Insurance Companies Inc., 29 F.3d 1244, 1252 (7th Cir. 1994). The

three exceprions arise when: 1) the statute of limi tions has run
on the pendent state claim, precluding filing of a separate suit in
state court; 2) substantial judicial resources have already been
committed so that sending the case Lo another court will cause a

substantial duplication of effort; and 3) it is absolutely clear

how the pendent clai be decided. Id. at 425).

Analyzing the present case in light of these three exceptions
establishes that this Court should not retain jurisdiction over
Whirlpool’s counterclaim. The parties agree that the first
exception, invoked when the statute of ltmitations has run on a
pendent stale claim, does not apply here. ‘Thus, Whirlpool] is not

time-barrea From pursuing its counterclaim in state court.

The second exception applies where substantial Judicial

resources have been committed in the pending case, such as when a

court has invested a considerable amount. of Lime overseeing the
litigation, through both extensive discovery and motion practice.
See, @.g., Miller Aviation, 273 F.3d at J32 (district court, which
had spent five years overseeing litigation before the federal
claims were disposed of, retained jurisdiction over supplemental
claims for reasons of judicial efficiency). Here, the second
exception does not apply because the complaint was disposed of

relatively carly in the litigation, with virtually no dis

overy


dictates a narrow scope of analysis: whether the Court’s summary
judgment ruling renders the determination of Whirlpool’s
counterclaim absolutely clear. The Court holds that it does not
because the summary judgment ruling did not implicate
paragraph 5(c) of the 2000 Agreement. This is not to say that the
summary judgment ruling does not inform (or even, arguably,
determine) the resolution of Whirlpool’s counterclaim; instead, the
Court nolds only that its prior ruling does not reach the level of

absolute clarity vis a vis the counterclaim to justify abandonment

of the general rule of relinat ment of supplement jurisdiction.

srdingly, the proper result here is for the state court system

state law

(if necessary) to xr camine the contours ot Whirlpool’s
counterclaim with fresh eyes.

CONCLUSION
a

For the reasons set forth above, St. etion to

claim GRANTED .

Dismiss Counte

IT IS SO ORDERED.

Harry D.

Judge
United St t

Court

vate: Math 20



a maximum of $50,000 in damages (based upon the terms of the 2000
Agreement and the selling price of the property).
II. DISCUSSION

The present Motion seeks to dismiss Whirlpvol’s counterclaim
on the basis that the counterclaim lacks an independent basis for
diversity jurisdiction, following dismissal of the complaint.
See 28 U.S.C. §1332(a). A district court “may decline Lo exercise
supplemental jurisdiction over a claim... if the district court
has dismissed all claims over which it has original jurisdiction.”
28 U.S.C. L367 (ce) (3). In determining whether lo exercise
Jurisdiction over claims such as the counterclaim here, courts
consider and weigh the factors of judicial economy, convenience,
fairness and comity. See Carnegie Mellon Univ. v. Cohill, 484 U.S.
343, 350 (1988); Timm v. Mead Corporation, 32 .3d 273 (lth Cir.
1994). The general rule is that, when ail federal claims are
dismissed before trial, the district court should relinquish
jurisdiction over the supplemental claims rather than resolve them

on the merits. See Uniled Mino Workers of Am. V. Gibbs

383 U.S.

M15, 926 (1996); Miller Aviation v. Milwaukee County Bd. of
Supervisors, 273 F.3d 7/22, 731 (7th Cir. 2001).
However, there are exceptions to the general rule. Based upon
a balance of the four previously-stated factors, courts have
‘

recognized three exceplions Lo the general rule of relinquishment

jurisdiction over supplementa! claims. See Wright v. Associated


onducted, and therekore this case has expended comparatively few

judicial resources. Cf. Id.
The third exception to Lhe general rule applies when it. is
absolutely clear how to decide the remaining state Jaw claims.

See, e.g., Wright, 29 F.3d at 1251. The rationale underlying this

exception is that if “the district court, in deciding a federal
claim decides an issue dispositive of a pendent claim, there is no
use leaving the latter Lo the state court.” Seo id.

Here, it is not absolutely clear how to decide Whirlpool’s
counterclaim based exclusively upon this Court’s summary judgment
ruling. Whirlpool argues that the summary judgment ruling “all but
compels judgment in Whiripool’s Favor on the counterclaim.” This

Court's summary judgment ruling hela thal the N&R Letter obtained

by Whirlpool satisfied the provisions of paragraph 5(d) in the 2000

Charles was contractually obligated to

Agreement, and thus
release Whirlpool from any claims pertaining to the pre-existing
conditions at the property. Whirlpool contends that this is

tantamount to a finding that il is entitled Lo reimbursement of iis

dant Co paragraph bla} of Lhe 2000 Agreament.

actual expenses purs.
In contrast, St. Charles notes, among other things, that
paragraph 5 of the 2000 Agreement included a reservation of rights

\greement, which in turn containe
Ag ent, which in turn cont ned

pertaining to the 1989 Purcha

contractual obligations pertaining to environmental remediation

that may require somelLhing more than a NFR Letter.


Minute Cider Foo (0697)

cia

United States District Court, Northern District of Mlinois

ing Judge if Other

signed Judge s
than Assigned Judge

Harry D. Leinenweber
rate Judge

CASE NUMBER

03 C 1917 DATE

3/12/2004

CASE St. Charles Manufacturing vs. Whirlpool Corporation, et al
TITLE
Un the following box (a) indicate the party filing the motion, ¢.g., plaintill. defendant, 3rd party plaintitl, and (b) state brielly the nature
MOTION: of the motion being presented. }

DOCKET ENTRY:

qd) Oo Filed motion of [ use listing in “Motion” box above.]
Qe oo Brief in support of motion due _
(3) oO Answer bricf to motion due. Reply to answer brief due.
(4) oO Ruling/Hearing on _ set for i.
Go Oo Status hearing{held/continued to] [set for/re-set for] on set for, at
(6) a Pretrial conference[held/continued to} [set for/re-set for] on set for | at 7
(7) a Trial[set for/re-set for] on at .
(8) o [Bench/Jury tial] [Hearing] held/continued to
(9) oO ‘This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]
DOFRCPA(m) C)Local Rule dtl OFRCP4I(ay(1) OF FRCP41(a)(2).
ao «of {Other docket entry) ENTER MEMORANDUM OPINION AND ORDER: St. Charles’s Motion
to Dismiss Counterclaim is GRANTED.

dal) (For further detail see order attached to the original minute order.}

No notices required. advised in open court Document

Number

No notices required
Notices mailed by judge’s stall
Notilied counsel by telephone
Docketing t mail notices

Mail AO 450 form.

Copy to judge/magistrate judge

courtroom
deputy’s
initials

WAP

umber of notices

date pile! notice

Date/lime ces
central Cle

ved in
fice

anaing deputy initials



St. Charles has the better argument here. This Court’s
summary judgment ruling was tethered to paragraph %(d) of the 2000
Agreement, which pertained specifically to Whirlpool’s procurement
of an NFR letter. The summary judgment. ruling was silent as to the

meaning otf paragraph 5(c), which is the subject of Lhe

counterclaim. fe may be that, as St. Charles argues,
paragraph S(c) reguires that Whirlpool perform other predicate acts
- separate [rom receipt of the NFR Letter - to obtain reimbursement
for “actual expenses.” In addition, even if reimbursement under
Paragraph S(c) naturally followed from this Court's prior
determination that Whirlpool met Lhe provisions of paragraph 5(d),
the issue of remediation expenses may not be as straightforward as
Whirlpool contends. for instance, although Whirlpool! claims that

such expenses are “casily rhainable based upon invoices

elved by Whirlpool for remediation activities . . . [Lh fore]

requiring neither trial nor further discovery,” St. Charles may

hese expen:

dispute the reasonableness of t 2s and/or raise issues
pertaining Lo mitigation of damages. ‘hus, it} is not unlikely that

further discovery and motion practice may be necessary Lo resolve

facet of the counterc

In expressing the foregoing analysis, this Court, of course,

does not intend Lo provide any opinion on the relative merits of

the parties’ interpretations of paragraph b(c) nor on the viability

St. Charles's potentiel defenses. The procedural posture here


IN THE UNITED STATES DISTRICT COURT = j L = D
FOR THE NORTHERN DISTRICT OF ILLINOIS. *° .
EASTERN DIVISION
MAR 1 2 2004

ST. CHARLES MANUFACTURING “US DisTRICr Coe
.S. F

LIMITED PARTNERSHIP and ST.
CHARLES ACQUISITION LIMITED
PARTNERSHIP, Case No. 03 C 1917

NWEBER
v7 JUDGE

Plaintiff, Hon. Harry D. Leinenweber

v. Op,

WHIRLPOOL CORPORATION and Wap 46 Ve
WHIRLPOOL KITCHENS, INC., Oy

Defendant.

MEMORANDUM OPINION AND ORDER

Before the urt js Plaintiffs’ Motion to Dismiss Counterclaim

for Lack of ifederal Jurisdiction (hereinafter, the “Motion”). For
the following reasons, Lhe Court grants Lhe Motion.

I. INTRODUCTION

fn March 2003, St. Charles Manufacturing Limited Partnership

and Charles Acquisition Limited Partnership (collectively, “St.
Charles”) filed a diversity suit against Whirlpool Corporation and

Whirlpool Kitchens, Ine. (collectively, “Whirpool”), asserting

claims for breach of contract, restitution, quasi contract and
unjust enrichment, and breach of agreement. In May 2003, Whirlpool

ered St. Charles's inilial complaint and also filed a

ans
counterclaim alleging breach of contract. In August 2003,

Whirlpool tiled a motion for summary judgment, which the Court


granted on December 23, 2003, disposing of all counts in the
complaint.

St. Charles's complaint originated from a 1989 Purchase
Agreement in which Whirlpool agreed to sell a parcel of real
property to St. Charles and also agreed to address environmental
contamination on the property. When a disagreement arose
pertaining to Whirlpool’s remediation efforts, the parties entered
into a second agreement (the “2000 Agreement”). In the 2000
Agreement, Whirlpool agreed to oblain official recognition for the
adequacy of its environmental remediation efforts on the properly.
Under paragraph 5(d) of the 2000 Agreement, St. Charles agreed that
“upon receipt of a ‘Comprehensive’ No Further Remediation letter

from the Illinois EPA” it would release Whirlpool From any and all

in respect of pre-existing conditions at the Facility.”
Although Whirlpool received a No Further Remediation letter

(the “NER Letter”) from the illinois BPA, St. Charles still tiled

suit against Whiripool. This Court granted Whirlpool’s motion for

summary judgment on all counts of St. Charles

complaint. Thus,

the only claim left before this Court is Whirlpool’s counterclaim

for preach of the 2000 Agreement. Specifically, Whirlpool’s

counterclaim seeks reimbursement of its expenses in obtaining the
€

NPR Letter, pursuant to paragraph S(c) of the 2000 Agreement.

Under the terms of paragraph 5S(c), this would entitle Whixlpool to