home *** CD-ROM | disk | FTP | other *** search
- NOTICE: This opinion is subject to formal revision before publication in the
- preliminary print of the United States Reports. Readers are requested to
- notify the Reporter of Decisions, Supreme Court of the United States, Wash-
- ington, D.C. 20543, of any typographical or other formal errors, in order that
- corrections may be made before the preliminary print goes to press.
- SUPREME COURT OF THE UNITED STATES
- --------
- No. 91-594
- --------
- AMERICAN NATIONAL RED CROSS, PETITIONER v.
- S. G. and A. E.
- on writ of certiorari to the united states court of
- appeals for the first circuit
- [June 19, 1992]
-
- Justice Souter delivered the opinion of the Court.
- The charter of the American National Red Cross autho-
- rizes the organization -to sue and be sued in courts of law
- and equity, State or Federal, within the jurisdiction of the
- United States.- 33 Stat. 600, as amended, 36 U. S. C. 2.
- In this case we consider whether that -sue and be sued-
- provision confers original jurisdiction on federal courts over
- all cases to which the Red Cross is a party, with the
- consequence that the organization is thereby authorized to
- removal from state to federal court of any state-law action
- it is defending. We hold that the clause does confer such
- jurisdiction.
- I
- In 1988 respondents filed a state-law tort action in a
- court of the State of New Hampshire, alleging that one of
- respondents had contracted AIDS from a transfusion of
- contaminated blood during surgery, and naming as defen-
- dants the surgeon and the manufacturer of a piece of
- medical equipment used during the procedure. After
- discovering that the Red Cross had supplied the tainted
- blood, respondents sued it, too, again in state court, and
- moved to consolidate the two actions. Before the state court
- decided that motion, the Red Cross invoked the federal
- removal statute, 28 U. S. C. 1441, to remove the latter
- suit to the United States District Court for the District of
- New Hampshire. The Red Cross claimed federal jurisdic-
- tion based both on the diversity of the parties and on the
- -sue and be sued- provision of its charter, which it argued
- conferred original federal jurisdiction over suits involving
- the organization. The District Court rejected respondents'
- motion to remand the case to state court, holding that the
- charter provision conferred original federal jurisdiction, see
- District Court order of May 24, 1990, reprinted at App. to
- Pet. for Cert. 18a-25a.
- On interlocutory appeal, the United States Court of
- Appeals for the First Circuit reversed. 938 F. 2d 1494
- (1991). The Court of Appeals compared the Red Cross
- charter's -sue and be sued- provision with analogous
- provisions in federal corporate charters previously exam-
- ined by this Court, and concluded that the relevant lan-
- guage in the Red Cross charter was similar to its cognates
- in the charter of the First Bank of the United States,
- construed in Bank of the United States v. Deveaux, 5
- Cranch 61 (1809), and in that of the federally chartered
- railroad construed in Bankers Trust Co. v. Texas and
- Pacific R. Co., 241 U. S. 295 (1916), in neither of which
- cases did we find a grant of federal jurisdiction. The Court
- of Appeals distinguished Osborn v. Bank of the United
- States, 9 Wheat. 738 (1824), where we reached the opposite
- result under the charter of the second Bank of the United
- States, the Court of Appeals finding it significant that the
- second Bank's authorization to sue and be sued spoke of a
- particular federal court and of state courts already pos-
- sessed of jurisdiction. The Court of Appeals also discounted
- the Red Cross's reliance on our opinion in D'Oench, Duhme
- & Co. v. Federal Deposit Ins. Corp., 315 U. S. 447 (1942),
- concluding that in that case we had -not[ed] only incidental-
- ly- that federal jurisdiction was based on the -sue and be
- sued- clause in the FDIC's charter. See 938 F. 2d, at
- 1497-1499. The Court of Appeals found support for its
- conclusion in the location of the Red Cross charter's -sue
- and be sued- provision in the section -denominat[ing]
- standard corporate powers,- id., at 1499, as well as in
- legislative history of the amendment to the Red Cross
- charter adding the current -sue and be sued- language, and
- in the different form of analogous language in other federal
- corporate charters enacted contemporaneously with that
- amendment. See id., at 1499-1500.
- We granted certiorari, 502 U. S. ___ (1991), to answer
- this difficult and recurring question.
-
- II
- Since its founding in 1881 as part of an international
- effort to ameliorate soldiers' wartime suffering, the Ameri-
- can Red Cross has expanded its activities to include, among
- others, the civilian blood-supply services here at issue. The
- organization was reincorporated in 1893, and in 1900
- received its first federal charter, which was revised in 1905.
- See American National Red Cross, Report of the Advisory
- Committee on Organization 4 (1946) (hereinafter Advisory
- Report), reprinted at App. to Brief for Appellants in No.
- 90-1873 (CA1), pp. 94, 101.
- The 1905 charter empowered the Red Cross -to sue and
- be sued in courts of law and equity within the jurisdiction
- of the United States.- Act of Jan. 5, 1905, ch. 23, 2, 33
- Stat. 600. At that time the provision would not have had
- the jurisdictional significance of its modern counterpart,
- since the law of the day held the involvement of a federally
- chartered corporation sufficient to render any case one
- -arising under- federal law for purposes of general statutory
- federal question jurisdiction. See Pacific R. Removal Cases,
- 115 U. S. 1, 14 (1885). In 1925, however, Congress restrict-
- ed the reach of this jurisdictional theory to federally
- chartered corporations in which the United States owned
- more than one-half of the capital stock. Act of Feb. 13,
- 1925, ch. 229, 12, 43 Stat. 941; codified as amended at 28
- U. S. C. 1349. Since the effect of the 1925 law on non-
- stock corporations like the Red Cross is unclear, see, e.g.,
- C.H. v. American Red Cross, 684 F. Supp. 1018, 1020-1022
- (ED Mo. 1987) (noting split in authority over whether
- 1349 applies to nonstock corporations), its enactment
- invested the charter's -sue and be sued- clause with a
- potential jurisdiction significance previously unknown to it.
- Its text, nevertheless, was left undisturbed for more than
- twenty years further, until its current form, authorizing the
- Red Cross -to sue and be sued in courts of law and equity,
- State or Federal, within the jurisdiction of the United
- States,- took shape with the addition of the term -State or
- Federal- to the 1905 language, as part of an overall revision
- of the organization's charter and by-laws, see Act of May 8,
- 1947, Pub. L. 80-47, 3, 61 Stat. 80, 81. It is this language
- upon which the Red Cross relies, and which the Court of
- Appeals held to have conferred no federal jurisdiction.
-
- III
- A
- As indicated earlier, we do not face a clean slate.
- Beginning with Chief Justice Marshall's opinion in 1809, we
- have had several occasions to consider whether the -sue and
- be sued- provision of a particular federal corporate charter
- conferred original federal jurisdiction over cases to which
- that corporation was a party, and our readings of those
- provisions not only represented our best efforts at divining
- congressional intent retrospectively, but have also placed
- Congress on prospective notice of the language necessary
- and sufficient to confer jurisdiction, see, e.g., United States
- v. Merriam, 263 U. S. 179, 186 (1923) (Congress presumed
- to intend judicially settled meaning of terms); Cannon v.
- University of Chicago, 441 U. S. 677, 696-698 (1979)
- (presuming congressional knowledge of interpretation of
- similarly worded earlier statute). Those cases therefore
- require visitation with care.
- In Deveaux, we considered whether original federal
- jurisdiction over suits by or against the first Bank of the
- United States was conferred by its charter. The language
- in point authorized the Bank ```to sue and be sued, plead
- and be impleaded, answer and be answered, defend and be
- defended, in courts of record, or any other place whatsoev-
- er,''' 5 Cranch, at 85. In the opinion written by Chief
- Justice Marshall, the Court held this language to confer no
- federal jurisdiction, reading it as a mere grant to the Bank
- of the normal corporate capacity to sue, id., at 85-86. The
- Court contrasted the charter's -sue and be sued- provision
- with one authorizing the institution of certain suits against
- the bank's officers -in any court of record of the United
- States, or of [sic] either of them,- a provision the Court
- described as -expressly authoriz[ing] the bringing of that
- action in the federal or state courts,- id, at 86. The Chief
- Justice concluded that this latter provision -evince[d] the
- opinion of congress, that the right to sue does not imply a
- right to sue in the courts of the union, unless it be ex-
- pressed,- ibid.
- The same issue came to us again 15 years later in
- Osborn. By this time Congress had established the second
- Bank of the United States, by a charter that authorized it
- -to sue and be sued, plead and be impleaded, answer and be
- answered, defend and be defended, in all state courts
- having competent jurisdiction, and in any circuit court of
- the United States.- Act of Apr. 10, 1816, ch. 44, 7, 3 Stat.
- 266, 269. In its interpretation of this language, the Court,
- again speaking through Chief Justice Marshall, relied
- heavily on its Deveaux analysis, and especially on the
- contrast developed there between the first Bank charter's
- -sue and be sued- provision and its provision authorizing
- suits against bank officers, see Osborn, 9 Wheat., at 818.
- Holding that the language of the second Bank's charter
- -could not be plainer by explanation,- ibid, in conferring
- federal jurisdiction, the Osborn Court distinguished De-
- veaux as holding that -a general capacity in the Bank to
- sue, without mentioning the Courts of the Union, may not
- give a right to sue in those Courts,- ibid.
- With the basic rule thus established, our next occasion to
- consider the issue did not arise until Bankers Trust, nearly
- a century later. The federal charter considered in that case
- authorized a railroad corporation -to sue and be sued, plead
- and be impleaded, defend and be defended, in all courts
- of law and equity within the United States.- Act of Mar.
- 3, 1871, ch. 122, 1, 16 Stat. 573, 574. Testing this
- language against that construed in Deveaux and Osborn, we
- concluded that it -d[id] not literally follow- its analogues
- considered in either of the earlier cases, 241 U. S., at 304,
- but held, nevertheless, that it had -the same generality and
- natural import- as the clause contained in the first Bank
- charter. Thus, we followed Deveaux and found in the
- failure to authorize federal court litigation expressly no
- grant of federal jurisdiction, id., at 304-305.
- Last came D'Oench, Duhme, where we held that the
- FDIC's charter granted original federal jurisdiction. That
- jurisdiction was not, we explained, -based on diversity of
- citizenship. Respondent, a federal corporation, brings this
- suit under an Act of Congress authorizing it to sue or be
- sued `in any court of law or equity, State or Federal.'- 315
- U. S., at 455-456 (citation and footnote omitted). It is
- perfectly true, as respondents stressed in argument, that in
- an accompanying footnote we quoted without comment
- another part of the same statute, providing that ```[a]ll suits
- of a civil nature at common law or in equity to which the
- Corporation shall be a party shall be deemed to arise under
- the laws of the United States: Provided, That any such suit
- to which the Corporation is a party in its capacity as
- receiver of a State bank and which involves only the rights
- or obligations of depositors, creditors, stockholders and such
- State bank under State law shall not be deemed to arise
- under the laws of the United States,''' id., at 455-456,
- n. 2. The footnote did not, however, raise any doubt that
- the Court held federal jurisdiction to rest on the terms of
- the -sue and be sued- clause. Quite the contrary, the
- footnote's treatment naturally expressed the subordinate
- importance of the provision it quoted. While as a state
- banks's receiver the FDIC might lose the benefit of the
- deemer clause as a grant of federal jurisdiction, the -sue
- and be sued- clause would settle the jurisdictional question
- conclusively, in any case.
- B
- These cases support the rule that a congressional
- charter's -sue and be sued- provision may be read to confer
- federal court jurisdiction if, but only if, it specifically
- mentions the federal courts. In Deveaux, the Court found
- a -conclusive argument- against finding a jurisdictional
- grant in the -sue and be sued- clause in the fact that
- another provision of the same document authorized suits by
- and against bank officers -in any court of record of the
- United States, or of either of them . . . .- See 5 Cranch, at
- 86. In contrasting these two provisions the Deveaux Court
- plainly intended to indicate the degree of specificity
- required for a jurisdictional grant. That is certainly how
- the Osborn Court understood Deveaux, as it described the
- latter provision as an -express grant of jurisdiction,- 9
- Wheat., at 818, in contrast to the first Bank charter's -sue
- and be sued- provision, which, -without mentioning the
- courts of the Union,- ibid, was held merely to give the Bank
- -a general capacity . . . to sue [but not] a right to sue in
- those courts,- ibid. The Osborn Court thus found a
- jurisdictional grant sufficiently stated in the second Bank
- charter's -sue and be sued- provision, with its express
- federal reference, remarking that -[t]o infer from [Deveaux]
- that words expressly conferring a right to sue in those
- courts do not give the right, is surely a conclusion which the
- premises do not warrant,- ibid.
- Applying the rule thus established, in Bankers Trust we
- described the railroad charter's -sue and be sued- provision,
- with its want of any reference to federal courts, and,
- holding it up against its analogues in Deveaux and Osborn,
- we found it closer to the former. Finally, in D'Oench,
- Duhme we based our finding of jurisdiction on the -sue and
- be sued- provision of the FDIC charter, which mentioned
- the federal courts in general, but not a particular federal
- court.
- The rule established in these cases makes it clear that
- the Red Cross charter's -sue and be sued- provision should
- be read to confer jurisdiction. In expressly authorizing the
- organization to sue and be sued in federal courts, using
- language resulting in a -sue and be sued- provision in all
- relevant respects identical to one on which we based a
- holding of federal jurisdiction just five years before, the
- provision extends beyond a mere grant of general corporate
- capacity to sue, and suffices to confer federal jurisdiction.
-
- IV
- Respondents offer several arguments against this
- conclusion, none of which we find availing.
-
- A
- First, we can make short work of respondents' argument
- that the charter's conferral of federal jurisdiction is
- nevertheless subject to the requirements of the -well-
- pleaded complaint- rule (that the federal question must
- appear on the face of a well-pleaded complaint) limiting the
- removal of cases from state to federal court. See Brief for
- Respondents 38-46. Respondents erroneously invoke that
- rule outside the realm of statutory -arising under- jurisdic-
- tion, i.e., jurisdiction based on 28 U. S. C. 1331, to
- jurisdiction based on a separate and independent jurisdic-
- tional grant, in this case, the Red Cross charter's -sue and
- be sued- provision. The -well-pleaded complaint- rule
- applies only to statutory -arising under- cases, see
- Verlinden B.V. v. Central Bank of Nigeria, 461 U. S. 480,
- 494 (1983); see also 13B Wright, Miller & Cooper, Federal
- Practice and Procedure 3566, pp. 82-83 (2d ed. 1984);
- Chemerinsky & Kramer, Defining the Role of the Federal
- Courts, 1990 B. Y. U. L. Rev. 67, 75, n. 17; it has no
- applicability here.
- B
- Respondents also claim that language used in congres-
- sional charters enacted closely in time to the 1947 amend-
- ment casts doubt on congressional intent thereby to confer
- federal jurisdiction over cases involving the Red Cross.
- Respondents argue that the 1948 amendment to the charter
- of the Commodity Credit Corporation (CCC), the 1947
- amendment to the charter of the Federal Crop Insurance
- Corporation (FCIC), and the 1935 amendment to the FDIC's
- charter, each of which includes explicit grants of federal
- jurisdiction, together demonstrate -a practice of using clear
- and explicit language to confer federal jurisdiction over
- corporations [Congress] had created.- Brief for Respondents
- 27.
- The argument does not hold up. The CCC amendment is
- irrelevant to this enquiry, as it conferred exclusive, rather
- than concurrent, federal jurisdiction, see Act of June 29,
- 1948, ch. 704, 4, 62 Stat. 1070. There is every reason to
- expect Congress to take great care in its use of explicit
- language when it wishes to confer exclusive jurisdiction,
- given our longstanding requirement to that effect. Its
- employment of explicitly jurisdictional language in the
- CCC's case thus raises no suggestion that its more laconic
- Red Cross amendment was not meant to confer concurrent
- federal jurisdiction.
- Nor do the other two enactments support respondents'
- argument. The statutes were passed twelve years apart
- and employed verbally and doctrinally distinct formulations.
- Compare Banking Act of 1935, ch. 614, 101, 49 Stat. 684,
- 692 (providing that suits involving FDIC -shall be deemed
- to arise under the laws of the United States-) with Act of
- Aug. 1, 1947, ch. 440, 7, 61 Stat. 719 (providing that FCIC
- -may sue and be sued in its corporate name in any court of
- record of a State having general jurisdiction, or in any
- United States district court, and [that] jurisdiction is hereby
- conferred upon such district court to determine such
- controversies without regard to the amount in controver-
- sy-). These differences are not merely semantic: the
- jurisdictional effect of the FDIC's provision depends on the
- 28 U. S. C. 1331 grant of general federal question jurisdic-
- tion, while the FCIC's provision functions independently of
- 1331. These differences of both form and substance belie
- respondents' claim of a coherent drafting pattern against
- which to judge the ostensible intent behind the Red Cross
- amendment.
- If, indeed, respondents' argument could claim any
- plausibility, it would have to be at the cost of ignoring the
- 1942 D'Oench, Duhme opinion citing the FDIC charter's
- -sue and be sued- provision as the source of federal jurisdic-
- tion in that case, see 315 U. S., at 455. If the -sue and be
- sued- clause is sufficient for federal jurisdiction when it
- occurs in the same charter with the language respondents
- claim to be at odds with its jurisdictional significance, it is
- certainly sufficient standing alone. In any event, the fact
- that our opinion in D'Oench, Duhme was handed down
- before the 1947 amendment to the Red Cross charter
- indicates that Congress may well have relied on that
- holding to infer that amendment of the Red Cross charter's
- -sue and be sued- provision to make it identical to the
- FDIC's would suffice to confer federal jurisdiction, see, e.g.,
- Cannon, supra, 441 U. S., 696-697. Congress was, in any
- event, entitled to draw the inference.
-
- C
- Respondents would have us look behind the statute to
- find quite a different purpose when they argue that the
- 1947 amendment may have been meant not to confer
- jurisdiction, but to clarify the Red Cross's capacity to sue in
- federal courts where an independent jurisdictional basis
- exists. See Brief for Respondents 23-27. The suggestion is
- that Congress may have thought such a clarification
- necessary after passage of the 1925 statute generally
- bringing an end to federal incorporation as a jurisdictional
- basis. See 28 U. S. C. 1349. But this suggestion
- misconstrues 1349 as somehow affecting a federally
- chartered corporation's capacity to sue, when by its own
- terms it speaks only to jurisdiction. If, then, respondents
- are correct that the enactment of 1349 motivated the 1947
- amendment, that motivation cuts against them, given that
- 1349 affected only jurisdiction.
- The legislative history of the 1947 amendment cuts
- against them, as well, to the extent it points in any direc-
- tion. Congress's revision of the charter was prompted by,
- and followed, the recommendations of a private advisory
- committee of the Red Cross. See H. R. Rep. No. 337, 80th
- Cong., 1st Sess., 6 (1947) (-[The 1947 amendment] was
- drafted as the result of recommendations made by [the
- Advisory committee] . . . . [They] incorporat[e] the recom-
- mendations of th[at] advisory committee . . . .-); S. Rep.
- No. 38, 80th Cong., 1st Sess., 1 (1947) (-The present legisla-
- tion incorporates, in the main, the recommendations of the
- [A]dvisory committee-). The Advisory Report had recom-
- mended that -[t]he charter should make it clear that the
- Red Cross can sue and be sued in the Federal Courts,-
- reasoning that -[t]he Red Cross has in several instances
- sued in the Federal Courts, and its powers in this respect
- have not been questioned. However, in view of the limited
- nature of the jurisdiction of the Federal Courts, it seems
- desirable that this right be clearly stated in the Charter.-
- Advisory Report 35-36, reprinted at App. to Brief for
- Appellants in No. 90-1873 (CA1), pp. 132-133.
- The Advisory Report's explicit concern with the limited
- jurisdiction of the federal courts indicates that the recom-
- mended change, which prompted the amendment to the
- -sue and be sued- provision, spoke to jurisdiction rather
- than capacity to sue. Against this, respondents argue only
- that the Advisory Report's use of the words -can- and
- -power- indicate concern with the latter, not the former.
- See Brief for Respondents 25. This is fine parsing, too fine
- to overcome the overall jurisdictional thrust of the Report's
- recommendation.
- In a final look toward the text, respondents speculate
- that the 1947 amendment can be explained as an attempt
- to clarify the Red Cross's capacity to enter the federal
- courts under their diversity jurisdiction. See Brief for
- Respondents 25-26, 29. The argument turns on the theory
- that federally chartered corporations are not citizens of any
- particular State, and thus may not avail themselves of
- diversity jurisdiction, see id., at 26 (quoting Walton v.
- Howard University, 683 F. Supp. 826, 829 (DC 1987)).
- Respondents completely fail, however, to explain how the
- addition of the words -State or Federal- to the -sue and be
- sued- provision might address this claimed jurisdictional
- problem. Indeed, the 1947 amendment, by specifying the
- particular courts open to the Red Cross, as opposed to the
- Red Cross's status as a party, seems particularly ill-
- suited to rectifying an asserted party-based jurisdictional
- deficiency.
- Perhaps most obviously, respondents' argument violates
- the ordinary sense of the language used, as well as some
- basic canons of statutory construction. The 1905 charter,
- authorizing the Red Cross -to sue and be sued in courts of
- law and equity within the jurisdiction of the United States,-
- simply cannot be read as failing to empower the Red Cross
- to sue in federal courts having jurisdiction. That fact, when
- combined with the Advisory Report's justification of the
- 1947 amendment by reference to federal courts' limited
- jurisdiction, see supra, leaves it extremely doubtful that
- capacity to sue simpliciter motivated that amendment.
- Indeed, the Red Cross's clear preamendment capacity to sue
- in federal courts calls into play the canon of statutory
- construction requiring a change in language to be read, if
- possible, to have some effect, see, e.g., Brewster v. Gage,
- 280 U. S. 327, 337 (1930); 2A N. Singer, Sutherland
- Statutory Construction 46.06 (5th ed. 1992), a rule which
- here tugs hard toward a jurisdictional reading of the 1947
- amendment.
-
- V
- Our holding leaves the jurisdiction of the federal courts
- well within Article III's limits. As long ago as Osborn, this
- Court held that Article III's -arising under- jurisdiction is
- broad enough to authorize Congress to confer federal court
- jurisdiction over actions involving federally chartered
- corporations, see 9 Wheat., at 823-828. We have consis-
- tently reaffirmed the breadth of that holding. See Pacific
- R. Removal Cases, 115 U. S., at 11-14; In re Dunn, 212 U.
- S. 374, 383-384 (1909); Bankers Trust, 241 U. S., at
- 305-306; Puerto Rico v. Russell & Co., 288 U. S. 476, 485
- (1933); Verlinden, 461 U. S., at 492 (1983). We would be
- loathe to repudiate such a longstanding and settled rule, on
- which Congress has surely been entitled to rely, cf. Pennsyl-
- vania v. Union Gas Co., 491 U. S. 1, 34-35 (1989) (Scalia,
- J., concurring in part and dissenting in part), and this case
- gives us no reason to contemplate overruling it.
-
- VI
- The judgment of the Court of Appeals is reversed, and the
- case is remanded for proceedings consistent with this
- opinion.
-