National Independent Truckers Insurance Company v. Gadway et al

Filing 101

MEMORANDUM AND ORDER - Judgment is entered against National pursuant to the findings of this Memorandum and Order and the Court's Memorandum and Order of March 12, 2012 (filing 99 ). National's complaint is dismissed with prejudice. The p arties shall show cause, by briefs to be filed on or before May 14, 2012, why Gadway's counterclaim should not be dismissed without prejudice to reassertion of that claim in a state court of appropriate jurisdiction. The Clerk of the Court is directed to set a show cause deadline of May 14, 2012. Ordered by Judge John M. Gerrard. (GJG)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
NATIONAL INDEPENDENT
TRUCKERS INS. CO.,
8:10-CV-253
Plaintiff,
vs.

MEMORANDUM AND ORDER

KELLY GADWAY and BRUCE W.
LARSON,
Defendants.
This matter is before the Court on the Court’s own Memorandum and
Order of March 12, 2012 (filing 99), in which the Court denied National
Independent Truckers Ins. Co.’s (hereinafter, National) motions for summary
judgment (filings 85 and 90) and motion to dismiss counterclaim (filing 92).
Furthermore, based on the findings made in its March 12 order, the Court
directed the plaintiff to show cause, by an appropriate brief in opposition,
why a partial summary judgment should not be entered against it. (Filing 99
at 13-14.)
Neither party has filed any response to the Court’s show cause order.
The Court therefore concludes that the parties have waived any objection to
the findings of the March 12 order. Accordingly, pursuant to Fed. R. Civ. P.
56(f), the Court will enter summary judgment against National on the terms
explained in its March 12 order. See filing 99. Specifically, the Court finds
that (a) National may not rescind the policy insofar as it provided compulsory
insurance coverage required by Nebraska law, and (b) National may not (and
did not) avoid liability under the MCS-90 endorsement before providing the
notice required by federal law. Based on the same reasoning, the Court
concludes National is not entitled to the relief sought in its complaint, and
that the complaint should be dismissed with prejudice.
Once that is accomplished, the only pending matter in this case is Kelly
Gadway’s counterclaim (filing 53). But the amount in controversy for that
claim seems to be approximately $9,000, and is certainly no greater than
$14,000. (Filings 53 and 92.) This is far short of the $75,000 amount required
for federal court jurisdiction under 28 U.S.C. § 1332.
Of course, a federal district court has supplemental jurisdiction over
claims that are related to a claim over which the court has original
jurisdiction. See 28 U.S.C. § 1367. But a court may decline to exercise

supplemental jurisdiction over such claims when the court has dismissed all
claims over which it has original jurisdiction. § 1367(c)(3). And in most cases,
when federal and state claims are joined and the federal claims are dismissed
on a motion for summary judgment, the pendant state claims are dismissed
without prejudice to avoid needless decisions of state law, as a matter of
comity and to promote justice between the parties. Birchem v. Knights of
Columbus, 116 F.3d 310 (8th Cir. 1997); Ivy v. Kimbrough, 115 F.3d 550 (8th
Cir. 1997); see, also, United Mine Workers v. Gibbs, 383 U.S. 715 (1966). That
would not mean that Gadway’s counterclaim is without merit; it would
simply mean that Gadway’s counterclaim belongs in state court.
Gadway’s counterclaim in this case arises under Nebraska law and is
for substantially less than the amount required for diversity jurisdiction.
Therefore, the Court finds it appropriate to order the parties to show cause
why the Court should not exercise its discretion to dismiss Gadway’s
counterclaim without prejudice to its being brought in a state court of
appropriate jurisdiction.
IT IS ORDERED:
1.

Judgment is entered against National pursuant to the
findings of this Memorandum and Order and the Court’s
Memorandum and Order of March 12, 2012 (filing 99);

2.

National’s complaint is dismissed with prejudice;

3.

The parties shall show cause, by briefs to be filed on or
before May 14, 2012, why Gadway’s counterclaim should
not be dismissed without prejudice to reassertion of that
claim in a state court of appropriate jurisdiction.

4.

The Clerk of the Court is directed to set a show cause
deadline of May 14, 2012.

Dated this 23rd day of April, 2012.
BY THE COURT:

John M. Gerrard
United States District Judge
-2-