Opinion
Civil Action No: 04-1509, c/w 04-1512, Section: "R" (1).
September 8, 2004
ORDER AND REASONS
Defendants move the Court to dismiss this matter under Rule 12(b) (1) for lack of subject matter jurisdiction. Plaintiff opposes the motion. For the following reasons, the Court DENIES defendants' motion.
I. BACKGROUND
Scott Buras, Barrett Mccreary, Todd Nienaber, Carlos Rodriguez, Jr., and Wayne Tedesco are former employees of defendant M, G, B Services. They signed agreements not to compete with MGB after they stopped working for MGB. They no longer work for MGB and currently work for plaintiff Lagniappe Logistics. On April 29, 2004, MGB sued Buras, McCreary, Nienaber, Rodriguez, and Tedesco in state court for breach of contract. MGB alleges that they violated the non-competition agreements. On June 1, 2004, Buras, McCreary, Nienaber, Rodriguez, and Tedesco removed the action to this Court in Civil Action 04-1512. On May 28, 2004, Laginappe Logistics sued MGB in this Court in Civil Action No. 04-1509. Lagniappe alleges, inter alia, that MGB's attempts to enforce the non-compete agreements are unreasonable restraints of trade that have injured its business. The cases were consolidated, but the Court has since remanded Civil Action 04-1512 to state court. (R. Doc. 23.) Defendants' (collectively referred to as MGB) now move to dismiss Lagniappe's suit for lack of subject matter jurisdiction. Lagniappe argues that the Court has jurisdiction under the federal antitrust statutes, 15 U.S.C. § 1 et seq., and diversity of citizenship.
Lagniappe also argues that the Court has jurisdiction under the preemptive effect of the Interstate Commerce Act, 49 U.S.C. § 13101 et seq. Lagniappe reasons that the ICA preempts all causes of action having to do with freight forwarders. The Court has already considered, and rejected, Lagniappe's ICA preemption argument. ( See R. Doc. 23.) Therefore, the Court will not address it again here.
II. DISCUSSION
A. Legal Standard
Federal courts are courts of limited subject matter jurisdiction. Coury v. Prot, 85 F.3d 244, 248 (5th Cir. 1996). A federal court may not entertain a case unless it is authorized to do so by the Constitution and legislation. See id. The jurisdiction of federal courts extends to actions that involve a federal question, diversity of citizenship, admiralty actions, suits against foreign states, and bankruptcy proceedings. See 28 U.S.C. §§ 1330-34. There is a presumption against subject matter jurisdiction "that must be rebutted by the party bringing an action to federal court." Id.
Federal Rule of Civil Procedure 12(b) (1) governs challenges to a district court's subject matter jurisdiction. The Court properly grants a motion to dismiss for lack of subject matter jurisdiction when it lacks the statutory or constitutional power to adjudicate the case. See Home Builders Ass'n of Miss., Inc., v. City of Madison, 143 F.3d 1006, 1010 (5th Cir. 1998) ( quoting Nowak v. Ironworkers Local 6 Pension Fund, 81 F.3d 1182, 1187 (2d Cir. 1996)). A district court may dismiss an action for lack of subject matter jurisdiction based on (1) the complaint alone; (2) the complaint supplemented by undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the Court's resolution of disputed facts. See Williamson v. Tucker, 645 F.2d 404, 413 (5th Cir. 1981); see also Robinson v. TCI/US West Communications Inc., 117 F.3d 900, 904 (5th Cir. 1997) (citations omitted). MGB raises a "facial attack" on the complaint. Accordingly, the Court must examine whether Lagniappe has alleged sufficiently a basis for subject matter jurisdiction, taking all of its allegations in the complaint as true. See Menchaca v. Chrysler Credit Corp., 613 F.2d 507, 510 (5th Cir. 1980) ( citing Mortensen v. First Fed. Savings Loan, 549 F.2d 884, 891 (3rd Cir. 1977)).
B. Analysis
(1) Jurisdiction Under the Antitrust Statutes
The federal antitrust statutes grant district courts jurisdiction over antitrust actions. 15 U.S.C. § 4. The Sherman Act applies to "every contract, combination . . . or conspiracy, in restraint of trade or commerce" and to every person who shall "monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of trade or commerce." Id. at §§ 1, 2. Persons injured in their businesses or property because of a violation of the antitrust laws may sue in the federal district court, without regard to the amount in controversy. Id. at § 14.
The focus of MGB's jurisdictional challenge is not clear. Citing no authority, MGB apparently argues that the Court has no jurisdiction under the Sherman Act to entertain a challenge to these non-competition agreements. MGB does not challenge the interstate nexus of the challenged activity, but rather the nature of the alleged violation. Here, Lagniappe complains that the non-competition agreements and MGB's efforts to enforce them created an unreasonable restraint of trade in the relevant market of the freight forwarding business. (Pl.'s Compl. at ¶ XXVI.) Lagniappe also alleges injury to its business as a result of MGB's conduct. ( Id. at ¶ XX.) Lagniappe further alleges that freight forwarding is a business conducted through interstate phone and internet connections and is nationwide in scope. ( Id. at ¶ V.) Federal courts have entertained challenges by competitors to non-competition agreements under the Sherman Act. See, e.g., Borg-Warner Protective Services v. Guardsmark, Inc., 946 F.Supp. 495, 498 (E.D. Ky. 1996) (competing security guard firm and employees sued employees' former employer, alleging that the former employer's attempt to enforce non-competition agreements violated federal antitrust laws). Lagniappe's allegations are sufficient to invoke subject matter jurisdiction under the Sherman Act.
(2) Diversity Jurisdiction
Because the Court finds that it has jurisdiction under the federal antitrust statutes, the Court need not reach the parties' dispute over whether the Court has diversity jurisdiction.
III. CONCLUSION
For the above reasons, the Court DENIES MGB's motion for dismiss for lack of subject matter jurisdiction.