Metro Chrysler Plymouth, Inc. v. Fraser
1:23-cv-09358
E.D.N.YMay 6, 2024Background
- Plaintiff, Star Chrysler, sued former employee Lionel Fraser in New York state court for unauthorized after-hours vehicle repairs on dealership premises for personal gain.
- The claims alleged by Star Chrysler were various state-law claims, including fraud, conversion, unjust enrichment, breach of loyalty, and the faithless servant doctrine.
- Defendant Fraser removed the case to federal court, arguing federal jurisdiction based on the Labor Management Relations Act (LMRA) and the Federal Arbitration Act (FAA).
- Upon further review, Fraser moved to withdraw his notice of removal, acknowledging that the claims did not arise under federal law.
- Both parties ultimately agreed that the federal court lacked subject-matter jurisdiction, and the case should be remanded to state court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Federal Question Jurisdiction | Claims are purely state-law | Initially argued claims arise under LMRA/FAA | No federal jurisdiction; claims purely state-law |
| LMRA Section 301 Preemption | Claims not based on labor contract | Initially argued preemption under LMRA | No preemption; claims unrelated to labor contract |
| FAA as a Basis for Jurisdiction | FAA does not confer federal jurisdiction | Initially cited FAA due to arbitration clause | FAA provides no independent federal-question jurisdiction |
| Remand to State Court | Agreed remand proper | Agreed remand proper | Remand to New York Supreme Court, Queens County |
Key Cases Cited
- Empire Healthchoice Assurance, Inc. v. McVeigh, 547 U.S. 677 (scope of federal question jurisdiction for removal)
- Caterpillar Inc. v. Williams, 482 U.S. 386 (removal of preempted state-law claims under LMRA)
- Allis-Chalmers Corp. v. Lueck, 471 U.S. 202 (LMRA Section 301 preempts state claims inextricably tied to labor contracts)
- Hawaiian Airlines, Inc. v. Norris, 512 U.S. 246 (state-law claims must depend on collective bargaining agreement to be preempted by LMRA)
- Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (FAA does not independently confer federal question jurisdiction)