives it of its character as a state-law claim which does not raise a federal question, than does the fact that a federal claim is invalid deprive it of its character as a federal claim which does raise a federal question. The proper response to the presentation of a nonexistent claim to a state court is dismissal, not the "federalize-and-remove" dance authorized by today's opinion. For even if the Court is correct that the National Bank Act obliterates entirely any state-created right to relief for usury against a national bank, that does not explain how or why the claim of
Petitioners seek to justify their end run around the well-pleaded-complaint rule by insisting that, in determining whether federal jurisdiction exists, we are required to "`look beyond the pleadings.'" Brief for Petitioners 18 (quoting Indianapolis v. Chase Nat. Bank, 314 U.S. 63, 69 (1941)). They point out:
Petitioners insist that, like the "manipulative" complaints in these diversity cases, "[r]espondents' complaint is disingenuously pleaded, not `well pleaded' in any respect, for it purports to raise a state law claim that does not exist." Id., at 16. Accordingly, the argument continues, just as federal courts may assert jurisdiction where a plaintiff seeks to hide the true citizenship of the parties, so too they may assert jurisdiction where a plaintiff cloaks a necessarily federal claim in state-law garb.
To begin with, the cases involving diversity jurisdiction are probably distinguishable on the ground that there is a crucial difference between, on the one hand, "looking beyond the pleadings" to determine whether a factual assertion is true, and, on the other hand, doing so in order to determine whether the plaintiff has proceeded on the basis of the "correct"
There may well be good reasons to favor the expansion of removal jurisdiction that petitioners urge and that the Court adopts today. As the United States explains in its amicus brief:
True enough, but inadequate to render today's decision either rational or properly within the authority of this Court. Inadequate for rationality, because there is no more reason
* * *
Today's opinion has succeeded in giving to our Avco decision a theoretical foundation that neither Avco itself nor Taylor provided. Regrettably, that theoretical foundation is itself without theoretical foundation. That is to say, the more general proposition that (1) the existence of a pre-emptive federal cause of action causes the invalid assertion of a state cause of action to raise a federal question, has no more logic or precedent to support it than the very narrow proposition that (2) the LMRA (Avco) and statutes modeled after the LMRA (Taylor) cause invalid assertions of state causes of action pre-empted by those particular statutes to raise federal questions. Since I believe that, as between an inexplicable narrow holding and an inexplicable broad one, the former is the lesser evil, I would adhere to the approach taken by Taylor and on the basis of stare decisis simply affirm, without any real explanation, that the LMRA and statutes modeled after it have a "unique pre-emptive force" that
FootNotes
Briefs of amici curiae urging affirmance were filed for the State of Arizona et al. by Terry Goddard, Attorney General of Arizona, Mary O'Grady, Solicitor General, Joseph A. Kanefield, Assistant Attorney General, and Dan Schweitzer, and by the Attorneys General for their respective States as follows: Gregg Renkes of Alaska, Richard Blumenthal of Connecticut, Thurbert E. Baker of Georgia, Mark J. Bennett of Hawaii, Lisa Madigan of Illinois, Thomas J. Miller of Iowa, J. Joseph Curran, Jr., of Maryland, Mike Hatch of Minnesota, Jeremiah W. (Jay) Nixon of Missouri, Peter Heed of New Hampshire, Patricia A. Madrid of New Mexico, Eliot Spitzer of New York, Jim Petro of Ohio, Hardy Myers of Oregon, Henry McMaster of South Carolina, Larry Long of South Dakota, Greg Abbott of Texas, and Christine O. Gregoire of Washington; for AARP et al. by Deborah M. Zuckerman, Stacy J. Canan, and Michael R. Schuster; and for Consumer Attorneys of California by James C. Sturdevant.
"Rate of interest on loans, discounts and purchases
"Any association may take, receive, reserve, and charge on any loan or discount made, or upon any notes, bills of exchange, or other evidences of debt, interest at the rate allowed by the laws of the State, Territory, or District where the bank is located, or at a rate of 1 per centum in excess of the discount rate on ninety-day commercial paper in effect at the Federal reserve bank in the Federal reserve district where the bank is located, whichever may be the greater, and no more, except that where by the laws of any State a different rate is limited for banks organized under state laws, the rate so limited shall be allowed for associations organized or existing in any such State under title 62 of the Revised Statutes. When no rate is fixed by the laws of the State, or Territory, or District, the bank may take, receive, reserve, or charge a rate not exceeding 7 per centum, or 1 per centum in excess of the discount rate on ninety day commercial paper in effect at the Federal reserve bank in the Federal reserve district where the bank is located, whichever may be the greater, and such interest may be taken in advance, reckoning the days for which the note, bill, or other evidence of debt has to run. The maximum amount of interest or discount to be charged at a branch of an association located outside of the States of the United States and the District of Columbia shall be at the rate allowed by the laws of the country, territory, dependency, province, dominion, insular possession, or other political subdivision where the branch is located. And the purchase, discount, or sale of a bona fide bill of exchange, payable at another place than the place of such purchase, discount, or sale, at not more than the current rate of exchange for sight drafts in addition to the interest, shall not be considered as taking or receiving a greater rate of interest."
"Usurious interest; penalty for taking; limitations
"The taking, receiving, reserving, or charging a rate of interest greater than is allowed by section 85 of this title, when knowingly done, shall be deemed a forfeiture of the entire interest which the note, bill, or other evidence of debt carries with it, or which has been agreed to be paid thereon. In case the greater rate of interest has been paid, the person by whom it has been paid, or his legal representatives, may recover back, in an action in the nature of an action of debt, twice the amount of the interest thus paid from the association taking or receiving the same: Provided, That such action is commenced within two years from the time the usurious transaction occurred."
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