City of Chicago v. International College of Surgeons, 522 U.S. 156 (1997)

City of Chicago v. International College of Surgeons

No. 96-910

Argued October 14, 1997
Decided December 15, 1997
522 U.S. 156

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

Syllabus

Following the Chicago Landmarks Commission’s preliminary determination that two of respondent ICS’s buildings qualified for protection under the city’s Landmarks Ordinance, the city enacted a Designation Ordinance creating a landmark district that included the buildings. ICS then applied to the Commission for permits to allow demolition of all but the facades of the buildings. The Commission denied ICS’s permit applications. ICS then filed actions in state court under the Illinois Administrative Review Law for judicial review of the Commission’s decisions, alleging, among other things, that the two ordinances and the manner in which the Commission conducted its proceedings violated the Federal and State Constitutions, and seeking on-the-record review of the Commission’s decisions. Petitioners (collectively the City) removed the suits to federal district court on the basis of federal question jurisdiction. The District Court consolidated the cases, exercised supplemental jurisdiction over the state law claims, and granted summary judgment for the City, ruling that the ordinances and the Commission’s proceedings were consistent with the Federal and State Constitutions, and that the Commission’s findings were supported by the evidence, and were not arbitrary and capricious. The Seventh Circuit reversed and remanded to state court, ruling that a federal district court lacks jurisdiction of a case containing state law claims for on-the-record review of local administrative action.

Held: a case containing claims that local administrative action violates federal law, but also containing state law claims for on-the-record review of the administrative findings, can be removed to federal district court. Pp. 163-174.

(a) The District Court properly exercised federal question jurisdiction over ICS’s federal claims, and properly recognized that it could thus also exercise supplemental jurisdiction over ICS’s state law claims. Defendants generally may remove "any civil action brought in a State court of which the [federal] district courts . . . have original jurisdiction." 28 U.S.C. § 1441(a). The district courts’ original jurisdiction encompasses cases "arising under the Constitution, laws, or treaties of the United States," § 1331, and an action satisfies this requirement when the plaintiff’s well pleaded complaint raises issues of federal law, Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63. ICS’s state court complaints raised a number of such issues in the form of various federal constitutional challenges to the Landmarks and Designation Ordinances, and to the manner in which the Commission conducted its proceedings. Once the case was removed, ICS’s state law claims were properly before the District Court under the supplemental jurisdiction statute. That statute provides,

in any civil action of which the district courts have original jurisdiction, the[y] shall have supplemental jurisdiction over all other claims that . . . form part of the same case or controversy.

§ 1367(a). Here, ICS’s state law claims are legal "claims" in the sense that that term is generally used to denote a judicially cognizable cause of action, and they and the federal claims derive from a common nucleus of operative fact, see Mine Workers v. Gibbs, 383 U.S. 715, 725. Pp. 163-166.

(b) ICS’s argument that the District Court lacked jurisdiction because its complaints contained state law claims requiring deferential, on-the-record review of the Commission’s decisions stems from the erroneous premise that those claims must be "civil actions" within the federal courts’ "original jurisdiction" under § 1441(a) for removal purposes. Because this is a federal question case, the District Court’s original jurisdiction derives not from ICS’s state law claims, but from its federal claims, which satisfy § 1441(a)’s requirements. Having thus established federal jurisdiction, the relevant inquiry respecting the accompanying state claims is whether they fall within a district court’s supplemental jurisdiction, and that inquiry turns on whether they satisfy § 1367(a)’s requirements. ICS’s proposed approach would effectively read the supplemental jurisdiction statute out of the books: the whole point of supplemental jurisdiction is to allow the district courts to exercise pendent jurisdiction over claims as to which original jurisdiction is lacking. Pp. 166-168.

(c) This Court also disagrees with ICS’s reasoning to the extent ICS means to suggest that a claim involving deferential review of a local administrative decision can never be "so related to claims . . . within . . . original jurisdiction that [it] form[s] part of the same case or controversy" for purposes of supplemental jurisdiction under § 1367(a). While Congress could establish an exception to supplemental jurisdiction for such claims, the statute, as written, bears no such construction, as it confers jurisdiction without reference to the nature of review. Nor do Chicago, R. I. & P. R. Co. v. Stude, 346 U.S. 574, 581, and 367 U.S. 348Horton v.Liberty Mut. Ins. Co., 367 U.S. 348, 354-355, require that an equivalent exception be read into the statute. To the extent that these cases might be read to establish limits on the scope of federal jurisdiction, they address only whether a cause of action for judicial review of a state administrative decision is within the district courts’ original jurisdiction under the diversity statute, § 1332, not whether it is a claim within the district courts’ pendent jurisdiction in federal question cases. Even assuming, arguendo, that the decision are relevant to the latter question, both indicate that federal jurisdiction generally encompasses judicial review of state administrative decisions. See Stude, supra, at 578-589; Horton, supra, at 352. Pp. 168-172.

(d) That § 1367(a) authorizes district courts to exercise supplemental jurisdiction over state law claims for on-the-record review of administrative decisions does not mean that the jurisdiction must be exercised in all cases. The district courts can decline to exercise pendent jurisdiction over such claims in the interests of judicial economy, convenience, fairness, and comity. See Carnegie-Mellon v. Cohill, 484 U.S. 343, 357; Gibbs, supra, at 726-727. The supplemental jurisdiction statute enumerates situations in which district courts can refuse to exercise supplemental jurisdiction, § 1367(c), taking into account such factors as the circumstances of the particular case, the nature of the state law claims, the character of the governing state law, and the relationship between the state and federal claims. District courts also may be obligated not to decide state law claims (or to stay their adjudication) where one of the abstention doctrines applies. See, e.g., Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 716. Pp. 172-174.

(e) ICS’s contentions that abstention principles required the District Court to decline to exercise supplemental jurisdiction, and that the court should have done so under § 1367(c), are left for the Seventh Circuit to address in the first instance. P. 174.

91 F.3d 981 reversed and remanded.

O’CONNOR, J., delivered the opinion of the Court, in which REHNQUIST, C. J., and SCALIA, KENNEDY, SOUTER, THOMAS, and BREYER, JJ., joined. GINSBURG, J., filed a dissenting opinion, in which STEVENS, J., joined, post, p. 175.