Corporations — appraisal; venue; jurisdiction

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United States Court of Appeals For the Seventh Circuit

Civil

Corporations — appraisal; venue; jurisdiction

Section 180.1330(2) does not vest jurisdiction over stock appraisals exclusively in state court.

“Wisconsin draws its corporate code from the Model Business Corporation Act, so this language or something similar appears in the statute books of 30 states. Several other states, including Delaware, have functionally identical provisions. Truck Components Inc. v. Beatrice Co., 143 F.3d 1057, 1061–62 (7th Cir. 1998), holds that Delaware’s version concerns venue rather than jurisdiction. See also TBK Partners, Ltd. v. Western Union Corp., 675 F.2d 456, 460 n.3 (2d Cir. 1982) (dictum understanding New York law the same way). Treating the statute as a claim by a state to oust the jurisdiction of the federal courts would simply render it unconstitutional, for no state may contract jurisdiction created by an Act of Congress. See, e.g., M’Kim v. Voorhies, 11 U.S. (7 Cranch) 279 (1812); Railway Co. v. Whitton’s Administrator, 80 U.S. (13 Wall.) 270 (1872). Cf. Chicago v. International College of Surgeons, 522 U.S. 156 (1997) (proceeding for review of a state agency’s decision is removable notwithstanding the state’s desire that its courts retain control). Under the Supremacy Clause, federal law prevails over conflicting state law. We said in Truck Components that it is best to read language such as Delaware’s (and Wisconsin’s) as allocating authority within its own judiciary. Why treat a state as claiming more power than it has? The commentary to the Model Business Corporation Act shows that the drafters set out to create a ‘provision[] . . . relating to venue’. ABA, Model Business Corporation Act Annotated §13.30 at 13–100 to 13–101 (4th ed. 2008 & 2011 rev.). There’s no reason not to take the authors at their word.”

Affirmed.

10-3509 Albert Trostel & Sons Co. v. Notz

Appeal from the United States District Court for the Eastern District of Wisconsin, Clevert, J., Easterbrook, J.