United States District Court, Southern District of New York
September 16, 1999
CENTRAL SYNAGOGUE, PLAINTIFF,
TURNER CONSTRUCTION COMPANY, AMIS INC. AND ARIS DEVELOPMENT CORPORATION, DEFENDANTS.
The opinion of the court was delivered by: Sweet, District Judge.
Plaintiff Central Synagogue ("Central") has moved, pursuant to
28 U.S.C. § 1447, for an order to remand this action to New York
State Supreme Court for lack of subject matter jurisdiction. For
the reasons set forth below, the motion is granted.
This action arises out of the tragic fire that consumed the
historic Central Synagogue Sanctuary (the "Sanctuary") of
plaintiff Central on August 28, 1998. As a result of the fire,
Central's insurance carrier, Wausau Business Insurance Company
("Wausau"), allegedly paid a certain sum of money to Central.
Wausau subsequently filed an action (the "Wausau case") in this
Court on January 29, 1999, seeking amounts in subrogation against
defendants Turner Construction Company ("Turner"), Amis Inc.
("Amis"), and Aris Development Corporation ("Aris," and, together
with Turner and Amis, the "Defendants"). Subject matter
jurisdiction in the Wausau case was predicated on diversity, as
Wausau is a Wisconsin entity and all Defendants are New York
On February 25, 1999, Central, a New York entity, filed the
instant action (the "Central case") in Supreme Court of the State
of New York, New York County against Defendants. Central's
complaint alleges state law claims of breach of contract,
negligence, and breach of fiduciary duty, and seeks damages for
uninsured losses sustained in the Sanctuary fire.
On April 2, 1999, Turner removed the Central case to this Court
pursuant to 28 U.S.C. § 1441, seeking joinder with the Wausau
case. Subject matter jurisdiction in the Central case is
predicated on 28 U.S.C. § 1367, the "supplemental jurisdiction"
On June 7, 1999, Central filed the instant motion to remand the
Central case to New York State Supreme Court, pursuant to
28 U.S.C. § 1447. Oral argument on the motion was heard on June 23,
1999, at which time the motion was deemed fully submitted.
The Basis for the Remand Action
Central's motion for remand based on lack of subject matter
jurisdiction rests on three assertions. First, Central asserts
that supplemental jurisdiction is not a valid basis for removal,
since § 1441 only permits removal of a "civil action brought in a
State court of which the district courts of the United States
have original jurisdiction." 28 U.S.C.A. § 1441(a) (West 1993 &
Supp. 1999) (emphasis added). Central construes this language to
mean that only an action which could have been brought in federal
court originally can be removed to federal court. Since § 1367
only supplies "supplemental jurisdiction" to a claim, not
original jurisdiction, and since the Central case could not
otherwise have been brought in federal court originally — lacking
a federal question claim under 28 U.S.C. § 1331 and failing to
meet the diversity requirements under § 1332 — Central
maintains that the case cannot be removed.
Second, Central asserts that, even if supplemental jurisdiction
somehow overcame the § 1441 "original" jurisdiction defect, §
1367 nevertheless only applies to claims brought in a single
action. Here, the claims were brought in two separate actions.
Third, Central asserts that § 1367(b) explicitly disallows the
exercise of supplemental jurisdiction over "claims by persons
proposed to be joined as plaintiffs under Rule 19 . . . when
exercising supplemental jurisdiction over such claims would be
inconsistent with the jurisdictional requirements of section
1332." Id. § 1367(b). Since Turner proposes to join Central as
a plaintiff in the Wausau case, presumably under Rule 19, and
since such joinder would destroy subject matter jurisdiction in
the Wausau case, which is premised on diversity (because Central
and Turner are both New York "citizens"), § 1367 cannot be used
as a basis for supplemental jurisdiction and thus as a basis for
Turner replies that a rational reading of §§ 1367 and 1441,
buttressed by case law in this Circuit and elsewhere, firmly
establishes that (1) the "original" jurisdiction requirement of §
1441 does not bar claims in which jurisdiction is predicated on §
1367; (2) jurisdiction under § 1367 is not limited to claims
brought in a single action; and (3) § 1367(b) does not apply in
the Central case. In addition, Turner maintains that Central's
motion is not timely.
Section 1367(b) Bars Supplemental Jurisdiction Which Destroys
To deal with the third argument for remand advanced by Central,
and to see why § 1367(b) clearly prohibits, in certain
situations, the exercise of supplemental jurisdiction where, as
here, such exercise would destroy diversity, it is necessary to
turn to the text of the statute itself. Section 1367 provides
(a) Except as provided in subsections (b) and (c) or
as expressly provided otherwise by Federal statute,
in any civil action of which the district courts have
original jurisdiction, the district courts shall have
supplemental jurisdiction over all other claims that
are so related to claims in the action within such
original jurisdiction that they form part of the same
case or controversy under Article III of the United
States Constitution. Such supplemental jurisdiction
shall include claims that involve the joinder or
intervention of additional parties.
(b) In any civil action of which the district courts
have original jurisdiction founded solely on section
1332 of this title, the district courts shall not
have supplemental jurisdiction under subsection (a)
over claims by plaintiffs against persons made
parties under Rule 14, 19, 20, or 24 of the Federal
Rules of Civil Procedure, or over claims by persons
proposed to be joined as plaintiffs under Rule 19 of
such rules, or seeking to intervene as plaintiffs
under Rule 24 of such rules, when exercising
supplemental jurisdiction over such claims would be
inconsistent with the jurisdictional requirements of
(c). . . .
As the language of the statute indicates, subsections (b) and
(c) are exceptions from the general grant of supplemental
jurisdiction under subsection (a). The second part of subsection
(b) contains the language crucial to this motion: The district
courts shall not have supplemental jurisdiction under
subsection (a) "over claims by persons proposed to be joined as
plaintiffs under Rule 19 of such rules . . . when exercising
supplemental jurisdiction over such claims would be inconsistent
with the jurisdictional requirements of section 1332."
It is undisputed that this Court has jurisdiction over the
parties in the Wausau case solely pursuant to 28 U.S.C. § 1332,
the diversity statute. It is also undisputed that, had Central
been a plaintiff in the Wausau case, diversity would have been
destroyed, because Central, like all the
Defendants, is a "citizen" of New York for purposes of § 1332.
In this action, Central is a person "proposed to be joined" to
the Wausau case as a plaintiff under Rule 19. As Turner states in
its reply memorandum to the instant motion, "Defendant Turner
removed the Central Synagogue Case to this Court seeking
joinder with the Wausau Case relying on 28 U.S.C. § 1332
jurisdiction over the related Wausau Case as original
jurisdiction and asking this Court to assert supplemental
jurisdiction pursuant to 28 U.S.C. § 1367 over The Central
Synagogue Case." Defendant Turner Construction Company's
Memorandum of Law in Opposition to Plaintiff's Motion to Remand,
at 3 ("Memo of D.") (emphasis added). Since Turner seeks
"joinder" of the two cases, Turner necessarily seeks joinder of
plaintiff Central to the Wausau claim pursuant to Rule 19.*fn2
Thus, Central's claim against Turner is a claim by a person
proposed to be joined as a plaintiff under Rule 19 and therefore
fits squarely within the language of 1367(b). This would not pose
a problem for Turner if the Wausau claim were predicated on
federal question jurisdiction.*fn3 However, as indicated above,
subject matter jurisdiction in the Wausau case is founded
exclusively on diversity. Exercising supplemental jurisdiction
over Central's claims against Turner, according to the plain
language of 1367(b), "would be inconsistent with the
jurisdictional requirements of section 1332." Central and Turner
are both New York citizens, and "for diversity jurisdiction to be
available, all of the adverse parties in a suit must be
completely diverse with regard to citizenship." E.R. Squibb &
Sons, Inc. v. Accident & Cas. Ins. Co., 160 F.3d 925, 930 (2d
Cir. 1998) (citing Strawbridge v. Curtiss, 7 U.S. (3 Cranch)
267, 2 L.Ed. 435 (1806)).
Turner asserts that § 1367(b) "only precludes jurisdiction over
claims made by plaintiffs pursuant to Rules 14, 19, 20 and 24."
(Memo of D. at 9.) This mischaracterizes the statute. Certainly
the first part of 1367(b) only precludes claims by plaintiffs
against persons made parties under Rules 14, 19, 20, or 24, but
the second part precludes claims "by persons proposed to be
joined as plaintiffs" under Rules 19 or 24. If Congress wanted to
limit the exception to persons seeking to join an action as
plaintiffs, it could have drafted the language of the statute to
say "by persons proposing to join as plaintiffs." The passive
voice of "proposed to be joined" clearly contemplates a situation
where a party other than the potential plaintiff is proposing
to join that potential plaintiff to the action — the exact
situation in the instant case. Defendant Turner is seeking to
join Central to the Wausau claim.
Finally, none of the cases cited by Turner aid Turner's
position. In most of the cases cited, supplemental jurisdiction
was predicated on federal question — not diversity — jurisdiction
in the original claim, in which case 1367(b) does not prohibit
jurisdiction over the supplemental claim. See King v. Crossland
Sav. Bank, 111 F.3d 251, 256 (2d Cir. 1997); Mizuna, Ltd. v.
Crossland Fed. Sav. Bank, 90 F.3d 650, 657 (2d Cir. 1996);
Brazinski v. Amoco Petroleum Additives Co., 6 F.3d 1176 (7th
Cir. 1993); Simcox v. McDermott Int'l, Inc., No. H-92-3014,
1993 U.S. Dist. LEXIS 18302, at *7-8 (S.D.Tex. Dec. 21, 1993). In
the two cases Turner cites where the original claim was
predicated on diversity jurisdiction, the issue was whether the
supplemental claim could be joined even though it failed to meet
the amount in controversy requirement of § 1332. See Stromberg
Metal Works v. Press Mechanical, Inc., 77 F.3d 928, 931 (7th
Patterson Enter., Inc. v. Bridgestone/Firestone, Inc.,
812 F. Supp. 1152, 1154-55 (D.Kan. 1993). There is a split on this
issue in the Circuit Courts. Compare Stromberg, 77 F.3d at
930-32 (7th Cir. 1996), and In re Abbott Labs., 51 F.3d 524,
527-30 (5th Cir. 1995), with Ahearn v. Charter Township of
Bloomfield, 100 F.3d 451 (6th Cir. 1996). However, in the
situation where invoking supplemental jurisdiction would destroy
the "complete diversity" requirement of all plaintiffs being from
a different state than all defendants, Stromberg says the
Whether § 1367(b) is a model drafting exercise may be
doubted, but the language draws an important line.
The complete-diversity rule of Strawbridge v.
Curtiss, 7 U.S. (3 Cranch) 267, 2 L.Ed. 435 (1806),
excludes from federal court cases in which citizens
of the same state are on each side. Supplemental
jurisdiction has the potential to move from complete
to minimal diversity. Suppose a citizen of Illinois
sues a citizen of Indiana under § 1332 and adds a
citizen of Illinois as a supplemental defendant. If
this strategy works, then Strawbridge is no longer
controlling. Similarly, suppose two parties (one from
Illinois, one from Indiana) who claim an interest in
the same property want to adjudicate their rights
against a third party, a citizen of Illinois. Without
a provision like § 1367(b), it would be easy for the
Indiana claimant to start the suit, leading the
defendant to add the Illinois claimant under Rule 19.
As written, § 1367(b) keeps cases of this kind out of
federal court entirely, just as Strawbridge does.
Stromberg, 77 F.3d at 932. This Court is not aware of any case
holding that § 1367 can be invoked to overcome the complete
There is simply no support for Turner's proposition that
"supplemental jurisdiction is mandatory if the removal claim is
related to the claim within the court's original jurisdiction."
(Memo of D. at 9.) Turner cites Itar-Tass Russ. News Agency v.
Russian Kurier, Inc., 140 F.3d 442 (2d Cir. 1998) for support,
yet Itar-Tass does not address the provisions of 1367(b).
Itar-Tass simply holds that a judge cannot decline supplemental
jurisdiction as a matter of discretion for any reason other than
those reasons enumerated in 1367(c). See id. at 447-48. Of
course, there is nothing about 1367(b) that is discretionary; if
the conditions of 1367(b) are met, the court "shall not have"
supplemental jurisdiction over the additional claims.
The Remaining Bases for Remand Need Not Be Addressed
Central's first assertion presented a complex question of
statutory interpretation: whether the jurisdiction conferred by §
1367 overrides the "original jurisdiction" language of § 1441.
However, because of the conclusion reached above that remand is
required by Central's third assertion, Central's first assertion
need not be addressed. The same rationale permits this Court to
refrain from considering Central's second assertion, regarding
the inapplicability of 1367 to separately filed claims.
The Remand Motion Is Timely
A final issue requiring consideration is whether Central's
claim is nevertheless time-barred. Turner calls attention to §
1447(c), which states, in relevant part:
A motion to remand the case on the basis of any
defect other than lack of subject matter jurisdiction
must be made within 30 days after the filing of the
Notice of Removal under Section 1446(a). If at any
time before the final judgment it appears that the
district court lacks subject matter jurisdiction, the
case shall be remanded. . . .
28 U.S.C.A. § 1447(c) (West 1993 & Supp. 1999). Turner maintains
that Central's assertion regarding Turner's failure to meet the
terms of the removal statute, id. § 1441, is time-barred
because it was not brought within 30 days of the filing of the
Notice of Removal.
However, it is not necessary to consider this issue, as the
decision with regard to the instant motion rests solely upon §
1367(b). Even if Central's assertions with regard to § 1441 were
defective, that would have no bearing on the issue of this
Court's lack of subject matter jurisdiction over the Central
claim. In addition, as the statute plainly states, there is no
time limit for a motion to remand on the basis of lack of subject
It is regrettable that the laudable goal of the efficient and
economic use of the legal system cannot be accomplished in the
instant case, but Congress has quite explicitly limited the
jurisdiction of the federal courts over cases such as the instant
one before this Court.
For the reasons discussed above, the case is hereby remanded to
the New York State Supreme Court.
It is so ordered.