United States District Court, D. Vermont
OPINION AND ORDER
WILLIAM K. SESSIONS, III, District Judge.
Plaintiff Adam Hubacz initially filed this case in state court, seeking unpaid wages and other relief with respect to his past employment as a police officer in the Waterbury Police Department. His pleadings assert purely state law causes of action. Defendants have removed the case here, arguing that Hubacz's claims require interpretation of this Court's rulings in a related case and therefore involve "an embedded federal issue." Hubacz has moved to remand. For the reasons set forth below, Hubacz's motion to remand is GRANTED, and this case is REMANDED to the Vermont Superior Court.
Factual and Procedural Background
As alleged in the First Amended Complaint, Hubacz was first employed as an officer in the Waterbury Police Department in February 2009. In January 2012, he was placed on administrative leave and, after notice and a hearing, terminated pursuant to Vt. Stat. Ann Tit. 24, § 1932 ("Section 1932"). The stated basis for the termination was the decision of the Washington County State's Attorney to cease prosecuting Hubacz's cases.
In February 2012, Hubacz commenced an action in this Court asserting, inter alia, a federal procedural due process claim and a claim for reversal of the termination decision. The latter claim was construed as an appeal under Rule 75 of the Vermont Rules of Civil Procedure. The Rule 75 claim alleged that the Village of Waterbury Trustees had failed to comply with Section 1932's procedural and substantive requirements. Regarding substance, Hubacz argued that the Village Trustees failed to provide evidence of negligence, dereliction of duty, or conduct unbecoming an officer as required by the statute.
On April 15, 2014, this Court granted the Village's motion for summary judgment on Hubacz's procedural due process claim and granted Hubacz's motion for summary judgment on his Rule 75 appeal. Asserting supplemental jurisdiction over the Rule 75 claim, the Court found that the Village "Trustees' factual findings did not support their ruling under Section 1932, " and remanded the case to the Trustees for further proceedings. Hubacz v. Vill. of Waterbury, No. 212-cv-39, 2014 WL 1493981, at *8 (D. Vt. Apr. 15, 2014) (" Hubacz I "). The Court also invited the Village Trustees to reconsider whether recourse for firing a police officer was limited to Section 1932, citing Gadue v. Village of Essex Junction, 336 A.2d 182 (1975) and its application of Vt. Stat. Ann. tit. 24, § 1931. Id. The Court explicitly offered "no opinion with respect to Hubacz's legal entitlement to back pay, damages, or attorney's fees." Id. at *9 n.4. The Court entered a final judgment in the case, and the parties did not appeal the Court's ruling.
The Court's ruling in Hubacz I clearly contemplated additional proceedings before the Village Trustees consistent with the Court's findings and conclusions of law. The Court did not intend for its ruling to be used as a basis for Hubacz to claim a right to immediate reinstatement as an active duty police officer, or to otherwise alter the status quo that existed prior the Village Trustees' initial ruling. Rather than retain jurisdiction until the conclusion of the remanded proceedings, and with the full expectation that the intent of its ruling would be carried out, the Court issued final judgment and extinguished its federal jurisdiction.
On May 15, 2014, Hubacz filed a Complaint in the Washington Unit of the Vermont Superior Court. The Complaint alleged that Hubacz is entitled to unpaid wages and the value of other benefits dating back to the date of his termination. The Complaint also asked the state court to order (1) Hubacz's reinstatement as a police officer in the Waterbury Police Department, and (2) that any further disciplinary proceedings be brought pursuant Section 1932. All claims in the Complaint were brought under state law.
Hubacz subsequently amended his Complaint, adding a claim of illegal retaliation and requesting additional mandamus, declaratory, and/or injunctive relief. The "Factual Background" section of the Amended Complaint includes references to the Rule 75 appeal in Hubacz I, and this Court's remand to the Village Trustees. Like the original Complaint, all claims in the First Amended Complaint are brought under state law.
Hubacz's First Amended Complaint responds in part to the revised Notice of Charges issued by the Village Manager on May 23, 2014. That Notice concluded that "there is just cause under 24 VSA § 1931 to recommend that the Village Trustees terminate [Hubacz's] employment." ECF No. 7-8 at 1. As in his original Complaint, Hubacz contends that pursuant to Vermont law the Village cannot proceed under Section 1931. The Village Manager has since issued a revised Notice of Charges, dated June 20, 2014, explaining that in addition to recommending termination under Section 1931, he will recommend removal for specific acts of misconduct under Section 1932. Hubacz disputes whether such alleged misconduct may be either raised or admitted at a hearing before the Village Trustees.
On June 30, 2014, Defendants removed the case to this Court. The Notice of Removal asserts that Hubacz's Amended Complaint
seeks to collaterally attack this Court's holding in [ Hubacz I ] as well as this Court's judgment remanding this case to the Village Trustees.... The First Amended Complaint references, misrepresents, and misconstrues [ Hubacz I ], taking the position that he has already won the right to reinstatement, back pay, and other monetary damages regardless of whatever the Village Trustees might decide on remand.
ECF No. 1 at 4. Defendants thus contend that "all of the various state-law claims asserted in the First Amended Complaint are founded upon Plaintiff's misrepresentation and misconstruction of [ Hubacz I ], an embedded federal issue that lies at the heart of every one of his claims." Id. at 4-5. Defendants also submit that Hubacz I constitutes the law of the case, and that principles of federal common law and federalism require the assertion of federal question jurisdiction.
Several motions are now pending before the Court, including Defendants' motion to dismiss for failure to exhaust administrative remedies and Hubacz's motion to remand the case to state court. Because subject matter jurisdiction is a threshold issue, the Court must first address the question of whether this case was properly removed. See Macro v. Independent Health Ass'n, Inc., 180 F.Supp.2d 427, 431 (W.D.N.Y. 2001) ("[W]hen an action is removed from state court, the district court first must determine whether it has subject matter jurisdiction over the claims before considering the merits of a motion to ...