B.C. Rogers Poultry, Inc., and B.C. Rogers Processors, Inc. (collectively, "B.C.Rogers"), appeal a remand to state court ordered pursuant to the Burford abstention doctrine. Concluding that the court acted without the doctrine's strictures as defined by the Supreme Court, we reverse.

The State of Texas brought Employers National Insurance Company ("ENIC"), an insurance company regulated under Texas law, into state court, where it was declared insolvent and placed in receivership. Pursuant to the Texas Insurance Code, the state obtained a permanent injunction and order, appointing Jack Webb as Special Deputy Receiver ("SDR") for ENIC and enjoining any person from interfering with the state receivership court proceedings or the lawful acts of the SDR and from taking any action involving the SDR outside of the state receivership court.

Webb, carrying out his duties as SDR, brought suit in state court against B.C. Rogers, as ENIC policyholders, to collect assets--unpaid workers' compensation premiums--allegedly belonging to ENIC. Webb asserts three alternative causes of action: (1) breach of contract, (2) quantum meruit, and (3) suit on sworn account. He seeks $674,335 in damages, plus interest and attorney's fees.

B.C. Rogers removed to federal court pursuant to 28 U.S.C. § 1441, alleging original jurisdiction based on diversity of citizenship. See 28 U.S.C. § 1332. Webb sought remand, advancing three grounds: (1) B.C. Rogers had failed to comply with the removal statute, (2) the permanent injunction enjoined B.C. Rogers from litigating the dispute in a forum other than the receivership court, and (3) under the Burford abstention doctrine, the district court should refrain from exercising jurisdiction.1 The district court summarily rejected the first two bases but elected Burford abstention and remanded, holding that

[a]bstention is appropriate in this case, for if this Court were to exercise federal jurisdiction, it could well interfere with the State of Texas' efforts to effect a coherent policy on a matter of public concern, that is, the collection of assets of an insolvent insurer through a state district court receivership proceeding wherein the state district court retains continuing jurisdiction over the liquidation proceedings.

We always must be certain that our limited jurisdiction encompasses the appeal before us. See Castaneda v. Falcon, 166 F.3d 799, 801 (5th Cir.1999); Jones v. Collins, 132 F.3d 1048, 1051 (5th Cir.1998). We sua sponte requested briefing on the issue and now clarify our jurisdiction.

The order abstaining under Burford and remanding is a final order disposing of all issues. We have jurisdiction, therefore, pursuant to 28 U.S.C. § 1291. See Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 715, 116 S.Ct. 1712, 135 L.Ed.2d 1 (1996); Munich Am. Reinsurance Co. v. Crawford, 141 F.3d 585, 589 (5th Cir.1998), cert. denied, --- U.S. ----, 119 S.Ct. 539, 142 L.Ed.2d 448 (1998).

In 28 U.S.C. § 1334(d), Congress has denied us jurisdiction over an appeal from a decision to abstain under § 1334(c) (allowing abstention, in the interest of comity or respect for state law, from state law causes of action arising under, or related to, title 11). Here, the receivership proceedings in state court arose under the Texas Insurance Code, not the Bankruptcy Code. See Clark v. Fitzgibbons, 105 F.3d 1049, 1051 (5th Cir.1997) ("Insurance companies are ineligible for the protections afforded by the federal Bankruptcy Code. 11 U.S.C. § 109."). The district court, therefore, did not exercise jurisdiction over the removed action under 28 U.S.C. § 1452(a) (providing for removal of any action over which the court has jurisdiction under 28 U.S.C. § 1334) and 28 U.S.C. § 1334(b) (providing for original jurisdiction in the district courts "of all civil proceedings arising under title 11, or arising in or related to cases under title 11."). Rather, it based its jurisdiction on diversity of citizenship, found in 28 U.S.C. § 1332. The court's decision to abstain, then, did not fall within 28 U.S.C. § 1334(c), so § 1334(d) is inapposite.

Similarly, in 28 U.S.C. § 1447(d), Congress denied us jurisdiction over remands pursuant to 28 U.S.C. § 1447(c), which requires a district court to remand if it lacks subject matter jurisdiction or if the removal was defective; conversely, § 1447(d) does not preclude review of remands on other grounds.2 Neither party argues that the district court lacked subject matter jurisdiction. Rather, they dispute whether the court abused its discretion in abstaining from exercising its jurisdiction. Section 1447(d), therefore, is also inapposite, and we have jurisdiction to consider the appeal.

The Burford doctrine allows a federal court to abstain from exercising its jurisdiction in deference to complex state administrative procedures. The Supreme Court has described the Burford doctrine as follows:

Where timely and adequate state-court review is available, a federal court sitting in equity must decline to interfere with the proceedings or orders of state administrative agencies: (1) when there are "difficult questions of state law bearing on policy problems of substantial public import whose importance transcends the result in the case then at bar"; or (2) where the "exercise of federal review of the question in a case and in similar cases would be disruptive of state efforts to establish a coherent policy with respect to a matter of substantial public concern."

New Orleans Pub. Serv., Inc. v. Council of New Orleans ("NOPSI" ), 491 U.S. 350, 361, 109 S.Ct. 2506, 105 L.Ed.2d 298 (1989) (quoting Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 814, 96 S.Ct. 1236, 47 L.Ed.2d 483 (1976)).3 Essentially, Burford instructs a district court to weigh the federal interests in retaining jurisdiction over the dispute against the state's interests in independent action to uniformly address a matter of state concern, and to abstain when the balance tips in favor of the latter. See Quackenbush, 517 U.S. at 728, 116 S.Ct. 1712; NOPSI, 491 U.S. at 363, 109 S.Ct. 2506; Burford, 319 U.S. at 334, 63 S.Ct. 1098. But this "balance only rarely favors abstention." Quackenbush, 517 U.S. at 728, 116 S.Ct. 1712. Typically, "federal courts have a virtually unflagging obligation ... to exercise the jurisdiction given them." Colorado River, 424 U.S. at 821, 96 S.Ct. 1236 (quotation omitted).

In Quackenbush, the Court determined that an action seeking damages never warrants abstention. The Court examined the foundation and history of abstention doctrines, and Burford abstention in particular, finding that the power to abstain originated in "the discretion federal courts have traditionally exercised in deciding whether to provide equitable or discretionary relief." Quackenbush, 517 U.S. at 730, 116 S.Ct. 1712. The Court disagreed with the Ninth Circuit's limitation of abstention to equitable cases, instead extending the doctrine "to all cases in which a federal court is asked to provide some form of discretionary relief." Id.4 A damages action, however, allows the court no discretion and may not be remanded. Id. at 731, 116 S.Ct. 1712.5

We review an abstention for abuse of discretion. See Clark, 105 F.3d at 1051; see also Burford, 319 U.S. at 318, 63 S.Ct. 1098 (describing court's choice of whether to abstain as a matter of discretion). The exercise of discretion must "fit[ ] within the narrow and specific limits prescribed by the particular abstention doctrine involved." Clark, 105 F.3d at 1051 (quotation omitted). A court necessarily abuses its discretion when it abstains outside of the doctrine's strictures.

B.C. Rogers presents a simple argument for reversal: Under Quackenbush, a court may not remand pursuant to Burford abstention if the plaintiff seeks damages. Webb seeks damages, so a Burford abstention remand is not permitted.

Webb counters with three ultimately unsuccessful arguments. First, he cites precedent no longer applicable after Quackenbush and argues to support an exercise of discretion where no discretion exists. He next incorrectly avers that the Quackenbush rule on which B.C. Rogers relies is not ironclad. He finally contends that, because one of his causes of action sounds in the equitable doctrine of quantum meruit, Burford abstention is appropriate within Quackenbush 's limitations.6 We conclude that, because Quackenbush denies the legal authority to remand, the district court abused its discretion.

Webb vigorously argues that the usual Burford considerations support remand. The McCarran-Ferguson Act, 15 U.S.C. §§ 1011-1015, assigns primary responsibility for regulating the insurance industry to the states. Texas has enacted an extensive regulatory scheme for dealing with insolvent insurers and has an interest in applying its law to marshal efficiently all the assets of such insurers in a uniform manner. Webb contends that the federal government, on the other hand, has a "complete absence" of interest in this dispute. The causes of action sound solely in state law; no federal statutes or interests are involved.

Webb buttresses this argument by citing several of our decisions in which we have affirmed abstention and have mentioned the strong interests states have in addressing insolvent insurers.7 But these cases indicate only that we probably would find the remand to be within the court's discretion if it had acted within the bounds of the Burford doctrine.8 The analysis ignores B.C. Rogers's argument that the district court had no discretion.

Relatedly, Webb overlooks that these cited cases precede Quackenbush and the limits it imposed on abstention.9 As we explained in Munich American, we previously had approved abstention remands in cases related to insolvent insurers involved in state proceedings; but this changed with Quackenbush 's prohibition on remanding damages action. See Munich American, 141 F.3d at 589. Now a court may abstain "only when the district court has discretion to grant or deny relief." Id. Accordingly, we found that the court abused its discretion by invoking Burford, because it had no discretion in the relief sought. Id. at 590.10

Webb's argument and the cited precedent would provide a sound basis for affirming the district court's application of the Burford doctrine if it were within its discretion. Because, however, we find that the nature of Webb's claims precludes Burford abstention, we do not reach whether the Burford doctrine otherwise favors abstention on these facts.

Webb's contention that Quackenbush does not impose an ironclad, per se bar to remanding damages action lacks merit. Webb quotes a passage11 from a section in which the Court explained the roots and purpose of abstention. See Quackenbush, 517 U.S. at 727-28, 116 S.Ct. 1712. It also noted that prior caselaw does "not provide a formulaic test for determining when dismissal [or remand] under Burford is appropriate." Id. at 727, 116 S.Ct. 1712. But the Court had not even begun its application of these general principles to the case before it. When it did reach its holding, it left no exceptions: abstention is appropriate "only where the relief being sought is equitable or otherwise discretionary." Id. at 731, 116 S.Ct. 1712 (emphasis added).12

Webb makes the superficially appealing argument that the "equitable nature" of quantum meruit brings the case within Quackenbush and allows for remand. "Quantum meruit is an equitable doctrine based on the principle that one who benefits from another's labor and materials should not be unjustly enriched thereby." SMP Sales Management, Inc. v. Fleet Credit Corp., 960 F.2d 557, 560 n. 3 (5th Cir.1992). Texas courts also have noted the equitable nature of quantum meruit.13 Because the case includes this claim for equitable relief, the argument goes, it falls within Quackenbush and may be remanded.

a.

Webb reads Quackenbush too simply and fails to comprehend the complexity of quantum meruit. For Burford to apply, a federal court must be sitting in equity with the discretion to deny relief. See Quackenbush, 517 U.S. at 728, 116 S.Ct. 1712 (explaining that the power to abstain "derives from the discretion historically exercised by courts of equity."). As part of the Court's formulation of when abstention doctrines apply, the court must be sitting in equity.14

In Quackenbush, the Court emphasized a court of equity's discretion to grant or deny relief, holding that abstention based remands or dismissals are appropriate "only where the relief being sought is equitable or otherwise discretionary." Quackenbush, 517 U.S. at 731, 116 S.Ct. 1712.15 The source of the power to abstain confirms the centrality of the court's sitting in equity and hence possessing discretion in the relief afforded. See Quackenbush, 517 U.S. at 728, 116 S.Ct. 1712. That discretion allows it to deny relief; the abstention doctrines merely add that "the exercise of this discretion must reflect principles of federalism and comity." Id. When a court considers these factors, balancing state and federal interests, discretion may favor withholding relief by way of abstention-based remand or dismissal.16

This withholding of extraordinary relief by courts having authority to give it is not a denial of the jurisdiction which Congress has conferred on the federal courts.... On the contrary, it is but a recognition ... that a federal court of equity ... should stay its hand in the public interest when it reasonably appears that private interests will not suffer.... It is in the public interest that federal courts of equity should exercise their discretionary power to grant or withhold relief so as to avoid needless obstruction of the domestic policy of the states.

Alabama Pub. Serv. Comm'n v. Southern R.R., 341 U.S. 341, 350-51, 71 S.Ct. 762, 95 L.Ed. 1002 (1951).

b.

When a court hears a claim for quantum meruit, it neither sits in equity nor possesses discretion. Courts frequently refer to quantum meruit as an equitable doctrine and even as seeking equitable relief. Despite its equitable nature, however, quantum meruit is an action at law--a legal cause of action seeking money damages. Indeed, courts recognize that they do not sit in equity when they hear a quantum meruit claim,17 and they recognize that a division between equity and law places quantum meruit on the law side.18

Furthermore, in a quantum meruit action, the court lacks discretion to balance interests between the state and federal governments. Relief turns not on a weighing of the equities but on a straightforward application of law to facts. If the facts justify relief under the legal standard--a question often answered by jury--the court has no discretion to weigh the equities and decide against relief.19

Sitting at law, without discretion to deny relief, a court cannot remand a quantum meruit claim under Quackenbush. The state's interests must yield to the federal court's "strict duty to exercise the jurisdiction that is conferred upon [it] by Congress." Quackenbush, 517 U.S. at 716, 116 S.Ct. 1712. Because the district court lacked discretion to remand these damages actions, we REVERSE and REMAND for further proceedings consistent with this opinion.

My colleagues in the majority have issued a forceful opinion from which I respectfully must dissent.

My colleagues conclude that the district court abused its discretion by abstaining under Burford1 because the nature of Webb's claims precludes abstention. According to the Burford abstention doctrine, a federal court may abstain and remand a case to state court "only where the relief being sought is equitable or otherwise discretionary."2 After determining that Webb's claim for quantum meruit is an action at law--a determination that in part spurs my dissent--the majority concludes that the district court was not sitting in equity and did not possess discretion to grant or deny relief. Thus, they opine, the district court acted outside the strictures of the doctrine by abstaining. I dissent, concluding that quantum meruit more appropriately should be considered an equitable action, and fully convinced that the district court's abstention order should be affirmed.

The nature of quantum meruit is, indeed, "complex[ ]."3 The majority describes quantum meruit as an action at law--a legal cause of action seeking money damages--and cites numerous cases in support thereof. There is contrary jurisprudence describing quantum meruit as an equitable action.4 "The battle of the string citations [, however,] can have no winner."5 Thus, reflection on the Supreme Court's discussion in Quackenbush v. Allstate Insurance Company6 is appropriate.

Congress imposed upon the federal courts a duty to exercise their jurisdiction, but the statutes conferring jurisdiction were enacted against a background of traditional principles that included a court's ability to abstain in certain circumstances.7 Thus, "it has long been established that a federal court has the authority to decline to exercise its jurisdiction when it is asked to employ its historic powers as a court of equity."8 And more specifically, "the power to dismiss under the Burford doctrine ... derives from the discretion historically enjoyed by courts of equity."9 Thus, the appropriate issue to be resolved is whether courts of equity historically heard claims of quantum meruit.

Given the Supreme Court's historical emphasis, it is my perception that the focus should be upon the origin of the relief and its position at the time the federal judicial system was created, not how the cause of action has since evolved.10 The roots of quantum meruit are in the courts of equity;11 claims for quantum meruit appeared in those courts before the cause of action could be pursued at law. Claims for quantum meruit were pursued in the courts of equity at the birth of our judicial system.12 Thus, despite some indications, historically speaking, that quantum meruit was a legal cause of action,13 I am not prepared to dispositively rule that quantum meruit is a legal cause of action.

Having personally concluded that a federal court sits in equity when hearing a claim for quantum meruit,14 I continue with the Burford analysis. The Supreme Court describes the Burford abstention doctrine as follows:

Where timely and adequate state court review is available, a federal court sitting in equity must decline to interfere with the proceedings or orders of state administrative agencies: (1) when there are difficult questions of state law bearing on policy problems of substantial public import whose importance transcends the result in the case then at bar; or (2) where the exercise of federal review of the question in a case and in similar cases would be disruptive of state efforts to establish a coherent policy with respect to a matter of substantial public concern.15

The district court abstained under the second noted circumstance,16 and, in doing so, in my opinion, it did not abuse its discretion.

Prior to Quackenbush, this court and other courts consistently had approved Burford abstention in actions involving an insurance company that, in turn, was involved in ongoing state delinquency proceedings.17 Being persuaded that the holding of Quackenbush does not torpedo the district court's decision to abstain, I briefly reflect only on the remaining analysis because of the solid background of precedent upholding Burford abstention in similar situations.

Texas' regulation of the insurance industry is "a matter of substantial public concern." Congress manifestly considers such regulation a matter of public concern.18 Precedent teaches that this concern is substantial.19

Texas has established a coherent policy regulating the insurance industry. It has formulated a complex and comprehensive scheme involving numerous actors, including the Department of Insurance, the Commissioner of Insurance, as well as the District Court of Travis County. Under Texas law, the governor, with the advice and consent of the senate, appoints a Commissioner of Insurance who is charged with the primary responsibility of administering, enforcing, and executing provisions of the Insurance Code.20 Decisions by the Commissioner may be challenged by interested parties in the District Court of Travis County, "and not elsewhere."21 The Attorney General for the State of Texas is charged with representing and advising the Commissioner in all legal matters.22

Texas' comprehensive scheme also quite appropriately covers matters concerning those insurance companies that become insolvent.23 Particular financial considerations must be met before an insurance company may be incorporated in Texas,24 and the Department of Insurance is charged with monitoring the continuing performance of insurance companies.25 If the department determines that an insurance company's financial position has dipped below a prescribed level, the Commissioner must notify the company of this determination and provide the company with a list of requirements, compliance with which will absolve the earlier departmental determination.26 If, after a specified period of time, the company has not met the requirements set forth by the Commissioner and other criteria have not been met, the Commissioner must notify the Attorney General who may apply to any Travis County court for remedial action, including the appointment of a receiver.27²⁷ Texas law charges an appointed receiver with the duty of conducting the business of the delinquent insurer and conserving the assets and protecting the rights of policyholders and claimants.28 Additionally, Texas law specifies where the proceeds collected by the receiver shall be held.29 Finally, Texas law specifies that the exclusive venue for delinquency proceedings shall be in Travis County.30 It is abundantly clear that Texas indeed has established a coherent policy in this area.

I find no basis for suggesting that the district court abused its discretion in concluding that federal review of the questions presented in this case and similar cases would be disruptive of Texas' efforts to effectuate its coherent policy. Congress delegated the regulation of the business of insurance to the states,31 and Texas has created a complex and comprehensive scheme to do exactly that. The Texas legislature has concentrated judicial review of insurance proceedings in Travis County, and consequently those courts, like the Department of Insurance and the Commissioner of Insurance, have developed a specialized knowledge regarding these proceedings.32 In my view, reversing the district court and allowing this case to continue in federal court inappropriately "usurp[s]" Texas' control over the liquidation proceeding.33

Finally, Texas requires the receiver to "take such steps as may be necessary to conserve the assets ... for the purpose of liquidating ... the affairs of the insurer."34 By holding that the federal district court possessed jurisdiction over this case, the majority potentially sacrifices one of the chief purposes of the Texas regulatory scheme by effectively requiring the "dissipation of the insolvent company's funds"35 likely to result from litigation conducted outside Travis County and away from the court with the responsibility for this insurance company salvage operation.

Splintering a portion of this on-going proceeding and insisting on jurisdiction herein for the federal district court unduly threatens the scheme enacted by Texas as specifically authorized by Congress. As our courts have so forcefully noted: " 'in instances, where states have ... formulat[ed] complex and specialized administrative and judicial schemes to regulate insurers, especially the liquidation of insolvent insurers,' the federal court should abstain from exercising jurisdiction in disputes occurring in the larger context of state liquidation proceedings."36 I am in absolute agreement with this statement.III.

In sum, we should conclude that quantum meruit historically was, and therefore should be deemed to be, an equitable action and that the district court did not abuse its discretion in abstaining under Burford. I would affirm the judgment appealed.