United States District Court, E.D. Missouri, Southeastern Division
ROBINSON MECHANICAL CONTRACTORS INC. d/b/a ROBINSON CONSTRUCTION CO., Plaintiff,
PTC GROUP HOLDINGS CORP., and PTC SEAMLESS TUBE CORP., Defendants.
MEMORANDUM AND ORDER
STEPHEN N. LIMBAUGH, JR., UNITED STATES DISTRICT JUDGE
matter is before the Court on defendant PTC Group Holdings
Corp.'s (“PTC”) motion to strike plaintiff
Robinson Mechanical Contractors Inc.'s d/b/a Robinson
Construction Company (“Robinson”) jury demand as
to Count VII (alter ego) (#154). The motion is fully briefed
and ripe for disposition. The facts have been explained in
other memorandums and orders (#151, #175) and will not be
is entitled to a jury trial by simply demanding it under
Federal Rule of Civil Procedure 38, unless “the court .
. . finds . . . there is no federal right to a jury
trial.” Fed.R.Civ.P. 39(a). The Court may find that no
right exists based on a party's motion. Fed.R.Civ.P.
39(a)(2). Or it may find that no right exists on its own,
without a motion. Id.
addressing whether Robinson has a federal right to a jury
trial on its alter ego claim, this Court must first decide
whether PTC has waived the issue. Robinson argues PTC has
waived the issue because PTC has conceded-eighteen times, by
Robinson's count-that the alter ego claim presents a jury
question. But Rule 39 has no timing requirement. “A
motion to strike a jury demand can be made at any
time.” Shaw v. Prudential Ins. Co. of Am., No.
10-3355-S-CV-DGK, 2012 WL 432874, at *7 (W.D. Mo. Feb. 9,
2012); see also United States v. Schoenborn, 860
F.2d 1448, 1455 (8th Cir. 1988) (finding that the district
court did not abuse its discretion in granting a party's
motion to strike the day before trial). Because Rule 39 has
no timing requirement, and because this Court can act without
any motion at all, PTC has not waived the issue of
Robinson's right to a jury trial on its alter ego claim.
merits, because this is a diversity case, the Court applies
state substantive law and federal procedural law.
Gasperini v. Ctr. for Humanities, Inc., 518 U.S.
415, 427 (1996); see also Erie R. Co. v. Tompkins,
304 U.S. 64, 78-79 (1938). The right to a jury trial is
procedural and will be decided by federal procedural law.
See Simler v. Conner, 372 U.S. 221, 222 (1963) (per
curiam). Federal Rule of Civil Procedure 38(a) preserves
“[t]he right of trial by jury as declared by the
Seventh Amendment to the Constitution  or as provided by a
federal statute . . . .” Robinson does not rely on any
federal statute to support its right. Thus, Robinson's
claimed right depends on the Seventh Amendment.
Seventh Amendment provides: “In Suits at common law,
where the value in controversy shall exceed twenty dollars,
the right of trial by jury shall be preserved . . . .”
U.S. Const. amend. VII. “Suits at common law”
refers to suits where legal-as opposed to equitable-rights
were determined. Granfinanciera, S.A. v. Nordberg,
492 U.S. 33, 41 (1989). When deciding whether a claim is
legal or equitable, courts perform a two-step analysis:
“First, we compare the . . . action to 18th-century
actions brought in the courts of England prior to the merger
of the courts of law and equity. Second, we examine the
remedy sought and determine whether it is legal or equitable
in nature.” Id. at 42 (quoting Tull v.
United States, 481 U.S. 412, 417-18 (1987)). The second
step is more important than the first. Id.
parties appear to agree that the first step of this analysis
is inconclusive because piercing the corporate veil had both
legal and equitable origins in eighteenth-century England.
See, e.g., Wm. Passalacqua Builders, Inc. v.
Resnick Developers S., Inc., 933 F.2d 131, 136 (2d Cir.
1991); Int'l Fin. Servs. Corp. v. Chromas Techs.
Canada, Inc., 356 F.3d 731, 736 (7th Cir. 2004).
Robinson's claimed right to a jury, then, depends on the
second step-the remedy sought. On this issue, there is a
circuit split between the Second and Seventh Circuits.
Seventh Circuit, in Chromas, 356 F.3d 731, relied on
state law to determine whether the remedy sought is legal or
equitable. 356 F.3d at 735. In Chromas, the court
noted “[t]he dispositive question . . . [was] whether
piercing the corporate veil under the law of Illinois is,
according to federal procedural law, a form of equitable
relief.” Id. However, the Chromas
court also observed, “Although we conclude that, under
Illinois law, piercing the corporate veil is an equitable
remedy to be determined by the court, this conclusion might
not be reached under the law of another state.”
Chromas, PTC relies on Delaware law to support its
claim that the remedy sought (alter ego liability) is
equitable. See also Sonne v. Sacks, 314 A.2d 194,
197 (Del. 1973). PTC also relies on United States v.
Golden Acres, Inc., 684 F.Supp. 96 (D. Del.1988), where
the district court quoted Delaware law and struck a jury
demand on a veil-piercing claim. 684 F.Supp. at 103. The
court held that, “Under the law of Delaware, a state
which staunchly maintains the division of law and equity,
‘piercing the corporate veil may be done only in the
Court of Chancery, when the purpose of the action is to
obtain a judgment against individual stockholders or
officers.'” Id. (footnote omitted)
(quoting Sonne, 314 A.2d at 197). But the district
court qualified its position, stating: “This citation
of Delaware law should not be misconstrued as implying that
Delaware law will necessarily control our ultimate
determination of whether the corporate veil of Golden Acres
should be pierced; federal law may control that
determination.” Id. at 103 n.4.
contrast, the Second Circuit, in Passalacqua, 933
F.2d 131, which is part of the circuit split on step two of
the Granfinanciera analysis, determined the nature
of the remedy without looking to state law. 933 F.2d at
136-37. In Passalacqua, the court held that the
nature of the remedy is legal in a veil-piercing claim where
the plaintiffs sought to pierce the veil to enforce a money
judgment. Id. at 136. The court explained:
“Plaintiffs seek to establish defendants' liability
for the judgment already obtained against Developers. This is
analogous to the second phase of the old creditors' bill
procedure in which the creditors, having obtained a judgment
against the corporation in equity, then enforced that
judgment against the individual stockholders at law.”
Id. Because the plaintiff sought to pierce the veil
to enforce a money judgment, the court held that the
remedy was legal. Id.
of these differing analyses, if the nature of the remedy in a
veil-piercing claim hinges on its status under Delaware law,
this Court agrees that it would be equitable. See
Sonne, 314 A.2d at 197. But this Court is persuaded by
the approach in Passalacqua, where the court
analyzed the remedy without looking to state law. In fact,
most courts have analyzed the remedy sought without looking
to state law. See, e.g., In re Bonds Distrib.
Co., No. 97-52130C-7W, 2000 WL 33682815, at *7-8 (Bankr.
M.D. N.C. Nov. 15, 2000); United States v. Vacante,
No. 108CV1349OWWDLB, 2010 WL 2219405, at *3-4 (E.D. Cal. June
2, 2010); Broyles v. Cantor Fitzgerald & Co.,
No. CV 3:10-854-JJB-CBW, 2016 WL 4054923, at *1-2 (M.D. La.
July 26, 2016); Iantosca v. Benistar Admin. Servs.,
Inc., 843 F.Supp.2d 148, 153 (D. Mass. 2012); In re
Kollel Mateh Efraim, LLC, 406 B.R. 24, 27-30 (Bankr.
S.D.N.Y. 2009); In re: FKF 3, LLC, No. 13-CV-3601
(KMK), 2016 WL 4540842, at *17 (S.D.N.Y. Aug. 30, 2016).
the plaintiff in Passalacqua, Robinson has obtained
a judgment (#151) for money damages against one party (PTC
Seamless Tube Corp.). Also like the plaintiff in
Passalacqua, Robinson hopes to pierce the corporate
veil so it can enforce the judgment for money damages against
a different party (PTC) (#47 at 37). An action seeking money
damages is a legal action. See Great-W. Life &
Annuity Ins. Co v. Knudson, 534 U.S. 204, 210 (2002);
Passalacqua, 933 F.2d at 136. Thus, Robinson is
entitled to a jury trial on its alter ego claim under the
IT IS HEREBY ORDERED that defendant
PTC's motion to strike (#154) plaintiff Robinson's