United States District Court, N.D. Ohio, Eastern Division
MEMORANDUM OPINION AND ORDER
HONORABLE SARA LIOI UNITED STATES DISTRICT JUDGE.
the Court is the motion to dismiss under Fed.R.Civ.P.
12(b)(6) and for summary judgment under Fed.R.Civ.P. 56 filed
by defendant William Sheppee (USA) Ltd. (“Sheppee
USA”). (Doc. No. 9 [“Mot. 1”].) Plaintiffs
IAL Logistics India Limited (“IAL Logistics”) and
IAL Container Line (USA) Inc. (“IAL USA”)
(collectively, “IAL”) filed a memorandum in
opposition (Doc. No. 12 [“Opp'n 1”]), and
Sheppee USA filed a reply (Doc. No. 13 [“Reply
1”]). For the reasons set forth herein, the
motion is granted.
before the Court is Sheppee USA's motion to dismiss under
Fed.R.Civ.P. 12(b)(1). (Doc. No. 14 [“Mot. 2”].)
IAL filed a memorandum in opposition. (Doc. No. 18
[“Opp'n 2”].) Sheppee USA filed a reply.
(Doc. No. 19 [“Reply 2”].) For the reasons set
forth herein, the motion is granted.
December 13, 2018, IAL filed its complaint (Doc. No. 1,
Complaint [“Compl.”]), which it amended on March
8, 2019 (Doc. No. 10, First Amended Complaint
[“FAC”]), after the first motion to dismiss had
support of its claims, IAL alleges that Vikram Singh
Associates, as seller of merchandise to Sheppee USA,
appointed IAL Logistics as a freight forwarder for the
purpose of arranging transportation of various merchandise
shipments from India to the United States. (FAC ¶ 6.)
IAL Logistics appointed IAL USA as its delivery agent.
(Id. ¶ 7.)
Logistics issued several bills of lading, referred to as
“House Bills, ” for carriage of the merchandise
on a “freight collect” basis, making the party
taking delivery responsible for payment of freight charges
and listing Sheppee USA as the “notify” party.
(Id. ¶ 11.) House Bills were issued by IAL
Logistics between December 23, 2015 and May 18, 2016; IAL USA
issued corresponding freight invoices for the shipments.
(Id. ¶ 12 & Exs. A-J.) The total amount of
the freight charges was $44, 450.00, toward which Sheppee USA
has allegedly paid only three payments of $4, 650.00 each.
(FAC ¶¶ 15-16.)
claims that, on September 10, 2018, after the parties
exchanged several offers and counteroffers for settlement,
Sheppee USA first agreed to pay $25, 000 in two installments
by the end of October 2018, and then confirmed (in early
October) that it would make one lump sum payment of $25, 000.
(Id. ¶¶ 25-26.) On October 15, 2018, and
again on October 24, 2018, IAL informed Sheppee USA that it
was prepared to commence litigation due to Sheppee USA's
continued failure to pay the lump sum settlement.
(Id. ¶¶ 27-28.)
December 13, 2018, IAL commenced this action, asserting a
claim for breach of a maritime contract and a claim for
unjust enrichment. It amended the complaint on March 8, 2019,
adding the claim for breach of settlement agreement.
Motion to Dismiss Under Rule 12(b)(1)
one of the FAC asserts a claim for breach of an alleged
settlement agreement entered into on or about September 10,
2018. (FAC ¶¶ 18-25.) The original
complaint contained no such claim, although it was filed at a
time IAL already knew of Sheppee USA's alleged breach of
the settlement. This count was added by way of the FAC, and
was followed by a separate motion to dismiss.
USA argues that this Court lacks subject matter jurisdiction
over the claim for breach of the settlement agreement because
it is well-settled that any such claim is simply a contract
dispute, properly within the purview of state courts and
state common law. (Mot. 2 at 275.) Sheppee USA asserts that
this claim does not fall under maritime jurisdiction, nor is
it covered by diversity jurisdiction (since the amount in
controversy is less than $75, 000), or any form of ancillary
USA relies upon Kokkonen v. Guardian Life Ins. Co. of
Am., 511 U.S. 375, 114 S.Ct. 1673, 128 L.Ed.2d 391
(1994). In Kokkonen, “the Supreme Court held
that, in enforcing a settlement agreement that produced the
dismissal of an earlier federal suit, a federal court
adjudicates a breach-of-contract controversy distinct from
the dismissed suit.” Limbright v. Hofmeister,
566 F.3d 672, 674 (6th Cir. 2009). “Therefore,
‘[e]nforcement of the settlement agreement . . .
requires its own basis for jurisdiction[, ]'”
Id. (quoting Kokkonen, 511 U.S. at 378),
“such as diversity or federal question
jurisdiction[.]” Id. at 676.
there is no allegation that the breached settlement agreement
addressed in count one of the FAC “produced the
dismissal of an earlier federal suit, ” or, for that
matter, the dismissal of any suit. IAL merely
alleges that it had an enforceable settlement agreement
(i.e., a contract) with Sheppee USA. Nor is there
any allegation that the alleged settlement agreement was
incorporated within one of this Court's orders, such that
this Court would have ancillary jurisdiction to enforce the
terms of the order. Any negotiations that may have resulted
in the alleged oral settlement agreement that IAL now seeks
to enforce were not supervised by this Court in the first
instance. In addition, there is no federal question
jurisdiction over the claim, and no one argues that there is.
Nor is there diversity jurisdiction because the amount in
controversy is insufficient, even if citizenship may be
only possible source of jurisdiction would be supplemental
jurisdiction. Although IAL never alleged supplemental
jurisdiction in either the original complaint or the first
amended complaint, it argues in its opposition brief that
such jurisdiction exists and that “there are
no obvious or compelling reasons for the Court to decline to
exercise supplemental jurisdiction in this action.”
(Opp'n 2 at 314.) An opposition brief, or a brief of any
kind, is not an appropriate means for amending a complaint.
D.E.&J. Ltd. P'ship v. Conaway, 133
Fed.Appx. 994, 1001-02 (6th Cir. 2005) (collecting cases
where courts did not construe statements in briefs as motions
to amend). That said, any such defect in the complaint could
be cured by way of further amendment for the sole purpose of
alleging supplemental jurisdiction, and any such amendment
would not be prejudicial under the circumstances.
even if supplemental jurisdiction were alleged, the Court
would decline, in its discretion, to exercise it over the
claim for breach of settlement agreement because the facts
and circumstances underlying any federal claim for breach of
a maritime contract are completely unmoored from the facts
and circumstances surrounding any supplemental claim for
breach of a settlement agreement. See 28 U.S.C.
§ 1367(a) (requiring claims over which there is
supplemental jurisdiction to be ...