United States District Court, D. Nebraska
AFFILIATED FOODS MIDWEST COOPERATIVE, INC., a Nebraska corporation, and ASSOCIATED WHOLESALE GROCERS, INC., Plaintiffs,
SUPERVALU INC., a Delaware corporation; Defendant. BOROWIAK IGA FOODLINER, INC., Plaintiff/Counter Defendant,
AFFILIATED FOODS MIDWEST COOPERATIVE, INC., and ASSOCIATED WHOLESALE GROCERS, INC., Defendants/Third-Party Plaintiffs/Counter Plaintiffs.
TREVOR BOROWIAK, Third Party Defendant.
MEMORANDUM AND ORDER
F. Bataillon, Senior United States District Judge
matter is before the court on the parties' (Counter
Claimant Affiliated Foods Midwest Cooperative, Inc.,
Defendants Affiliated Foods Midwest Cooperative, Inc.,
Associated Wholesale Grocers, Inc., Third Party Plaintiff
Affiliated Foods Midwest Cooperative, Inc.) motion to strike
jury trial request, Filing No. 37, in
16-cv-00466.Borowiak objects, Filing No. 54 in the Lead
case, and Filing No. 61 in the Member Case, to the Order
dated May 30, 2017, Filing No. 48, granting the Motion to
Strike Plaintiff's Jury Demand in the Lead Case filed by
Affiliated Foods Midwest Cooperative (“AFM”) and
Associated Wholesale Grocers (“AWG” and
collectively with AFM, “AFM/AWG”) (Filing No.
37). These objections are filed pursuant to Fed.R.Civ.P.
72(a) and NECivR 72.2(a). Defendant Supervalu filed a request
for a jury trial in the Member Case, 16cv465. Filing No. 1,
¶ 11 at 2, and in its answer, Filing No. 33 at 7 and its
answer to amended complaint, Filing No. 58 at 10. In the Lead
case, Borowiak filed a request for a jury trial in its
complaint, Filing No. 1.
Supreme Court has construed the statutory grant of authority
conferred on magistrate judges under 28 U.S.C. § 636 to
mean that nondispositive pretrial matters are governed by
§ 636(b)(1)(A) and dispositive matters are covered by
§ 636(b)(1)(B). Gomez v. United States, 490
U.S. 858, 873-74 (1989); see alsoFed. R. Civ. P.
72(a). On review of a decision of the magistrate judge on a
nondispositive matter, the district court may set aside any
part of the magistrate judge's order that it finds is
clearly erroneous or contrary to law. 28 U.S.C. § 636
(b)(1)(A); Fed.R.Civ.P. 72(a). With respect to dispositive
motions, a magistrate judge lacks authority to do anything
but make recommendations, which are subject to de novo
review. See e.g., United States v.
Lothridge, 324 F.3d 599, 600 (8th Cir. 2003); 28 U.S.C.
AFM is in the business of selling grocery products and other
items to retail grocery stores. AFM regularly entered into
long-term supply agreements with many of its customers. As
part of AFM's agreement to loan money to its customers,
the parties agree that for a certain period of time AFM will
supply all the groceries to the customer. SuperValu Inc. is
similarly in the business of selling grocery products to
retail grocery stores. They are direct competitors of AFM.
Borowiak owns seven retail grocery stores. At all material
times herein, Borowiak entered in to a Supply Agreement with
AFM, which made AFM the primary grocery supplier to Borowiak.
The Agreement was to last for 5 years. Borowiak agreed to buy
at least $85, 000, 000 in goods from AFM. AFM decided to sell
its business in late 2016. Once the announcement of a
possible sale occurred, SuperValu began working with Borowiak
to become its supplier.
October 12, 2016, a complaint filed by AFM filed against
SuperValu in the District Court of Madison County, Nebraska
(Member Case) was removed to federal court. The complaint
alleged SuperValu, by supplying fresh meat and other
groceries, tortiously interfered with certain agreements
between AFM and Borowiak. See Filing No. 1 at 1.
Borowiak alleged that there had been a “failure or
refusal” by AFM “to provide fresh meat and timely
deliver produce” and AFM has been “unable or
failed to consistently serve Borowiak's needs for other
foodstuffs and items sold by retail grocers such as the $1.00
product offering and cross-dock products.” See
Filing No. 11, at 3. As a result Borowiak purchased all fresh
meat for its seven stores from SuperValu. Id. In
addition, Borowiak also learned AFM was selling substantially
all of its assets to Associated Wholesale Grocers, Inc.
(“AWG”) and Borowiak would, thereafter, be
required to become an AWG member to receive the grocery items
previously provided by AFM. Id. at 2. Borowiak would
be “required to accept terms and conditions different
than those in the Agreement relating to the valuable
patronage rebate Borowiak was then receiving from AFM”.
See Filing No. 12-2 at 4-5.
October 12, 2016, Borowiak filed suit (Lead Case) against AFM
for breach of contract, breach of the covenant of good faith
and fair dealing, and for violations of the Nebraska Consumer
Protection Act (“NCPA”), and Borowiak requested a
jury trial. Filing No. 1. AFM filed a Counterclaim against
Borowiak, alleging Borowiak defaulted under the Supply
Agreement and Promissory Note, and filed a Third Party
Complaint against Trevor Borowiak for breach of the
guaranties, among other causes of action. Filing No. 44.
AFM/AWG filed the instant motion to strike Borowiak's
demand for jury trial, arguing that Borowiak waived its right
to a jury trial in each of the above agreements executed
between the parties. Borowiak filed a complaint and demand
for jury trial. Filing No. 1. AFM/AWG moved to strike the
demand for jury trial. Filing No. 37. Thereafter, in their
amended answer, AFM/AWG requested a jury trial on all matters
that are triable to a jury. Filing No. 44, at 28. The Amended
Answer with AFM/AWG's jury demand asserts claims for
breach of contract relating to the three (3) agreements
relied upon in AFM/AWG's motion to strike, as well as
claims for violation of the Nebraska Consumer Protection Act,
unjust enrichment and related business torts. Filing No. 44.
The magistrate judge granted the motion to strike. Filing No.
48. SuperValu, a defendant in the Member case, demanded a
jury trial, Filing No. 33, and no motion to strike was ever
objects to the findings of the magistrate judge, in
particular, the magistrate judge's determinations that:
a. “[T]he Eighth Circuit Court of Appeals has
repeatedly stated that ‘the right to a jury trial in
the federal courts is to be determined as a matter of federal
law in diversity as well as other actions'” (Filing
No. 48 at 4).
b. “Courts in the Eighth Circuit apply the federal
‘knowing and voluntary' test to determine whether a
jury trial has been waived” (Filing No. 48 at 5).
c. “Borowiak argues enforcement of the clauses are
procedurally unenforceable” (Filing No. 45 at 5).
d. “Borowiak knowingly and voluntarily executed waivers
of a jury trial on its claims in this case” (Filing No.
48 at 5).
e. “[AFM/AWG] did not clearly, unequivocally, and
decisively waive its right to enforce the valid contractual
waivers of a jury trial in this matter. It is clear that
[AFM/AWG] intended at the outset of this litigation to
enforce the jury waiver clauses. . . . The Court finds
[AFM/AWG's] conduct does not amount to a clear,
unequivocal, decisive waiver of the valid contractual jury
waivers” (Filing No. 48 at 6).
f. “The Motion to Strike the Plaintiff's Jury
Demand in the Lead Case (Filing No. 37) is ...