IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF OHIO

EASTERN DIVISION

United States of America, 

et al.,

 

Plaintiffs, 

 

v. Case No. 2:12-cv-881 

 

Magistrate Judge Kemp

Cannon Management Group, LLC,

et al., 

Defendants. 

 

OPINION AND ORDER

This action involves a dispute that arose between a project

contractor and a construction company in the course of their work

on a construction project located at a Veteran’s Affairs facility

in Chillicothe, Ohio. Plaintiff N.R. Lee is the construction

company, and it brought this action against the project

contractor, Cannon Management Group, LLC (“Cannon”), as well as

Cannon’s surety on the project, American Contractors Indemnity

Company, asserting claims for breach of contract, violation of

the Miller Act, 40 U.S.C. §3131 et seq., and reformation of

contract. The complaint also alleges that the “Contracts contain

an arbitration clause and a case has been filed at the American

Arbitration Association,” and asserts that the case should be

stayed pending the arbitration. 

Defendants filed a motion to dismiss for lack of

jurisdiction, arguing that N.R. Lee failed to set forth a valid

Miller Act claim because it failed to sue within the time

proscribed by the Act, and that without that claim this Court

lacked subject-matter jurisdiction over the action. 

Subsequently, N.R. Lee filed a motion to stay this case pending

the outcome of an arbitration scheduled to take place on August

Case: 2:12-cv-00881-TPK Doc #: 18 Filed: 08/21/13 Page: 1 of 8 PAGEID #: <pageID>
13, 2013 before the American Arbitration Association. In their

opposition to the motion to stay, Defendants argue primarily that

the Court cannot rule on the motion to stay because it lacks

subject matter jurisdiction. The Court will first turn to the

question of whether it has subject-matter jurisdiction over this

matter. 

I.

A federal court is a court of limited jurisdiction; that is,

not every lawsuit which alleges a legal claim can be filed in a

federal court. Rather, this court may hear cases only if the

kind of case a plaintiff wishes to bring is described in Article

III of the United States Constitution and if Congress has granted

the Court the authority to hear the case. Cases falling outside

the jurisdiction of the federal courts can be filed in a court of

general jurisdiction, such as the state court.

The complaint alleges that the basis of this Court’s

jurisdiction is the Miller Act, 40 U.S.C. §§3131 et seq. (Compl.

at ¶3.) Defendants argue that this Court lacks jurisdiction

because the Miller Act provides that “[a]n action brought under

this subsection must be brought no later than one year after the

day on which the last of the labor was performed or material was

supplied by the person bringing the action,” 40 U.S.C.

§3133(b)(4), and this action was brought outside of that time

period. N.R. Lee argues that the time limitation is not

jurisdictional. 

The Supreme Court has considered the question of whether

certain statutory requirements are jurisdictional or merely

essential ingredients of a federal claim for relief: 

On the subject-matter jurisdiction/ingredient-of-claimfor-relief dichotomy, this Court and others have been

less than meticulous. “Subject matter jurisdiction in

federal-question cases is sometimes erroneously

conflated with a plaintiff's need and ability to prove

-2-

Case: 2:12-cv-00881-TPK Doc #: 18 Filed: 08/21/13 Page: 2 of 8 PAGEID #: <pageID>
the defendant bound by the federal law asserted as the

predicate for relief-a merits-related determination.” 2

J. Moore et al., Moore's Federal Practice § 12.30[1],

p. 12-36.1 (3d ed.2005) (hereinafter Moore). Judicial

opinions, the Second Circuit incisively observed,

“often obscure the issue by stating that the court is

dismissing ‘for lack of jurisdiction’ when some

threshold fact has not been established, without

explicitly considering whether the dismissal should be

for lack of subject matter jurisdiction or for failure

to state a claim.” Da Silva [v. Kinsho Intern. Corp],

229 F.3d [358], at 361 [(2nd Cir. 2000)]. We have

described such unrefined dispositions as “drive-by

jurisdictional rulings” that should be accorded “no

precedential effect” on the question whether the

federal court had authority to adjudicate the claim in

suit. Steel Co. [v. Citizens for a Better Environment],

523 U.S. [83], at 91, 118 S.Ct. 1003 [(1998)].

Arbaugh v. Y&H Corp., 546 U.S. 500, 511 (2006). The consequences

of classifying a provision as jurisdictional rather than as an

element of a claim for relief are significant: 

First, “subject-matter jurisdiction, because it

involves a court's power to hear a case, can never be

forfeited or waived.” . . . Moreover, courts, including

this Court, have an independent obligation to determine

whether subject-matter jurisdiction exists, even in the

absence of a challenge from any party. . . . 

Second, in some instances, if subject-matter

jurisdiction turns on contested facts, the trial judge

may be authorized to review the evidence and resolve

the dispute on her own. . . . If satisfaction of an

essential element of a claim for relief is at issue,

however, the jury is the proper trier of contested

facts. . . . 

Third, when a federal court concludes that it lacks

subject-matter jurisdiction, the court must dismiss the

complaint in its entirety. . . . In contrast, when a

court grants a motion to dismiss for failure to state a

federal claim, the court generally retains discretion

to exercise supplemental jurisdiction, pursuant to 28

U.S.C. § 1367, over pendent state-law claims.

-3-

Case: 2:12-cv-00881-TPK Doc #: 18 Filed: 08/21/13 Page: 3 of 8 PAGEID #: <pageID>
Id. at 514 (citations omitted). 

Because of the importance of this determination, the Supreme

Court adopted a “readily administrable bright line” articulated

as follows: “when Congress does not rank a statutory limitation

on coverage as jurisdictional, courts should treat the

restriction as nonjurisdictional in character.” Id. at 516

(holding that “the threshold number of employees for application

of Title VII is an element of a plaintiff’s claim for relief, not

a jurisdictional issue”). More recently, the Supreme Court has

provided some further guidance on discerning Congress’s intent:

Congress, of course, need not use magic words in order

to speak clearly on this point. “[C]ontext, including

this Court's interpretation of similar provisions in

many years past, is relevant.” . . . When “a long line

of this Court's decisions left undisturbed by

Congress,” . . . has treated a similar requirement as

“jurisdictional,” we will presume that Congress

intended to follow that course.

Henderson ex rel. Henderson v. Shinseki, 131 S. Ct. 1197, 1203,

179 L. Ed. 2d 159 (2011) (citations omitted). 

The provision at issue here is the Miller Act’s time

limitation on filing actions. Typically “rules that seek to

promote the orderly progress of litigation by requiring that the

parties take certain procedural steps at certain specified times”

are considered “claim-processing rules” and should not be

considered jurisdictional. Henderson, 131 S. Ct. at 1203

(citations omitted). “Filing deadlines . . . are quintessential

claim-processing rules.” Id. The Supreme Court has noted that

language making a time limit emphatic is not the same as language

designating a time limit as jurisdictional. Arbaugh, 546 U.S.

at 510 (“this Court and others have occasionally described a

nonextendable time limit as ‘mandatory and jurisdictional.’ . . . 

-4-

Case: 2:12-cv-00881-TPK Doc #: 18 Filed: 08/21/13 Page: 4 of 8 PAGEID #: <pageID>
But in recent decisions, we have clarified that time

prescriptions, however emphatic, ‘are not properly typed

“jurisdictional.”’)(citations omitted). Indeed, in Henderson the

Court held that a statute providing that a veteran seeking

Veterans Court review of the Department of Veterans Affairs'

determination of disability benefits “shall file a notice of

appeal ... within 120 days” was not jurisdictional. 131 S.Ct.,

at 1204 (quoting 38 U.S.C. § 7266(a)). Instead the Court held

that “the language of § 7266 provides no clear indication that

Congress wanted that provision to be treated as having

jurisdictional attributes.” Henderson, 131 S. Ct. at 1205. 

Indeed, because of the history of treating filing deadlines as

non-jurisdictional, there must be a clear indication that

Congress intends for such limitations to be jurisdictional for

them to be treated as such. Sebelius v. Auburn Reg'l Med. Ctr.,

133 S. Ct. 817, 825, 184 L. Ed. 2d 627 (Jan. 22, 2013). 

In light of these rulings, the Ninth Circuit held that the

time limitation in the Miller Act is not jurisdictional:

A proper analysis of the Miller Act's statute of

limitations makes clear that it is a claim-processing

rule, not a jurisdictional requirement. As a statute of

limitations, § 3133(b)(4) of the Miller Act is cloaked

in a presumption of non jurisdictional status that may

be stripped only if there is an “exceptional” reason

for doing so, Auburn Reg'l, 133 S.Ct. at 825 (citations

omitted), and the relevant factors all indicate there

is nothing exceptional about § 3133(b)(4). It is,

instead, a “run-of-the mill statute of limitations.”

See Holland v. Florida, ––– U.S. ––––, 130 S.Ct. 2549,

2561, 177 L.Ed.2d 130 (2010). 

For one, § 3133(b)(4) “does not speak in jurisdictional

terms.” Auburn Reg'l, 133 S.Ct. at 824 (internal

quotation marks omitted). Neither the word “courts” nor

“jurisdiction” appears in the section, which implies

that § 3133(b)(4) is “a restriction on the rights of

plaintiffs to bring suit, rather than [ ] a limitation

on the power of the federal courts to hear the suit.”

-5-

Case: 2:12-cv-00881-TPK Doc #: 18 Filed: 08/21/13 Page: 5 of 8 PAGEID #: <pageID>
Payne v. Peninsula Sch. Dist., 653 F.3d 863, 869 (9th

Cir. 2011) (en banc). 

Nor is § 3133(b)(4) located in a provision granting

federal courts jurisdiction over Miller Act claims. See

Reed Elsevier, 130 S.Ct. at 1245–46. Federal courts

have subject matter jurisdiction over Miller Act claims

pursuant to 28 U.S.C. § 1331, and § 1331 does not

“condition[ ] its jurisdictional grant” on whether the

plaintiff files his claim within the one year

limitations period in § 3133(b)(4) of the Miller Act.

See id. at 1246. 

There is also not a “century's worth of precedent and

practice in American courts” holding that the Miller

Act's statute of limitations is a jurisdictional

requirement. See Auburn Reg'l, 133 S.Ct. at 825

(internal quotation marks omitted). Since Arbaugh, the

Supreme Court has twice held, despite the presumption

against it, that a filing deadline was jurisdictional,

see Bowles v. Russell, 551 U.S. 205, 208, 127 S.Ct.

2360, 168 L.Ed.2d 96 (2007) (notice of appeal); John R.

Sand & Gravel v. United States, 552 U.S. 130, 133, 128

S.Ct. 750, 169 L.Ed.2d 591 (2008) (statute of

limitations for suits filed in the Court of Federal

Claims), but both decisions hinged on the fact that the

Supreme Court itself had long held those deadlines were

jurisdictional, Bowles, 551 U.S. at 210–12, 127 S.Ct.

2360 (cases dating back to 1848); John R. Sand &

Gravel, 552 U.S. at 134, 128 S.Ct. 750 (cases dating

back to 1883); see also Reed Elsevier, 130 S.Ct. at

1250–51 (Ginsburg, J., concurring) (explaining Bowles

and John R. Sand & Gravel in light of Arbaugh's bright

line rule). In contrast, the Supreme Court has never

held that the Miller Act's statute of limitations is a

jurisdictional requirement, nor is there uniformity

among the circuit courts on the issue. See Highland

Renovation Corp. v. Hanover Ins. Grp., 620 F.Supp.2d

79, 81–82 (D.D.C.2009) (compiling cases).

Lastly, the Miller Act “was intended to be highly

remedial,” and the Supreme Court has stated that courts

must construe the Miller Act's provisions with this

highly remedial purpose in mind. Fleisher Eng'g &

Constr. Co. v. United States ex rel. Hallenbeck, 311

U.S. 15, 17–18, 61 S.Ct. 81, 85 L.Ed. 12 (1940). It is

unlikely Congress intended the Miller Act's statute of

limitations to be a jurisdictional requirement given

-6-

Case: 2:12-cv-00881-TPK Doc #: 18 Filed: 08/21/13 Page: 6 of 8 PAGEID #: <pageID>
the Act's highly remedial purpose. See Henderson, 131

S.Ct. at 1202–05 (in analyzing a filing deadline for an

appeal to the Veteran's Court, noting that, given “the

solicitude of Congress for veterans,” Congress would

not have intended the filing deadline at issue to be

jurisdictional due to the potentially “drastic”

consequences of such a label).

U.S. ex rel. Air Control Technologies, Inc. v. Pre Con Indus.,

Inc., 11-56230, 2013 WL 3242673, *3-4 (9th Cir. June 28, 2013). 

The Court finds this reasoning persuasive. 

In arguing that the provision at issue is jurisdictional,

Defendants cite to decisions that pre-date Arbaugh. One of the

decisions that Defendants cite, U. S., for Use of Celanese

Coatings Co. v. Gullard, 504 F.2d 466 (9th Cir. 1974), has now

been expressly overruled by Air Control Technologies, Inc.,1

which stated, “[b]ecause Celanese Coatings is clearly

irreconcilable with intervening higher authority, we overrule it

and hold the Miller Act's statute of limitations is a

claim-processing rule, not a jurisdictional requirement.” Air

Control Technologies, Inc., 2013 WL 3242673 at *4. Accordingly,

the Court concludes that the time limitation in the Miller Act is

not jurisdictional. As a result, the Court may proceed to

consider the motion for stay pending arbitration. 

II.

N.R. Lee has moved to stay this action pending the

arbitration. Under the Federal Arbitration Act, “[i]f a court

determines that the cause of action is covered by an arbitration

clause, it must stay the proceedings until the arbitration

process is complete.” Fazio v. Lehman Bros., Inc., 340 F.3d

386, 392 (6th Cir. 2003) (citing 9 U.S.C. § 3). N.R. Lee has

1

 The Court recognizes that Air Control Technologies, Inc.

was decided after the briefs in this case were filed. 

-7-

Case: 2:12-cv-00881-TPK Doc #: 18 Filed: 08/21/13 Page: 7 of 8 PAGEID #: <pageID>
attached three contracts to the complaint, each of which is

between N.R. Lee and Cannon, and each of which indicates that the

parties have agreed to binding arbitration in the event that any

claims are not resolved by mediation. Defendants do not dispute

that the disputes between N.R. Lee and Cannon are “subject to

arbitration under the contractual provisions agreed between

them.” (Doc. No. 15 at 4.) Defendants note that American

Contractors Indemnity Co. is not a party to any of the contracts. 

(Id.) However, Defendants recognize that they could be bound by

the arbitration if the Miller Act claim survives. (Id.) Indeed,

sureties on Miller Act subcontracts are bound by ensuing

arbitration proceedings even if the sureties were not named

parties in the arbitration as long as they had constructive

notice of the proceeding. U.S. for Use & Benefit of Skip

Kirchdorfer, Inc. v. M.J. Kelley Corp., 995 F.2d 656, 661 (6th

Cir. 1993). Here American Contractors Indemnity Co. has been

named as a party to the arbitration proceeding. (Doc. No. 13,

Exh. B.) The only argument Defendants have made against the stay

is that the Court lacks subject-matter jurisdiction to rule on

the motion because of the jurisdictional nature of the time

requirement in the Miller Act. Having found that argument to be

meritless, the Court determines that a stay is appropriate here. 

III.

For the foregoing reasons, the Motion of N.R. Lee for Stay

Pending Arbitration (Doc. No. 13) is granted. 

 /s/ Terence P. Kemp 

 UNITED STATES MAGISTRATE JUDGE

-8-

Case: 2:12-cv-00881-TPK Doc #: 18 Filed: 08/21/13 Page: 8 of 8 PAGEID #: <pageID>