Willy v. Coastal Corp., 503 U.S. 131, 2 (1992)

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132

WILLY v. COASTAL CORP.

Opinion of the Court

legal merits, over which the court lacked jurisdiction. See Cooter & Gell v. Hartmarx Corp., 496 U. S. 384. And the District Court's interest in having rules of procedure obeyed did not disappear with the subsequent determination that it lacked subject-matter jurisdiction. United States Catholic Conference v. Abortion Rights Mobilization, Inc., 487 U. S. 72, distinguished. Pp. 135-139. 915 F. 2d 965, affirmed.

Rehnquist, C. J., delivered the opinion for a unanimous Court.

Michael A. Maness argued the cause and filed briefs for petitioner.

Michael L. Beatty argued the cause for respondents. With him on the brief were Carter G. Phillips, Mark D. Hopson, Lawrence P. Ellsworth, and Robert C. DeMoss.

Chief Justice Rehnquist delivered the opinion of the Court.

We granted certiorari to decide whether a federal district court may impose sanctions pursuant to Rule 11 of the Federal Rules of Civil Procedure in a case in which the district court is later determined to be without subject-matter jurisdiction. 501 U. S. 1216 (1991). We conclude that in the circumstances presented here it may do so.

Petitioner Willy sued respondent Coastal Corporation (Coastal or respondent) in Texas state court, raising a variety of claims relating to Coastal's decision to terminate his employment as "in-house" counsel. Petitioner alleged that he had been fired due to his refusal to participate in respondent's violation of various federal and state environmental laws. Respondent removed the case to Federal District Court, claiming original federal-question jurisdiction under 28 U. S. C. 1331, 1441. Petitioner objected to the removal, claiming that his case did not "arise under" federal law, see 1331, but the District Court disagreed and concluded that it had subject-matter jurisdiction. The District Court subsequently granted respondent's motion to dismiss for failure to

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