Summary
In this diversity action, the Seventh Circuit affirmed summary judgment for the window manufacturer on the distributor's contract and service-agreement claims, holding that the service agreement did not require the manufacturer to keep end customers satisfied. However, the court vacated judgment on the homeowners' warranty claims and remanded them to state court, because those claims shared only the same product with the distributor's claims and lacked a common nucleus of operative facts, thus falling outside the supplemental jurisdiction under 28 U.S.C. §1367(a). The court also noted that removal of the entire suit was proper and that judgment on the federal claims could stand even if a timely remand motion would have been granted for the non-federal claims.
Topics
Practice areas
Questions Presented
- Whether the district court properly granted summary judgment on Prolite's contract claims against Ply Gem and the counterclaims.
- Whether the district court had supplemental jurisdiction over the homeowners' warranty claims.
Holdings
- Summary judgment was proper because the service agreement did not require Ply Gem to keep customers happy; it required Prolite to perform repairs in exchange for a discount, and Prolite received the discount and parts. Prolite never asked for additional aid under the excessive problems clause.
- The homeowners' claims are not within the supplemental jurisdiction because they do not share a common nucleus of operative facts with Prolite's claim. The claims involve different contracts, different parties, and different grievances.
Key quotations
“The dispute between Prolite and Ply Gem was removable in principle, see §1441(a), and nothing in the chapter on removal (28 U.S.C. §§ 1441 to 1455) suggests that the presence in a state case of an additional claim worth less than $75,000 (and not part of the same case or controversy as the first) blocks removal of a claim otherwise within federal jurisdiction.” (7)
“The judgment of the district court is affirmed, except with respect to the homeowners’ claims. The judgment dealing with those claims is vacated, and the case is remanded to the district court with instructions to remand them to state court.” (8)
“What does enough commonality really mean? Still, unless there is a phrase better than 'nucleus of operative facts,' there’s no point in complaining. No one has come up with a better phrase, despite a lot of trying, so we apply this one as best we can.” (5)
Factual background
Prolite Building Supply, LLC bought Ply Gem windows from MW Manufacturers, Inc. and resold them to residential builders in Wisconsin. Homeowners complained that the windows admitted air even when closed. Prolite and Ply Gem had a service agreement making Prolite the principal servicer. Prolite and Ply Gem solved some problems but not all. Contractors stopped buying from Prolite, and Prolite stopped paying Ply Gem. Prolite and 12 homeowners sued in state court; Ply Gem removed to federal court and counterclaimed for unpaid bills. Great Lakes Window, an affiliate, filed a separate federal suit. The district court granted summary judgment to Ply Gem and Great Lakes.
Procedural history
Prolite and homeowners filed suit in state court; Ply Gem removed to federal court based on diversity jurisdiction; Great Lakes Window filed separate federal suit; actions consolidated; district court granted summary judgment to defendants.
Remand instructions
The district court is instructed to remand the homeowners' claims to state court.