Grubbs v. General Electric Credit Corporation

RESPONDENT: General Electric Credit Corporation
LOCATION: Bay Marchand Area

DOCKET NO.: 71-257
DECIDED BY: Burger Court (1972-1975)
LOWER COURT: United States Court of Appeals for the Fifth Circuit

CITATION: 405 US 699 (1972)
ARGUED: Mar 23, 1972
DECIDED: Apr 18, 1972

Bill J. Cornelius - for petitioner
Bill J. Cornelius -
Hubert D. Johnson - for respondent

Facts of the case


Media for Grubbs v. General Electric Credit Corporation

Audio Transcription for Oral Argument - March 23, 1972 in Grubbs v. General Electric Credit Corporation

Warren E. Burger:

We will hear arguments next to 71-257 Grubbs against General Electric Company.

Can you just -- you may proceed whenever you are ready.

Bill J. Cornelius:

Thank you Your Honor.

Mr. Chief justice, may it please the Court.

This case involves a judgment canceling a note and for $20,000 damages recovered on the merits by the petitioner T.R. Grubbs in United States District Court against General Electric Credit Corporation, after the case had been removed from the United States Court, from State Court to United States government which was the party throughout the proceeding.

The Court of Appeals held that the case was improperly removed and ordered that it would be remanded to the State Court.

We on certiorari are asking this honorable court to reverse the ruling of the Court of Appeal and sustain the jurisdiction of the United States District Court which rendered its judgment on the merits.

The case arose in this manner.

It was originally filed by General Electric Credit Corporation in State Court against T.R.Grubbs who is a small businessman in Jefferson, Texas.

The case was filed on simple note, to collect a promissory note.

When the case was filed in State Court, the petitioner Grubbs answered on the merits, claiming the invalidity of the promissory note and also filed a cross action against General Electric Credit Corporation and the General Electric company, alleging that these two companies had conspired together in an unlawful attempt which was successful to destroy his business by torturous and wrongful conduct in violation of both the State and the Federal Antitrust Laws.

The petitioner Grubbs then amended his pleadings and brought in the United States Government in order to determine the priority of various liens being claimed against the petitioner by the government and other parties.

When the government was brought into the case and State Court, it filed a petition for removal and the case was removed without objection or without motion to remand on the part of any party.

In United States Court after removal, the United States government filed an answer claiming that its lien was indeed prior to the other liens being asserted against Mr. Grubbs, and the government also filed a cross action against General Electric Credit Corporation and the General Electric company, alleging that they had conspired together to injure and destroy the petitioner Grubb's business and thereby had tortuously interfered and not only with the petitioner's business but with the interest of the government, its lien which it had on the asset of Grubbs.

No party objected to removal.

William H. Rehnquist:

Mr. Cornelius was your pleading against the United States proper under the Texas law of pleadings without a permissible type of claim to assert in the case that General Electric had a reason to sue?

Bill J. Cornelius:

Yes Your Honor we believe it was, and --

Byron R. White:

Can the Antitrust claims be tried in State Court?

Bill J. Cornelius:

No Your Honor, but at the time, we filed this pleading.

We had not briefed the question carefully and we were at that time under the impression that the State Court could not construe the Federal Antitrust Laws, but could enforce them concurrently with Federal Court.

We later discovered that, that was incorrect.

Byron R. White:

So what's your answer to Mr. Justice Rehnquist?

Was it a proper pleading or it wasn't?

Bill J. Cornelius:

Yes Your Honor, I understood him to ask if it was proper for us to bring the government in.

William H. Rehnquist:

Using a certain antitrust decree against the --

Bill J. Cornelius:

Not against the government.

No Your Honor.

So when this was -- when the removal was effective, there was no petition, no motion for remand, no objection to jurisdiction, all of the parties answered on the merits.

The United States government asserted affirmative release in tort against GECC and GE as we were doing.

GE and GECC filed a number of amended pleadings.