author: NANGLE, Chief Judge.

text:
    NATIONAL CREDIT UNION ADMINISTRATION BOARD, as Liquidating Agent for Zionic Federal Credit Union, Plaintiff, v. James A. CHRISTENSON, Trustee of the R.O. Herbert Trust, et al., Defendants.
    Nos. 85-1074C(1) to 85-1080(1).
    United States District Court, E.D. Missouri, E.D.
    Jan. 3, 1986.

      Gary H. Feder, St. Louis, Mo., for plaintiff.
    Mark T. Keaney, St. Louis, Mo., for defendants.
   MEMORANDUM

NANGLE, Chief Judge.

Six of the seven cases consolidated in this action are now before this Court on defendants’ motions to quash service of process, to dismiss for improper venue and to dismiss for lack of personal jurisdiction, or in the alternative, to transfer under 28 U.S.C. § 1404(a). For the reasons stated herein, all of defendants’ motions are denied.

These cases represent a small portion of the lawsuits arising out of the insolvency and subsequent liquidation of the Zionic Federal Credit Union (Zionic). There is little disagreement over the basic facts surrounding the transactions which transpired between the parties to these lawsuits. The parties are in disagreement over the legal significance of their actions.

Zionic, a Missouri credit union, operated originally from offices in Bridgeton, Missouri and then later from St. Charles, Missouri. On June 6, 1984, Zionic was found to be insolvent and was placed into involuntary liquidation by the National Credit Union Administration Board (NCUAB) pursuant to 12 U.S.C. §§ 1766(b) and 1787(a)(1). The NCUAB was required to pay the insured depositors from the National Credit Union Share Insurance Fund as required by federal law. 12 U.S.C. § 1787(c)(1). In addition, the NCUAB, pursuant to 12 U.S.C. § 1787(a)(1), appointed itself liquidating agent for Zionic. As the liquidating agent, NCUAB is charged with collecting the assets of the failed credit union. The funds recovered are ultimately to be distributed to the creditors of Zionic, the Share Insurance Fund and the remaining uninsured depositors. All of the seven cases, consolidated by this Court’s Order of July 22, 1985, concern loan transactions involving National Heritage Corporation (NHC), James A. Christenson and individual members of the Herbert family (the Herbert defendants). The motions which are the subject of this Order relate only to the actions against NHC and the Herbert defendants.

NHC is a South Carolina corporation with its principal place of business also in South Carolina. Richard 0. Herbert, as president of NHC, sought to reorganize the debt structure of NHC, a family business. The company operates a cemetery business with properties located in North Carolina, South Carolina and Georgia. Richard Herbert, in his affidavit, states that during the late summer or fall of 1982, he was contacted in his office in Anderson, South Carolina by Mr. Mel Lanius. According to Mr. Herbert, Mr. Lanius was seeking reputable borrowers to take out loans from a bank associated with the Reorganized Church of Latter Day Saints. Mr. Herbert was subsequently contacted by James A. Christen-son, attorney for Zionic, who stated that Zionic Federal Credit Union of St. Louis, Missouri, would be making the loans for the church. Mr. Christenson also requested that Mr. Herbert’s South Carolina attorneys prepare the necessary documentation for the loans. On December 3, 1982, Mr. Lanius and Mr. Christenson came to South Carolina and executed notes for a total amount of $200,000.00. Mr. Herbert also states that he was presented with a check in the amount of the notes. Finally, Mr. Herbert states that Mr. Christenson explained that it was necessary to issue the loans in the name of individuals until Zionic obtained approval to make corporate loans, but that no individual would be personally liable for any loss on the notes.

The notes signed on December 3, 1982, with the exception of the names of the makers, guarantors and witnesses and the account numbers are identical. They all state that payments are to be made to Zionic Federal Credit Union, located in St. Louis, Missouri. In the collateral section, the notes state the following; “stock in cemetery company, accounts receivable $400,000.00 and guarantees”.

Subsequent to December 3, 1982, a number of additional loans were signed by individual members of the Herbert family for the benefit of NHC. The Herbert Family defendants each state that the loans were necessary to allow NHC to reorganize its debt structure. The parties do not dispute that all proceeds from the loans to the Herbert defendants were in fact used in the family business. The Herbert defendants further state that it was their understanding that it was necessary for the loans to be carried in individual names because Zionic had no authority to make loans to corporations, but that there would be no personal liability on the notes. The Herbert defendants state that the loans were all signed in South Carolina and that they never traveled to Missouri in connection with those notes. In their answers to interrogatories however, Richard, Marie and Jeffrey Herbert state they made a total of ten trips to St. Louis during the period from April, 1983 to August, 1984. The purposes of their trips were to discuss finances, banking arrangements and to execute a trust agreement.

In addition to the loans made to the Herbert defendants, a number of other loans were made to James A. Christenson as trustee of The R.O. Herbert Trust (Herbert Trust). The Herbert Trust arises out of a complex financing arrangement which is outlined in what is referred to as the Unitrust Agreement. The Unitrust Agreement was executed by Richard and Marie Herbert on or about April 26,1982 in St. Louis, Missouri. According to NCUAB, Richard Herbert set up two Missouri corporations, National Family Institute, Inc., and National Financial Management Corporation. Under the terms of the Unitrust Agreement, capital and common stock of NHC as well as certain rights of action and notes receivable whicfy, belonged to Mr. Herbert were transferred to National Financial Management Corp. The Unitrust Agreement designates National Financial Management Corp. as trustee of the Herbert Trust.

James A. Christenson, as president of National Financial Management Corp., signed for loans from Zionic amounting to $624,064.00. These notes are the subject of the suit filed by plaintiff numbered 85-1074C(1). The Herbert defendants claim Christenson made loans to himself and never accounted to the Herbert Trust or NHC for the funds borrowed. The Herbert family defendants sought reconsideration of this Court’s order consolidating the Chris-tenson case with the six other cases that involved individual members of the Herbert family and NHC. That motion was denied by this Court on the basis that all seven cases are the result of a series of loans involving the Herbert Trust, the Herbert family and their South Carolina business, National Heritage Corporation.

In the six cases, involving members of the Herbert family, the defendants filed affidavits in which they admit signing the notes for the loans in question. They also state that they are South Carolina citizens, that the notes were all signed in South Carolina and that James Christenson informed them that there would be no personal liability on these notes. The Herbert defendants have filed motions in these six cases to quash service, to dismiss for improper venue and for lack of personal jurisdiction, or in the alternative, to transfer under 28 U.S.C. § 1404(a). Upon review of the pleadings and affidavits submitted by the respective parties, this Court must deny all of defendants’ motions.

Defendants seek to quash service of process for the reason that plaintiff failed to “plead the applicability of any provision in Rule 4(e) [Fed.R.Civ.Pro. ] authorizing out of state service.” Defendants have not cited any case law, nor is this Court aware of any requirement that plaintiff plead the basis for out of state service in its complaint. Accordingly, defendants’ motion to quash service must be dismissed.

Defendants next seek to dismiss plaintiff’s complaint on the basis that venue is improper. Defendants argue that the signing of the notes in South Carolina necessitates a finding that the claim arose in South Carolina. This Court cannot agree. The source of the funds in this case was Zionic Federal Credit Union, located within the Eastern District of Missouri. That fact is clearly stated at the top of every note involved in these lawsuits. Moreover, the payments made on the notes were sent to Zionic Federal Credit Union, and the alleged breach of the loan agreements occurred, if at all, within this district. There are additional factors which support this Court’s conclusion that venue is proper in this district. The Herbert family established two corporations and a trust within this state as part of the loan financing program. While subsequent documents may have voided the Unitrust Agreement, this Court cannot ignore the relationship of these transactions to the Herbert family and their South Carolina business, NHC. For these reasons, this Court finds that the cause of action in all of these cases arises in Missouri and therefore venue is proper within this district.

Defendants next seek dismissal of the six complaints for lack of personal jurisdiction. Defendants state in their affidavits that the notes were all executed and delivered in South Carolina and at no time did they ever go to Missouri in connection with these notes. Defendants contend that there is no basis for asserting long-arm jurisdiction over them. This Court disagrees.

In passing on a motion to dismiss for lack of jurisdiction over a non-resident, a federal diversity court is required to engage in a two-step inquiry: first, whether defendant committed one of the acts enumerated in the long-arm statute; and second, whether the exercise of personal jurisdiction over defendant violates the due process clause of the fourteenth amendment. The Land-O-Nod Company v. Bassett Furniture Industries, Inc., 708 F.2d 1338 (8th Cir.1983); Scullin Steel Co. v. National Railway Utilization Corp., 676 F.2d 309, 312 (8th Cir.1982). Plaintiff, the party that is seeking to invoke federal jurisdiction, has the burden of establishing that jurisdiction exists, and this burden may not be shifted to the party challenging the jurisdiction. Mountaire Feeds, Inc. v. Agro Impex, S.A., 677 F.2d 651, 653 (8th Cir.1982). While the facts are viewed in the light most favorable to the plaintiffs, “there must nonetheless be some evidence upon which a prima facie showing of jurisdiction may be found to exist....” Aaron Ferer & Sons Co. v. Diversified Metals Corp., 564 F.2d 1211, 1215 (8th Cir.1977) (citations omitted). See also Data Disc, Inc. v. Systems Technology Associates, Inc., 557 F.2d 1280, 1285 (9th Cir.1977) (plaintiff need only make a prima facie showing of jurisdictional facts through submission of affidavits plus discovery materials); Greycas, Inc. v. Anderson, 584 F.Supp. 894, 895-96 (E.D.Mo.1984); 4 Wright & Miller, Federal Practice and Procedure § 1068 at 250 (1969).

Missouri’s Long-Arm statute provides in part:

1. Any person or firm, whether or not a citizen or resident of this state, or any corporation, who in person or through an agent does any of the acts enumerated in this section, thereby submits such person, firm, or corporation, and, if an individual, his personal representative, to the jurisdiction of the courts of this state as to any cause of action arising from the doing of any such acts:
(1) The transaction of any business within this state;
(2) The making of any contract within this state;
(3) The commission of a tortious act within this state;
(4) The ownership, use, or possession of any real estate situated in this state;
(5) The contracting to insure any person, property or risk located within this state at the time of contracting.
(6) Engaging in an act of sexual intercourse within this state with the mother of a child on or near the probable period of conception of that child.
2.
3. Only causes of action arising from acts enumerated in this section may be asserted against a defendant in an action in which jurisdiction over him is based upon this section.

Mo.Rev.Stat. § 506.500 (Supp.1984).

The due process clause of the fourteenth amendment places limits upon the power of a court to exercise personal jurisdiction over a non-resident defendant. The due process clause requires that a defendant have certain minimum contacts with the forum state such that the maintenance of the suit does not offend “traditional notions of fair play and substantial justice.” International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945); Land-O-Nod, 708 F.2d at 1340. Accord World Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980); Kulko v. California Superior Court, 436 U.S. 84, 98 S.Ct. 1690, 56 L.Ed.2d 132 (1978). “In judging minimum contacts, a court properly focuses on ‘the relationship among the defendant, the forum, and the litigation.’ ” Calder v. Jones, 465 U.S. 783, 104 S.Ct. 1482, 1486, 79 L.Ed.2d 804 (1984) (citations omitted). See also Helicopteros Nacionales de Colombia S.A. v. Hall, 466 U.S. 408, 104 S.Ct. 1868, 1872, 80 L.Ed.2d 404 (1984). The defendant’s contacts with the forum state must be purposeful and such that defendant “should reasonably anticipate being haled into court there.” World Wide Volkswagen, 444 U.S. at 297, 100 S.Ct. at 567. See also Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239, 2 L.Ed.2d 1283 (1958).

In this circuit, the due process standard has devolved into a consideration of five factors:

(1) the nature and quality of the contacts with the forum state; (2) the quantity of the contacts with the forum state; (3) the relation of the cause of action to the contacts; (4) the interest of the forum state in providing a forum for its residents; and (5) the convenience of the parties.

Aaron Ferer & Sons Co. v. Diversified Metals Corp., 564 F.2d 1211, 1215 (8th Cir.1977). See Land-O-Nod, 708 F.2d at 1340. The first three factors are of primary importance and the last two are of secondary importance. Id.

In applying this analysis to the case at bar, this Court finds the exercise of personal jurisdiction over the Herbert defendants and NHC to be proper. Defendants seek to separate their conduct into individual acts, thus minimizing their contact with the State of Missouri. Viewed as a whole, however, it becomes clear that all of the defendants were part of a plan to transact business and make contracts within this state. The defendants have not disputed that two Missouri corporations, National Family Institute and National Financial Management Corp. were established as part of the loan financing arrangement. Nor have the defendants disputed the fact that the funds borrowed from a Missouri credit union were necessary to reorganize the debt structure of their South Carolina business, NHC. In fact, as previously stated, the Unitrust Agreement, signed by members of the Herbert family, provided that ownership and control of NHC would be turned over to one of the Missouri corporations. Defendants’ position that their conduct consisted of mere “perfunctory” execution of notes in South Carolina is unsupported by the facts of this case. This Court finds that the defendants’ conduct consisted of both making contracts and transacting business within this state. See First National Bank of Kansas City v. Ward, 380 F.Supp. 782, 784 (W.D.Mo.1974). Therefore, defendants’ conduct is sufficient to subject them to service of process under the Missouri long-arm statute. Mo.Rev.Stat. § 506.500 (Supp.1984).

This Court must also examine the particular facts and circumstances of this case to determine whether the exercise of personal jurisdiction is offensive to “traditional notions of fair play and substantial justice.” It is clear that simply an individual’s contract with an out-of-state party, without more, is insufficient to establish minimum contacts in the other party’s home forum. Burger King Corp. v. Rudzewicz, — U.S.-, 105 S.Ct. 2174, 2185, 85 L.Ed.2d 528 (1985). See also Scullin Steel v. National Railway Utilization Corp., 676 F.2d 309, 313 (8th Cir.1982); Pioneer Insurance Company v. Gelt, 558 F.2d 1303, 1309 (8th Cir.1977). These defendants have done more. The establishment of the Missouri corporations as part of the financing arrangement demonstrates that the defendants have purposely availed themselves of the privilege of conducting activities within the state, thus invoking the benefits and protection of Missouri laws. Hanson v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958). All members of the Herbert family, who are defendants in these actions, stated in their affidavits that they have never traveled to St. Louis in connection with these loans. In responding to interrogatories submitted by NCUAB however, Richard, Jeffrey and Marie Herbert admitted that they made a total of ten trips to St. Louis during the period from April, 1983 to August, 1984. These three defendants state in their answers that the meetings were necessary to execute and later void the Unitrust Agreement, discuss banking arrangements and to discuss the general finances of NHC. These meetings demonstrate that the defendants, both individually and as officers and employees of NHC, have conducted a business relationship with Zionic in this state that lasted over several years. As this Court noted in Greycas Inc. v. Anderson, 584 F.Supp. 894, 896-97 (E.D.Mo.1984), “[a] single meeting in this state has been held sufficient to satisfy the transaction of business requirement of § 506.500.” With these contacts, certainly defendants should have anticipated that failure to make payments on the loans to a Missouri bank would have consequences here. Moreover, these causes of action arises directly out of the contacts defendants have made with this state. The Supreme Court has held on numerous occasions that with respect to interstate contractual obligations, parties who create continuing relationships and obligations with citizens of another state “are subject to regulations and sanctions in the other state for the consequences of their activities.” Burger King Corp. v. Rudzewicz, supra, 105 S.Ct. at 2182.

Defendants’ principal argument is that they lacked physical presence in this state. As previously noted however, Richard, Jeffrey and Marie Herbert made several trips to St. Louis in connection with the finances of NHC. This Court finds little significance in the fact that three other defendants, Debra Herbert, Judy Herbert Ed-monds and Kent Edmonds did not actually travel to Missouri. All the proceeds from the loans made to the Herbert defendants were for the benefit of NHC. Richard and Jeffrey Herbert are officers of NHC. Their visits to Missouri were no doubt for the benefit of both the corporation and the other members of the Herbert family. After having others travel to Missouri to protect their interest, defendants Debra Herbert, Judy Herbert Edmonds and Kent Ed-monds cannot now deny their involvement in the business transactions. Moreover, it has been held by numerous courts that it is not a question of the physical presence of the defendant, but whether the act or transaction itself has a substantial connection with the forum state. Defendants may not avoid jurisdiction under these circumstances merely because they did not enter or do not reside in the forum state. Burger King Corp. v. Rudzewicz, supra, 105 S.Ct. at 2184. As explained, this Court finds defendants’ conduct within this state to be substantial and therefore, sufficient to establish personal jurisdiction over each of the defendants in these actions. Accordingly, defendants’ motions to dismiss for lack of personal jurisdiction are denied.

Defendants’ final motions are for transfer of venue under 28 U.S.C. § 1404(a). Section 1404(a) sets forth three factors to be considered in ruling on a motion to transfer: “For the [1] convenience of the parties and [2] witnesses, [3] in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought.” 28 U.S.C. § 1404(a) (1976) (bracketed numbers added).” In addition, the Court will also look at such factors as the access to sources of proof, the availability of compulsory process for witnesses and the expense attendant to the production of said witnesses; “the relative advantages and obstacles to a fair trial”. J.F. Pritchard & Co. v. Dow Chemical of Canada, Ltd., 462 F.2d 998, 1000 (8th Cir.1972). The Eighth Circuit has stated that a change of venue, although within the trial court’s discretion, should not be freely granted. “Courts are in the business of deciding cases, not playing procedural hockey among the available districts at the whim of dissatisfied parties.” In re Nine Mile Limited, 692 F.2d 56, 61 (8th Cir.1982).

This Court is in doubt whether it could transfer the lead case, 85-1074C(l), to South Carolina even if a motion to that effect had been filed. In that action, plaintiff named both James Christenson, as trustee of the Herbert Trust, and NHC as defendants. Section 1404(a) allows a transfer “to any other district or division where it might have been brought.” The notes involved in 85-1074C(l) were apparently signed in St. Louis by James Christenson as trustee of the Herbert Trust. The place of residence of Mr. Christenson is unknown, as he has not entered an appearance in this suit. Therefore, this Court cannot say with any certainty that cause number 85-1074C(l) could have been brought in South Carolina. This Court, upon review of the facts of 85-1074C(l) believes that in the interest of judicial economy, the Christenson case should not be severed from the other six cases. The Herbert defendants, as officers and employees of NHC are inextricably bound up in the Christenson lawsuit. Certainly if the action in which NHC is a defendant were tried in St. Louis, the Herbert defendants would be necessary witnesses to explain the business transactions involving the family business. Even considering the six other cases separately however, this Court finds the balance of considerations to be in favor of retaining venue in this district.

The Herbert defendants claim hardship in traveling to Missouri for the trial of these cases. While this Court understands this problem, other factors must be considered. The employees and the records of the failed credit union, which constitute vital evidence in these cases, are located in Missouri. In addition, numerous suits have been filed in this district as a result of the insolvency of Zionic Federal Credit Union. In a large majority of these cases, the defendants assert the same defense put forth by the Herbert family — that they were told there would be no personal liability on the notes. As the exact circumstances of the failure of the credit union are developed in each of these cases, the courts in this district will develop a better understanding of the relevant facts and circumstances. This will result in a more efficient use of judicial resources.

Collectively, the Herbert family borrowed in excess of one-half million dollars from Zionic Federal Credit Union. When the loans signed by Mr. Christenson, as trustee of the Herbert Trust are included, the amount borrowed exceeds one million dollars. The failure of the credit union has caused great financial hardship to those who invested their money in Zionic. As a result, this state has a significant interest in trying these cases in this district. Defendants, having come to a Missouri bank to borrow large sums of money to restructure the debt of their family business, and having allegedly failed to repay the debt, have no justifiable complaint about being subjected to the judicial process of this federal court.

      . Christenson has made no entry of appearance nor has he filed any pre-trial motions or answered the complaint. According to the Herbert defendants, he is believed to be in Honduras.

      . The following notes were executed on December 3, 1982; note number 82-143 for $50,000.00 signed by Richard O. Herbert, case number 85-1079C(1); note number 82-144 for $50,000.00 signed by Marie E. Herbert with Richard O. Herbert as guarantor, case number 85-1077C(l); note number 82-145 for $50,000.00 signed by Kent A. Edmonds (son-in-law of Richard O. Herbert) with Richard O. Herbert as guarantor, case number 85-1080C(l); and note number 82-146 for $50,000.00 signed by Judy Herbert Edmonds with Richard O. Herbert as guarantor, case number 85-1078C(l).

      . According to the defendants’ affidavits, these notes were drafted by the Herbert family’s lawyers in South Carolina. It is clear that the parties who drafted the notes contacted Zionic at some point to obtain the proper note and account numbers and to determine the amount of collateral required.

      . The Unitrust Agreement, dated April 26, 1983, consists of a Trust Agreement and a Transfer Agreement. It is obvious from the terms of the Unitrust Agreement that the Herberts sought to obtain more favorable tax treatment for their family business. On or about August 8, 1984, various members of the Herbert family executed a document titled "Acknowledgment and Confirmation” which purports to void the Trust and Transfer Agreements.

      .The Transfer Agreement states that National Family Institute, Inc., and National Financial Management Corporation are Missouri corporations. According to plaintiff, at one time the two corporations operated out of the same office as Zionic Federal Credit Union in Bridge-ton, Missouri. The Trust and Transfer Agreements are signed by Richard O. Herbert as transferor, Howard Fisher as president of National Family Institute, Inc., James Christenson as president of National Financial Management Corporation and Marie E. Herbert as beneficiary. Defendants do not dispute that these were Missouri corporations nor do they dispute the validity of the Unitrust Agreement. Under its own terms, the trust administration and the rights of the parties are governed by Missouri law.

      . These six cases are numbered 85-1075C(l), 85-1076C(l), 85-1077C(l), 85-1078C(l), 85-1079C(1) and 85-1080C(l).


source: Caselaw Access Project

author: POLOZOLA, District Judge:

license: Public Domain

text:
    Kevin J. VILLAR v. WILCO TRUCK RENTALS, et al.
    Civ. A. No. 83-111-B.
    United States District Court, M.D. Louisiana.
    Jan. 6, 1986.

      Lewis 0. Unglesby, Donald T. Phelps, J.J. McKernan, Robert Vandaworker, Baton Rouge, La., for Kevin J. Villar.
    Grayson H. Brown, and Terry J. Butcher, Baton Rouge, La., for intervenor Travelers Ins. Co.
    Thomas E. Balhoff, Paul Marks, Jr., Charles A. Schulte, Jr., Owen, Richardson, Taylor, Mathews & Atkinson, Baton Rouge, La., for Wilco Truck Rentals.
    Paul B. Deal, Michael T. Cali, New Orleans, La., for Budd Co.
    Paul Marks, Jr., Charles A. Schulte, Jr., Owen, Richardson, Taylor, Mathews & Atkinson, Baton Rouge, La., for Midland Ins. Co., and W.T.R. Transport.
    Edward E. Rundell, Alexandria, La., for Fruehauf Corp.
   POLOZOLA, District Judge:

Kevin J. Villar brought this suit seeking damages for personal injuries he sustained when a wheel or rim on a truck tire plaintiff was changing exploded into the air. Villar sued The Budd Company (Budd), the manufacturer of the rim involved in the accident, alleging the rim was defectively manufactured. When the rim exploded, it struck Villar’s arm causing compound injuries to the arm and elbow. The tire struck Villar in the head causing a cerebral concussion and rendered him unconscious for approximately thirty minutes. Eight days after the accident, plaintiff’s arm was amputated after the initial emergency surgery failed.

This case was tried before a jury which found Budd liable and awarded plaintiff the sum of $1,000,000.

Following the verdict, Budd filed several post-trial motions. The court denied Budd’s motions for directed verdict, judgment notwithstanding the verdict, and new trial on the issue of liability. This matter is now before the court on Budd’s motion for a new trial on the issue of damages or, alternatively, for remittitur.

After carefully reviewing the evidence in this case, the court finds that the verdict rendered by the jury is clearly excessive and was not based on or supported by the evidence presented at the trial. The court further finds that the jury’s verdict was obviously tainted by undue sympathy on the part of the jury in favor of the plaintiff. Since the amount of the verdict is clearly and unreasonably excessive under the facts of this case, the court hereby grants Budd’s motion for a new trial on the issue of damages.

The question of whether a new trial on the basis of excessive damages should be granted is a purely procedural one governed by federal law. Giancontieri v. Pan American World Airways, 767 F.2d 1151, 1155 n. 4 (5th Cir.1985); Westbrook v. General Tire & Rubber Co., 754 F.2d 1233 (5th Cir.1985). The federal standard to be applied in determining when a verdict is excessive was set forth by Judge Rubin in Caldarera v. Eastern Airlines, 705 F.2d 778, 784 (5th Cir.1983), as follows:

The jury's award is not to be disturbed unless it is entirely disproportionate to the injury sustained. We have expressed the extent of distortion that warrants intervention by requiring such awards to be so large as to “shock the judicial conscience,” “so gross or inordinately large as to be contrary to right reason,” so exaggerated as to indicate “bias, passion, prejudice, corruption, or other improper motive,” or as “clearly exceeding] that amount that any reasonable man could feel the claimant is entitled to.” [footnotes omitted]

The amount of the verdict in this case meets each of the criteria set forth in the Caldarera opinion because the verdict: (1) does shock the judicial conscience of this court; (2) is so gross as to be contrary to right reason; (3) is exaggerated and excessive to indicate bias, passion and prejudice by the jury in favor of the plaintiff; and (4) clearly exceeds the amount that any reasonable man could find under the facts of this case. The amount of the verdict in this case, when compared to other awards for similar injuries, is grossly excessive. It leads the court to conclude that “something besides the evidence was at work” when the jury considered and returned its verdict. Westbrook v. General Tire & Rubber Co., 754 F.2d 1233, 1240 (5th Cir. 1985). The court believes that the “something” in this case was the undue sympathy of the jury toward the plaintiff. The court was very careful to include in its charge to the jury that it must render its decision without bias, prejudice or sympathy for or against any party. It is difficult for the court to believe the jury adhered to this charge when the court compares the jury’s verdict with the facts of the case and to other similar cases. The court also believes its ruling on the admissibility of certain testimony presented by the plaintiffs vocational expert was prejudicial to the defendant. While the court gave the defendant the opportunity to take the expert’s deposition during an overnight recess, the court must, upon careful analysis and reconsideration of its ruling, conclude that the court’s ruling was prejudicial to the defendant and did not give the defendant ample opportunity to rebut the vocational expert's testimony. There is little doubt that the testimony of the vocational expert was very favorable to the plaintiff and had a substantial impact on the jury. It is also clear that the testimony and opinion of this expert was emphasized in plaintiff’s closing argument. Thus, the court cannot say its ruling was a harmless error.

The court concludes that plaintiff sustained a serious injury in this case which has resulted in both mental and physical disabilities. However, these facts do not give the jury the unrestricted right to assess damages far in excess of that which are supported by the law and evidence.

Because the jury returned an in globo verdict of $1,000,000, it is impossible for the court to determine the exact amount awarded by the jury for Villar’s pain, suffering and disfigurement and for past and future wages. It was stipulated at trial that Villar’s medical bills were slightly over $103,000. Additionally, Villar has lost past and future wages of between $117,000 and $267,000, depending on whether the figures of plaintiff’s or defendant’s economist are accepted. Thus, the general damages awarded by the jury are between $630,000 and $780,000. Budd contends that this amount is excessive, and this court agrees. Even if the jury accepted the figures of plaintiff’s economist and awarded “only” $630,000 for pain and suffering, this amount greatly overcompensates Villar for the injuries he has sustained as a result of this accident.

The facts of this case were “particularly of a type conducive to arouse the sympathy of the jury.” Gorsalitz v. Olin Mathieson Chemical Corp., 429 F.2d 1033, 1044 (5th Cir.1970). Before the accident Villar was an outgoing young man. At trial he presented the image of a broken individual. His expressionless appearance before the jury each day in a short sleeved shirt which just covered his stump presented “mute evidence of the terrible injury he had sustained.” Gorsalitz, 429 F.2d at 1044.

Additionally, there were other facts which the court allowed in evidence which obviously influenced the amount of the award, although they had no relevance other than to show Villar’s predisposition to psychological problems. Villar was forced to drop out of high school in the ninth grade to help support his family after his father had a stroke. His father later committed suicide. Villar’s first wife drowned only a few days after they were married, and his second wife had left him shortly before the accident.

If a jury verdict results from passion or prejudice, the proper remedy is a new trial and not remittitur. Westbrook v. General Tire & Rubber Co., 754 F.2d 1233, 1241 (5th Cir.1985); Lowe v. General Motors Corp., 624 F.2d 1373, 1383 (5th Cir.1980); Brabham v. Mississippi, 96 F.2d 210, 213 (5th Cir.1938). In this case the court finds that the verdict was tainted by the extreme sympathy the jury obviously felt for Villar. The jury clearly exceeded its discretion and authority in attempting to compensate Kevin Villar for all of the problems which had befallen him during his life instead of awarding him damages arising from the accident. Judicial intervention is thus warranted under the facts of this ease because of the jury’s abuse of its discretion and because the jury’s award is not supported by the evidence.

Therefore:

IT IS ORDERED that the motion of The Budd Company for a new trial on the issue of damages be, and it is hereby GRANTED.

IT IS FURTHER ORDERED that the trial of this case on the issue of damages be, and it is hereby set for January 29, 1986, at 9:00 a.m. with a jury.

IT IS FURTHER ORDERED that on or before January 17, 1986, the parties shall:

(1) File a list of witnesses and exhibits to be used at the trial.
(2) Exchange written expert reports of any expert to be called at the trial. An up-to-date report shall be prepared and exchanged, even if the expert testified at the last trial. The failure of a party to comply with this portion of the order shall preclude that expert from testifying at the trial.
(3) File motions in limine, if any, together with a memorandum in support thereof.
(4) File jury instructions, voir dire questions and proposed interrogatories to the jury.

      . The parties referred to the rim as a "wheel" many times during the testimony. For clarity purposes the court will use the words “rim” and “tire” in this opinion, with the understanding that the words “rim” and “wheel” mean the same.

      . Villar also sued numerous other defendants with whom he either settled or dismissed prior to trial.

      .The court denied these motions on September 6, 1985. Budd has already filed an appeal with the Fifth Circuit Court of Appeals on this ruling. This court does not believe it has lost jurisdiction herein to rule on the remaining motions which pertain to quantum. At the same time, the court expresses no opinion as to whether the appeal taken by Budd is proper or valid under the Federal Rules of Appellate Procedure.

      . Although the court has previously denied Budd’s motion for a new trial on the issue of liability, the law is clear that a new trial can be granted on one issue but denied as to another. Westbrook v. General Tire & Rubber Co., 754 F.2d 1233, 1242 (5th Cir.1985); Edwards v. Sears, Roebuck & Co., 512 F.2d 276, 282 (5th Cir.1975); Pingatore v. Montgomery Ward & Co., 419 F.2d 1138, 1142-43 (6th Cir.1969). In Edwards the court stated: “A jury’s finding as to liability can be binding even though its monetary award is found to be excessive or even improperly influenced — our deference to and faith in the jury system demands at least this much." 512 F.2d at 282.
      The defendant strenuously contested liability in this case. It cannot be said, however, that the jury’s verdict on liability was against the weight of the evidence or that it was tainted by undue sympathy. The plaintiff presented numerous technical witnesses whose testimony supports the jury’s finding of liability, including two experts, John Tabony, Jr., and Oscar Kurt, who testified that the accident was caused solely by a manufacturing defect in the rim. Budd also presented expert testimony which supported Budd’s contention that it did not cause the plaintiffs accident. The jury chose to accept the testimony presented by plaintiffs experts. There is sufficient evidence in the record to support the jury’s verdict on the issue of liability, irrespective of the court’s finding that the jury’s verdict on quantum was tainted by undue sympathy in favor of the plaintiff and was not supported by the evidence presented in this case.

      . The Fifth Circuit has held that past awards for similar injuries can be used as a rough guide in determining whether a verdict is excessive, Gia-contieri v. Pan American World Airways, 767 F.2d 1151, 1156 (5th Cir.1985), although such a comparison is not controlling. Wakefield v. United States, 765 F.2d 55, 59-60 (1985).
      The case which is most similar to the facts herein is Davis v. New Orleans Public Belt Railroad, 375 So.2d 395 (La.App. 4th Cir.1979). In that case the plaintiff, a 21 year old man with a ninth grade education and low normal to subnormal intelligence, suffered a traumatic amputation of his nondominant arm when he was run over by a train. The pain and suffering he endured seemed equal, if not greater, than that suffered by Villar. The court held that $425,000 in general damages was the highest amount that could reasonably have been awarded.
      In Stansbury v. Hover, 366 So.2d 918 (La.App. 1st Cir.1978), an award of $225,000 was affirmed for a 14 year old boy whose left arm was mangled in a skiing accident and had to be amputated after four unsuccessful attempts to save the arm through surgery. That plaintiff had a 95% permanent disability of the left arm and a 57% disability of the entire body, which is the same amount of disability Dr. Strange assigned to Villar.
      Plaintiff relies heavily on Greene v. Wright, 365 So.2d 551 (La.App. 1st Cir.1978). However, the court finds that the facts in the Greene case are distinguishable from the Villar case.
      In Greene, the court stated that a jury could have awarded between $450,000 and $500,000 for pain and suffering to a plaintiff whose injuries were similar to Villar’s, although much more severe. In addition to an amputation of a finger and serious difficulties with his right hand, Greene endured thirteen surgeries, had vision problems and psychological difficulties.

      . The court must note that even if it is wrong in its conclusion that a new trial should be granted on the issue of damages for the reasons stated herein, the court believes a remittitur should be granted herein. However, it would be a vain and useless thing to grant a remittitur considering the remarks made by counsel for the plaintiff and defendant at oral argument. It is obvious a new trial would have to be granted in this case.


author: DIMMICK, District Judge.

text:
    Marvin B. DURNING and Jean C. Durning, husband and wife, on behalf of themselves and all other persons similarly situated, Plaintiffs, v. The FIRST BOSTON CORPORATION; Citibank, N.A.; First Interstate Bank of Casper, N.A.; Wyoming Community Development Authority, Defendants.
    No. C85-1328D.
    United States District Court, W.D. Washington, Seattle Division.
    Jan. 7, 1986.

      Dexter A. Washburn, Schweppe, Krug & Tausend, P.S., Seattle, Wash., for plaintiffs.
    Bennet A. McConaughy, Paul L. Ahern, Jr., Douglas C. Ross, Roberts & Shefel-man, Seattle, Wash., for all defendants except First Boston.
    Hugh F. Bangasser, Preston, Thorgrim-son, Ellis & Holman, Seattle, Wash., for defendant First Boston.
   MEMORANDUM AND ORDER

DIMMICK, District Judge.

Defendants move to dismiss under Fed. R.Civ.P. 12(b)(6). They argue that a document attached to the complaint shows that plaintiffs have failed to state a claim upon which relief can be granted. The Court agrees and accordingly dismisses this cause of action.

This securities fraud lawsuit arises out of the sale of a $75,000,000 issue of tax-exempt single family mortgage revenue bonds by the Wyoming Community Development Authority (“Authority”). First Interstate Bank of Casper is the trustee for the bond issue. Citibank is the paying agent. First Boston Corporation is the lead underwriter for the syndicate which marketed the bonds.

The Authority was created to provide financing for the construction of housing. In 1978, the Authority initiated the single family mortgage purchase program to enable many otherwise ineligible borrowers to obtain mortgage loan financing. The 1981 bond issue was part of that program.

The Authority was authorized to use the bond proceeds to purchase certain qualifying mortgage loans on residential real property from financial institutions. The home purchasers paid an interest rate of 13 percent for 20-year mortgages. The Authority used the homeowners’ monthly mortgage payments to make interest payments to its bondholders.

In 1981, plaintiffs Marvin and Jean Durn-ing purchased four bonds in the principal amount of $5,000 each. The bonds were offered and sold to the public pursuant to a disclosure document known as the Official Statement. Plaintiffs allege that the Official Statement was misleading because it did not inform investors that the bonds were redeemable prior to 1991. In June 1985, one of the Durnings’ bonds was recalled for redemption. The Durnings allege that this resulted in the termination of interest payments of more than $4,000 through 1991. The Durnings also allege that the value of the bonds in the secondary trading market dropped immediately after the June 1985 call from 119.74 to 104.00 (100 = par).

The Durnings brought this action against the four named defendants. The Durnings moved to have this action certified as a class action on behalf of those who purchased bonds prior to the 1985 call. The Durnings assert claims under federal and state securities laws, common-law negligent misrepresentation, breach of contract, tortious breach of the covenant of good faith and fair dealing, breach of fiduciary duty, unjust enrichment, and the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. § 1961 et seq. All four defendants move to dismiss under Fed.R.Civ.P. 12(b)(6).

A motion to dismiss will not be granted unless it appears to a certainty that the plaintiff would not be entitled to relief under any facts that could be proved. Halet v. Wend Investment Co., 672 F.2d 1305 (9th Cir.1982). A plaintiffs complaint will be liberally construed in his favor with the alleged facts generally accepted as true. Rosen v. Walters, 719 F.2d 1422 (9th Cir.1983).

Plaintiffs’ complaint alleges that they were mislead when buying the bonds because the Official Statement did not disclose that the bonds were redeemable before June 1, 1991. Accepting this factual assertion as being true, plaintiffs have a valid claim against the defendants.

The defendants, however, contend that plaintiffs’ allegations are refuted by the Official Statement which is attached to the complaint. When the allegations of the complaint are refuted by an attached document, the Court need not accept the allegations as being true. See Ott v. Home Savings & Loan Ass’n, 265 F.2d 643, 646 n. 1 (9th Cir.1958); Interstate Natural Gas Co. v. Southern California Gas Co., 209 F.2d 380, 384 (9th Cir.1953). See also 5 C. Wright & A. Miller § 1357, nos. 84-86 (1969) and accompanying text. Thus, if the Court finds that the Official Statement explains that the bonds were recallable at any time after their issuance, then this cause of action must be dismissed.

On the first page of the Official Statement, in the first paragraph, a sentence reads:

The Bonds will be subject to redemption prior to maturity as more fully set forth herein, including mandatory redemption at par from unexpended proceeds, prepayments and certain revenues.

This sentence immediately puts the investors on notice that the bonds are subject to redemption — including mandatory redemption.

On pages 13-14 of the Official Statement, the investor is informed of three types of redemption: (1) sinking fund redemption, (2) mandatory redemption at par,, and (3) optional redemption. The sinking fund and optional redemption provisions clearly set forth when the bonds can be redeemed. There is no dispute concerning these types of redemptions. Instead, the dispute involves the mandatory redemption at par provision which provides:

The Bonds will be subject to mandatory redemption at a redemption price equal to 100% of the principal amount of the Bonds to be redeemed, plus interest accrued to the redemption date, from amounts on deposit in the Mandatory Redemption Account representing (i) Bond proceeds deposited in the Program Fund and remaining unexpended on May 1, 1983, (ii) Prepayments of Mortgage Loans, (iii) amounts withdrawn from the Bond Reserve Fund as the result of the reduction of the Bond Reserve Requirement and (iv) excess revenues, subject to the Authority’s right, under certain conditions, to withdraw from the lien of the Indenture investment earnings on amounts on deposit in the Special Reserve Fund.

On page 16, the Official Statement warns investors that the Authority is unable to predict when redemption would occur:

Due to the many factors which influence economic and financial market conditions, the Authority is not able to predict with any significant degree of reliability the expected level of prepayments it will actually receive on the Mortgage Loans. To the extent that prepayments occur, the Authority is required by the Indenture to apply amounts received to the redemption of Bonds.

These three sections, taken together, unambiguously inform the investor that mandatory redemption may take place any time the mandatory redemption account has sufficient funds.

An analagous case is Associated Builders, Inc. v. Alabama Power Co., 505 F.2d 97 (5th Cir.1974). There, the plaintiff filed a class action suit alleging that a prospectus misrepresented the fact that the bonds it had purchased were recallable. Plaintiff had appended a copy of the prospectus to the complaint. The court upheld the trial court’s decision granting defendant’s motion to dismiss under Rule 12(b)(6). The court found the prospectus, taken as a whole, showed that the bonds could be redeemed at any time.

The Durnings argue that Associated Builders is inapposite because the prospectus in that case used the phrase “at any time” in describing when the bonds could be recalled. The Durnings assert that while the Authority has used the phrase “at any time” in previous and subsequent offerings, the phrase was not used in this offering. The Durnings have also presented to this Court, as an attachment to their brief, a xeroxed copy of part of Moody’s Municipal & Government Manual. Moody’s, in describing the 1981 series A bonds, states that the bond were not callable before June 1, 1991. These two contentions pose a problem. Generally, a court will only , consider the complaint and any attached exhibits when deciding a 12(b)(6) motion. See 5 C. Wright & A. Miller, Federal Practice & Procedure §§ 1356, 1357 (1969). Thus, the Court normally would not consider this information. However, in view of the fact that a motion to dismiss for failure to state a claim should only be granted when defendant can show that under no set of facts can plaintiff prevail, the Court will consider this information.

First, the Authority’s use of the phrase “at any time” in previous bond issues is irrelevant. Whether the Official Statement could have been written in a clearer, more explicit, fashion is not for this Court to decide. The only relevant issue before this Court is, looking only at the Official Statement, whether it informs the investor that the bonds were redeemable at any time. For the reasons stated earlier, the Court finds that the Official Statement so informs the investor.

Second, Moody’s interpretation of the Official Statement is irrelevant. Because the Official Statement is clear on its face that the bonds were redeemable at any time that mandatory redemption funds were sufficient, it is irrelevant that Moody’s misinterpreted the Official Statement. Moreover, the Official Statement itself, on the table of contents’ page, states that

[n]o dealer, broker, salesman or other person has been authorized by the Wyoming Community Development Authority or the underwriters to give any information or to make any representations, other than as contained in this Official Statement. If given or made, such other information or representations must not be relied upon as having been authorized by any of the foregoing.

Thus, investors were warned that third-party representations concerning the bond issue may not be accurate.

Because the Court finds, as a matter of law, that the Official Statement is not ambiguous and that it informs investors that the bonds were redeemable when the mandatory redemption account has sufficient funds, the plaintiffs have failed to state a claim for which relief can be granted.

THEREFORE, this cause of action is DISMISSED.

      . Because of the Court’s ruling on the 12(b)(6) motion, all other motions pending in this case are moot.

        . At oral argument counsel for defendants informed the Court that the Authority recalled $28 million worth of bonds in 1983 — seven times the amount recalled in 1985. No litigation arose out of that redemption and no other litigation has been instituted involving the 1985 redemption.

      . When the mandatory redemption account will have sufficient funds is impossible to predict because when the bonds are issued, the Authority cannot predict the amount of bond proceeds that will be used to purchase mortgages. The demand for the proceeds depends upon the demand for mortgages, which in turn depends upon the demand for single family housing. Moreover, mortgage interest rates fluctuate. Should mortgage interest rates fall below the 13-percent rate required to be charged pursuant to the bond issue to secure the issue’s creditworthiness, at least two consequences are likely to occur: (1) homebuyers are likely to seek mortgage financing from other sources because they can obtain a mortgage elsewhere at a lower rate, and (2) homeowners will prepay and refinance the mortgages backed by the Authority.
      If this occurs, the Authority must have the ability to reduce the number of outstanding bonds because it will not be able to generate sufficient funds from remaining mortgage payments to meet debt service obligations. The right to redeem the bonds under these circumstances makes the program economically sound and default less likely.

      . It is interesting to note that Moody’s made another mistake in describing the 1981 Series A bond offering. It states that, beginning in 1982, the bonds could be recalled at 1021/2. The Official Statement is clear, however, that under the mandatory redemption provision, the bonds would be redeemed at par value (par = 100).


author: VAN SICKLE, Senior District Judge.

text:
    Richard D. (Jake) LATHAN, Gladys Lathan, Clarence Hopmann, Frances Hopmann, Howard Rust, Sr., Jessie Rust, Larry Young, Allen D. Miller, Carole A. Miller, Howard Rust, Jr., Wilma Rust, James Brown, and Sadeania Brown, on behalf of themselves and others similarly situated, Plaintiffs, v. John R. BLOCK, Secretary of Agriculture; Frank W. Naylor, Jr., Undersecretary of Agriculture for Small Community and Rural Development; Farmers Home Administration; Charles W. Shuman, Administrator, Farmers Home Administration; All State Directors; All District Directors; and All County Supervisors, individually and in their official capacities, Defendants.
    Civ. No. A1-85-60.
    United States District Court, D. North Dakota, Southwestern Division.
    Jan. 8, 1986.

      Jerold W. Barringer, Palmyra, Ill., for plaintiffs.
    Dennis G. Linder, Sheila Lieber, and Mer-ril Hirsh, Attys. U.S. Dept, of Justice, Civ. Div., Washington, D.C., Gary Annear, Asst. U.S. Atty., Fargo, N.D. (Mary Osowski & Charlene Rosen, U.S. Dept, of Agriculture, Washington, D.C., of counsel), for defendants.
   MEMORANDUM AND ORDER

VAN SICKLE, Senior District Judge.

In this action, Plaintiffs seek certification of a class composed of persons who “have had FmHA [Farmers Home Administration] in either a junior or other lien position and who have had another lienholder than FmHA foreclose or begin the process of foreclosure as a result of FmHA’s intentional and conspired efforts to induce the other lienholders to initiate the foreclosure, and who are or may be eligible for farmer program loan servicing options prior to the foreclosure were FmHA to do the foreclosure itself.” (Motion for Class Certification, II1). Pursuant to Fed.R.Civ.P. 12, Defendants have filed a motion to dismiss. Plaintiffs have filed a brief in opposition to that motion.

FACTS

The federal courts have recently confronted many cases concerning FmHA policies and practices. A number of those cases concern FmHA’s obligations to provide notice and a hearing prior to foreclosure and to inform borrowers of the right to seek loan deferral under 7 U.S.C. § 1981a. Matzke v. Block, 732 F.2d 799 (10th Cir.1984); Curry v. Block, 738 F.2d 1556 (11th Cir.1984); Allison v. Block, 723 F.2d 631 (8th Cir.1983); Coleman v. Block, 580 F.Supp. 194 (D.N.D.1984). The instant action, though not involving § 1981a directly, seeks to extend the rights of FmHA borrowers as those rights have been recognized in the earlier cases.

Approximately 240,000 to 265,000 persons nationwide have mortgaged real estate to FmHA to secure FmHA farm program loans. Plaintiffs allege that FmHA’s lien on the borrower’s property is junior to that of another lienholder in 85% to 90% of those cases. FmHA may acquire a junior lien when it makes a farm ownership loan simultaneously with another lender, when chattel security is inadequate to secure an operating loan and there is a previous real estate lien in force, or when FmHA makes loans in its capacity as “lender of last resort.”

Plaintiffs allege that, when a borrower is delinquent on both a loan from FmHA and a loan from a senior lienholder, FmHA is currently following a practice of inducing or allowing a senior lienholder to foreclose on the senior lien. Plaintiffs allege that FmHA’s practice is to reach an agreement with the senior lienholder that, if the senior lienholder will foreclose its lien, FmHA will bid on the property at the foreclosure sale. Plaintiffs argue that this procedure is utilized to allow FmHA to bypass an obligation to provide procedural due process prior to deprivation of property or liberty. They seek an order that FmHA be required to protect the interests of the borrower, as well as those of the government, until FmHA has the opportunity to offer the necessary pretermination administrative due process. In essence, they ask that, when a lien senior to FmHA’s is to be foreclosed, FmHA be ordered to acquire a senior lien position and to then provide administrative due process before that senior lien is foreclosed.

DISCUSSION

The complaint includes seven claims for relief. The first and fifth claims allege that FmHA, through action in concert with other lienholders, has deprived Plaintiffs of property or liberty in violation of the fifth amendment; the first claim challenges FmHA’s acquisition of the property at the foreclosure sale, while the fifth claim challenges FmHA’s failure to acquire the property to begin offering due process. The second and sixth claims allege that FmHA, through action in concert with other lien-holders, has deprived Plaintiffs of property or liberty in violation of certain statutes and certain regulations adopted pursuant to those statutes; the second claim challenges FmHA’s acquisition of the property at the foreclosure sale, while the sixth claim challenges FmHA’s failure to acquire the property to begin offering due process. The third claim alleges that FmHA, through action in concert with other lien-holders, has deprived Plaintiffs of property or liberty in violation of the federal Administrative Procedure Act (APA). The fourth claim is that certain of FmHA’s regulations violate the fifth amendment. The seventh claim is that Defendants’ actions constitute tortious behavior of such a willful and malicious nature as to render Plaintiffs’ contractual obligations to FmHA null and void.

In support of their motion to dismiss, Defendants argue: 1). that Plaintiffs fail to state a claim upon which relief may be granted because a right to the procedural due process which Plaintiffs seek is not established under the federal constitution, FmHA’s regulations, or the federal APA; 2). that insofar as Plaintiffs seek recovery under a tort theory, they have not complied with provisions of the Federal Tort Claims Act; 3). that insofar as Plaintiffs seek retroactive relief, their claims are barred by sovereign immunity; and 4). that Plaintiffs have not properly named or served all of the defendants.

Constitutional Claims

Plaintiffs’ first and fifth claims for relief concern allegations of deprivation of rights secured by the due process clause of the fifth amendment. Defendants argue the actions challenged are not protected by the fifth amendment because they are not state actions.

It is a basic principle of constitutional law that due process protections apply only to such action as may fairly be said to be that of the government. Blum v. Yaretsky, 457 U.S. 991, 1002, 102 S.Ct. 2777, 2785, 73 L.Ed.2d 534 (1982). A governmental body may be held responsible for a private entity’s decision only when the governmental body has exercised coercive power or has provided such significant encouragement, either overt or covert, that the private entity’s choice must in law be deemed to be that of the government. Mere approval of or acquiescence in the initiatives of a private party is not sufficient to justify holding the government responsible for those initiatives. Id. at 1004, 102 S.Ct. at 2786. Defendants assert that the actions challenged here are those of private lienholders, who are not subject to the strictures of the due process clause, rather than of FmHA.

The complaint alleges that Defendants have done more than approved of or acquiesced in the decisions of private lien-holders; it alleges that Defendants have conspired with other lienholders and induced those other lienholders to foreclose on Plaintiffs’ property. For purposes of this motion, this court must accept the allegations of the complaint as true. Hishon v. King & Spalding, 467 U.S. 69, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984). As this court recognized in Coleman v. Block, 580 F.Supp. 194 (D.N.D.1984), the Plaintiffs’ interests in the mortgaged property are interests protected by the fifth amendment. If Plaintiffs are able to establish that Defendants acted in concert with private lien-holders to induce those lienholders to act to foreclose, they may be able to establish an entitlement to the protections of the due process clause.

Defendants argue that, even if Plaintiffs can establish a right to some form of procedural due process, they cannot as a matter of law establish a right to the form of relief which they seek. Plaintiffs seek in-junctive relief in two forms. First, they seek an order enjoining Defendants from “conspiring with and inducing” other lien-holders to foreclose and by so doing to avoid providing the procedural due process mandated by the Coleman decision. Second, they seek an order both requiring FmHA to acquire a senior lien position where a senior lienholder has been induced by FmHA to begin foreclosure proceedings and requiring FmHA to return property to the mortgagor until administrative due process has been provided. Defendants argue that, even if Plaintiffs are entitled to some form of due process before a privately held lien is foreclosed, they are not entitled to the “buy-out” program described in the second form of requested injunctive relief. The “buy-out” program envisioned by Plaintiffs appears to this court to be a more expansive reading of due process obligations than has been recognized to date. However, the first form of injunctive relief described in the complaint is similar to that which has been ordered in other cases. If Plaintiffs are able to establish that Defendants have acted in concert with private lienholders and that by so doing Defendants have deprived Plaintiffs of property or liberty without the constitutionally mandated due process of law, Plaintiffs may establish a right to some form of relief. This court will not address the propriety of the form of relief at this time. This court concludes that the motion to dismiss, insofar as it concerns the first and fifth claims for relief, must be denied.

Claims Concerning FmHA’s Regulations

Plaintiffs’ second and sixth claims concern FmHA’s alleged violations of 7 U.S.C. § 1921 et seq., and the regulations implemented pursuant thereto and codified at 7 C.F.R., Chapter XVIII. Plaintiffs’ fourth claim is that, to the extent those regulations permit Defendants to take various loan servicing actions without providing procedural due process, those regulations are in violation of the fifth amendment.

Plaintiffs assert, in their second and sixth claims for relief, that statutes and regulations governing FmHA’s actions require it to grant administrative due process before acting in concert with a private lien-holder to foreclose a privately held lien. Neither the complaint nor Plaintiffs’ brief on the motion to dismiss specifies the statutes and regulations involved in their claims. It appears to this court that Plaintiffs raise issues concerning the following provisions:

The Secretary is authorized and empowered to make advances, without regard to any loan total indebtedness limitation, to preserve and protect the security for or the lien or priority of the lien securing any loan or other indebtness owing to, insured by, or acquired by the Secretary under this chapter or under any other programs administered by the Farmers Home Administration; to bid for and purchase at any execution, foreclosure, or other sale or otherwise to acquire property upon which the United States has a lien by reason of a judgment or execution arising from, or which is pledged, mortgaged, conveyed, attached, or levied upon to secure the payment of, any such indebtness whether or not such property is subject to other liens, to accept title to any property so purchased or acquired; and to sell, manage, or otherwise dispose of such property as hereinafter provided.

7 U.S.C. § 1985(a) (1985).

When necessary to protect the interest of the Government, actions will be taken by FmHA for the account of the borrower as provided below.

7 C.F.R. § 1872.2(b) (1985) (in part).

When a prior lien foreclosure sale is to be held and the State Director determines that a substantial net recovery on the Government’s interest can be made by acquiring and reselling the security, he will authorize a bid.... Such bid may provide for payment of the prior lien indebtedness and costs incidental to the sale which must be paid from the sale proceeds. When under state law it is necessary, prior to such foreclosure, to acquire the prior lienholder’s rights to protect the Government’s junior lien interest, and in other situations when it is advantageous to the Government to pay the prior lien in full before the foreclosure sale, payment of the prior lien and required costs may be made with the advice of the OGC, provided the Government will obtain a greater recovery of the secured debt (not an inventory profit) than it could by bidding at the prior lien foreclosure sale, and the FmHA account after acquisition of the prior lien will be liquidated as provided in § 1872.17. Information clearly supporting the action as being to the Government’s financial advantage must be documented and made as part of the file.

7 C.F.R. § 1872.2(c)(1) (1985) (in part).

If there is a prior lien(s) and foreclosure is determined necessary, the State Director will contact the prior lienholder, whether directly or through the County Supervisor, and give the prior lienholder an opportunity to foreclose.
(i) If the prior lienholder is unable or unwilling to foreclose, FmHA will foreclose, either subject to the prior lien or paying the prior lien in full.
(ii) If the prior lienholder agrees to foreclose, the State Director will contact the prior lienholder to determine whether a cash payment is required on the date of the sale....

7 C.F.R. § 1955.15(d)(1) (1985) (in part).

Other courts which have considered this question have determined that the statute and regulations vest FmHA with discretion to determine what action it will take when a senior lien is foreclosed, and do not dictate FmHA’s decision. See Curry v. Block, Civ. No. 281-37, slip op. at 5 (D.Ga. May 20, 1983); Nihart v. Block, 6-83 Civ. No. 826 (D.Minn. Aug. 5, 1983), aff'd, 725 F.2d 689 (8th Cir.1983). This court concurs with these decisions. Section 1985(a) authorizes the Secretary of Agriculture (Secretary) to make advances to protect FmHA’s security interest, to bid and purchase at foreclosure sales when FmHA holds a lien on the subject property, and to manage or dispose of property acquired through purchase at a foreclosure sale. It does not require that the Secretary take such actions, or even suggest circumstances under which such actions might be appropriate. The regulations are more specific: sections 1872.2(b) & (c) set out actions to be taken by FmHA when it determines that it must act to protect its security interest. Section 1872.2(c)(1) sets out procedures to be followed when an FmHA State Director determines that a substantial net recovery on the government’s interest can be made by purchasing the secured property at a sale held to foreclose a prior lien. The regulations neither mandate that FmHA purchase the subject property at the foreclosure sale nor mandate that it grant procedural due process in deciding whether or how it must act to protect its security interest. Since the statute and regulations do not require that FmHA take a particular action to protect its security interest, FmHA cannot have violated the statute and regulations in the manner Plaintiffs allege. This court concludes that the second and sixth claims for relief fail to state a claim upon which relief may be granted and that Defendants are therefore entitled to dismissal of those claims pursuant to Fed.R.Civ.P. 12(b).

Plaintiffs’ fourth claim for relief is that, to the extent FmHA’s regulations allow Defendants to take various loan servicing actions without providing procedural due process prior to taking the action, those regulations are in violation of the fifth amendment. Plaintiffs have not addressed this claim in their brief on the motion to dismiss. This court considers this claim to raise issues similar to those of the first and fifth claims. If Plaintiffs can establish that FmHA’s regulations allow it to act in concert with private lienholders to deprive Plaintiffs of a property or liberty interest without due process of law, Plaintiffs may establish a right to relief under this claim. The motion to dismiss, insofar as it concerns the fourth claim for relief, must be denied.

Claim Under the Administrative Procedure Act

Plaintiffs’ third claim is that FmHA’s actions are in violation of the APA. 5 U.S.C. § 702. Defendants argue that, for the reasons expressed by this court in Coleman v. Block, 580 F.Supp. 194, 201 (D.N.D.1984), the APA does not apply to FmHA’s actions here challenged. Plaintiffs’ brief on the motion to dismiss does not address application of the APA. This court concurs with Defendants’ assertion.

The APA applies to cases of adjudication required by statute to be determined on the record after opportunity for a hearing. 5 U.S.C. § 554. As this court recognized in Coleman, the APA does not apply when the administrative agency is not required to make a determination on the record. FmHA is not required to make foreclosure, acceleration, or deferral determinations “on the record” as that phrase is interpreted under the APA. The APA therefore does not apply to any foreclosure, acceleration, or deferral actions FmHA may take in concert with other lienholders. Consequently, Plaintiffs’ third claim for relief must be dismissed.

Tort Claims

Plaintiffs’ seventh claim is that Defendants’ conduct “represent[s] tortious behavior of such a willful and malicious nature as to render the class Plaintiffs’ contractual obligations, which might otherwise be due, null and void.” Amended Complaint, 11141. Defendants assert that they are entitled to dismissal of this claim because Plaintiffs have not complied with jurisdictional prerequisites for bringing a claim either in tort or in contract. Once again, this court must consider the issue without the benefit of Plaintiffs’ response to Defendants’ contentions.

Defendants’ argument is twofold: that Plaintiffs’ claim concerns actions which are not within the ambit of the Federal Tort Claims Act (FTCA) waiver of sovereign immunity, and that, even if sovereign immunity were waived, Plaintiffs’ failure to file an administrative claim precludes their action in this court. Under the FTCA, the federal government retains its immunity from suit for claims “based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the Government, whether or not the discretion involved be abused.” 28 U.S.C. § 2680(a). Butz v. Economou, 438 U.S. 478, 98 S.Ct. 2894, 57 L.Ed.2d 895 (1978). The federal government also retains its immunity from claims arising from certain intentional and malicious acts. 28 U.S.C. § 2680(h); U.S. v. Perry, 706 F.2d 278, 279-80 (8th Cir.1983). The actions of which Plaintiffs complain concern Defendants’ obligations to act to protect FmHA’s interest in secured property. This court concludes that such actions constitute discretionary decisions excluded by 28 U.S.C. § 2680(a) from the FTCA waiver of immunity. See Tuepker v. Farmers Home Administration, 538 F.Supp. 375, 377 (W.D.Mo.1982), aff'd, 708 F.2d 1329 (8th Cir.1983). Moreover, Plaintiffs’ failure to pursue an administrative claim precludes their action in this court. Smith v. U.S., 588 F.2d 1209 (8th Cir.1978); Kjeldahl v. U.S., 52 B.R. 916 (D.Minn.1985).

Plaintiffs attempt to state a contract claim in that they allege their contractual obligations to FmHA have been voided by Defendants’ conduct. Exclusive jurisdiction over the contract claim lies in the Claims Court. 28 U.S.C. § 1346(a)(2). This court concludes that Plaintiffs’ seventh claim for relief is barred under the FTCA and under 28 U.S.C. § 1346(a)(2).

Retroactive Relief &

Sovereign Immunity

Defendants allege that the named Plaintiffs seek retroactive relief and as such their claims are either moot, or barred by sovereign immunity, or both. From the allegations of the complaint, it is clear that foreclosure proceedings involving the named Plaintiffs have been completed, with the exception of named Plaintiffs Howard Rust, Sr., Jessie Rust, Howard Rust, Jr., Wilma Rust, James Brown, Sadenia Brown (Amended Complaint ¶¶ 83 & 84), Clarence Hopmann, and Frances Hopmann (Id. ¶ 70). Plaintiffs’ requested relief includes the following:

[A] permanent mandatory injunction requiring the Defendants:
To return the property to those Plaintiffs in situations where FmHA has already acquired the property as a result of FmHA previously conspiring to induce the other lienholders to foreclose until the Government has granted the required administrative procedural due process;
To return the property, wherever feasi- ■ ble, to the Plaintiffs where FmHA has already conspired to induce other lien-holders or private parties to purchase the property at the foreclosure sale until the Government has granted the required administrative procedural due process.

(Id. at 46).

The relief sought is indeed broad. Plaintiffs seek, on a nationwide basis, the return of property subject to prior foreclosures. Insofar as title to those properties is now held by parties other than FmHA, this court is without power to order the titleholders to return the properties to Plaintiffs. Those titleholders are not before this court, and Plaintiffs have suggested no basis for relief as against those parties.

Insofar as FmHA holds title to the properties, Defendants argue that the relief desired is barred by sovereign immunity. However, this action is against federal officials rather than against the federal government itself. (See infra, pages 405-06). It is in the nature of a suit brought under the doctrine of Bivens v. Six Unknown Named Agents of Federal Bureau of Narcotics, 403 U.S. 388, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971). See also Arcoren v. Farmers Home Administration, 770 F.2d 137 (8th Cir.1985). To that extent, this court is not prepared to accept Defendants’ theory of sovereign immunity.

In order to grant the relief sought, this court would need to set aside numerous foreclosure judgments. Plaintiffs do not suggest a basis for this form of relief. Nor do they suggest why such relief would not be barred under principles of res judicata. This court concludes that as to those named Plaintiffs whose property has been subject to a completed foreclosure action, the relief sought is not available and dismissal of the claims of those Plaintiffs is therefore in order.

Defects in Service

Plaintiffs have identified as defendants 1). John R. Block, Secretary of Agriculture; 2). Frank W. Naylor, Jr., Under Secretary of Agriculture; 3). FmHA; 4). Charles W. Shuman, Administrator of FmHA; and 5). All State Directors, All District Directors, and All County Supervisors. The complaint, at 1112, states that all the named defendants are sued in their official capacities. The caption of the complaint suggests that those defendants not named, but identified, are sued in both individual and official capacities.

Plaintiffs’ complaint includes the following certification of service:

I, Jerold W. Barringer, pursuant to F.R. C.P. Rule 4(d)(4) & (5), have delivered a copy of the summons and of the complaint to the United States attorney for the District Court of North Dakota, Southwestern Division, and have sent a copy of the summons and of the complaint by certified mail, return receipt requested, to the Attorney General of the United States at Washington, District of Columbia, and have sent a copy of the summons and of the complaint by certified mail, return receipt requested, to the individually named defendants as officers and agents of the United States.

An amended complaint indicates that it was served only upon Merril Hirsh, an attorney with the United States Department of Justice who is appearing in this action on behalf of the defendants.

The rule to which Plaintiffs refer provides that service shall be made:

Upon the United States, by delivering a copy of the summons and of the complaint to the United States attorney for the district in which the action is brought ... and. by sending a copy of the summons and of the complaint by registered or certified mail to the Attorney General of the United States at Washington, District of Columbia.
Upon an officer or agency of the United States, by serving the United States and by sending a copy of the summons and of the complaint by registered or certified mail to such officer or agency.

Fed.R.Civ.P. 4(d)(4) & (5). A relevant statute provides that a civil action against an officer or employee of the United States may be venued in any judicial district in which a defendant resides or the cause of action arose, and further provides:

The summons and complaint in such an action shall be served as provided by the Federal Rules of Civil Procedure except that the delivery of the summons and complaint to the officer' or agency as required by the rules may be made by certified mail beyond the territorial limits of the district in which the action is brought.

28 U.S.C. § 1391(e). Also relevant are Fed. R.Civ.P. 10(a), requiring that the caption of the complaint include the name of each of the parties, and Fed.R.Civ.P. 25(d), providing that when a public officer is sued in his or her official capacity, he or she may be described by official title rather than by name.

Plaintiffs’ brief on the motion to dismiss addresses sufficiency of service only briefly:

Finally Defendants maintain that since they were named individually, based on the tort claim issue, and they weren’t served properly, they should all be dismissed completely. If sovereign immunity prevents the tort claim relief, then the individual aspects of the captioned class action will already have been taken care of. As to the administrative claims aspect of the suit, naming the Defendants in their official capacity and serving the parties pursuant to the rules on class actions suffices to eliminate the sovereign immunity bar. As a result, Defendants’ arguments are without merit.

The meaning of Plaintiffs’ reference to serving the parties pursuant to the rules on class actions is not apparent to this court. In any event, Plaintiffs have not addressed the question of sufficiency of service of those parties identified but not named in the caption of the complaint.

Given the provision of Fed.R. Civ.P. 25(d), this court concludes that the caption of the complaint sufficiently identifies those parties sued. The question of sufficiency of service must then be considered. Since Defendants state that they will waive defects in service of those named in their official capacities only, the remaining question is whether “All State Directors,” “All District Directors,” and “All County Supervisors” were properly served. Fed.R.Civ.P. 4(d)(5) is clear: service upon an officer of the United States is effected by sending a copy of the summons and of the complaint by registered or certified mail to the officer as well as to the United States. See Hutchinson v. United States, 677 F.2d 1322, 1328 (9th Cir.1982); Lawrence v. Acree, 79 F.R.D. 669 (D.D.C.1978); Wright & Miller, Federal Practice and Procedure: Civil § 1107 (1967 & Supp. 1985). Plaintiffs have not attempted to effect service upon each of the parties identified by official title but not named. The complaint will therefore be dismissed as against those parties. See C & L Farms, Inc. v. Federal Crop Insurance Corporation, 771 F.2d 407 (8th Cir.1985) (district court has discretion to determine appropriate remedy for defective service).

Suit Against FmHA

Defendants assert that FmHA cannot be sued in its own name. It is well recognized that a federal agency cannot be sued eo nominee without the consent of Congress. Blackmar v. Guerre, 342 U.S. 512, 72 S.Ct. 410, 96 L.Ed. 534 (1952); Dore v. Schultz, 582 F.Supp. 154 (S.D.N.Y.1984); Wright & Miller, Federal Practice and Procedure: Jurisdiction 2d § 3655 (1985). Plaintiffs have not demonstrated that Congress has consented to suit against FmHA in its own name. Therefore, this court concludes that the complaint must be dismissed as against that agency.

CONCLUSION

For the foregoing reasons, IT IS ORDERED:

1). Plaintiffs’ complaint, insofar as it concerns the second, third, sixth, and seventh claims for relief, is dismissed.
2). The claims of the following named Plaintiffs are dismissed: Richard D. (Jake) Lathan, Gladys Lathan, Larry Young, Allen D. Miller, Carole A. Miller, and Jo Anne Rackley.
3). As against the following Defendants, the complaint is dismissed in its entirety: All State Directors, All District Directors, All County Supervisors, and Farmers Home Administration.
4). The motion to dismiss is, in all other respects, denied.


author: POLOZOLA, District Judge.

text:
    J.B. TINDLE, D/B/A J.B. Tindle Distributors v. Bill LEDBETTER, D/B/A J.B. Quality Wholesale.
    Civ. A. No. 85-869-B.
    United States District Court, M.D. Louisiana,
    Jan. 8, 1986.
    Larry G. Starns, Denham Springs, La., for plaintiffs.
    Kelly Mangum, Rubin, Curry, Colvin & Joseph, Baton Rouge, La., for Justice Bros. Distributing Co., and Edward R. Justice, Sr.
    Jerry L. Finley, Denham Springs, La., for Bill Ledbetter.
   POLOZOLA, District Judge.

This matter is before the court on the motion of Bill Ledbetter to remand this suit to state court. No oral argument is required on this motion.

Ledbetter was the Louisiana distributor for Justice Brothers Distributing Co., Inc., until January 18, 1985, when his distribution contract was terminated. J.D. Tindle was then awarded the new Justice distribution contract. Thereafter, Ledbetter allegedly continued to hold himself out as the Justice distributor. Tindle filed this suit in the Twenty-first Judicial District Court for the Parish of Livingston, Louisiana, to enjoin Ledbetter from interfering in Tindle’s business.

Ledbetter then filed an answer and re-conventional demand, which is the Louisiana procedural equivalent to a counterclaim. In the counterclaim against Tindle, Ledbetter seeks the following relief: (1) monetary damages for the use by Tindle of parts racks allegedly owned by Ledbetter; (2) an injunction against Tindle and his agents preventing them from using the parts racks; (3) dissolution of the preliminary injunction obtained by Tindle and damages for wrongful issuance of the injunction; and (4) the balance due on a loan made by Tindle to Ledbetter.

Ledbetter also has asserted a claim against Tindle and three additional defendants, Justice Brothers Distributing Co., Inc., Edward R. Justice, Sr., and Edward R. Justice, Jr. (“Justices”), under the Louisiana anti-monopoly act for treble damages and attorney’s fees. The Justices removed the suit to this court. The Justices’ assert two reasons for removal under 28 U.S.C. § 1441(c): (1) the claims against the Justices were separate and independent from the claims asserted against Tindle; and, (2) the antitrust claims were brought under federal law and were separate and independent from the principal claim of the plaintiff against Ledbetter.

Ledbetter has now moved to remand this suit to state court. He contends that the claims against the Justices are not separate and independent claims and that there is no other basis for removal because a federal claim has not been asserted and there is no complete diversity of citizenship. For reasons which follow, the court finds that this action was improvidently removed and should be remanded to state court.

Although the Justices contend that Led-better’s claim in his “third party demand” against them is separate and independent from his claim against Tindle, the Justices are not third party defendants. The Justices were joined as defendants in recon-vention under article 1064 of the Louisiana Code of Civil Procedure, which is the Louisiana procedural equivalent of Rule 13(h) of the Federal Rules of Civil Procedure. Thus, the Justices must be considered as additional defendants in counterclaim and not as third party defendants.

Since the Justices are counterclaim defendants, they cannot remove this suit to federal court. In Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 61 S.Ct. 868, 85 L.Ed. 1214 (1941), the Supreme Court held that only a true defendant, and not a counterclaim defendant, could remove a suit to federal court. The United States Supreme Court noted in Shamrock that the removal statute must be strictly construed so as to restrict the jurisdiction of the federal courts on removal. Furthermore, the Supreme Court has recently reaffirmed the rule that removal jurisdiction must be based on the facts alleged in the plaintiffs complaint. Franchise Tax Board v. Construction Laborers Vacation Trust, 463 U.S. 1, 103 S.Ct. 2841, 2847, 77 L.Ed.2d 420 (1983).

Even if a suit could be removed by counterclaim defendants, the claims against the Justices are not separate and independent from the claims against Tindle. In American Fire & Casualty Co. v. Finn, 341 U.S. 6, 71 S.Ct. 534, 95 L.Ed. 702 (1951), the Supreme Court held that there is no separate and independent claim or cause of action permitting removal under § 1441(c) “where there is a single wrong to plaintiff, for which relief is sought, arising from an interlocked series of transactions.” Finn, 341 U.S. at 14, 71 S.Ct. at 540. If joint liability is alleged, the transactions are interlocked and the idea of a separate and independent claim is negated. Pullman Co. v. Jenkins, 305 U.S. 534, 538, 59 S.Ct. 347, 349, 83 L.Ed. 334 (1939); Bentley v. Halliburton Oil Well Cementing Co., 174 F.2d 788, 793 (5th Cir.1949).

In this case, Ledbetter has alleged that Tindle and the Justices are jointly liable under Louisiana R.S. 51:137 because they conspired together to restrain trade and commerce in this state. Ledbetter’s recon-ventional demand against Tindle and the Justices involve the same facts, and the relief sought against the Justices and Tin-dle for the alleged antitrust violations is the same. Thus, it cannot be said that the claim against the Justices is a separate and independent claim for relief as required by § 1441(c).

The Justices also contend that the antitrust claims asserted against them are separate and independent from the plaintiff's claim against the original defendant. As noted above, removal cannot be based on the allegations contained in a counterclaim. Furthermore, there is no basis for jurisdiction on removal because no claim under federal law has been asserted and there is no complete diversity between Ledbetter and the defendants in counterclaim.

In summary, the court finds that this case was improvidently removed. There is nothing alleged in the complaint over which this court could have had original jurisdiction. Furthermore, the allegations of the counterclaim cannot provide a basis for removal. Finally, the allegations against the Justices in the counterclaim are so interwoven with the claims against Tindle that there clearly is not a removable claim under § 1441(c). Because of the court’s decision to remand this action, the court has not decided any of the other pending motions. These motions should be considered by the state district judge.

Therefore:

IT IS ORDERED that the motion of Bill Ledbetter to remand be and it is hereby GRANTED.

Judgment shall be entered remanding this case to the Twenty-first Judicial District Court, for the Parish of Livingston, State of Louisiana.

      . See Louisiana Code of Civil Procedure article 1061.

      . Louisiana R.S. 51:121-152.

      . The court questions whether removal was timely in view of decisions interpreting the Louisiana Long Arm statute, R.S. 13:3204, which provide that service of process is effective upon mailing, not delivery. See Connor v. Farmer, 80 F.R.D. 472, 476-77 (E.D.La.1978); Thomas Organ Co. v. Universal Music Co., 261 So.2d 323, 327 (La.App. 1st Cir.1972). Because of the court’s decision to remand on other grounds, it is unnecessary to decide this issue.

      . The Fifth Circuit Court of Appeals has held that a third party defendant may remove a separate and independent claim. Marsh Investment Corp. v. Langford, 652 F.2d 583 (5th Cir.1981); Carl Heck Engineers v. Lafourche Parish Police Jury, 622 F.2d 133 (5th Cir.1980). The continuing validity of these decisions is questionable in light of the Supreme Court’s decision in Franchise Tax Board v. Construction Laborers Vacation Trust, 463 U.S. 1, 103 S.Ct. 2841, 77 L.Ed.2d 420, discussed infra.

        .See also Rath Packing Co. v. Becker, 530 F.2d 1295, 1303 (9th Cir.1975) aff'd., 430 U.S. 519, 97 S.Ct. 1305, 51 L.Ed.2d 604 (1977); Nolan v. Otis Elevator Co., 560 F.Supp. 119, 122 (D.C.N.J.1982).

      . Paragraphs V through VII of Ledbetter’s Answer and Reconventional Demand.

      . The Justices allege that Ledbetter has asserted federal antitrust claims against them. In their briefs, the Justices continually refer to Ledbet-ter’s allegations of their violations of “state and federal antitrust laws.” However, nowhere in the counterclaim does Ledbetter use that phrase. The only statute to which he refers and under which he seeks damages against the Justices is Louisiana R.S. 51:137. It is clear that Ledbetter chose not to assert a federal claim in his state court suit.
      Even if a federal antitrust claim had been asserted, it would not have been a basis for a valid removal. A state court has no jurisdiction over federal anti-trust violations because exclusive jurisdiction for those matters rests with the federal court. Thus, this court could not acquire jurisdiction over these claims by removal. General Inv. Co. v. Lake Shore & Mich. S. Ry., 260 U.S. 261, 287-88, 43 S.Ct. 106, 117, 67 L.Ed. 244 (1922); Lambert Run Coal Co. v. Baltimore & Ohio R.R. Co., 258 U.S. 377, 382, 42 S.Ct. 349, 351, 66 L.Ed. 671 (1922).