In this action, a District Court in Missouri held that it had authority to stay its own remand order. The plaintiffs brought an action under the Missouri Merchandising Practices Act. The plaintiffs alleged that the defendants placed expiration dates on their medications, causing consumers to discard products and replace them after the expiration dates had passed, with knowledge that the products remained safe and effective beyond those dates.
The defendants removed the action from the Circuit Court for St. Louis County to the District Court pursuant to CAFA. The District Court, however, held that the defendants did not meet their burden of establishing an amount in controversy that was at least $5 million, and remanded the action to the state court. The defendants then moved to stay the remand orders, arguing that equity favored issuance of a stay. The defendants also argued that the stay would prevent the parties from having to expend resources to litigate the cases simultaneously in state court and on appeal, and that it would avoid any potentially inconsistent rulings from the state court. The District Court agreed and granted the motion.
Under 28 U.S.C. § 1447(d), an order remanding a case to state court is generally not reviewable on appeal, and § 1447(c) states that when a remand order is issued by a district court, the district court is ordinarily divested of jurisdiction, allowing the state court to proceed with the case. However, the District Court explained that pursuant to §1453(c) federal courts of appeals may exercise their discretion to accept an appeal from a remand order under CAFA notwithstanding §1447(d).
The District Court reasoned that to hold that a district court lacks the limited jurisdiction to stay its remand order in a CAFA case would render the statutory right to appeal a CAFA remand order worthless. While deciding a motion to stay pending appellate review, courts must consider:
- the likelihood that a party seeking the stay will prevail on the merits of the appeal;
- the likelihood that the moving party will be irreparably harmed absent a stay;
- the prospect that others will be harmed if the court grants the stay; and
- the public interest in granting the stay.
The District Court determined that the defendants adequately demonstrated a sufficient likelihood of success on the merits to support their motions to stay because of the lack of authority on the issues. The District Court also found that the burden of having to simultaneously litigate cases in state court and on appeal, as well as the potential for inconsistent outcomes if the state court ruled on any motions while the case was pending before the Eight Circuit, demonstrated irreparable harm and favored granting the stay.
Similarly, the District Court noted that the plaintiffs’ interests would be served by granting a stay because neither party would incur additional expenses from simultaneous litigation, and plaintiffs would not be harmed by a lengthy delay because of the expedited appellate review process set forth in § 1453(a). Finally, the District Court explained that granting the stay would benefit the public’s interest by saving judicial resources and promoting judicial economy.
For these reasons, the District Court opined that a stay of the remand order was appropriate. However, the District Court explained that the parties could not seek any further relief from it until the Eighth Circuit ruled on the merits of the appeal because it lacked subject matter jurisdiction.