HAYNES, Circuit Judge:
Our prior opinion is withdrawn, and the following is substituted in its place. Defendants-Appellants appeal the district court's order of remand on the basis that the district court lacked the discretion to abstain from hearing the case. Because we conclude that the district court could not permissively abstain and equitably remand under 28 U.S.C. §§ 1334(c)(1) and 1452(b) without considering the Chapter 15 bankruptcies, we REVERSE the district court's decision to remand the case to state court and REMAND the case to the district court for consideration under its bankruptcy jurisdiction.
Plaintiffs-Appellees are three Louisiana resident pension funds. Plaintiffs invested in a leveraged feeder fund located in the Cayman Islands (the "Leveraged Fund"). The Leveraged Fund was part of a larger fund, the Fletcher Income Arbitrage Fund, Ltd. (the "Arbitrage Fund"). In June 2012, the master fund entity, of which the Leveraged Fund and the Arbitrage Fund were a part, filed a voluntary petition for bankruptcy under Chapter 11 in the Bankruptcy Court for the Southern District of New York.
Plaintiffs sued Defendants, various organizations and individuals involved in the transaction, in Louisiana state court in March 2013. Plaintiffs accused Defendants of violating various Louisiana securities laws, among other state law claims. Plaintiffs later amended the petition to add Skadden, Arps, Slate, Meagher & Flom, L.L.P. ("Skadden") as a defendant. In June 2013, Defendants removed the case to federal district court based on the related Chapter 11 bankruptcy. Additionally, Defendants argued that the federal court had diversity jurisdiction, as Skadden was improperly joined.
In January 2014, the Leveraged Fund and the Arbitrage Fund, through Cayman liquidators, filed voluntary petitions under Chapter 15 in the S.D.N.Y. Bankruptcy Court. See In re FIA Leveraged Fund, No. 14-10093 (Bankr.S.D.N.Y. Feb. 27, 2014) (order recognizing foreign main proceeding); In re Fletcher Income Arbitrage Fund Ltd., No. 14-10094 (Bankr.S.D.N.Y. Feb. 27, 2014) (order recognizing foreign main proceeding). Defendants notified the district court of these bankruptcies in a supplemental memorandum in further support of their motion to dismiss and their opposition to Plaintiffs' motion to remand.
In June 2014, the magistrate judge issued a report recommending that the district court grant the motion to remand. The report found that the district court had subject matter jurisdiction under 28 U.S.C. § 1334(b) because the case was related to the Chapter 11 filing. The report considered and rejected Plaintiffs' argument that the district court must abstain under § 1334(c)(2). Though it found that mandatory abstention did not apply, the report recommended that the district court permissively abstain from exercising that jurisdiction and equitably remand under 28 U.S.C. §§ 1334(c)(1) and 1452(b). The report did not address the Chapter 15 bankruptcies as part of this analysis, though it noted the existence of the bankruptcies in a footnote.
Over Defendants' objection, the district court adopted the report and recommendation. The district court stated that it would remand the case "pursuant to 28 U.S.C. § 1334(c)(1) and 28 U.S.C. § 1452(b)." The district court did not address diversity jurisdiction or the Chapter
Defendants timely appealed. Defendants argue that the district court erred by permissively abstaining and equitably remanding the case (1) without considering diversity jurisdiction and (2) in spite of the Chapter 15 bankruptcies. As we conclude that the district court erred in remanding the case in light of the Chapter 15 bankruptcies, we do not address Defendants' first argument regarding diversity jurisdiction.
We must first determine whether we have appellate jurisdiction.
However, there are limited circumstances under which we may review a remand order. See In re Shell Oil Co., 932 F.2d 1523, 1528 (5th Cir.1991) ("[W]here an exception to non-reviewability exists, an appellate court has jurisdiction to review the remand order...." (quotation marks and citation omitted)). The Supreme Court has held that provisions barring review do not apply if the district court exceeds its statutorily-defined authority to remand. See, e.g., Thermtron Prods., Inc. v. Hermansdorfer, 423 U.S. 336, 351, 96 S.Ct. 584, 46 L.Ed.2d 542 (1976) (holding that the district judge, who remanded a properly removed case where there was diversity jurisdiction, exceeded statutory authority when he remanded that case based on efficiency).
Though § 1447(d) is not at issue here,
We therefore recognize a limited exception to the nonreviewability provisions of §§ 1334(c)(1) and 1452(b), but only for cases that involve permissive abstention and are related to Chapter 15 bankruptcies.
We limit this holding to only Chapter 15-related cases that are remanded based on § 1334(c)(1) permissive abstention. We need not — and do not — resolve whether appellate jurisdiction exists to review a § 1452(b) remand order that is based on § 1334(c) abstention in a case that does not relate to a Chapter 15 bankruptcy.
Turning to the merits of the appeal, Defendants argue that the district court exceeded its statutory authority by permissively abstaining and equitably remanding this lawsuit even though it relates to Chapter 15 bankruptcy cases.
§ 1334(c)(1) (emphasis added).
We have not previously addressed the extent to which this provision bars permissive abstention in Chapter 15 bankruptcy cases. There are two possible interpretations of the subsection. First, the phrase "[e]xcept with respect to a case under chapter 15 of title 11" could mean that § 1334(c)(1) only excepts the Chapter 15 bankruptcy itself. See, e.g., Abrams v. Gen. Nutrition Cos., 2006 WL 2739642, at *7 (D.N.J. Sept. 25, 2006) (unpublished) (adopting this interpretation). Second, the phrase could mean that both the Chapter 15 case itself and cases "arising in or related to" Chapter 15 cases are excluded. See, e.g., British Am. Ins. Co. v. Fullerton (In re British Am. Ins. Co.), 488 B.R. 205, 238-39 (Bankr.S.D.Fla.2013) (adopting the
We hold that the latter interpretation is more consistent with the plain language and purpose of the statute. If one reads the rest of the subsection after the initial clause, the subsection clearly distinguishes between a "case" and a "proceeding." The "case" arises under title 11; the statute permits a court to abstain from a "particular proceeding" that arises under title 11 or arises in or relates to the "case." See § 1334(c)(1). We understand the word "case" to mean the same thing in the initial clause that it does in the rest of the subsection. See Sullivan v. Stroop, 496 U.S. 478, 484, 110 S.Ct. 2499, 110 L.Ed.2d 438 (1990) ("[I]dentical words used in different parts of the same act are intended to have the same meaning." (citation and quotation marks omitted)). Reading the initial clause in context, the subsection indicates that a court may abstain from "a particular proceeding arising under title 11 or arising in or related to a case under title 11" but not from a proceeding "with respect to a case under Chapter 15 of title 11." § 1334(c)(1).
The district court also relied on § 1452 to equitably remand. Though § 1452 does not explicitly exclude Chapter 15 cases, several courts have held that § 1334(c) should be read in pari materia with § 1452(b). See, e.g., Lazar v. California (In re Lazar), 237 F.3d 967, 981 (9th Cir.2001) (quoting Sec. Farms v. Int'l Bhd. of Teamsters, 124 F.3d 999, 1010 (9th Cir. 1997)); see also Erlenbaugh v. United States, 409 U.S. 239, 243, 93 S.Ct. 477, 34 L.Ed.2d 446 (1972) (under rule of in pari, materia, statutes that pertain to the same subject should be construed "as if they were one law" (quoting United States v. Freeman, 44 U.S. 556, 564, 3 How. 556, 11 L.Ed. 724 (1845))). Lending support to the view that the provisions should be read in pari materia, § 1452 explicitly references § 1334 to define jurisdiction over bankruptcy cases. See § 1452(a) ("A party may remove any claim or cause of action in a civil action ... to the district court for the district where such civil action is pending, if such district court has jurisdiction of such claim or cause of action under section 1334 of this title." (emphasis added)); see also United States v. Rodriguez, 60 F.3d 193, 196 (5th Cir.1995) (observing that parties' position that two provisions should be interpreted in pari materia was supported by the Federal Sentencing Guidelines' explicit reference to a Federal Rule of Criminal Procedure). Reading §§ 1334(c)(1) and 1452(b) together, then, the prohibition against abstention from proceedings related to Chapter 15 cases also applies to bar the equitable remand of those proceedings under § 1452.
In their brief,
Here, however, the propriety of removal was not in doubt: removal was proper based on the Chapter 11 proceedings, such that the district court had subject matter jurisdiction at the time of removal. The issue in our case is the propriety of remand. "[T]he ability of a party to remove a case and the ability of a court to remand a case that has been properly removed by a party are distinct concepts not necessarily subject to the same rules." Buchner v. F.D.I.C., 981 F.2d 816, 818 (5th Cir.1993). "Once the district court has assumed jurisdiction over a properly removed case ... [t]he district court's authority to remand the case to state court depends on the nature of the district court's jurisdiction over the claims that comprise the case at the time of the remand." Cuevas v. BAC Home Loans Servicing, LP, 648 F.3d 242, 248 (5th Cir.2011) (emphasis added); Adair v. Lease Partners, Inc., 587 F.3d 238, 240 (5th Cir.2009).
We hold that a district court cannot permissively abstain from exercising jurisdiction in proceedings related to Chapter 15 cases. Accordingly, we conclude that the district court erred by permissively abstaining and equitably remanding the case in the face of the Chapter 15 bankruptcies. Because we conclude that the district court's remand was in error on this basis, we do not reach Defendants' arguments regarding possible diversity jurisdiction. Accordingly, we REVERSE the district court's decision to remand the case to state court and REMAND the case to the federal district court for proceedings consistent with this opinion.