Great Lakes Gas Transmission Ltd. v. Essar Steel Minn., LLC
| Decision Date | 25 June 2015 |
| Docket Number | Case No. 09-cv-3037 (SRN/LIB) |
| Parties | Great Lakes Gas Transmission Limited Partnership, Plaintiff, v. Essar Steel Minnesota, LLC; Essar Steel Limited f/k/a Essar Steel Holdings, Ltd.; Essar Steel India Limited f/k/a Essar Steel Limited; and Essar Global Fund Ltd. f/k/a Essar Global Limited, Defendants. |
| Court | U.S. District Court — District of Minnesota |
Brian A. Farlow, Hayley Ellison, Worthy W. Walker, Barbara L. Wohlrabe, and David W. Elrod, Gruber Hurst Elrod Johansen Hail Shank, LLP, 1445 Ross Ave, Suite 2500, Dallas, TX 75202; David T. Schultz and Julian C. Zebot, Maslon LLP, 90 South 7th Street, Suite 3300, Minneapolis, MN 55402, for Plaintiff.
Douglas H. Flaum, Kevin P. Broughel, and Shahzeb Lari, Paul Hasting LLP, 75 East 55th Street, New York, NY 10022; Eric A. Hirsch, Fried Frank Harris Shriver & Jacobson LLP, One New York Plaza, New York, NY 10004; Lousene M. Hoppe and Nicole M. Moen, Fredrikson & Byron, PA, 200 South 6th Street, Suite 4000, Minneapolis, MN 55402-1425, for Defendants.
This matter is before the Court on Defendant's Motion to Amend the May 4, 2015 Order to Certify for Interlocutory Appeal [Doc. No. 884]. For the reasons set forth below, the Court denies Defendant's motion.
Although the facts of this matter are thoroughly detailed in prior orders of this Court, the Court finds it prudent to recite the detailed procedural posture of this case, particularly given the unfortunately inaccurate account provided in Defendant's brief. (See Def.'s Mem. at 1-2 [Doc. No. 885].)
Plaintiff Great Lakes Gas Transmission Limited Partnership ("Plaintiff" or "Great Lakes") filed this case in October 2009, alleging that the above named Defendants failed to make all payments due under a contract ("Contract") that was initially executed in 2006 between Plaintiff and Minnesota Steel Industries ("MSI"). The Contract, otherwise known as the Transportation Services Agreement ("TSA"), was effective July 1, 2009 through March 31, 2024. (See First Am. Compl. ¶ 17 [Doc. No. 35.) The Contract explicitly incorporated the terms of a gas tariff ("Tariff") on file with the Federal Energy Regulatory Commission ("FERC"). (See id.)
In 2007, Defendant ESML purchased MSI, and "expressly and/or impliedly assumed all of [MSI's] liabilities," including MSI's obligations under the Contract at issue in this case. (See id. ¶ 16; see also First Am. Answer ¶ 19 [Doc. No. 314].) In its First Amended Complaint, Plaintiff alleged that the Court had subject matter jurisdiction under 28 U.S.C. § 1332(a)(1), because the matter in controversy exceeded the value of $75,000 and was between citizens of different states. (See First Am. Compl. ¶ 9 [Doc. No. 35].)
On September 1, 2011, Defendants filed a Motion to Dismiss for Lack of Subject Matter Jurisdiction [Doc. No. 354]. Specifically, Defendants argued that the Court did not have diversity jurisdiction because complete diversity of citizenship did not exist between the parties. The parties thoroughly briefed the issue of diversity jurisdiction, but did not address whether the Court had federal question jurisdiction. The briefing was likely limited to diversity jurisdiction because Plaintiff did not allege federal question jurisdiction in the Complaint. Before the Court had an opportunity to rule on the jurisdictional issue raised, the parties filed a Stipulation on February 29, 2012, stating "that [Defendants] have no objections to the Court's subject matter jurisdiction in their dispute with Great Lakes, and that [Defendants] will not raise any objections to the Court's subject matter jurisdiction either in this proceeding or in any appellate proceeding related to this proceeding." (Stipulation ¶ 1 [Doc. No. 392].) Thus, the Court was under the impression that issues pertaining to subject matter jurisdiction in this case were put to rest.
Accordingly, litigation proceeded and the Court addressed the merits of Great Lakes' claims and Defendants' defenses. On March 15, 2012, the Court issued an order granting Plaintiff's Motion Dismiss for Failure to State a Claim and to Strike Defendant's Pleadings and dismissing ESML's counterclaims [Doc. No. 397]. On March 19, 2013, the Court issued an Order finding that Defendants were liable for anticipatorily breaching the Contract, as a matter of law [Doc. No. 559]. Great Lakes sought, and still seeks, to "recover damages for [Defendants'] breach of contract based on its Tariff rate, which isthe reservation charges due under the TSA." (See Pl.'s Mem. in Opp'n at 14 [Doc. No. 429].) Pre-trial, the Court must determine the rate of prejudgment interest that applies to Plaintiff's damages and which FERC Tariff reservation rate applies for calculating the damages. Thus, the only remaining issues for trial are: (1) the discount rate to apply to future damages; and (2) whether the discount rate to apply to future damages is pre- or post-tax. Trial was initially scheduled to begin October 27, 2014 [Doc. No. 808].
When this case was on the eve of trial, Defendants alerted the Court via letter [Doc. No. 811] that they believed that the Court in fact lacked diversity jurisdiction. Defense counsel explained that they "first became aware" of the issue when they were preparing their trial brief. (See Flaum Letter at 1 [Doc. No. 811].) Specifically, Defendants uncovered that Plaintiff's initial disclosure about the parties' citizenship was incomplete as Great Lakes failed to disclose the citizenship of TC PipeLines, LP's hundreds or thousands of public unitholders. (See id.) When Plaintiff initially filed this case, the case law was not as clear as it is today about whether public unitholders' citizenship should be considered when determining whether a court sits in diversity jurisdiction. The Court assumes that defense counsel's belated awareness about this issue stems from the fact that Defendants changed counsel over the course of this case's multiple year history.
Affording the parties an opportunity to present their positions on the issue of subject matter jurisdiction, the Court permitted Plaintiff to File a Motion for Leave to File a Second Amended Complaint to assert federal question jurisdiction, and permitted Defendant to file a Motion to Dismiss on the issue of subject matter jurisdiction. Theparties duly filed their respective motions. The Court carefully studied the parties' briefing and the relevant case law. On May 4, 2015, the Court issued an Order [Doc. No. 879] (1) denying Plaintiff's Motion for Leave to File Second Amended Complaint [Doc. No. 812], and (2) denying Defendant Essar Steel Minnesota LLC's Motion to Dismiss for Lack of Subject Matter Jurisdiction [Doc. No. 856]. The Court held that resolution of Plaintiff's breach of contract claim raises a necessarily disputed and substantial federal question.
The Court then held a telephonic status conference with the parties on May 13, 2015. During this conference, the Court permitted Defendant to file a motion requesting an interlocutory appeal on the issue of the Court's subject matter jurisdiction over this case. Defendant filed this motion [Doc. No. 884] and a supporting memorandum [Doc. No. 885] on May 22, 2015. Plaintiff filed its response brief on June 5, 2015 [Doc. No. 888].
Defendant's supporting memorandum [Doc. No. 885] frankly mischaracterizes this Court's May 4 Order. Although the Court spent over fifty pages carefully addressing and distinguishing relevant case law, Defendant carelessly accuses the Court of not "cit[ing] any relevant authority for its position." (See Def.'s Mem. at 3 [Doc. No. 885].) Unfortunately, in the fog of Defendant's anger about the Court's ruling finding subject matter jurisdiction (a position Defendant endorsed for years until the eve of trial), Defendant distorts the record, requiring the Court, once again, to carefully explain its ruling.
While courts of appeals have jurisdiction over "all final decisions of the district courts," 28 U.S.C. § 1291, under certain circumstances, a district court may determine that an otherwise non-final order should be certified for interlocutory appeal under 28 U.S.C. § 1292(b). See 28 U.S.C. § 1292(b). Section 1292(b) provides:
When a district judge, in making in a civil action an order not otherwise appealable under this section, shall be of the opinion that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation, he shall so state in writing in such order.
Id. Thus, the three criteria for certification under this provision are: (1) the order involves a controlling question of law; (2) there is substantial ground for difference of opinion as to that controlling question of law; and (3) certification will materially advance the ultimate termination of litigation. White v. Nix, 43 F.3d 374, 377 (8th Cir. 1994) (citations omitted).
Although the statute grants district courts the discretion to certify orders for interlocutory appeal, "[it] has . . . long been the policy of the courts to discourage piecemeal appeals because most often such appeals result in additional burdens on both the court and the litigants." Id. at 376 (internal quotations and citation omitted). Due to this additional burden, motions for certification should be "granted sparingly and with discrimination." Id. (internal quotations and citation omitted). The legislative history of section 1292 indicates that ...
To continue reading
Request your trial