Ryan v. Streck, Inc.
309 Neb. 98
| Neb. | 2021Background
- Ryan received Streck shares in 1985; in 2012 Streck repurchased them under a revised redemption agreement tying price to the most recent JVA valuation.
- Ryan sued in state court in 2015 for breach of that agreement, voluntarily dismissed, then filed in federal court asserting federal securities claims and several state-law claims (including breach of contract).
- The federal district court dismissed all claims for failure to state a claim; Ryan moved to amend based on newly discovered appraisal evidence; the district court denied relief and Ryan appealed.
- The Eighth Circuit affirmed dismissal of most claims but remanded to consider whether the newly discovered evidence warranted reopening the breach-of-contract claim; on remand the district court declined to continue exercising supplemental jurisdiction and dismissed the state claim in Sept. 2018.
- Ryan refiled the breach-of-contract claim in Sarpy County in March 2019; the state court dismissed it as statute-barred (May 2020). Ryan appealed to the Nebraska Supreme Court.
- The Nebraska Supreme Court reversed, holding the federal court had exercised supplemental jurisdiction while the claim was pending and §1367(d) tolled the state limitations period during the federal litigation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the federal court exercised supplemental jurisdiction over Ryan's breach-of-contract claim on remand | Ryan: federal court retained and exercised supplemental jurisdiction over the state claim until it declined it on remand | Streck: because the Eighth Circuit affirmed dismissal of federal claims, the federal court could not have exercised supplemental jurisdiction over the remanded contract claim | Held: Federal court did have supplemental jurisdiction over the claim until it discretionarily declined to continue it on remand |
| Whether 28 U.S.C. § 1367(d) tolled the state statute of limitations while the claim was in federal court | Ryan: §1367(d) tolled (stopped the clock) while the claim was pending in federal court | Streck: the state limitation continued to run and Ryan could have filed in state court during federal litigation | Held: §1367(d) tolled the limitations period during pendency in federal court (Artis controlling) |
| Whether Neb. Rev. Stat. § 25-201.01 tolled the limitations period | Ryan: alternatively, the state savings provision would allow refiling after dismissal | Streck: Ryan could have timely filed in state court and §25-201.01 does not help here | Held: Court did not decide because federal tolling under §1367(d) resolved timeliness in Ryan's favor |
| Whether the state court could raise statute-of-limitations sua sponte and dismiss | Ryan: state court erred to raise SOL sua sponte after not being pleaded by Streck | Streck: court acted correctly to dismiss a facially time-barred claim | Held: Court declined to address because §1367(d) tolling made the dismissal improper |
Key Cases Cited
- Artis v. District of Columbia, 138 S. Ct. 594 (U.S. 2018) (§1367(d) “tolled” a state limitations period by stopping the clock during federal litigation)
- Ryan v. Ryan, 889 F.3d 499 (8th Cir. 2018) (Eighth Circuit affirmed dismissal of federal claims and remanded to consider newly discovered evidence on breach claim)
- Crest Const. II, Inc. v. Doe, 660 F.3d 346 (8th Cir. 2011) (federal courts have discretion whether to exercise supplemental jurisdiction over state claims)
- Glorvigen v. Cirrus Design Corp., 581 F.3d 737 (8th Cir. 2009) (discretionary exercise of supplemental jurisdiction after dismissal of federal claims)
- United States v. Rodgers, 461 U.S. 677 (U.S. 1983) (interpretive guidance that the word “may” in a statute is generally permissive)