Brown & Caldwell v. Institute for Energy Funding, Ltd.

MEMORANDUM OPINION AND ORDER

This is a diversity action for breach of contract and quantum meruit in which counterclaims have been filed against plaintiff Brown & Caldwell, alleging breach of contract and negligence in connection with the performance of energy audit services at various facilities. Subsequently, Brown & Caldwell, as third-party plaintiff, filed a third-party complaint against three parties, including the movant Grefco, Inc. (“Grefco”), under F.R.Civ.P. 14. Claim One of the third-party complaint alleges that if Brown & Caldwell is liable to counterclaim-ants, then Grefco would be obligated to indemnify Brown & Caldwell. Claim Two alleges a similar claim against Grefco for partial indemnity. Grefco has moved to dismiss the third-party complaint for lack of subject matter jurisdiction, i.e., lack of diversity of citizenship between it and Brown & Caldwell. It is uncontroverted that both Brown & Caldwell and Grefco are citizens of California under 28 U.S.C. § 1332 (c); therefore, that no diversity of citizenship exists between them.

Two issues are raised by this motion. First, whether Brown & Caldwell’s third-party complaint in the circumstances here is within the…