United States District Court, D. Minnesota
Noah's Ark Processors, LLC and Noah's Ark Holding Company, LLC, Plaintiffs,
Robert R. Elliott, Defendant.
William M. Topka, Esq., and Robert B. Bauer, Esq., Dougherty,
Molenda, Solfest, Hills & Bauer P.A., Apple Valley, MN,
on behalf of Plaintiff.
R. Elliott, pro se.
MEMORANDUM OPINION AND ORDER
MONTGOMERY U.S. DISTRICT JUDGE
matter before the undersigned United States District Judge
for a ruling on Defendant Robert Elliott's
(“Elliott”) Objection [Docket No. 12] to
Magistrate Judge David T. Schultz's May 25, 2017 Report
and Recommendation [Docket No. 2] (“R&R”).
Elliott objects to Judge Schultz's recommendation to
remand this action to state court. For reasons set forth
below, Elliott's objection is overruled.
is a member of Noah's Ark Processors, LLC and Noah's
Ark Holding Company (collectively, “Noah's
Ark” or the “Companies”). Am. Compl.
[Docket No. 1-2] ¶ 7. On January 3, 2014, the
Companies' operating agreements were amended in two
respects Am. Compl. ¶ 11. A forum selection clause was
added to require that disputes between Noah's Ark members
or between members and the Companies be adjudicated in the
Fourth District of Hennepin County, Minnesota. Id.
The amendment also added a jury waiver, which required
members to waive their right to trial by jury in suits
against other members or against Noah's Ark. Id.
Although Elliott voted against the amendment, the amendment
March 24, 2017, Noah's Ark filed a declaratory judgment
action in the Fourth District of Hennepin County, seeking an
order declaring the amendment to be valid. Am. Compl.
¶17. On May 15, 2017, Elliottt removed the case to
federal court, citing federal question jurisdiction, 28
U.S.C. § 1331.
24, 2017, Judge Schultz sua sponte recommended the
case be remanded to state court for lack of jurisdiction.
R&R at 1. Judge Schultz determined that Elliottt's
removal was based upon an anticipated federal defense, which
is not a valid basis for jurisdiction under § 1331.
Id. at 2.
objects to Judge Schultz's conclusion that federal
question jurisdiction is lacking.Elliottt argues that federal
question jurisdiction is present because the complaint should
be read as “arising under” the Constitution
because it directly implicates constitutional protections, or
because resolution of the case involves a substantial
question of federal law. Obj. at 5-9, 13-16. Elliottt also
argues that jurisdiction is proper under the “natural
plaintiff” theory. Id. at 13-19.
Standard of Review
standard of review of a magistrate judge's order on a
dispositive issue is de novo. See 28 U.S.C.
§ 636(b)(1)(C); D. Minn. LR 72.2. “The district
judge may accept, reject, or modify the recommended
disposition; receive further evidence; or return the matter
to the magistrate judge with instructions.” D. Minn