Exclusive Federal Claims in State Court

Exclusive Federal Claims in State Court

A few federal claims can be heard only in federal court, and some plaintiffs file them in state court anyway.¹ Copyright infringement suits belong to that small set, which means the state courts lack subject matter jurisdiction over them. Patent infringement suits belong to it as well. For removal law, the question is whether a defendant sued on such a claim may carry the case to the one court that has power over it.

For years the answer was no. Older case law refused to allow removal of such a case,² on the theory that a federal court's jurisdiction over a removed case is derivative of the state court's. The federal court received only the power the state court held, and a state court with no power over the claim left nothing to pass along. The case ended in dismissal, and the plaintiff could start over in federal court only if the limitations period had not yet run.

Congress ended the problem by adding subsection (f), which overruled those decisions.³ Under it, the court to which a civil action is removed is not precluded from hearing and determining any claim in the action because the state court lacked jurisdiction over that claim.⁴ The statute thus cuts the tie between the two courts. A federal court's power over an exclusive federal claim never came from the state court. It comes from the grant of original jurisdiction that § 1441(a) already requires of every removed action.⁵

Subsection (f) removes one obstacle and nothing more. Section 1441(a) still authorizes removal only of actions over which the district courts have original jurisdiction, so a defendant cannot remove an action the plaintiff could not have filed in federal court.⁸ The other limits on removal remain as well. Removal jurisdiction is narrower than original jurisdiction in some respects, and a diversity case, for example, cannot be removed by a defendant who is a citizen of the forum state.⁹ That bar does not trouble the Georgia defendant. The copyright claim rests on federal law, not diversity, and the in-state-defendant rule governs diversity cases only. A defendant sued in state court on a federal statute may remove.¹⁰

A patent-flavored dispute is not necessarily a removable one. Dillon and Greeley, both Kansans, are parties to a patent license, and Dillon sues Greeley in Kansas state court for unpaid royalties under it, pleading only state-law breach of contract. A royalty claim does not arise under the patent laws, so it is not an exclusive federal claim, and the state court has jurisdiction over it. The parties' common citizenship rules out diversity. Dillon could not have sued in federal court, so Greeley has nothing to remove, exactly as a state-law contract claim between two Kansans is not removable.¹¹ Subsection (f) cannot rescue the removal, because it speaks only to the state court's power, and the defect here is the absence of original federal jurisdiction. The Georgia and Kansas cases differ in one respect: whether the plaintiff's own claim arises under federal law. The subject matter of the contract does not answer that question.

Removal of an exclusive federal claim otherwise follows the ordinary route. The defendant files a notice of removal containing a short and plain statement of the grounds in the district court for the district and division where the state action is pending,¹² generally within thirty days after receiving the initial pleading.¹³ The plaintiff's remaining objections are narrow. A late removal is a procedural defect, not a jurisdictional one, so the plaintiff waives it by failing to move to remand within thirty days after removal. Only an objection that the federal court lacks subject matter jurisdiction survives that delay.¹⁴