Bradley Timberland Resources v. Bradley Lumber Company
712 F.3d 401
8th Cir.2013Background
- Webster extended a $6 million revolving credit line to Bradley Lumber secured in part by Bradley Timberland's woodlands.
- Bradley Lumber defaulted; Bradley Timberland sued Webster and Bradley Lumber in Arkansas state court for fraud and interference with business expectancy, then Webster removed to federal court.
- The district court found Bradley Lumber fraudulently joined to defeat diversity and denied remand; it dismissed Bradley Timberland's claims as time-barred.
- Bradley Timberland appealed the denial of remand and the dismissal, and challenged the denial of its motion for reconsideration.
- The court affirmed the district court's remand denial, dismissal, and denial of reconsideration.
- Bradley Timberland now challenges the timeliness and procedural posture of the federal action as well as the merits of the underlying state-law claims
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Bradley Lumber was fraudulently joined to defeat diversity | Bradley Timberland argues Bradley Lumber is a proper defendant with viable Arkansas claims. | Bradley Lumber had no misrepresentation liability; common ownership negates any potential constructive fraud. | Yes, fraudulent joinder; no reasonable basis for Bradley Lumber liability. |
| Whether remand was proper given fraudulent joinder | Remand required because not all defendants joined in removal. | Consent not required due to fraudulent joinder; removal valid. | Remand denied; removal proper. |
| Whether Bradley Timberland's claims were time-barred | Accrual occurred in fall 2007; suit filed August 2011 is timely under Arkansas law. | Accrual occurred in fall 2007 and the three-year limit expired fall 2010. | Claims time-barred; district court did not err in dismissal. |
| Whether the motion for reconsideration was properly denied | New evidence shows mis-timing; should be reconsidered. | Newly offered evidence could have been offered earlier; reconsideration appropriate only for manifest errors. | No abuse of discretion in denying reconsideration. |
Key Cases Cited
- Wilkinson v. Shackelford, 478 F.3d 957 (8th Cir. 2007) (fraudulent joinder and remand standards; resolve doubts in favor of remand)
- Yarborough v. DeVilbiss Air Power, Inc., 321 F.3d 728 (8th Cir. 2003) (elements of actual and constructive fraud under Arkansas law)
- Zutz v. Nelson, 601 F.3d 842 (8th Cir. 2010) (plausibility standard for stating a claim; Twombly/Iqbal guidance)
- Varner v. Peterson Farms, 371 F.3d 1011 (8th Cir. 2004) (statute of limitations accrual for tort claims; discovery not required for accrual)
- O'Mara v. Dykema, 942 S.W.2d 854 (Ark. 1997) (Arkansas three-year limitations for torts; accrual at wrong occurring)
