### In the



# United States Court of Appeals

For the Seventh Circuit

____________________

No. 17

‐ 3149

P ROLITE B UILDING S UPPLY

, LLC, et al.

, Plaintiffs

‐ Appellants

,

v.

MW M ANUFACTURERS

, I NC

., doing business as Ply Gem Win

‐

dows,

Defendant

‐ Appellee

, and

G REAT L AKES W INDOW

, I NCORPORATED

, Third

‐ Party Plaintiff

‐ Appellee

.

____________________

Appeal from the United States District Court

for the Eastern District of Wisconsin.

Nos. 15

‐ C

‐ 1049, 15

‐ C

‐ 1205

— Lynn Adelman

, Judge

.

____________________

A RGUED M ARCH 30, 2018

— D ECIDED M AY 22, 2018

____________________

Before E ASTERBROOK and R OVNER

, Circuit Judges

, and

G ILBERT

, District Judge

. *

* Of the Southern District of Illinois, sitting by designation.2 No. 17

‐ 3149

E ASTERBROOK

, Circuit Judge

. Prolite Building Supply

bought Ply Gem windows from MW Manufacturers. (The

parties use “Ply Gem” for both the product and its maker;

we do the same.) Prolite resold the windows to residential

builders in Wisconsin. Some of the homeowners were not

satisfied with the windows, which admitted air even when

closed. They complained to the builders, which complained

to Prolite, which complained to Ply Gem. Working together

under a contract that made Prolite the windows’ principal

servicer, Prolite and Ply Gem solved some but far from all of

the problems. Contractors stopped buying from Prolite,

which stopped paying Ply Gem for earlier deliveries.

Prolite and 12 homeowners filed suit in state court. Pro

‐

lite contended that Ply Gem broke a promise to make the

builders and ultimate customers happy. The homeowners

made claims under the warranties that accompanied the

windows. Ply Gem removed the action to federal court and

counterclaimed against Prolite for unpaid bills. It added An

‐

drew Johnson and Michael Newman, Prolite’s only two

members, as additional parties. (Johnson and Newman had

guaranteed payment of Ply Gem’s invoices.) Great Lakes

Window, a company affiliated with Ply Gem, filed its own

federal suit against Prolite, Johnson, and Newman, seeking

to collect other invoices. Additional homeowners intervened

in the removed suit. The district court consolidated these ac

‐

tions, and the caption that begins this opinion names the

main contestants without going into excessive detail.

The district court granted summary judgment to Ply

Gem and Great Lakes. 2017 U.S. Dist. L EXIS 220922 (E.D. Wis.

Sept. 18, 2017). The judge found that the parties are of di

‐

verse citizenship. (Prolite’s members are citizens of Wiscon

‐No. 17

‐ 3149 3

sin, so Prolite itself is a citizen of Wisconsin, as are all of the

homeowner parties, while Ply Gem and Great Lakes are in

‐ corporated in Delaware (Ply Gem) or Ohio (Great Lakes)

with their principal places of business in North Carolina.)

Prolite’s initial claim against Ply Gem comfortably exceeds

$75,000; Ply Gem’s counterclaim exceeds $180,000; Great

Lakes’ claim exceeds $260,000. None of the homeowners’

claims exceeds $75,000, so none meets the diversity jurisdic

‐

tion (aggregation of different litigants’ claims is not allowed,

see Snyder v. Harris

, 394 U.S. 332 (1969)), but the district

judge wrote that “the claims of the homeowner plaintiffs are

part of the same case or controversy as Prolite’s claim against

Ply Gem” and come within the supplemental jurisdiction. 28

U.S.C. §1367(a). We’ll return to that question, but we start

with the contract claims and counterclaims.

Ply Gem and Prolite had three contracts: a sales agree

‐

ment, a credit agreement, and a service agreement (the “Ser

‐

vice Rebate Obligation”). Prolite concedes that it does not

have any defense to the claims for payment by Ply Gem and

Great Lakes, which rest on the credit agreement, unless it

can show that Ply Gem broke its promises under the service

agreement. The service agreement requires Prolite to repair

the Ply Gem windows that the contractors installed. In ex

‐ change, Ply Gem gave Prolite a 3% discount on the windows’

price and promised to furnish needed parts at no cost. Pro

‐

lite says that it spent about $290,000 trying to fix the trouble

‐

some windows but concedes that it received the 3% discount

and all the parts it requested. Another portion of the service

agreement provides that in the event of “excessive” prob

‐

lems (an undefined term) Ply Gem would furnish additional

aid, including complete window reinstallation, for a price to4 No. 17

‐ 3149

be negotiated. Prolite never asked Ply Gem to replace win

‐

dows under this clause.

Prolite contends that what Ply Gem should have done

was either reinstall all of the windows, without specific re

‐

quests, or design a new line of windows with better attrib

‐

utes and replace the old windows with the new ones, again

without requests. Only those two steps could have kept the

customers happy, Prolite insists. The problem, as the district

judge observed, is that the service agreement does not re

‐ quire Ply Gem to keep the customers happy. (That’s the func

‐

tion of the warranties.) Instead the service agreement re

‐ quires Prolite to keep the customers happy by performing

repairs in exchange for a discount. The district court’s opin

‐

ion meticulously discusses the contractual language. It is not

necessary to repeat that analysis in the Federal Reporter. Nor

need we repeat the district court’s convincing resolution of

the dispute about expert evidence that Prolite proffered.

The homeowners’ claims, by contrast, pose a knotty prob

‐

lem. They can be resolved under the supplemental jurisdic

‐

tion only if they “are so related to claims in the action within

such original jurisdiction that they form part of the same

case or controversy under Article III of the United States

Constitution.” 28 U.S.C. §1367(a). The statute does not define

“case or controversy,” nor does Article III. Courts often ask

whether the claims share a common nucleus of operative

facts. See, e.g., Houskins v. Sheahan

, 549 F.3d 480, 495 (7th Cir.

2008). This jiggles the vagueness problem around a little

without solving it. The same phrase is used in the law of

preclusion. It does real work and can handle many disputes,

but not by prescribing an algorithm. It tells us that “enough”

commonality makes for a controversy but does not dictateNo. 17

‐ 3149 5

the solution to any case. So, for example, supplemental ju

‐

risdiction is appropriate when the supplemental claim in

‐

volves the same parties, contracts, and course of action as the

claim conferring federal jurisdiction. Channell v. Citicorp Na

‐

tional Services, Inc.

, 89 F.3d 379, 385–86 (7th Cir. 1996); Strom

‐ berg Metal Works, Inc. v. Press Mechanical, Inc.

, 77 F.3d 928, 932

(7th Cir. 1996). Ammerman v. Sween

, 54 F.3d 423, 424 (7th Cir.

1995), adds that “[a] loose factual connection between [ ]

claims is generally sufficient” to confer supplemental juris

‐

diction. How loose is that? What does enough commonality

really mean? Still, unless there is a phrase better than “nu

‐

cleus of operative facts,” there’s no point in complaining. No

one has come up with a better phrase, despite a lot of trying,

so we apply this one as best we can.

CNH Industrial America LLC v. Jones Lang LaSalle Americas,

Inc.

, 882 F.3d 692, 701–04 (7th Cir. 2018), suggests that, in an

action by a manufacturer for a breach

‐ of

‐ contract claim, the

court would also have supplemental jurisdiction over deal

‐ erships’ independent breach

‐ of

‐ contract claims. That at least

entails a single contract and closely related parties. There’s

less commonality here. What the contract and warranty

claims have in common is that they concern Ply Gem win

‐

dows. But that is all they share. The language of the warran

‐

ty (three warranties, actually, for three series of windows)

and the service agreement do not overlap. The parties to the

agreements overlap through Ply Gem, but the grievances do

not. Prolite complained that Ply Gem did not do enough to

ensure that its customers (the builders) remained willing to

purchase Ply Gem windows. The homeowners, by contrast,

just wanted to stop drafts and moisture. Each homeowner’s

claim presented a different problem. Some could be fixed,

some not. The nature of the work done differed. The losses6 No. 17

‐ 3149

differed. There may well be savings from litigating the

homeowners’ claims together, because they have some

things in common with each other, but it is impossible to say

that Prolite’s claim and the homeowners’ claims are just one

big controversy. The operative facts differ, as do the contrac

‐

tual terms.

Prolite might have been able to make the imbroglio a sin

‐ gle case or controversy by framing a contract theory that

turned on the merits of the homeowners’ warranty claims. If

Prolite had alleged, for example, that Ply Gem refused to

acknowledge that the homeowners had warranty claims,

preventing Prolite from complying with its obligations un

‐

der the service agreement, then the warranty claims would

have been integral to the whole dispute. But Prolite didn’t

make any such allegations. The homeowners’ claims there

‐

fore cannot proceed under the supplemental jurisdiction.

What happens now? Ply Gem asks us to affirm the judg

‐

ment on Prolite’s claims (and the counterclaims) and send

the homeowners’ claims back to state court. Prolite and the

homeowners, however, want us to vacate the whole judg

‐

ment and remand the whole case.

If the dispute between Prolite and Ply Gem were one un

‐

der federal law, then 28 U.S.C. §1441(c) would supply the

solution. The federal claim would make the whole suit re

‐

movable, and §1441(c)(2) would require the immediate re

‐

mand of any state

‐ law claim not within the supplemental

jurisdiction. The Judicial Code does not contain a parallel

provision for the combination of a diversity claim that is

within federal jurisdiction and a diversity claim that is not.

The dispute between Prolite and Ply Gem was removable in

principle, see §1441(a), and nothing in the chapter on remov

‐No. 17

‐ 3149 7

al (28 U.S.C. §§ 1441 to 1455) suggests that the presence in a

state case of an additional claim worth less than $75,000 (and

not part of the same case or controversy as the first) blocks

removal of a claim otherwise within federal jurisdiction.

The way §1441(c) treats the combination of removable

and non

‐ removable claims implies that there is no jurisdic

‐

tional obstacle to removing the whole suit and sending the

surplus claims back to state court. Section 1447(c) tells us

that a motion to remand on the basis of any ground other

than the absence of subject

‐ matter jurisdiction is forfeited if

not made within 30 days after the filing of the notice of re

‐

moval. Prolite and the homeowners did not argue in the dis

‐

trict court, during those 30 days, that the homeowners’

claims are outside the supplemental jurisdiction and that the

whole suit was therefore not properly removed. In this court

Prolite and the homeowners initially represented that the

entire case comes within federal jurisdiction, only to change

their minds after the supplemental

‐ jurisdiction issue was

raised at oral argument. Grubbs v. General Electric Credit

Corp

., 405 U.S. 699 (1972), tells us that once a removed case

has gone to judgment, the decision should stand even if an

immediate remand would have been proper.

Imagine what would have happened if the original suit

had begun in federal court. The diversity jurisdiction of 28

U.S.C. §1332 would have covered the dispute between Pro

‐

lite and Ply Gem. The tag

‐ along homeowners’ claims should

have been dismissed. The Supreme Court has never suggest

‐

ed that the presence of one claim under the jurisdictional

amount prevents the resolution of other claims that exceed

it, if complete diversity is present. See Clark v. Paul Gray, Inc

.,

306 U.S. 583, 590 (1939).8 No. 17

‐ 3149

What’s more, we cannot forget that we have two suits, the

second one (by Great Lakes) filed initially in federal court

with both complete diversity and stakes exceeding $75,000

for every litigant. Each of these consolidated suits must be

considered independently. Hall v. Hall

, 138 S. Ct. 1118 (2018).

The dispute between Prolite and Ply Gem could be resolved

under the supplemental jurisdiction in the suit by Great

Lakes no matter what one makes of the homeowners’ claims.

The judgment of the district court is affirmed, except

with respect to the homeowners’ claims. The judgment deal

‐ ing with those claims is vacated, and the case is remanded to

the district court with instructions to remand them to state

court.