Pillsbury Co., Inc. v. Port of Corpus Christi Authority

United States Court of Appeals,
Fifth Circuit.
No. 94-20597.
The PILLSBURY COMPANY, INC., Plaintiff-Appellee,
v.
The PORT OF CORPUS CHRISTI AUTHORITY, Defendant-Appellant.
Oct. 11, 1995.
Appeal from the United States District Court for the Southern
District of Texas.
Before JOLLY and BENAVIDES, Circuit Judges, and SHAW*, District
Judge.
BENAVIDES, Circuit Judge:
Defendant-Appellee The Port of Corpus Christi Authority
("Corpus Port") appeals the district court's denial of its motion
to dismiss for lack of diversity jurisdiction and/or motion for
summary judgment alleging that it is an "arm of the State of Texas"
entitled to Eleventh Amendment immunity and not a "citizen" for
purposes of diversity jurisdiction. We reverse the district
court's ruling and dismiss for lack of jurisdiction.
FACTS AND PROCEDURAL HISTORY
The facts of the case are undisputed. The Pillsbury Company
("Pillsbury"), a Delaware corporation with its principal place of
business in Minnesota, and the Corpus Port entered into a
contractual arrangement concerning a shipment of bagged sugar
consigned to Pillsbury. The shipment arrived at the Corpus Port in
*
Chief Judge of the Western District of Louisiana, sitting
by designation.
1
March 1991, and was allegedly damaged while being stored in the
Corpus Port's cargo dock sheds (warehouses).
On March 8, 1993, Pillsbury sued the Corpus Port for breach of
contract/bailment for the damage caused to the sugar stored at the
Corpus Port. The Corpus Port filed a motion to dismiss for lack of
diversity jurisdiction and/or motion for summary judgment, alleging
that it was an "arm of the State of Texas," and therefore not
considered a "citizen" for purposes of diversity jurisdiction. The
Corpus Port also alleged that it was entitled to Eleventh Amendment
immunity from suit in federal court.
After allowing the parties extra time for briefing the
jurisdictional issue, the district court determined that the Corpus
Port is not an arm of the State of Texas and thus, as a citizen
within the meaning of 28 U.S.C. § 1332, is capable of supporting
the exercise of the court's diversity jurisdiction.1 The Corpus
Port filed a motion for reconsideration or, in the alternative, a
motion for certification under 28 U.S.C. § 1292(b). The district
court denied the motion for reconsideration, but certified the
interlocutory order for immediate appeal. This Court subsequently
granted the interlocutory appeal.2
DISCUSSION
1
The court also ruled that it lacked admiralty jurisdiction
because 1) the contract at issue did not involve a maritime
obligation to provide wharfage and 2) there was no evidence of a
claim for damages arising from the breach of a severable maritime
obligation of the contract.
2
The Port of Houston Authority has filed a brief of amicus
curiae in this appeal.
2
The district court's finding that the Corpus Port is legally
and factually indistinguishable from the Port of Houston Authority
("Houston Port") is unassailed in this appeal. Accordingly, we are
bound by our decision in Kamani v. Port of Houston Authority3, in
which we upheld an earlier decision finding the Houston Port "a
creature of state law and a political subdivision of the State of
Texas" entitled to Eleventh Amendment immunity. Id. at 613
(quoting McCrea v. Harris County Houston Ship Channel Navigation
Dist., 423 F.2d 605, 607 (5th Cir.), cert. denied, 400 U.S. 927, 91
S. Ct. 189, 27 L. Ed. 2d 186 (1970)). Therefore, we find that the
Corpus Port, like the Houston Port, is entitled to Eleventh
Amendment immunity.
We reject Pillsbury's contention that the U.S. Supreme Court's
decision in Hess v. Port Authority Tans-Hudson Corp.4 overrules our
decision in Kamani. Hess is not broad enough to support
Pillsbury's contention. We view Hess as a limited holding
addressing the standard to be applied to bi-state entities not
created pursuant to state statute. Because the Corpus Port and the
Houston Port were both created and still operate pursuant to
Article XVI, Section 59 of the Texas Constitution, Hess does not
overrule Kamani or control the disposition of this appeal.
Likewise we find Jacintoport Corp. v. Greater Baton Rouge Port
Commission, 762 F.2d 435 (5th Cir.1985), cert. denied, 474 U.S.
1057, 106 S. Ct. 797, 88 L. Ed. 2d 774 (1986), decided after Kamani by
3
702 F.2d 612 (5th Cir.1983)
4
--- U.S. ----, 115 S. Ct. 394, 130 L. Ed. 2d 245 (1994).
3
a panel of this Court and pertaining to the Eleventh Amendment
exception status of a port created under Louisiana law and not
Texas law, is of no benefit to Pillsbury.
CONCLUSION
Having found that the Corpus Port is entitled to Eleventh
Amendment immunity, we REVERSE the ruling of the district court and
DISMISS Pillsbury's claim for lack of jurisdiction.
4