Owen Equipment & Erection Co. v. Kroger

Brief Fact Summary.

Kroger, an Iowa citizen,  filed anegligence action in federal court against Omaha Public Power District (OPPD), a Nebraska company. Jurisdiction was based on diversity. OPPD filed a third party complaint against Owen; Kroger amended her complaint to add Owen as a defendant. The district court denied Owen’s motion to dismiss Kroger’s complaint for lack of  jurisdiction. (At trial, it had become known that Owen was an Iowa company). The Court of Appeals affirmed. The Supreme Court granted certiorari.

Synopsis of Rule of Law.

In determining whether jurisdiction over a nonfederal claim exists, the context in which the nonfederal claim is asserted is crucial; practical needs warranting the exercise of ancillary jurisdiction involve protecting legal rights and/or effectively resolving an entire, logically integrated action.

Facts.

Kroger’s husband was electrocuted when he walked by the boom of a steel crane that had come to close to a power line. Kroger, an Iowa citizen,  filed a negligence action in federal court against Omaha Public Power District (OPPD) , a Nebraska company, to recover damages for her husband’s death. Jurisdiction was based on diversity. OPPD filed a third party complaint against Petitioner, Owen Equipment & Erection Co.; Kroger amended her complaint to add Owen as a defendant. Subsequently, summary judgment was granted for OPPD, and the lawsuit proceeded between Kroger and Owen. At trial, it became known that Owen was an Iowa company. The district court denied Owen’s motion to dismiss Kroger’s complaint for lack of  jurisdiction. The Court of Appeals affirmed. The Supreme Court granted certiorari.

Issue.

Where federal jurisdiction is based on diversity, can a plaintiff assert a claim against a third party defendant if there is no basis for federal jurisdiction over the claim, based on the doctrine of ancillary jurisdiction?

Held.

No. Neither convenience of litigants nor judicial economy considerations can justify extending the doctrine of ancillary juridiction to a plaintiff’s cause of action against a citizen of the same state in a diversity case.

Discussion.

The nonfederal claim in this case was not ancillary to the federal one; Kroger’s claim against Owen was a new and independent claim from the one asserted against OPPD. Additionally, the nonfederal claim was asserted by Kroger against Owen, and it was Kroger who chose the forum. Normally, ancillary jurisdiction involves claims by a party haled into court against his will, or by another person whose rights would be lost absent asserting them in the pending action.