DARLING'S v. NISSAN MOTOR CORP.

863 F. Supp. 26 (1994) | Cited 0 times | D. Maine | September 2, 1994

ORDER AND MEMORANDUM OF DECISION

BRODY, District Judge

Defendant, Nissan Motor Corporation, moves to dismiss this action on the grounds that the Court lacks subject matter jurisdiction. Nissan also asserts that, even if the Court has jurisdiction, it should nevertheless dismiss or stay the action because a parallel state-court litigation is currently pending between these parties.

BACKGROUND

Nissan manufactures and distributes cars, trucks, and parts throughout the continental United States. Darling's sells automobiles and has been a Nissan dealer since about 1981. The parties have operated under a series of contracts, the most recent of which was executed in 1990. According to this contract, Darling's is obligated to provide warranty repairs to Nissan vehicles without charge to the vehicle's owner. Nissan is required to reimburse Darling's for these warranty repairs.

At the center of the dispute between the parties is the rate at which Nissan reimburses Darling's for warranty repairs. In Maine, the warranty reimbursement rate is governed by Maine's Regulation of Business Practices Between Motor Vehicle Manufacturers, Distributors, and Dealers, 10 M.R.S.A. §§ 1171-86 (1980 & Supp. 1993). In 1991, the Maine legislature amended these provisions to require manufacturers to reimburse dealers for parts and labor provided in warranty work at the "retail rate customarily charged by that [dealer]" for non-warranty repairs. 10 M.R.S.A. § 1176 (Supp. 1994). After 1991, the parties began to dispute the applicability of the statute, particularly its 1991 amendments, to their contract; the scope of the statute; and the necessary prerequisites to a claim under the statute.

After some unsuccessful negotiations between the parties, Darling's began filing actions in the Maine District Court, Small Claims Division, in Bangor. To date, Darling's has filed 69 such claims. The Maine District Court has resolved eight of these claims finding that Darling's had not submitted a "particularized claim" as required by the statute. The Small Claims Court thus did not allow Darling's to recover increased reimbursement from Nissan for those claims. The remaining actions are still pending.

In January 1994, Darling's informed Nissan that it intended to name the Nissan owners for whom warranty work was completed as co-defendants in upcoming small-claims actions. (See Def.'s Mem. at Ex. A.) In February 1994, Darling's notified Nissan of its intention to "take legal action against Nissan for reimbursement, additional damages and attorney's fees." (Am. Complaint at Ex. H.) Darling's referred, in particular, to this Court's decision in a similar case, Acadia Motors, Inc. v. Ford Motor Co., 844 F. Supp. 819 (D. Me. 1994), in which the Court held that the 1991 amendments to § 1176 applied to pre-1991 contracts without violating the Contracts Clause of the Maine Constitution.

On March 3, 1994, Nissan filed a twelve-count declaratory judgment action in Maine Superior Court. On March 17, 1994, Darling's filed its Complaint in this Court. Like Nissan, Darling's also demanded declaratory and injunctive relief. Nissan moved to dismiss arguing that it is "'uneconomical as well as vexatious for a federal court to proceed in a declaratory judgment suit where another suit is pending in a state court presenting the same issues, not governed by federal law, between the same parties.'" (Def.'s Mem. at 5 (quoting Brillhart v. Excess Ins. Co. of Am., 316 U.S. 491, 495, 86 L. Ed. 1620, 62 S. Ct. 1173 (1942) (emphasis added)).) In an apparent response to this argument, Darling's amended its Complaint deleting all requests for declaratory and injunctive relief. Nissan again moves to dismiss or stay the action pending resolution of the state-court action. This time, Nissan also argues that the Court lacks subject matter jurisdiction to hear this matter.

JURISDICTION

The threshold issue is whether the Court has jurisdiction over the subject matter of the case. Darling's asserts that this Court has diversity jurisdiction under 28 U.S.C. § 1332. Nissan disagrees, arguing that the matter in controversy does not exceed $ 50,000 as required by § 1332.

In St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 288-89, 82 L. Ed. 845, 58 S. Ct. 586 (1938), the Supreme Court established the standard for determining whether the requisite jurisdictional amount has been properly alleged:

The sum claimed by the plaintiff controls if the claim is apparently in good faith. . . . But if, from the face of the pleadings, it is apparent, to a legal certainty, that the plaintiff cannot recover the amount claimed . . . the suit will be dismissed.

1. Attorney Silver also identifies costs of $ 793.84. Costs are expressly excluded from the amount in controversy, however. See 28 U.S.C. § 1332 ("the matter in controversy [must] exceed[] the sum or value of $ 50,000, exclusive of interest and costs ") (emphasis added).

2. Although some of the issues raised by the parties were resolved in the Small Claims Court, that court's decisions are not binding in these actions. See 14 M.R.S.A. § 7485 (Supp. 1994) ("Any fact found or issue adjudicated in a proceeding [in Small Claims Court), may not be deemed found or adjudicated for the purpose of any other cause of action. The judgment obtained shall be res judicata as to the amount in controversy.").

3. The doctrine of collateral estoppel also requires that "the determination of an essential fact or issue [be] actually litigated and resolved by a valid final judgment " in order to be conclusive in subsequent litigation. Spickler v. Dube, 644 A.2d 465, slip op. at 9 n.7 (Me. 1994) (emphasis added) (citations omitted).

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