that merely omitting a federal-law claim from an amended complaint, as occurred in Cohill itself, is a sufficient basis not to grant an otherwise proper remand to state court. The pleadings were amended early in the litigation with no prejudice to defendants, and a remand to state court would merely effectuate plaintiffs' original choice of a state forum. In such a case, the federal courts' traditional aversion to forum-shopping is not substantially implicated.
Second, defendants argue that the amended complaint continues to plead facts which would support a federal-law claim, specifically, a claim under federal securities law, 15 U.S.C. § 78(j) and Rule 10b-5. Defendants acknowledge that the amended complaint does not specifically mention any claims arising under federal securities law, and that the state court would not have jurisdiction to hear such a claim. However, defendants contend that a federal securities claim is alleged in the amended complaint and that this court can and should hear it. Plaintiffs characterize defendants' discernment of such a claim as a tortured reading of the complaint which does not withstand scrutiny. Plaintiffs further represent that the amended complaint does not allege any claims cognizable under federal law. This court agrees. The mere allegation that defendants disseminated false and misleading documents relating to the purchase of limited partnership interests, coupled with the allegation that two of the plaintiffs are non-New York residents, does not sufficiently plead a violation of federal securities laws under 15 U.S.C. § 78(j) and Rule 10b-5. See, e.g., Anspach v. Bestline Products, Inc., 382 F. Supp. 1083 (N.D. Ca. 1974) (an action alleging a violation of 15 U.S.C. § 78j(b) and Rule 10b-5 must allege with adequate specificity that an instrumentality of interstate commerce was used).
Third, defendants take the position that this case is related to a matter pending in United States District Court for the Southern District of New York before the Honorable Robert W. Sweet, Alberti et al. v. Trupin et al., 90 Civ. 3475 (RWS), and should be consolidated with that case to avoid piecemeal litigation. Plaintiffs dispute this contention, arguing that the litigation before Judge Sweet concerns an entirely different transaction involving no common facts, transactions or occurrences. Plaintiffs also note that Alberti was filed in 1990 and discovery proceedings in that case are now fully underway. Were there any merit to defendants' contention of relatedness, the proper course would have been for defendants to have disclosed their contention of relatedness at the time they removed the action to federal court. See Rule 15 of the Rules for the Division of Business Among District Judges, United States District Courts for the Southern and Eastern Districts of New York (November, 1991). The determination of relatedness would then be made by the judge presiding over the previously filed case. Id. Any contention of relatedness therefore is not properly before this court and is not relevant to the court's determination of plaintiffs' motion for a remand.
Defendants' final argument against remanding the case is that the state-law issues presented in the amended complaint are neither novel nor complex, and could be resolved by this court without encroaching upon principles of comity and state autonomy. However, the mere fact that the state-law issues presented to a federal court have been previously resolved in the state courts is not sufficient to justify the exercise of pendant jurisdiction when it would otherwise be inappropriate. Gibbs concluded that pendant jurisdiction should typically be declined where the federal-law claims drop out of the case prior to the time that the case goes to trial. Gibbs, 383 U.S. at 726-27, 86 S. Ct. 1130, 16 L. Ed. 2d 218. In the present case, the complaint was amended to omit all federal-law claims before the parties engaged in any discovery and before any responsive pleading was filed. With no federal-law claims remaining at this early point in the litigation, the court declines to exercise pendant jurisdiction over the state-law claims in the amended complaint.
In a case such as this where no federal-law claims remain and judicial economy, convenience and fairness do not demand that the district court hear pendant claims, it is appropriate for the district court to remand the case back to the state court. Baylis v. Marriott Corp., 843 F.2d 658, 665 (2d Cir. 1988). If the court relinquished pendant jurisdiction by dismissing plaintiff's case, plaintiffs might encounter problems with timeliness under the governing statutes of limitations, and the cost and expense of litigating on the part of the parties and the state court would be needlessly exacerbated.
For the foregoing reasons, this action is remanded to the Supreme Court of the State of New York, New York County.
Dated: July 27, 1992
New York, New York
Constance Baker Motley, U.S.D.J.