Hartford Steam Boiler Inspection & Ins. Co. v. Quantum Chem. Corp.

No. 91 C 6907, 1994 U.S. Dist. LEXIS 12716 (N.D. Ill. Sep. 6, 1994)

 

RULE:

28 U.S.C.S. § 1367(b) applies only to claims by plaintiffs against new parties whose addition would destroy diversity. In this way, § 1367(b) prevents the original plaintiff from maneuvering a non-federal claim into federal court by initially filing claims against only diverse parties, and then later seeking to add non-diverse parties, whose presence, had plaintiff included them in its original complaint, would have destroyed diversity. Section 1367(b) carves out only specific instances in which it excludes the supplemental jurisdiction in diversity cases. By no means does it exclude it from diversity cases in general. Rather, § 1367(b) is concerned only with efforts of a plaintiff to smuggle in claims that the plaintiff would not otherwise be able to interpose against certain parties for want of subject matter jurisdiction. 

FACTS:

An insurer filed an action against the chemical corporation, seeking a declaratory judgment that the chemical corporation's losses were not covered under its policy. A heat exchanger had failed at the chemical corporation's facility, causing damage to the heat exchanger and some surrounding property. The chemical corporation filed a counterclaim against the insurer. The chemical corporation also filed a separate, third party complaint against the property insurers. The property insurers contended that the action against them could be heard by the court in which the insurer filed its declaratory judgment action against the chemical corporation. 

ISSUE:

Did the Court have supplemental jurisdiction over the chemical corporation's action against the property insurers?

ANSWER:

Yes

CONCLUSION:

The court agreed, finding that a logical relationship existed between the original declaratory judgment action and the action against the third-party insurers. Both actions arose out of the same incident. Accordingly, the court held that it had supplemental jurisdiction over the chemical corporation's action against the property insurers.

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