* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not

be published and is not precedent except under the limited circumstances set forth in 5TH CIR.

R. 47.5.4.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 06-30900

VOLVO TRUCKS NORTH AMERICA INC

Plaintiff - Appellant-Cross-Appellee

v.

CRESCENT FORD TRUCK SALES INC 

Defendant - Appellee-Cross-Appellant

Appeal from the United States District Court

for the Eastern District of Louisiana, New Orleans

No. 2:02-CV-3398

Before KING, STEWART, and PRADO, Circuit Judges.

PER CURIAM:*

Plaintiff Volvo Trucks North America, Inc. (“Volvo”) appeals the district

court’s judgment entered on the jury’s verdict in favor of defendant Crescent

Ford Truck Sales, Inc. (“Crescent”) on its breach of contract claim. Crescent

cross-appeals the jury’s finding, as incorporated into the judgment, that it

breached its dealer agreement with Volvo by failing to procure a customer’s

signature on the warranty registration. Because we find that subject matter

jurisdiction does not exist in this case, however, we VACATE the judgment and

United States Court of Appeals

Fifth Circuit

F I L E D

April 10, 2008

Charles R. Fulbruge III

Clerk
No. 06-30900

2

REMAND to the district court with instructions to DISMISS the case without

prejudice.

I.

On November 3, 1999, Luciano Refrigerated Transport, Inc. (“Luciano”)

initiated an adversary proceeding against Volvo in the United States

Bankruptcy Courtfor the Eastern District of Louisiana. On November 15, 2000,

Volvo filed a third-party demand against Crescent. However, on January 9,

2000, Volvo entered into an agreement to settle Luciano’s claims. On October

30, 2002, the bankruptcy court dismissed the claims remaining between Volvo

and Crescent without prejudice for lack of subject matter jurisdiction, concluding

that they were not “related to” the Luciano bankruptcy for the purposes of 28

U.S.C. § 1334(b). Neither Volvo nor Crescent appealed the bankruptcy court’s

order. 

Instead, on November 13, 2002, Volvo filed the instant breach-of-contract

case in district court, alleging 28 U.S.C. § 1332 diversity jurisdiction. The case

went to trial, resulting in a jury verdict and final judgment, from which both

Volvo and Crescent have appealed. At oral argument, Volvo brought the lack of

diversity jurisdiction to the attention of this court and sought to amend the

pleadings to cure this jurisdictional defect, as permitted by 28 U.S.C. § 1653, by

invoking 28 U.S.C. § 1334(b)’s jurisdictional provision for “civil proceedings . . .

related to cases under title 11.” After a close review of the record, however, we

conclude that there is no basis for federal jurisdiction in this case.

II.

A federal court may examine its subject matter jurisdiction at any time

during a case. Bass v. Denney (In re Bass), 171 F.3d 1016, 1021 (5th Cir. 1999).

Whether a federal court has subject matter jurisdiction is a question of law that

we review de novo. Gasch v. Hartford Accident & Indem. Co., 491 F.3d 278, 281

(5th Cir. 2007). This case proceeded in the district court under alleged diversity
No. 06-30900

3

jurisdiction. However, as Volvo suggested at oral argument, diversity

jurisdiction is lacking because both parties are incorporated in Delaware. See

28 U.S.C. § 1332.

Volvo now seeks to alter the basis for federal jurisdiction pursuant to 28

U.S.C. § 1653, arguing that it is apparent from the face of its complaint that the

federal forum is available in this case under 28 U.S.C. § 1334(b) because the

claims are “related to” Luciano’s bankruptcy proceedings. But the bankruptcy

court decided this issue in a final, unappealed order, dismissing Volvo’s thirdparty claim against Crescent without prejudice for lack of subject matter

jurisdiction.

In light of the bankruptcy court’s order, principles of collateral estoppel

require the conclusion that there is no related-to-bankruptcy jurisdiction in this

case. In any event, we agree with the bankruptcy court that the claims between

Volvo and Crescent are not “related to” the Luciano bankruptcy under 28 U.S.C.

§ 1334(b). 

As the bankruptcy court correctly set out, a “proceeding is related to a

bankruptcy if the outcome of that proceeding could conceivably have any effect

on the estate being administered in bankruptcy.” In re Bass, 171 F.3d at 1022

(citations and internal quotation marks omitted); see also Celotex Corp. v.

Edwards, 514 U.S. 300, 308 n.6 (1995). In other words, an “action is related to

bankruptcy if the outcome could alter the debtor’s rights, liabilities, options, or

freedom of action (either positively or negatively) and . . . in any way impacts

upon the handling and administration ofthe bankruptcy estate.” In re Bass, 171

F.3d at 1022 (citations and internal quotation marks omitted). Further, relatedto-bankruptcy jurisdiction does not exist “over proceedings that have no effect

on the debtor.” Walker v. Cadle (In re Walker), 51 F.3d at 569 (quoting Celotex,

514 U.S. at 308). 

In In re Walker, we affirmed the district court’s decision that neither it nor
No. 06-30900

4

the bankruptcy court had subject matter jurisdiction pursuant to 28 U.S.C. §

1334(b) over a third-party complaint in an adversary proceeding to determine

whether the third-party defendant should be required to reimburse the

defendant for any money found owing to the debtor. Id. We concluded that the

defendant’s claim against the third-party defendant had “no ‘conceivable effect

on the administration of the estate’ nor would the outcome of that claim ‘alter

the debtor’s rights, liabilities, options, or freedom of action.’” Id. We explained

that it was “difficult to imagine that whether [the third-party defendant] should

be required to reimburse [the defendant] for any money [the defendant] pays to

[the debtor] could somehow affect the estate.” Id.

In this case, Volvo settled Luciano’s claims against it on January 9, 2000.

The bankruptcy court subsequently dismissed Volvo’s third-party complaint

because “Volvo Truck’s third-party claim against Crescent will not have any

[e]ffect on the [d]ebtor’s estate.” Luciano Refrigerated Transp., Inc. v. Volvo

Trucks N. Am., Inc., No. 99-1244, slip op. at 4 (Bankr. E.D. La. Oct. 30, 2002).

We agree. As was the case in In re Walker, we cannot conceive of any way in

which the determination of whether Crescent is liable to Volvo for breach of

contract damages could possibly affect Luciano’s bankruptcy estate or alter his

“rights, liabilities, options, or freedom of action.” Therefore, this case is not

“related to” the Luciano bankruptcy for the purposes of 28 U.S.C. § 1334(b)

subject matter jurisdiction.

III. CONCLUSION

Consequently, we VACATE the judgment and REMAND to the district

court with instructions to DISMISS the case without prejudice. Costs shall be

borne by Volvo.