Case of the Sewing MacHine Companies
21 L. Ed. 914, 85 U.S. 553, 18 Wall. 553 (1874)
Rule of Law:
For a case to be removable from state court to federal court based on diversity of citizenship and claims of prejudice or local influence under the Act of March 2, 1867, all the plaintiffs or all the defendants seeking removal must be non-residents of the state where the suit is brought and must join in the petition for removal, unless the case involves a separate and distinct controversy against an alien or non-resident defendant as provided by the Act of July 27, 1866.
Facts:
- Corporation plaintiffs paid certain sums of money for patent rights to construct, use, and vend patented sewing machines from the corporation defendants.
- The plaintiffs alleged that the defendant corporations overcharged them by failing to reduce patent fees as stipulated, even though the defendants granted licenses to other parties at lower rates.
- The corporation plaintiffs initiated an action at law in the Supreme Judicial Court of Massachusetts to recover these alleged overpayments.
- The defendants named in the suit were the Grover & Baker Sewing Machine Company (a Massachusetts corporation), the Wheeler & Wilson Manufacturing Company (a Connecticut corporation), and the Singer Manufacturing Company (a New York corporation).
Procedural Posture:
- Corporation plaintiffs instituted an action at law against the Grover & Baker Sewing Machine Company, Wheeler & Wilson Manufacturing Company, and Singer Manufacturing Company in the Supreme Judicial Court of Massachusetts (state trial court) to recover alleged overpayments.
- The Grover & Baker Sewing Machine Company, being a Massachusetts corporation, entered an appearance and filed an answer.
- The Wheeler & Wilson Manufacturing Company (a Connecticut corporation) and the Singer Manufacturing Company (a New York corporation) subsequently appeared, filed answers, and filed separate petitions for removal of the cause to the Circuit Court for that district, citing the Act of March 2, 1867.
- The Supreme Judicial Court of Massachusetts refused to grant the petitions for removal and directed the parties to proceed to trial.
- Following this ruling, the case proceeded to trial in the state court, which resulted in a verdict and judgment for the plaintiffs.
- The defendants (appellants here) then sought review by the United States Supreme Court via a writ of error, challenging the state court's denial of their removal petitions.
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Issue:
Does the Act of March 2, 1867, permit the removal of an entire state court suit to federal court by only some non-resident defendants, when other co-defendants are citizens of the forum state, on grounds of prejudice or local influence?
Opinions:
Majority - Mr. Justice Clifford
No, the Act of March 2, 1867, does not permit the removal of an entire state court suit to federal court by only some non-resident defendants when co-defendants are citizens of the forum state, on grounds of prejudice or local influence, unless all non-resident parties on one side join the petition for removal. The Court reasoned that federal courts derive their judicial power solely from acts of Congress, and such jurisdiction must be strictly construed. The Judiciary Act of 1789, as interpreted in cases like Strawbridge v. Curtiss, established the 'complete diversity' rule, requiring that all parties on one side of a dispute be citizens of different states from all parties on the other side for diversity jurisdiction. While the Act of July 27, 1866, created a limited exception for removal by an alien or non-resident defendant in cases with severable controversies that could be 'finally determined without the presence of the other defendant or defendants,' the Act of March 2, 1867, did not alter the fundamental requirement for non-severable cases. The 1867 Act expanded removal rights to non-resident plaintiffs and relaxed the timing for removal petitions but did not eliminate the underlying principle that all plaintiffs or all defendants seeking removal must be non-residents and join in the petition. The Court stated it is a 'great mistake to suppose that any such right is conferred by that act where one or more of the plaintiffs or one or more of the petitioning defendants are citizens of the State in which the suit is pending' without explicit statutory language to that effect, which it found lacking.
Dissenting - Justices Miller and Bradley
Justices Miller and Bradley dissented from the Court's opinion regarding the construction of the Act of March 2, 1867, believing that the act should be interpreted more broadly to allow removal in such circumstances, and for that reason, dissented from the judgment.
Analysis:
This case significantly reinforces the principle that federal courts are courts of limited jurisdiction, emphasizing the strict construction of statutory grants of removal jurisdiction. It solidifies the 'complete diversity' rule established in Strawbridge v. Curtiss as a foundational element of diversity jurisdiction, clarifying that subsequent removal acts, like the Act of 1867, expanded specific aspects of removal (e.g., timing, plaintiff's right to remove) but did not fundamentally alter the requirement for all relevant parties to be diverse and join the petition for removal in non-severable cases. This strict interpretation limits the scope of federal intervention in state court disputes, ensuring that only those cases precisely defined by Congress enter the federal system and preventing individual non-resident defendants from unilaterally removing an entire case when resident co-defendants exist.
