U.S. Bank National Association v. Copy Center of Topeka, Inc.

U.S. District Court, District of Minnesota February 12, 2024

Trial Court Opinion

UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA

U.S. Bank National Association, Civ. No. 23-3443 (PAM/DJF)
doing business as U.S. Bank
Equipment Finance,

Plaintiff,

Copy Center of Topeka, Inc., MEMORANDUM AND ORDER

Defendant/Third-Party Plaintiff,

Konica Minolta Business
Solutions U.S.A., Inc.,

Third-Party Defendant.

This matter is before the Court on Plaintiff’s Motion to Remand. For the following
reasons, the Motion is granted.
BACKGROUND
Plaintiff U.S. Bank National Association (“US Bank”) filed this lawsuit in the state
district court for Lyon County, Minnesota against Defendant Copy Center of Topeka, Inc.,
a Maine company doing business in Kansas. US Bank alleged that the Copy Center failed
to make payments under three equipment financing agreements that Konica Minolta
Business Solutions U.S.A., Inc. (“Konica Minolta”) assigned to US Bank. The Complaint
raises three breach-of-contract claims and a claim for delivery of the equipment, all under
state law.
Copy Center filed a counterclaim against US Bank and a third-party claim against
Konica Minolta, alleging that the copy machines Konica Minolta sold did not function

properly and raising several state-law claims such as fraud and fraudulent inducement,
unjust enrichment, breach of warranties, and breach of the implied covenant of good faith
and fair dealing.
Approximately one month after Copy Center filed its third-party complaint, Konica
Minolta purported to remove the lawsuit to this Court. (Docket No. 1.) The presiding
Magistrate Judge ordered Konica Minolta to more specifically plead the citizenship of US

Bank, and also asked the parties to weigh in on whether Konica Minolta’s removal was
proper under recent Supreme Court authority, Home Depot U.S.A., Inc. v. Jackson,

139 S. Ct. 1743, 1748-49

 (2019).  (Docket No. 5.)  US Bank and Konica Minolta filed letters in 
response, and Konica Minolta amended its notice of removal to more specifically allege 
US Bank’s citizenship.  Copy Center took no position on whether removal was proper.  

Thereafter, US Bank brought this Motion to Remand.                        
DISCUSSION                                                                
In  the  “Eighth  Circuit,  third-party  defendants  are  generally  not  permitted  to 
remove.”  Steeby v. Discover Bank,

980 F. Supp. 2d 1131, 1136

 (W.D. Mo. 2013) (citing 
Lewis v. Windsor Door Co.,

926 F.2d 729, 733

 (8th Cir. 1991)); see also Duckson, Carlson, 

Bassinger,  LLC  v.  Lake  Bank,  N.A.,

139 F. Supp. 2d 1117, 1118

  (D. Minn.  2001) 
(Rosenbaum,  J.)  (“It  is  well-established  that  a  defendant  cannot  remove  based  on  a 
counterclaim.”).  The Supreme Court in Home Depot directly “address[ed] whether [the 
removal statute—28 U.S.C. § 1441] allows a third-party counterclaim defendant—that is, 
a party brought into a lawsuit through a counterclaim filed by the original defendant—to 
remove the counterclaim filed against it.”  Home Depot,

139 S. Ct. at 1745-46

.  The Court 

concluded that the removal statute does not allow a counterclaim defendant to remove.  See

id. at 1748

 (“[W]e conclude that § 1441(a) does not permit removal by any counterclaim 
defendant,  including  parties  brought  into  the  lawsuit  for  the  first  time  by  the 
counterclaim.”).                                                          
Konica Minolta asserts that the Supreme Court did not mean what it said in Home 
Depot.    According  to  Konica  Minolta,  Home  Depot stands  only  for  the  well-settled 

principle that removal on the basis of third-party claim is improper.  In other words, Konica 
Minolta’s argument is that when the only basis for federal jurisdiction is the third-party 
claim, the third-party defendant cannot remove.  But when there is already a basis for 
federal jurisdiction in the complaint—as here, when the original parties are of diverse 
citizenship—removal by any defendant, initial or third-party, is allowed. 

Konica Minolta focuses on the Supreme Court’s discussion of the principle that, 
when determining whether removal is proper, a district court evaluates “whether the 
plaintiff could have filed its operative complaint in federal court, either because it raises 
claims arising under federal law or because it falls within the court’s diversity jurisdiction.”  
Id.  But original jurisdiction over the complaint is not the only factor in determining 

whether § 1441 permits removal; original jurisdiction is a necessary but not a sufficient 
condition to removal.  Home Depot’s holding is that, because removal under § 1441 is 
premised on the “defendant or defendants” removing the “civil action”—“the action as 
defined by the plaintiff’s complaint,” id.—“‘the defendant’ to that action is the defendant 
to that complaint, not a party named in a counterclaim.”  Id.             
Home Depot’s ruling is inescapable: “§ 1441(a) does not permit removal by any 

counterclaim defendant, including parties brought into the lawsuit for the first time by the 
counterclaim.”  Id.  Only an original defendant or defendants to a complaint can remove a 
civil action to federal court.  Thus, even if the complaint raises a federal claim, if it is filed 
in state court and the original defendant does not to remove it, any counterclaim defendant  
cannot remove it.  As here, where the basis for federal jurisdiction in the original complaint 
is diversity jurisdiction, only the original defendant can invoke § 1441 to remove the action.  

The fact that Konica Minolta was later brought into the action as a third-party defendant 
has no effect on whether removal is available.  As to Konica Minolta, and all third-party 
defendants, § 1441 does not apply.                                        
Finally, although US Bank’s Motion to Remand was brought after the 30-day time 
period provided in the statute,

28 U.S.C. § 1447

(c), US Bank argues that Konica Minolta’s 

amended notice of removal re-set that clock, and US Bank’s Motion to Remand is timely.  
Konica Minolta does not challenge the timeliness of the Motion to Remand, and has waived 
any argument in that regard.  See,e.g., Holbein v. TAW Enters., Inc.,

983 F.3d 1049, 1053

 
(8th Cir. 2020) (holding that “nonjurisdictional defect[s] in removal [are] waived if not 
raised” by the opposing party).                                           
CONCLUSION                                                                
Accordingly, IT IS HEREBY ORDERED that Plaintiffs’ Motion to Remand  

(Docket No. 13) is GRANTED and this matter is REMANDED to the Minnesota District 
Court for the Fifth Judicial District, Lyon County.                       

Dated:        February 12, 2024                                           

                                        s/Paul A. Magnuson           
                                   Paul A. Magnuson                  
                                   United States District Court Judge