Grable v. Darue
This case presents a question of federal jurisdiction arising from the seizure of property to satisfy a federal tax debt. In 1994, the Internal Revenue Service (IRS) seized property belonging to Grable to satisfy a tax debt. The IRS served notice of the seizure by certified mail, although 26 U.S.C. § 6335(a), the relevant statute, provides that notice must be “given” personally to the owner of the property. Grable nevertheless received actual notice of the seizure. The IRS then sold the property to Darue.
Six years later, Grable challenged the sale in Michigan state court by filing a motion to quiet title. Darue removed the case to federal district court. Grable filed a motion to remand based on the federal court's lack of subject matter jurisdiction. The district court held that it had jurisdiction to hear the case because the application of 26 U.S.C. § 6335(a) implicates a substantial federal interest, meaning that Grable’s claim was based on a federal question and was properly in federal court, and ruled in favor of Darue on the quiet title motion. The Sixth Circuit Court of Appeals affirmed, holding that Grable’s quiet title action presents a federal question because it is rooted in the Internal Revenue Code, the correct interpretation of which represents a substantial federal interest.
Question Presented:
28 U.S.C. § 1441(b) allows removal of any state civil action in which the district courts have original jurisdiction wherein the claim is founded on a right arising under the Constitution, treaties
or laws of the United States. This Court has routinely held that such removal requires both a substantial federal question and the district court must have original jurisdiction over the
action.
The question raised is, when there is a violation by the IRS of 26 U.S.C. § 6335(a) by intentionally ignoring the prerequisite provision requiring personal service of notice of seizure before
obtaining service by certified mail, whether the defendant in a state quiet title action can remove the action by claiming that the necessary interpretation of 26 U.S.C. § 6335(a) as to whether
strict compliance or substantial compliance with the statute constitutes a substantial federal question and creates original jurisdiction in the district court.
