Under 28 U.S.C. §§ 1447(c) and (d), remand orders in removed cases are immune from appellate review when they are based on a lack of subject matter jurisdiction. Until recently, all appellate courts that had addressed the issue had concluded that when a district court declines to exercise supplemental jurisdiction under 28 U.S.C. § 1367(c) and remands the supplemental claims to state court, the remand is not based on a lack of subject matter jurisdiction and is therefore reviewable on appeal. In HIF Bio, Inc. v. Yung Shin Pharmaceuticals Industrial Co., however, the United States Court of Appeals for the Federal Circuit became the first circuit to hold that such remands, sometimes referred to as Cohill remands, are based on a jurisdictional defect and therefore are not subject to appellate review. On October 14, 2008, the Supreme Court granted certiorari in HIF Bio to resolve the circuit split created by the Federal Circuit. The Court heard oral argument in the case, now captioned Carlsbad Technology, Inc. v. HIF Bio, Inc., on February 24, 2009.
This Essay provides a brief explanation of § 1367 and §§ 1447(c) and (d) and argues that the Supreme Court should reverse the Federal Circuit’s decision in HIF Bio. We contend that the Federal Circuit erred in concluding that Cohill remands are subject-matter jurisdictional because a district court does not remand supplemental claims based on its lack of power over the claims. Instead, a district court remands supplemental claims based on its discretionary decision under § 1367(c) that a state court is a better forum in which to litigate them. After establishing that Cohill remands are not subject-matter jurisdictional and therefore are reviewable on appeal, we examine the district court’s remand order and the Federal Circuit’s opinion in HIF Bio. We assert that in reviewing the remand order in HIF Bio and deciding that Cohill remands fall within §§ 1447(c) and (d), the Federal Circuit incorrectly applied the Supreme Court’s recent decision in Powerex Corp. v. Reliant Energy Services, Inc. Finally, we offer a few comments about whether Cohill remands should be reviewable on appeal.