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[08-22-08 15:26:08] PAGES PGT: OPIN

Cite as: 546 U. S. 132 (2005)

135

Opinion of the Court

with prejudice. On appeal, the Court of Appeals for the Tenth Circuit agreed with the Martins that the suit failed to satisfy the amount-in-controversy requirement. The Tenth Circuit rejected Franklin’s contention that punitive damages and attorney’s fees could be aggregated in calculating the amount in controversy, in part on the basis of decisions is­ sued after the District Court’s remand decision. The Court of Appeals reversed and remanded to the District Court with instructions to remand the case to state court. 251 F. 3d 1284, 1294 (2001). Back before the District Court, the Martins moved for at­ torney’s fees under § 1447(c). The District Court reviewed Franklin’s basis for removal and concluded that, although the Court of Appeals had determined that removal was im­ proper, Franklin “had legitimate grounds for believing this case fell within th[e] Court’s jurisdiction.” App. to Pet. for Cert. 20a. Because Franklin “had objectively reasonable grounds to believe the removal was legally proper,” the Dis­ trict Court denied the Martins’ request for fees. Ibid. The Martins appealed again, arguing that § 1447(c) re­ quires granting attorney’s fees on remand as a matter of course. The Tenth Circuit disagreed, noting that awarding fees is left to the “wide discretion” of the district court, sub­ ject to review only for abuse of discretion. 393 F. 3d 1143, 1146 (2004). Under Tenth Circuit precedent, the “ ‘key fac­ tor’ ” in deciding whether to award fees under § 1447(c) is “ ‘the propriety of defendant’s removal.’ ” Ibid. (quoting Excell, Inc. v. Sterling Boiler & Mechanical, Inc., 106 F. 3d 318, 322 (CA10 1997)). In calculating the amount in contro­ versy when it removed the case, Franklin had relied on case law only subsequently held to be unsound, and therefore Franklin’s basis for removal was objectively reasonable. 393 F. 3d, at 1148. Because the District Court had not abused its discretion in denying fees, the Tenth Circuit af­ ﬁrmed. Id., at 1151.