Abraham Watkins v. Festeryga

Case: 23-20337 Document: 171-1 Page: 1 Date Filed: 05/16/2025

United States Court of Appeals for the Fifth Circuit United States Court of Appeals

Fifth Circuit ____________ FILED

May 16, 2025 No. 23-20337 Lyle W. Cayce ____________ Clerk

Abraham Watkins Nichols Agosto Aziz & Stogner,

Plaintiff—Appellee, versus

Edward Festeryga,

Defendant—Appellant. ______________________________

Appeal from the United States District Court for the Southern District of Texas USDC No. 4:22-CV-4249

______________________________

Before Elrod, Chief Judge, Jones, Smith, Stewart, Richman, Southwick, Haynes, Graves, Higginson, Willett, Ho, Duncan, Engelhardt, Oldham, Wilson, Douglas and Ramirez, Circuit Judges.

Don R. Willett, Circuit Judge:

This case asks whether we have appellate jurisdiction to review a remand order based solely on a defendant’s alleged waiver of the right to remove. By statute, Congress has sharply limited our power to review district court orders remanding cases to state court. Specifically, we lack jurisdiction to review remand orders grounded in either (1) a lack of subject-matter jurisdiction or (2) a defect in the removal procedure. But a remand based on a defendant’s alleged waiver—say, by participating in state-court proceedings before removal—fits neither category. Nonetheless, 45 years ago in In re Weaver, our circuit inexplicably held otherwise.

Fast forward to today. In this case, a Texas law firm sued one of its former attorneys, Edward Festeryga, in state court, alleging that he took firm files and clients to his new practice. Seventeen days later—well within the 30-day statutory removal window—Festeryga removed the case to federal court. The district court, however, remanded the case, concluding that Festeryga had waived his removal right by filing a motion to dismiss in state court. Bound by Weaver—and acknowledging its “erroneous premises”—a panel of this court “reluctantly” dismissed Festeryga’s appeal for lack of appellate jurisdiction.1

Today, we do what only this court sitting en banc can: we correct course and “unweave Weaver.”2

I This case arises from a dispute between a Texas law firm—Abraham Watkins Nichols Agosto Aziz & Stogner—and one of its former associates, Edward Festeryga. After learning that Festeryga had attempted to take clients and firm files to his new firm, Abraham Watkins terminated his employment and sued him in Texas state court for various state-law torts.

What followed was a brisk, 17-day flurry of state-court activity. Abraham Watkins first secured a temporary restraining order barring Festeryga from spoliating evidence, contacting or representing firm clients, or disclosing confidential client information. Next, the firm moved for expedited discovery to obtain communications and documents between Festeryga and its clients. In response, Festeryga filed a motion to dismiss under Texas’s anti-SLAPP statute—the Texas Citizens Participation Act (TCPA).3 That motion triggered an automatic stay of discovery,4 but the parties later stipulated to a protective order, and Festeryga agreed to produce certain limited materials.

On the eve of his production deadline, however, Festeryga removed the case to federal court, invoking diversity jurisdiction based on his Canadian citizenship.5 Abraham Watkins moved to remand on two grounds: (1) that Festeryga failed to establish complete diversity of citizenship, and (2) that he waived his removal rights by filing a motion to dismiss and stipulating to a protective order in state court. The district court declined to reach the diversity question but concluded that Festeryga’s TCPA motion reflected an intent to “invok[e] the jurisdiction of the state court.”6 Accordingly, the court granted the firm’s remand motion.

Festeryga appealed, contending that the district court erred in finding waiver. Abraham Watkins responded that the panel lacked appellate jurisdiction to review remand orders based on waiver. Alternatively, the firm maintained that remand was proper regardless—both because waiver had occurred and because complete diversity was lacking.

Bound by circuit precedent, a panel of this court dismissed the appeal for lack of appellate jurisdiction. As the panel “reluctantly” noted, Weaver held that waiver-based remand orders are jurisdictional—and therefore “immune from review.”7 Thus, even while recognizing “that Weaver rests on erroneous premises,” the panel dutifully followed our rule of orderliness and dismissed the appeal.8 Acknowledging that Weaver bound the panel, Judge Duncan concurred, but urged the en banc court to “unweave Weaver.”9 We took that invitation seriously—and granted rehearing en banc.

II A

Removal procedures are governed by statute,10 and Congress has placed “broad restrictions on the power of federal appellate courts to review district court orders remanding removed cases to state court.”11 Chief among those restrictions is 28 U.S.C. § 1447(d), which on its face imposes a categorical bar: “An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise.”

Despite this seemingly clear language, the Supreme Court has sharply narrowed § 1447(d)’s scope.12 The Court has held that § 1447(d) must be read in pari materia with its statutory neighbor, § 1447(c).13 In short, § 1447(d)’s bar applies only when the remand order rests on the grounds authorized by § 1447(c).14 So construed, § 1447(d) bars appellate review only when the remand is based on one of two grounds: (1) a defect in the removal process, or (2) a lack of subject-matter jurisdiction.15

Remand orders resting on any other ground remain open to appellate review.16 A few examples: remands based on Burford abstention,17 enforcement of a forum-selection clause,18 or a district court’s decision to decline supplemental jurisdiction over state-law claims.19

The issue in this appeal is whether a remand based on the defendant’s alleged waiver of the right to remove—by participating in state-court proceedings—fits within one of § 1447(c)’s two categories. If it does, § 1447(d) bars our review. If not, our appellate jurisdiction remains intact.

B This issue first reached our court 45 years ago. In In re Weaver, a Georgia corporation filed state-court claims against employees of the Small Business Administration.20 It sought both damages and injunctive relief to prevent the sale of corporate assets.21 Although the corporation initially secured an ex parte injunction, it was soon undone: the defendants “arranged a telephone conference call with a different superior court judge” who “vacated the injunction.”22 A few days later, the defendants removed the case to federal court.23

The district court remanded the case, reasoning that “removal was no longer available since the [defendants] had sought and obtained the dissolution of the temporary injunction in state court.”24 After two unsuccessful motions for reconsideration, the defendants turned to us for mandamus relief.25

The Weaver panel denied relief. The panel acknowledged that under the Supreme Court’s decision in Thermtron, § 1447(d) bars appellate review only when a remand rests on grounds listed in § 1447(c).26 But Weaver narrowed Thermtron’s scope, holding that appellate review should be “strictly limited” to cases where the district court “clearly” did not rely on § 1447(c)27

In reaching that conclusion, Weaver relied heavily on In re Merrimack Mutual Fire Insurance Company.28 There, the panel considered a remand based on destroyed diversity—although the original parties were diverse, later-added ones were not.29 To assess its appellate jurisdiction, Merrimack framed the inquiry as whether the district court had relied on a ground outside § 1447(c). The wrinkle: while lack of diversity is plainly a § 1447(c) ground, it was unclear whether that section applied when diversity was destroyed by adding dispensable—rather than indispensable—parties. The appealability of the remand turned on whether the newly added parties were dispensable—something the district court never addressed. Merrimack held that where the basis for remand is ambiguous, appellate review is foreclosed unless the district court expressly invoked a non-§ 1447(c) ground.30

Returning to Weaver, the panel deemed Merrimack controlling. The district court’s remand order cited no specific ground under § 1447(c)—but neither did it identify any basis outside that section. Instead, it “merely concluded” that removal was unavailable because the defendants “had sought the dissolution of the injunction in state court.”31 Weaver reasoned that a waiver-based remand fell within § 1447(c)’s scope. Although the district court never cited § 1447(c), Weaver inferred that the court found removal improper—so “jurisdiction was lacking.”32 And a lack of jurisdiction, of course, is one of the two enumerated bases for remand under § 1447(c).

In short, Weaver held that waiver may be characterized as a jurisdictional defect—placing it squarely within § 1447(c)’s bar on appellate review.

C We reject Weaver’s flawed holding:33 A remand based on waiver is not jurisdictional. Basic legal principles and overwhelming precedent—not to mention Abraham Watkins’s concession—compel that conclusion.

“Subject matter jurisdiction defines the court’s authority to hear a given type of case.”34 That authority derives exclusively from two sources: the Constitution and Congress.35 Waiver comes from neither.36 It is a doctrine of common-law origin, triggered “when a party voluntarily or intentionally surrenders a known right.”37 But it is well established that a party’s litigation conduct can neither confer subject-matter jurisdiction on a court nor strip it away.38 A party may waive its right to remove a case, but that waiver bears no relation to the court’s jurisdiction to hear it.

Nor does waiver bear the hallmarks of jurisdiction doctrine. Jurisdictional defects must be raised sua sponte; waiver need not be.39 Waiver can itself be waived; jurisdiction cannot.40 And while jurisdictional issues are reviewed de novo, waiver is reviewed for abuse of discretion.41 It is little surprise, then, that our court has consistently held in analogous contexts that waiver does not affect jurisdiction.42

Weaver offers no serious analysis to the contrary. Its reasoning rests on a single premise: that because the district court believed the case was no longer removable, it must have concluded that jurisdiction was lacking.43 That “logical inference” is hardly logic at all. It is barely reasoning. Unsurprisingly, other circuits have struggled to make sense of it. The Tenth Circuit said it could “fathom no explanation” for Weaver.44 The Seventh Circuit called it “unsound” and “illogical.”45 These courts—plus the Eleventh Circuit—have all reached the sounder conclusion: waiver-based

_____________________ 1980) (“Waiver is an affirmative defense, [] which must be specially pled.” (citation omitted)). See Soto Enters., 864 F.3d at 1093 (“[U]nlike jurisdictional defects (which cannot be waived and can be raised sua sponte by the court), courts lack authority to remand sua sponte for procedural defects, and the parties can waive such defects by failing to raise them in a timely manner.”). remand orders are not jurisdictional.46 Today we join that consensus and make clear that Weaver was wrongly decided.

To be sure, the Ninth Circuit once reached the opposite conclusion. Relying on Weaver, it held that waiver-based remands fall within § 1447(c) and are thus unreviewable.47 But that decades-old decision carries little persuasive force—for three reasons. First, although the Ninth Circuit cited Weaver for the proposition that waiver-based remands are unreviewable under § 1447(c), it never expressly endorsed Weaver’s mistaken premise that waiver affects jurisdiction.48 Second, the Ninth Circuit offered no independent reasoning—only bare reliance on Weaver. But because Weaver itself offered no justification, the Ninth Circuit’s rote recitation of Weaver’s conclusion adds no persuasive weight. Finally, the Ninth Circuit’s reference to Weaver appears to have been dicta.49 The remand order under review rested not only on waiver, but also on untimely removal—an independent and mandatory ground for remand. As the Ninth Circuit acknowledged, that timeliness defect independently barred appellate review.50 And the opinion’s final sentence confirms that it was this timeliness defect—not the finding of waiver—that ultimately deprived the court of appellate jurisdiction.51

In short, waiver is not jurisdictional. That conclusion follows from first principles and is confirmed by the overwhelming weight of circuit authority. Weaver is analytically unsound and widely discredited. We now join the prevailing view and make explicit what the law already implies: waiver-based remand orders do not fall within § 1447(d)’s bar to appellate review.

D

Reluctant to defend Weaver’s faulty analysis, Abraham Watkins wisely concedes what settled authority has long made clear: waiver has no bearing on subject-matter jurisdiction. Instead, the firm seeks to rehabilitate Weaver by reimagining its rationale. According to Abraham Watkins, Weaver did not rest on the view that waiver-based remands implicate subject-matter jurisdiction. Rather, the firm contends that Weaver treated waiver as a defect in the removal process—the second category of remands covered by § 1447(c), and therefore shielded from review under § 1447(d).

That revisionist reading fails for two reasons. First, it is simply not what Weaver held. Second, even if Weaver had framed waiver as a removal defect, that rationale is no more defensible than the flawed premise that waiver is jurisdictional.

First, Abraham Watkins’s reimagined reading of Weaver defies any plausible interpretation of the opinion. Weaver held that waiver-based remand orders are unreviewable under § 1447(c) because they implicate jurisdiction—not because they involve a defect in the removal process. The plain language of Weaver makes that clear. Consider the relevant passage:

Even though the specific language of § 1447(c) was not used, it seems apparent that at the time of the remand order, Judge Edenfield believed the case was not removable, leading to the logical inference that he felt jurisdiction was lacking. Such a holding is within the guidelines of § 1447(c).52 At the time Weaver was decided, § 1447(c) governed cases “removed improvidently and without jurisdiction.”53 Although the statute used the conjunction “and,” courts consistently read it disjunctively—recognizing two independent grounds for remand.54 Accordingly, Weaver’s conclusion that waiver-based remands fall within § 1447(c)’s unreviewable scope must have rested on one of two rationales: either that waiver rendered the removal “improvident” or that it implicated jurisdiction. The quoted passage leaves no doubt as to which rationale Weaver adopted: it treated waiver as a jurisdictional bar.

Abraham Watkins resists that straightforward conclusion. It urges us to read Weaver as saying the opposite of what it plainly states—that waiver reflects an “improvident” removal, not a jurisdictional one. To be sure, “jurisdiction” is a capacious term, and courts once applied it in what the Supreme Court has called a “‘profligate’ manner.”55 But Weaver did no such thing. Its treatment of waiver as jurisdictional is anchored in § 1447(c)’s use of that very term. In short, the decision deemed waiver-based remands unreviewable because it assumed they fell within § 1447(c)’s “without jurisdiction” category. It defies reason to recast Weaver as treating waiver as a removal defect rather than a jurisdictional flaw.

Even if Weaver could somehow be read to treat waiver-based remands as removal defects, as Abraham Watkins urges, we would still reject that reading. Characterizing waiver as a removal defect is no more defensible than calling it jurisdictional.

Though § 1447(c)’s language has evolved over time, its “defect” provision has always referred to violations of statutory requirements governing removal. A removal defect, then, arises when a defendant fails to satisfy one of the express statutory conditions for removal. Despite changes to the statutory text, courts have consistently construed § 1447(c) in line with that understanding.

When Weaver was decided, § 1447(c) applied to cases “removed improvidently and without jurisdiction.”56 Although “improvidently” might seem broad, courts gave it a narrow and precise construction.57 Indeed, both the Supreme Court and our circuit understood “removed improvidently” to mean removal in violation of statutory requirements. In Thermtron, the Supreme Court considered a remand based solely on the district court’s “heavy docket.”58 Explaining why that remand did not involve improvident removal, the Court emphasized that “there is no express statutory provision forbidding the removal of this action and that the cause was timely removed in strict compliance with 28 U.S.C. § 1446.”59 Two years later, our circuit followed suit, holding that “[r]emoval cannot have been improvident if all procedural requirements, E. g., timely filing, have been satisfied.”60 Other circuits likewise adopted narrow readings of the term “removed improvidently.”61 Thus, by the time Weaver was decided, it was well settled that “removed improvidently” referred only to violations of statutory removal requirements.

Congress appears to have endorsed that narrow construction. When Congress amended § 1447(c) in 1988 to add a timing requirement for remand motions, it also replaced “removed improvidently” with “any defect in removal procedure.”62 That change confirmed—and effectively codified— the judicial understanding that this category encompasses only statutory defects in the removal process. It is not a catch-all for all forms of improper removal.63 Unsurprisingly, courts continued to interpret § 1447(c) that way, particularly in light of the clarifying language that—apart from jurisdiction— only statutory defects are covered.64

In 1996, Congress amended the statute again—this time eliminating the phrase “removal procedure.” It now referred more broadly to “any defect other than lack of subject matter jurisdiction.”65 At first glance, that change may seem significant: by replacing “removal procedure” with “any defect,” the statute could be read to sweep more broadly—perhaps covering all nonjurisdictional grounds. But every circuit to consider the amended language—including ours—has “uniformly” rejected that expansive interpretation.66 Rather, the 1996 amendment sought to resolve a circuit split over whether § 1447(c) encompassed all statutory removal defects or only procedural ones.67 By omitting the phrase “removal procedure,” Congress clarified that § 1447(c) covers all statutory defects—whether procedural or substantive.68

The bottom line is this: a “defect” under § 1447(c) must be grounded in a statutory deficiency.69 This was true when Weaver was decided—and it remains the uniform understanding today.

Accordingly, waiver by participation cannot qualify as a defect under § 1447(c) because it is a judicially created, common-law doctrine.70 It is a “second-order prudential device” with no footing in the removal statutes.71 Because § 1447(c) defects are confined to statutory deficiencies, a finding of waiver—rooted in non-statutory, common-law principles—cannot qualify. This is the consensus view among our sister circuits.72 And Abraham Watkins offers no alternative explanation—let alone a persuasive one—for how a common-law waiver doctrine could qualify as a statutory defect.

Thus, even assuming Weaver held that waiver-based remands fall within § 1447(c) as removal defects, that holding fares no better under en banc scrutiny.

III

Weaver’s conclusion that waiver-based remand orders are unreviewable is untenable. We therefore overrule Weaver and hold that waiver through state-court participation is neither jurisdictional nor a removal defect under § 1447(c). It thus falls outside § 1447(d)’s bar on appellate review.

The parties raise additional issues on appeal.73 But our central task was to correct the flawed Weaver precedent—a task only this en banc court could undertake. Having done so, we RETURN this case to the original panel— now assured of its appellate jurisdiction—to resolve the remaining issues. James C. Ho, Circuit Judge, joined by Higginson, Circuit Judge, concurring:

I concur. I write separately to note that our decision today rightly reaffirms a basic principle of en banc rehearing—namely, that we need not decide every issue en banc, but may instead leave non-en banc worthy issues for the original panel to address. See ante, at 18 (“we RETURN this case to the original panel . . . to resolve the remaining issues”).

In so doing, we unanimously reject the occasional suggestion that our en banc court somehow has an “absolute duty to hear and decide” every issue presented in an appeal. But see, e.g., Comer v. Murphy Oil USA, 607 F.3d 1049, 1061 (5th Cir. 2010) (Dennis, J., dissenting) (asserting such a duty).

As a leading treatise observes, “[a] case that involves a question of exceptional importance can also involve questions of less general importance.” 16AA Wright & Miller, Federal Practice and Procedure § 3986.3 (5th ed.). When that happens, “the court may conclude . . . that only some of the issues in the case warrant en banc consideration.” Id. See, e.g., Asherman v. Meachum, 957 F.2d 978, 983 (2nd Cir. 1992) (“Obviously, judicial resources are needlessly used if all thirteen members of this in banc court are obliged to consider issues that can be expeditiously resolved by a panel of three judges. The possibility that the panel’s resolution of the remaining issues would precipitate renewed in banc consideration is too remote to be taken seriously.”); United States v. Padilla, 415 F.3d 211, 217 (1st Cir. 2005) (“a circumscription of the issues to be considered is well within the discretion of the en banc court”); Keohane v. Fla. Dep’t of Corr. Sec’y, 981 F.3d 994, 996 (11th Cir. 2020) (Pryor, C.J., statement respecting the denial of rehearing en banc) (“[W]e and our sister circuits have said again and again that the ‘heavy artillery’ of en banc review should be used rarely.”).

I agree and accordingly concur.