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State v. Real Parties In Interest

In the absence of extraordinary circumstances that indisputably demand removal as absolutely necessary to vouchsafe the central integrity of the federal court judgment, the All Writs Act cannot be employed as a vehicle for removal.

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Appeal from the United States District Court for the Eastern District of Texas, Texarkana

The district court entered a final judgment, incorporating a settlement agreement that supposedly ended the litigation between the State of Texas and the tobacco industry. It should have been expected that, when attorney’s fees are in the billions, a string of disputes would follow. This appeal arises from the post-settlement controversy questioning the legitimacy of the contingency fees awarded to counsel representing the state (“Private Counsel”). Texas instituted this pre-litigation discovery proceeding in state court for the purpose of investigating possible fraud and breach of fiduciary duty claims against Private Counsel. Private Counsel removed the action to federal court, claiming federal jurisdiction on the basis of the settlement agreement and further arguing that the All Writs Act, 28 U.S.C. � 1651, was applicable to protect the integrity of the court’s judgment from a collateral assault. Texas moved to remand, asserting, inter alia, the absence of federal jurisdiction based on the Eleventh Amendment. The district court, concluding that Texas had submitted itself to the jurisdiction of the federal court, denied the motion and Texas has appealed. We find no basis in this case for removal jurisdiction under the All Writs Act. We further conclude that the Texas Rule 202 discovery proceeding presents a premature basis for asserting the district court’s jurisdiction to protect the settlement agreement. We therefore reverse with instructions to remand this action to the state court from whence it came.

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