JUSTICE SOUTER delivered the opinion of the Court.
Title 28 U. S. C. § 1447(d) limits appellate review of a district court order remanding a case from federal to state
The Private Securities Litigation Reform Act of 1995 (Reform Act), 109 Stat. 737, targeted "perceived abuses of the class-action vehicle in litigation involving nationally traded securities," Merrill Lynch, Pierce, Fenner & Smith Inc. v. Dabit, ante, at 81, and put limits on federal securities class actions. But Congress soon discovered that "[r]ather than face the obstacles set in their path by the Reform Act, plaintiffs and their representatives [were] bringing class actions under state law, often in state court," ante, at 82. To block this bypass of the Reform Act, Congress enacted the Securities Litigation Uniform Standards Act of 1998 (Act), 112 Stat. 3227; see Dabit, ante, at 81-82.
The Act has a preclusion provision
Petitioners are eight groups of investors holding mutual fund shares, who filed separate actions in Illinois state courts, each group seeking to represent a class of investors allegedly injured by devaluation of their holdings by respondents (mutual funds, investment advisors, and an insurance company) (hereinafter collectively the funds).
The funds filed notices of removal to federal district court in each case stating, among other things, that the actions were removable under and precluded by the Act. Once in the District Court, however, the investors argued that the cases should be remanded for lack of subject-matter jurisdiction, and in separate orders the District Court for the Southern
The funds filed notices of appeal from the remand orders, and in one of the cases, 373 F.3d 847 (2004), the Seventh Circuit issued an opinion addressing the threshold question of its appellate jurisdiction. The Court of Appeals acknowledged that 28 U. S. C. § 1447(d) bars review of district court orders remanding for lack of subject-matter jurisdiction, 373 F. 3d, at 849 (citing Gravitt v. Southwestern Bell Telephone Co., 430 U.S. 723 (1977) (per curiam)), but decided that the District Court had the last word neither on the characterization of its decision as jurisdictional nor on the correctness of its conclusion that remand was required, see 373 F. 3d, at 849.
The Court of Appeals considered all covered class actions involving covered securities, whether precluded or not, to be removable under the Act, and for that reason thought the preclusion issue to be distinct from the jurisdictional issue of whether the case belonged in federal court at all. Id., at 849-850. In the view of the Court of Appeals, if the District Court remanded because, for example, the class comprised too few investors to make the case a covered class action, that would be a jurisdictional decision that the case had been removed improperly, and the order would therefore be unreviewable in accordance with § 1447(d). Id., at 849. But the court held that orders remanding "properly removed" suits
As the Court of Appeals put it, once the District Court had made that substantive decision of no preclusion in this case, it was time for the court to bow out, not because it had lacked "adjudicatory competence" to begin with but because it had completed its work: "Once a court does all that the statute authorizes, there is no adjudicatory competence to do more. That is not the `lack of subject-matter jurisdiction' that authorizes a remand. Otherwise every federal suit, having been decided on the merits, would be dismissed `for lack of jurisdiction' because the court's job was finished." Id., at 850. This remand, the court concluded, was therefore not for want of jurisdiction, and review was not barred by § 1447(d).
To satisfy itself that its decision made "practical sense," the court proposed that the Act reserves to the Federal Judiciary the exclusive authority to make the preclusion decision. Ibid. Treating remand orders in this context as immunized from appeal by § 1447(d) would thus mean that "a major substantive issue in the case [would] escape review," since it would not be open to resolution in the state court subject to review by this Court. Ibid.
The Seventh Circuit subsequently consolidated the funds' appeals and decided, on the merits, that the Act does preclude the investors' claims. 403 F.3d 478 (2005). We granted certiorari to resolve a split of authority on the question whether § 1447(d) bars review of remand orders in cases removed under the Act,
The policy of Congress opposes "interruption of the litigation of the merits of a removed cause by prolonged litigation of questions of jurisdiction of the district court to which the cause is removed," United States v. Rice, 327 U.S. 742, 751 (1946), and nearly three years of jurisdictional advocacy in the cases before us confirm the congressional wisdom. For over a century now, statutes have accordingly limited the power of federal appellate courts to review orders remanding cases removed by defendants from state to federal court, see id., at 748-752; Thermtron Products, Inc. v. Hermansdorfer, 423 U.S. 336, 346-348 (1976). The current incarnation is 28 U. S. C. § 1447(d), which provides that an "order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise."
The bar of § 1447(d) applies equally to cases removed under the general removal statute, § 1441, and to those removed under other provisions, see Things Remembered, supra, at 128, and the force of the bar is not subject to any statutory exception that might cover this case.
The Court of Appeals did not, of course, overlook the cases holding that even a remand premised on an erroneous conclusion of no jurisdiction is unappealable; it relied instead on cases like Kontrick v. Ryan, 540 U.S. 443 (2004), and Scarborough v. Principi, 541 U.S. 401 (2004), which observed that some rulings loosely called jurisdictional are patently not jurisdictional in the strict sense, see 373 F. 3d, at 849 (citing Kontrick, supra; Scarborough, supra). The appeals court saw this as such a case; it understood that a district court had removal jurisdiction over any covered action under subsection (c), with the consequence that a subsequent order dismissing because of preclusion under subsection (b), or remanding because the action was not precluded, rested simply on an application of substantive law under subsection (b), law that was not jurisdictional at all.
We think, however, that the District Court was correct in understanding its remand order to be dictated by its finding that it lacked removal jurisdiction. Unlike the Court of Appeals, we read authorization for the removal in subsection (c), on which the District Court's jurisdiction depends, as confined to cases "set forth in subsection (b)," § 77p(c), namely, those with claims of untruth, manipulation, and so on. The quoted phrase immediately follows the subsection (c) language describing removable cases as covered class actions involving covered securities, and the language has no apparent function unless it limits removal to covered class actions involving claims like untruth or deception. And legislative
The funds argue that removal jurisdiction is broader by emphasizing the adjective that introduces subsection (c): "Any" covered action. § 77p(c). But that suggestion would be persuasive only if we stopped reading right there, and we do not stop there; we do not read statutes in little bites. And, as just noted, if we did read the removal power that broadly there would be no point to the phrase "as set forth in subsection (b)," for subsection (b) cases would be removable anyway as a subset of covered class actions. Ibid. The funds purport to counter this objection with their argument that on our reading the last phrase of subsection (c) is redundant in providing that removed cases "shall be subject to subsection (b)," since subsection (b) cases would in any event be so subject. Ibid. The funds are in fact right about that redundancy, but the point does not count for their side, because the phrase is redundant on their reading, too: any subsection (b) case removed as falling within the broad category of covered class actions would be treated in accordance with subsection (b) if the subsection applied to that case. In sum, we see no reason to reject the straightforward reading: removal and jurisdiction to deal with removed cases is limited to those precluded by the terms of subsection (b).
Once removal jurisdiction under subsection (c) is understood to be restricted to precluded actions defined by subsection
We have yet to deal with one objection to our application of § 1447(d), which if well taken would be a serious one. The
But a district court does not have the last word on preclusion under the Act, for nothing in the Act gives the federal courts exclusive jurisdiction over preclusion decisions. A covered action is removable if it is precluded, and a defendant can enlist the Federal Judiciary to decide preclusion, but a defendant can elect to leave a case where the plaintiff filed it and trust the state court (an equally competent body, see Missouri Pacific R. Co. v. Fitzgerald, 160 U.S. 556, 583 (1896)) to make the preclusion determination.
And what a state court could do in the first place it may also do on remand; in this case, the funds can presently argue the significance of Dabit and ask for dismissal on grounds of
We hold that the Act does not exempt remand orders from 28 U. S. C. § 1447(d) and its general rule of nonappealability. We therefore vacate the judgment of the Court of Appeals and remand the case with instructions to dismiss the appeal for lack of jurisdiction.
It is so ordered.
JUSTICE SCALIA, concurring in part and concurring in the judgment.
I join the judgment of the Court, and Parts I, III, and IV of the Court's opinion; I do not join Part II for the reasons set forth below.
The District Court ordered these cases remanded to state court for want of jurisdiction. We know this because the orders say so: "Because the Court lacks subject matter jurisdiction, the Court
The Court of Appeals rejected the District Court's description of its orders because it believed the District Court had been too loose in its use of the term "jurisdiction." 373 F.3d 847, 849-850 (2004). What the District Court actually did, the Court of Appeals concluded, was to remand on nonjurisdictional grounds (not subject to the appellate-review bar of § 1447(d)) after deciding that petitioners' suits were not precluded. Such recharacterization seems to me flatly inconsistent with § 1447(d). Under that section, an "order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise." Ibid. (emphasis added). But appellate review is exactly what is involved in looking behind the face of an order to determine its true basis: In order to reject a district court's own characterization, a court of appeals must decide, as the Seventh Circuit did here, that the district court was wrong. We have therefore held, in language that makes plain the correct outcome here, that "[i]f a trial judge purports to remand a case on the ground that it was removed `improvidently and without jurisdiction,' his order is not subject to challenge in the court of appeal, by mandamus, or otherwise." Thermtron Products, Inc. v. Hermansdorfer, 423 U.S. 336, 343 (1976) (quoting § 1447(c) (1970 ed.); emphasis added). Whether the District Court was right or wrong—even if it was so badly mistaken that it misunderstood the true basis for its orders—it
Review of the sort engaged in by the Court of Appeals threatens to defeat the purpose of § 1447(d). As we recognized in Thermtron Products, the appellate-review bar was enacted "to prevent delay in the trial of remanded cases by protracted litigation of jurisdictional issues." Id., at 351. Such delay can be created just as easily by asking whether the district court correctly characterized the basis for its order as it can by asking whether that basis was correct— which even the Court of Appeals recognized was beyond its jurisdiction, 373 F. 3d, at 849. See also Thermtron Products, supra, at 343 (noting that § 1447(d) "prohibits review of all remand orders [based on lack of subject-matter jurisdiction] whether erroneous or not"). The remand orders in these cases date back to early 2004; over two years later, federal courts are still engaged in appellate review.
The Court should end this delay by holding that appellate courts cannot look behind the stated basis for the district court's remand order. Instead, it concludes that "the District Court was correct in understanding its remand order to be dictated by a finding that it lacked removal jurisdiction." Ante, at 642 (emphasis added). It seems to me no more within our authority to declare the District Court's views correct than it was within the Court of Appeals' authority to reject them. Either decision is an exercise of appellate review barred by the plain terms of § 1447(d).
Brian Wolfman and Arthur R. Miller filed a brief for Law Professors et al. as amici curiae.
"(1) an untrue statement or omission of a material fact in connection with the purchase or sale of a covered security; or
"(2) that the defendant used or employed any manipulative or deceptive device or contrivance in connection with the purchase or sale of a covered security." 112 Stat. 3228 (codified at 15 U. S. C. § 77p(b)).
The preclusion provision is often called a preemption provision; the Act, however, does not itself displace state law with federal law but makes some state-law claims nonactionable through the class-action device in federal as well as state court. See Merrill Lynch, Pierce, Fenner & Smith Inc. v. Dabit, ante, at 87 ("The Act does not deny any individual plaintiff, or indeed any group of fewer than 50 plaintiffs, the right to enforce any state-law cause of action that may exist").
Section 1442(a) is an exception to the "well-pleaded complaint" rule, under which (absent diversity) "a defendant may not remove a case to federal court unless the plaintiff's complaint establishes that the case `arises under' federal law." Franchise Tax Bd. of Cal. v. Construction Laborers Vacation Trust for Southern Cal., 463 U.S. 1, 10 (1983) (emphasis deleted). The federal officer removal statute allows "suits against federal officers [to] be removed despite the nonfederal cast of the complaint," Jefferson County v. Acker, 527 U.S. 423, 431 (1999), and reflects a congressional policy that "federal officers, and indeed the Federal Government itself, require the protection of a federal forum," Willingham v. Morgan, 395 U.S. 402, 407 (1969). An officer's federal defense need be only colorable to assure the federal court that it has jurisdiction to adjudicate the case, see Acker, supra, at 431.
The funds assert that a preclusion defense need be only colorable as well, but the Act is different. It avails a defendant of a federal forum in contemplation not of further litigation over the merits of a claim brought in state court, but of termination of the proceedings altogether, and a merely colorable claim of preclusion does not satisfy a district court that it may dismiss a case as precluded by the Act. There is no room for such a case to exist in a limbo of colorable preclusion; if a claim is precluded, it "may [not] be maintained," 15 U. S. C. § 77p(b), and if the claim is not, the federal courts no longer have any business being involved, as there is no longer any federal question on which to moor the district court's jurisdiction. Nor has Congress expressed in the Act, as it did with 28 U. S. C. § 1442(a), any policy of having particular suits tried in a federal court; there is no indication whatsoever in the Act that, apart from its purpose to preclude certain vexing state-law class actions, Congress intended to add other state-law cases to the federal dockets, and there is no apparent federal interest in spending time on such cases akin to the interest in adjudicating suits against federal officers.
In Waco, a case was removed to federal court on an invocation of diversity jurisdiction, id., at 141, and the District Court thereafter "entered a single decree embodying . . . separate orders," id., at 142. In one order, the District Court dismissed a cross-complaint against one party. In another, the District Court concluded that because of the dismissal there was no diversity of citizenship and it thus lacked jurisdiction, and so it remanded the case to state court. An appeal was taken from the order of dismissal. This Court determined that the appeal would lie, because "the decree of dismissal preceded that of remand," and because the District Court's order of dismissal was conclusive upon the parties. Id., at 143. We noted that a "reversal [of the dismissal] cannot affect the order of remand, but it will at least, if the dismissal . . . was erroneous, remit the entire controversy, with the [previously dismissed party] still a party, to the state court for . . . further proceedings." Id., at 143-144.
The order appealed in Waco was not a remand order; the order here is, and thus falls within § 1447(d)'s bar on appeals of "[a]n order remanding a case" to state court. Moreover, the funds do not explain how to reconcile their argument with Waco's acknowledgment that the order of remand "cannot [be] affect[ed]" notwithstanding any reversal of a separate order, id., at 143. The District Court's remand order here cannot be disaggregated as the Waco orders could, and if the Seventh Circuit's preclusion decision stands, there is nothing to remand to state court.