1 IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT OF ARKANSAS 2 CENTRAL DIVISION 3 MICHAEL GORE, No. 4:24-CV-644-LPR 4 Plaintiff, 5 v. 6 Wednesday, March 4, 2026, Little Rock, Arkansas 7 ICON EQUITIES LLC, et al., 8:58 a.m. 8
9 Defendants. 10 TRANSCRIPT OF TELECONFERENCE 11 BEFORE THE HONORABLE LEE P. RUDOFSKY, UNITED STATES DISTRICT JUDGE 12 13 APPEARANCES: 14 On Behalf of the Plaintiff: 15 MR. LUTHER ONEAL SUTTER, Sutter & Gillham, PLLC 16 310 Natural Resources Drive, Suite 2 Little Rock, Arkansas 72205 17 18 On Behalf of the Defendant: 19 MR. ALEXANDER P. MICKEL, Kutak Rock, LLP 20 5111 West JB Hunt, Suite 300 Rogers, Arkansas 72758 21 22 23 24 25 Proceedings reported by machine stenography. Transcript prepared utilizing computer-aided transcription. Graham Higdon, RMR, CRR, United States Court Reporter 1 P R O C E E D I N G S 2 THE COURT: Thank you all for joining. This is Gore 3 against Icon Equities LLC, et al., 4:24-CV-00644. I believe I 4 heard that we have Mr. Sutter on the line for the plaintiffs and 5 then let me make sure I know who we have on the line for Union 6 Pacific. I believe it's Mickel. Is it Mr. Mickel? Is that 7 correct? 8 MR. MICKEL: Yes, your Honor. Alex Mickel here this 9 morning. 10 THE COURT: And, Mr. Sutter, you're here, too? 11 MR. SUTTER: Yes. Yes, sir. 12 THE COURT: Okay. Great. I think it's down to just 13 you two gentlemen, right? I don't think there are any other 14 parties at this point that we have to wait for -- that we're 15 waiting for; is that correct? 16 MR. SUTTER: Yes, sir. 17 MR. MICKEL: Yes, sir. 18 THE COURT: Okay. I got it. That's a "yes" from both 19 of you. Okay. Good. 20 So here's the deal. Obviously, as you all know, we have 21 sort of 1980s technology at the court in terms of our 22 teleconference abilities. And so what that requires is that we 23 all speak very loudly, very clearly, try not to speak over one 24 another. And also if I don't call on you by name, if you would 25 just introduce yourselves for the record every time you speak, Graham Higdon, RMR, CRR, United States Court Reporter 1 that would be helpful because our court reporter will -- it'll 2 make it easier on him to get a good record that way. 3 If we are not following any of these rules or if for any 4 other reason the court reporter can't get a good record, I'm 5 going to ask the court reporter to jump in right away and let us 6 know that he's having a problem as opposed to sort of waiting 7 and then we have to reconstruct what we all just said. So if he 8 does that, please understand he's doing it at my direction. 9 Okay. So obviously we have most immediately pending the 10 motion to remand, which is part of Document 56. I've called you 11 all here because I feel like I am ready to rule and I feel like 12 I can give you a ruling over the phone to sort of push things 13 forward so you all don't have to wait for me to have a pristine 14 written order. 15 Having said that, we can do this one of two ways. I feel 16 like I have enough to sort of just rule, and I'm happy to do 17 that. On the other hand, I am also happy to listen to you all 18 argue if you feel like there are points you'd like to make that 19 are worth your -- your oral argument time, you know, your 20 client's money, and my oral argument time. So we can really do 21 it, whatever you'd like. If any party wants to argue, then I'll 22 let you all argue. If nobody wants to argue, then I will just 23 decide the case on the briefs and I'll tell you what my decision 24 is. 25 But I guess, Mr. Sutter, what is your desire? Graham Higdon, RMR, CRR, United States Court Reporter 1 MR. SUTTER: Judge, I don't really have any argument. 2 What I'm interested in is -- is -- is, in particular, is given 3 that the -- the original complaint made a -- essentially made a 4 demand with all of the defendants, and given the law and 5 diversity, that you can't aggregate damages against defendants 6 to create diversity -- diversity jurisdiction. That's the 7 question I'm hoping you answer today. So thank you for your 8 time. 9 THE COURT: Okay. I appreciate that. So I will put 10 Mr. Sutter down on the side of no oral argument. 11 Mr. Mickel, what do you want? 12 MR. MICKEL: Your Honor, I don't believe I need 13 additional oral argument on this, but I would say that it's 14 Union Pacific's position -- and this is laid out in the 15 sur-reply -- that there's still diversity jurisdiction even if 16 you don't aggregate the claims. But I don't believe I need 17 additional oral argument on that. 18 THE COURT: Okay. And I should just say I understand 19 both of your different positions from the briefing on -- you 20 know, both of the different positions you've just discussed from 21 your briefing as well as, of course, you've made in your 22 briefing other arguments as well. I'm going to put Mr. Mickel 23 also down for not needing or wanting oral argument. So since 24 nobody needs or wants oral argument, I am just going to rule. 25 This is going to be a little lengthy, in part. I apologize Graham Higdon, RMR, CRR, United States Court Reporter 1 for that, but I am trying to get decisions out the door sooner 2 rather than later these days and I have found that doing it 3 orally helps me -- helps me do that, at least to some extent, 4 rather than have you wait until I, you know, dot every I and 5 cross every T and all of that stuff. 6 So with that, if y'all will just pay attention, I know you 7 will, and then after I'm -- after I'm done, I will obviously ask 8 you all if you have any requests for clarifications or things of 9 that nature. 10 Okay. This order addresses plaintiff's motion for remand. 11 And that motion was -- as I explained earlier, part of 12 Document 56. 13 As I'm about to explain, the motion is denied because the 14 Court has diversity jurisdiction over the remaining state-law 15 claims. 16 This case was originally filed in state court by Plaintiff 17 Michael Gore against multiple defendants. The complaint 18 asserted federal claims against Icon Equities LLC, Albert De 19 Renzo, and Lloyd and McDaniel, PLC. The complaint asserted 20 state-law claims against Union Pacific Railroad. 21 And I guess I should say parenthetically here, the 22 complaint also named Union Pacific Corporation as a defendant, 23 but Union Pacific Corporation has since been voluntarily 24 dismissed and is not relevant for the purposes of this order. 25 If you want to know more about that, see Document 17. Graham Higdon, RMR, CRR, United States Court Reporter 1 Okay. The case was removed to federal court on July 29, 2 2024. 3 More than a year later, in August of 2025, plaintiff moved 4 to, one, dismiss his federal claims with prejudice and, two, 5 remand state-law claims. The Court granted the request to 6 dismiss the federal claims with prejudice, and that happened at 7 Doc 60. As to the remand request, the Court asked for 8 additional briefing. Now that the additional briefing is 9 complete and the Court has reviewed that briefing, the Court is 10 ready to decide the remand issue as I've just explained to you a 11 couple of moments ago. 12 When a federal court has dismissed all federal claims in a 13 removed case, that court usually has discretion to remand any 14 remaining state-law claims. And that comes from cases like 15 Royal Canin v. Wullschleger, 604 U.S. 22, 31 to 32 (2025), also, 16 for example, Carlsbad Technology, Inc. v. HIF Bio, Inc., 556 17 U.S. 635, 639 (2009). I could go on with more Supreme Court 18 cases and Eighth Circuit cases, but I don't feel the need to. 19 In any event, the idea that a court in that situation has 20 the discretion to remand the remaining state-law claims is true 21 only where the sole basis for the Court's jurisdiction over the 22 remaining state-law claims is supplemental jurisdiction. Where 23 a court has diversity jurisdiction over the remaining state-law 24 claims, the Court must exercise that jurisdiction and keep the 25 state-law claims. And in the present case, the Court is Graham Higdon, RMR, CRR, United States Court Reporter 1 persuaded that it does have diversity jurisdiction over 2 state-law claims, and so must exercise it. Here's why. 3 At the time the plaintiff's complaint was filed, the 4 parties were diverse. At the time of removal, the parties were 5 diverse. And the parties remain diverse today. As I understand 6 it -- I guess I should say as the Court understands it, no one 7 questions any of that. Neither party questions any of that. 8 So, we move on to the amount in controversy requirement. And, 9 given that plaintiff is contesting the amount in controversy 10 requirement, it falls to Union Pacific to -- sorry -- Union 11 Pacific Railroad Company to prove the amount in controversy by a 12 preponderance of the evidence. And that comes from cases like 13 James Neff Kramper Farm Partnership v. IBP, Inc., 393 F.3d 828, 14 831 (Eighth Circuit 2005). It also comes from cases like 15 Trimble v. Asarco, Inc., 232 F.3d 946, 959, (Eighth Cir. 2000). 16 I think that's sufficient for you to understand where I've 17 gotten that principle from. 18 In any event, the amount in controversy is the potential 19 value of a claim to plaintiff, that is, the highest amount a 20 plaintiff asserts he can recover on his claim. 21 The state-law claims have always sought, and still today 22 seek, both compensatory and punitive damages against Union 23 Pacific Railroad Company for conversion and breach of contract. 24 And the support for that is, if you look at the Notice of 25 Removal at Doc 1 at page 11 and you compare that to the Graham Higdon, RMR, CRR, United States Court Reporter 1 complaint, Doc 2 at page 6. At the time plaintiff filed this 2 action, in May of 2024, approximately $14,800 in wages had been 3 allegedly converted and/or withheld in breach of contract. 4 Again, allegedly. And where you get that is from Defendant's 5 Statement of Undisputed Material Fact, Doc 40 at two to three, 6 particularly the table there, and Plaintiff's Response to the 7 Defendant's Statements of Undisputed Material Facts, Doc 45 at 8 three. 9 So at the time -- at that time, I should say, meaning in 10 May of 2024, compensatory damages could have reached 11 approximately $14,800. Considering this level of potential 12 compensatory damages, punitive damages could have easily reached 13 $74,000, which is about five times the potential compensatory 14 damages. A five to one punitive damage award is not unheard of, 15 especially where the compensatory award is relatively small. 16 And that comes from cases like BMW of North America v. Gore, 517 17 U.S. 559, 568 (1996), and I'll just quote it for a second. 18 "Only when an award can be fairly categorized as 'grossly 19 excessive' in relation to" -- and this is putting my own words 20 in a little bit -- the State's legitimate interests in 21 punishment and deterrence -- if it was a written opinion, you'd 22 see that in brackets -- "does it enter the zone of arbitrariness 23 that violates the due process clause of the Fourteenth 24 Amendment." 25 Okay. So, putting the potential compensatory award and the Graham Higdon, RMR, CRR, United States Court Reporter 1 potential punitive award together gets each state-law claim over 2 the 75,000 amount in controversy threshold, at least at the time 3 the complaint was filed. And that's not even thinking about 4 attorney's fees yet. 5 However, there is a wrinkle here. At some unknown point in 6 July of 2024, the $14,800 was returned to the plaintiffs. And 7 just so you know, that's coming from Plaintiff's Response to 8 Defendant's Statement of Undisputed Material Fact, Doc 45 at 9 three. And the quote there is, "Statement 20: Plaintiff's 10 withheld wages were returned to him" -- and, you know, dot, dot, 11 dot, dot. There's ellipses there. The response to that was, 12 "Admitted, several weeks later." And so the best I can do on 13 this record is say that sometime in July of 2024 the $14,800 was 14 returned to the plaintiff. The record does not reveal the exact 15 date in July of 2024 that the moneys were returned. And the 16 record's silence on this point is unfortunate because the exact 17 date might matter a great deal. Remember that this case was 18 removed to federal court on July 29, 2024. And obviously that 19 comes from the Notice of Removal. 20 The Eighth Circuit has clearly stated that, in removal 21 cases, the amount in controversy is judged at the time of the 22 removal. And that comes from cases like Noonan v. American 23 Family Mutual Insurance Co., 924 F.3d 1026 at 1028 (Eighth 24 Circuit 2019). It also comes from cases like Schubert v. Auto 25 Owners Insurance Co., 649 F.3d 817 at 822 (Eighth Circuit 2011). Graham Higdon, RMR, CRR, United States Court Reporter 1 I guess I should also note here that the Court agrees with Union 2 Pacific that post-removal happenings cannot affect whether the 3 amount in controversy requirement has been met. And that comes 4 from St. Paul Mercury Indemnity Co. against Red Cab Co., 303 5 U.S. 283, 292. 6 If removal occurred before the $14,800 was returned to the 7 plaintiff, then the analysis that I set forth a couple of 8 moments ago would hold and Union Pacific Railroad has proved by 9 a preponderance of the evidence that the amount in controversy 10 exceeded $75,000. Also, in that scenario, plaintiff would be 11 unable to establish to a legal certainty that the claim is for 12 less than the amount in controversy -- than the amount in 13 controversy threshold that's required. If, however, instead, 14 the $14,800 was returned to plaintiff before the case was 15 removed, then a different analysis is called for. 16 And so let's think about this latter scenario for a second. 17 In that latter scenario, it's crystal clear that the 18 plaintiff will receive less than $14,800 for compensatory 19 damages. Indeed, in that scenario, he may only receive and is 20 likely only to receive a $1 nominal damages award, even assuming 21 if he gets through trial and wins a trial. This very, very low 22 compensatory or nominal damage award of a dollar raises a much 23 more difficult issue, because of the constitutional restraints 24 on punitive damages. 25 And, again, when I talk about the constitutional restraints Graham Higdon, RMR, CRR, United States Court Reporter 1 on punitive damages, I'm talking about the State Farm case and 2 the Gore case. In terms of State Farm, that's 538 U.S. 408. 3 And in terms of Gore, we're talking about 517 U.S. -- and the 4 pinpoint cite I guess there would be 582. 5 But let me explain that even in this scenario, the value of 6 the claim to plaintiff could exceed $75,000. And that's because 7 a punitive damage award could constitutionally exceed a 8 single-digit ratio where the compensatory damage award is small 9 and the misconduct is particularly egregious. 10 The State Farm quote that I'd like to give you all here is 11 the following -- and, again, if I was to write this, there would 12 be a number of ellipses that you'll see in this quote, but 13 understanding that there are ellipses in here, the quote that 14 I've honed in on is the following: 15 "We decline . . . to impose a bright-line ratio which a 16 punitive damages award cannot exceed. Our jurisprudence and the 17 principles it has now established demonstrate, however, that, in 18 practice, few awards exceeding a single-digit ratio between 19 punitive and compensatory damages, to a significant degree, will 20 satisfy due process . . . Nonetheless, because there are no 21 rigid benchmarks that a punitive damages award may not surpass, 22 ratios greater than those we have previously upheld may comport 23 with due process where a particularly egregious act has resulted 24 in only a small amount of economic damages." 25 I'll also provide a quote from Gore on this point. "Low Graham Higdon, RMR, CRR, United States Court Reporter 1 awards of compensatory damages may properly support a higher 2 ratio than high compensatory awards, if, for example, a 3 particularly egregious act has resulted in a small amount of 4 economic damages. A higher ratio may also be justified in cases 5 where the injury is hard to detect or the monetary value of 6 noneconomic harm might have been difficult to determine." 7 Okay. So moving on from the case quotes then. 8 Ultimately, it is not out of the question here that a 9 punitive damage award in this case could constitutionally exceed 10 $75,000. Moreover, even if the compensatory damages were only 11 $1 and the punitive damages were something less than $75,000, 12 say, for example, $50,000, attorney's fees could easily put the 13 amount in controversy over $75,000. 14 In light of all of this, the Court is going to adjudicate 15 state-law claims. This is for two independent reasons. And now 16 I'm basically summing up. 17 First, it is most likely that diversity jurisdiction 18 exists, because it would exist in either of the two scenarios I 19 described above, and requires the Court to adjudicate state-law 20 claims. That is, the preponderance of evidence suggests to the 21 Court that the amount in controversy exceeds $75,000 and 22 plaintiff cannot establish to a legal certainty that the claim 23 is worth less than this amount. 24 Second, even if the Court's diversity jurisdiction analysis 25 turns out to be wrong, the existence of diversity jurisdiction Graham Higdon, RMR, CRR, United States Court Reporter 1 over the state-law claims in this case is a close enough call -- 2 again, even if the Court ends up being wrong about that call -- 3 it's a close enough call that the Court, as a matter of 4 discretion, will continue to exercise its supplemental 5 jurisdiction over state-law claims. 6 And here's what I want to emphasize about that. I do want 7 to emphasize that the Court agrees with and accepts and 8 acknowledges and adopts Union Pacific Railroad Company's 9 argument that Royal Canin does not apply here because plaintiff 10 has not amended his complaint. Union Pacific is right that a 11 court order dismissing with prejudice all the federal claims in 12 a case, even if it's done at behest of the plaintiff, is not the 13 same thing as a plaintiff omitting all federal claims in an 14 amended complaint and thereby making it as if the omitted 15 federal claims had never been pled in the first place. 16 And there I will point everybody to the Defendant's 17 Sur-Reply, Document 62 at pages two to three. 18 Given this, exercising supplemental jurisdiction in these 19 circumstances is the most efficient way to get this case to the 20 merits and avoid additional jurisdictional wrangling. 21 And I have a, perhaps, analogous cite there. Maybe it's 22 not a see cite, but it's kind of analogous for this proposition, 23 which is Royal Canin, 604 U.S. at 38, note eight. And 24 essentially there it notes that constant litigation over the 25 matter of the amount in controversy has the potential to -- Graham Higdon, RMR, CRR, United States Court Reporter 1 having -- let me -- let me try that again. 2 What I'm citing notes that constant litigation over the 3 matter of the amount in controversy, having the potential to 4 alter a court's jurisdiction, would be wasteful. 5 And, again, that is not a direct quote. That puts some of 6 my words into the quote, but it is essentially that's what the 7 proposition is in Royal Canin. And I think it, at least by 8 analogy, applies here. 9 So, again, just so sort of very ultimately sum up, there's 10 diversity jurisdiction here. But even if that's not right, the 11 diversity jurisdiction call is close enough that it makes sense 12 to exercise supplemental jurisdiction over these state-law 13 claims. 14 So where that -- where that leaves us then is a denial of 15 the remand order and then a sort of question for you all I will 16 have administratively with respect to the pending motion for 17 summary judgment. But before I get to my question with respect 18 to the pending motion for summary judgment, I am happy to 19 discuss requests for clarification. This obviously is not a 20 time to argue against the decision. I've made my decision. You 21 know, you may agree with it or you may not, but I'm happy if you 22 need clarification. 23 Why don't we start with Mr. Sutter. 24 MR. SUTTER: Judge, yes. I'd like -- and I'm not 25 arguing with you. I appreciate your hard work. I disagree and Graham Higdon, RMR, CRR, United States Court Reporter 1 object to the decision for purposes of the record. But just a 2 couple of questions because I may have misunderstood. I'm not a 3 good listener because of some disabilities I have and I 4 apologize. It's hard for me to take -- just so the Court knows 5 in the future, oral decisions, I have difficulty processing it 6 sometimes and I apologize for that. 7 THE COURT: Don't -- don't -- Mr. Sutter, let me 8 interrupt you for a second. Don't apologize for that. I did 9 not know that. I appreciate you telling me that. And 10 obviously, while I'm happy to also -- I'm happy to give you 11 clarification today, you should know that a transcript of this 12 decision will be prepared and will be put on the website so 13 eventually you'll be able to read it. 14 MR. SUTTER: Yes, sir, I know that. I just didn't 15 want you to -- I live in interesting times these days, Judge. 16 I've been accused of all kinds of unethical conduct. So I have 17 to be careful how I interact with courts. 18 THE COURT: I got it. 19 MR. SUTTER: And so -- so I needed to make that record 20 so that you would not make any enforcement finding against me. 21 And I have no basis to believe that you would, but I'm operating 22 in an environment, Judge, right now where I have to be somewhat 23 paranoid. 24 THE COURT: I got it. Okay. So that's fine. I 25 totally understand. What do you want to know in terms of Graham Higdon, RMR, CRR, United States Court Reporter 1 clarification? 2 MR. SUTTER: Okay. All right. So, Judge, it appears 3 -- it appeared, as I was listening, that perhaps you shifted the 4 burden to me to prove the existence of jurisdiction when you 5 said that the record was unclear. Judge, the burden was on 6 Union Pacific to provide that information to you. And, quite 7 frankly, I dropped that argument and I did not raise it. And 8 I'm embarrassed by that. But, as you know, your subject matter 9 jurisdiction can be questioned anytime. 10 And so it's my recollection, just for the record, that the 11 money was returned to the plaintiff before this matter was 12 removed. And I just wanted to say that for the record. I 13 understand your alternative basis, which is supplemental 14 jurisdiction. Let me just say for the record, therefore, if you 15 did that, Judge -- and I'm sure you didn't, I probably 16 misunderstood -- 17 THE COURT: Let me -- so let me stop you there just 18 for a second and then I'll let you bring up your other ones. 19 So I don't believe that's what I -- that's what I said or 20 did. I will -- I'll obviously go back and look. But I will say 21 this to make it -- to make it very, very clear -- and this is 22 what I believe I said originally. But I agree with you in this 23 sense, Mr. Sutter. 24 So it is Union Pacific's burden to prove the amount in 25 controversy by a preponderance of the evidence. If Union Graham Higdon, RMR, CRR, United States Court Reporter 1 Pacific proves the amount in controversy by a preponderance of 2 the evidence, you then could, but -- if you wanted to, you then 3 could try to prove that to a legal certainty that is not the 4 value of your claim. But that's only after they have proved it 5 by a preponderance of the evidence. So they do need to prove it 6 by a preponderance of the evidence. 7 As to the record being -- as to the record being unclear in 8 terms of when exactly the funds were returned and whether it was 9 before or after removal, you're correct that I said the record 10 was unclear, but what I decided was, either way, they have still 11 proved to me by -- meaning Union Pacific has still proved to me 12 by a preponderance of the evidence that there is diversity 13 jurisdiction. And the second part of that ruling was even if 14 the funds had been returned -- even if the funds had been 15 returned before removal, because of the potential for a $1 16 nominal damages award, a larger than ten to one, it could be 17 significantly larger punitive damage award, and I explained 18 that, I'm not going to go through it again, why it could be -- 19 why it could be so large, plus attorney's fees, that still gets 20 Union Pacific there by a preponderance of the evidence to over 21 $75,000. 22 But, anyway, on that point, I just wanted to make the 23 record clear. I think you are right legally in terms of the 24 standards and the burdens of proof, but I still -- and I know 25 obviously you disagree with this, but I still don't think, under Graham Higdon, RMR, CRR, United States Court Reporter 1 those standards and burdens, you prevail. 2 MR. SUTTER: Yes, sir. I appreciate that. And I do 3 appreciate the opportunity to make a record because I do -- I do 4 understand it more clearly. Thank you for your clarification. 5 I would just say that I'm sure that any -- that you resolved any 6 doubts against jurisdiction as you're required to do, but, yet, 7 I understand your ruling now. 8 So the second thing I would say, Judge, is I would 9 respectfully request a ruling on the factors addressing your 10 discretion to exercise supplemental jurisdiction. 11 One of the biggest concerns I have, Judge, because I -- I 12 actually made this law where you can convert money in the 13 Arkansas Supreme Court two or three decades ago. It's a case 14 called Grayson versus Bank of Little Rock. And I took the 15 position back then that you appear to be taking, that money 16 couldn't be -- I won't say that. I'll withdraw that statement. 17 I don't know what position you're going to take. But I'm 18 drawing that from the idea that I get a $1 nominal damage award. 19 You know, one of the factors -- 20 THE COURT: Well, and I should -- I guess I should 21 say -- and that's a good point, Mr. Sutter. I'm not 22 suggesting -- and if I suggested it, I should not have suggested 23 it. I'm not suggesting that if the money is returned, you're 24 for sure only going to get a $1 nominal damage award. I was 25 posing that as the best instance for you with respect to remand Graham Higdon, RMR, CRR, United States Court Reporter 1 because that's what would make the -- that's what -- that's what 2 would make the amount in controversy the absolute lowest it 3 could be for you. So that was a -- you know, that's an 4 assumption that I was trying to sort of, you know, take on your 5 behalf for purposes of this motion to amend. I was not trying 6 to -- 7 MR. SUTTER: I understand that. 8 THE COURT: -- suggest how the law is going to shake 9 out. 10 MR. SUTTER: Right. I understand. And thank you for 11 that because that's sort of what I was thinking here. Because 12 I'll just tell you, this is -- I think it's an unsettled issue 13 of state law. And, you know, I don't want to litigate every 14 case like it needs to be up to the Supreme Court like I have 15 before, but I just wanted to bring that issue to your attention, 16 that this is an unsettled question of state law in my mind. And 17 I didn't hear you address the factors addressing supplemental 18 jurisdiction. I'm sure you considered them all, but I just 19 wanted, for the record, to make my record that to the extent 20 you're exercising supplemental jurisdiction, I really believe 21 consideration should be given to the fact that we're really in 22 uncharted areas here where we -- when we're talking about the 23 measure of damages that are allowable in conversion where you 24 have money converted and money is returned. Because this was 25 one of the precise issues that I recall -- I could be wrong -- Graham Higdon, RMR, CRR, United States Court Reporter 1 that I recall arguing to the Arkansas Supreme Court in this Bank 2 of Little Rock versus Grayson case. 3 THE COURT: I appreciate that, Mr. Sutter. Let me 4 tell you this. You are correct that I considered -- and I guess 5 what I will say is I considered every factor, because in terms 6 of exercising my discretion with respect to keeping a -- you 7 know, keeping supplemental jurisdiction, I -- and you should 8 tell me if you think otherwise -- I think that this is a 9 totality of the circumstances test and I'm supposed to take into 10 account everything that I think could bear on that question. 11 I will tell you -- I accept your argument or your 12 contention -- certainly for purposes of this motion I accept 13 your contention that this is an area of unsettled law and a 14 novel question -- again, if not novel, at least unsettled. I 15 accept that fully and I -- that was -- that sort of was factored 16 in. 17 What I will tell you is -- and I want to be straight with 18 both parties a hundred percent. In this situation, the 19 strongest factor -- and I felt really that this outweighed every 20 other factor -- I know I have discretion to not have it outweigh 21 it, but I really do feel like it outweighs it -- which is the 22 closeness of the diversity of jurisdiction question, and that is 23 really -- that is what is pushing me, regardless of any factors 24 that push me the other way, which your novelty question does 25 push me the other way. But I think it is overwhelmed by the Graham Higdon, RMR, CRR, United States Court Reporter 1 closeness of the diversity question and my desire to avoid a 2 wrong decision on that. Because obviously, you and I both know, 3 if I have diversity jurisdiction, I'm required to exercise it. 4 And so I really don't want to make a mistake of saying I don't 5 have diversity jurisdiction when I do. 6 Now, it's true that I should resolve all questions in favor 7 -- in favor of remand. That's true, and those principles push 8 up against each other. But in this particular situation I think 9 the closeness of the diversity question is very, very important 10 in the supplemental jurisdiction analysis. And for me, given 11 the factors here, it really outweighs everything else. 12 MR. SUTTER: And I do appreciate your clarification, 13 Judge. And I do appreciate the time you've taken, although, I 14 respectfully disagree with the Court's ruling. I just want to 15 make my record clear, because in the event I get an adverse -- 16 THE COURT: Yup. 17 MR. SUTTER: In the event I get an adverse jury 18 verdict or an adverse ruling from you, I don't want to be 19 accused of forum shopping or making any objection -- 20 THE COURT: You are -- you are doing your job. 21 Everything you are doing makes perfect sense to me. 22 MR. SUTTER: And I do want -- thank you, Judge. And I 23 appreciate that. I just want to make it clear that win, lose, 24 or draw, I intend to pursue the jurisdictional issue on further 25 up the Eighth Circuit regardless of -- if I win I'm not, but if Graham Higdon, RMR, CRR, United States Court Reporter 1 I lose -- if I lose -- because a unanimous jury, Judge, is a 2 hard -- is a hard bar to overcome, particularly in this 3 environment. So I really appreciate your time this morning. 4 It's always a pleasure talking to you. 5 THE COURT: Any further clarification requests you 6 need? 7 MR. SUTTER: No, sir. I was about to say that you've 8 answered all my questions. 9 THE COURT: Okay. Mr. Mickel, your turn if you have 10 anything. 11 MR. MICKEL: Your Honor, I don't have any questions. 12 Thank you. 13 THE COURT: Okay. So now I do have some questions for 14 you all then, which is -- and, Mr. Sutter, this question maybe 15 you just answered. I had this question going in, but maybe I no 16 longer have it. I take it you still want to pursue this claim 17 to the merits; is that correct? 18 MR. SUTTER: Absolutely. What's my alternative? 19 THE COURT: No, no, no, no. Yeah. I just -- the 20 reason I ask is I know there was, you know, there was a whiff of 21 some settlement with other organizations and I have no idea how 22 much -- or other entities -- how much you did or didn't get from 23 them. So it's not without the realm of possibility that you 24 could just say, you know what, I'm done. I just wanted to make 25 sure, but I understand you still want to pursue it. Graham Higdon, RMR, CRR, United States Court Reporter 1 MR. SUTTER: Judge, yeah. Quitting's not in me. 2 THE COURT: I got it. I have no problem with that. 3 That's great. Okay. So in that case, then what I have sort of, 4 you know, up next is the motion for summary judgment that Mr. 5 Mickel filed that has been stayed up until this point. 6 Mr. Mickel, let me ask you and then I will ask Mr. Sutter. 7 Given the amount of time that has sort of, you know, come 8 between the filing of this and -- the filing of your motion and 9 now, is there anything that you need to update or do you need 10 supplemental briefing? And, again, I'm going to ask the same 11 thing to Mr. Sutter. Is there anything that changes -- that 12 sort of would be beneficial for you to all either go back and do 13 the briefing again or to file a supplemental brief on? 14 MR. MICKEL: No, your Honor. I don't believe Union 15 Pacific needs to supplement the briefing any further. This is 16 primarily interpretations of statutes that provide protections 17 to Union Pacific. So I don't believe anything else is needed. 18 I don't believe we need to supplement anymore facts for the 19 record or anything like that. 20 THE COURT: Okay. Mr. Sutter, what about for you? 21 MR. SUTTER: Well, Judge, it's up to you really 22 because you made the rather unusual ruling that my -- that my 23 verified statement of facts was not -- was not sufficient to 24 support a motion for summary judgment, my early motion. And so 25 I can either re-file that with an affidavit or I can make a Graham Higdon, RMR, CRR, United States Court Reporter 1 motion at trial, whichever -- but I will be making a motion for 2 judgment as a matter of law at trial. It's just however you 3 would like to address the issue on -- because the arguments of 4 Union Pacific revolve around -- he's correct -- revolve around a 5 statute and whether or not Union Pacific needed a court order to 6 foreclose the lien before sending the money on to the alleged 7 judgment creditors. And so it's just a matter of how you want 8 that issue crystallized in terms of judicial economy. If you 9 want to address it at trial, we can do that, or I can re-file 10 that motion in the form in which you want it filed and we can 11 handle it like that. I just -- 12 THE COURT: I see -- 13 MR. SUTTER: -- wanted to let you know what I'm going 14 to do. 15 THE COURT: No, I see what you're talking about, Mr. 16 Sutter. So I'm really not talking about your motion because 17 I've already ruled on that. I'm talking about -- I'm talking 18 about Mr. -- the defendants, Union Pacific's motion, which I 19 think is Doc 38, because that's the one I haven't ruled on. And 20 so I really -- what I was asking you is, do you need -- do you 21 need a sur-response or another response or some supplement -- 22 some supplemental response? And the only reason I'm asking is 23 because how long I've had it for. 24 MR. SUTTER: Right. No. The answer to your question 25 is no, Judge. But I guess my motion is to -- is to allow me to Graham Higdon, RMR, CRR, United States Court Reporter 1 file a motion for summary judgment myself out of time. 2 THE COURT: Well, if you have that motion, you can put 3 it in writing and I'm happy to look at it. You know, I don't 4 know what I'm going to decide on it, but if that's what you want 5 to do, you can do that as long as you write up the motion. And, 6 who knows, maybe Union Pacific -- maybe Union Pacific will be 7 generous and think that that is the right way to sort of do this 8 most efficiently. I have no idea. I don't want to know right 9 now. I'm not asking. But I don't want to take an oral motion. 10 MR. SUTTER: Yes, sir. 11 THE COURT: So, okay. Then here's what I would like, 12 though. I would like to schedule an oral argument on this. I 13 do agree with Mr. Sutter that this is a -- again, I'm not sure 14 if "novel" is exactly the right word, but this is a, perhaps, 15 unsettled question. The reason I say "perhaps" is I'm not sure 16 it's unsettled, and that'll be part of our argument, but I 17 accept Mr. Sutter's -- I accept Mr. Sutter's good, reasonable 18 argument that there is at least an unsettled portion of this. 19 Whether I end up ultimately agreeing with it or not, I think 20 it's reasonable enough to really delve into. 21 And so I'm going to have Heather reach out to you, or, 22 quite frankly, if Heather wants to do it now, you can do it now. 23 But I'd like to set oral argument for sometime in April or May. 24 And then once we have that oral argument, just resolve this. 25 And if, you know, if it's either resolved to throw it out, fine, Graham Higdon, RMR, CRR, United States Court Reporter 1 if it's resolved to move on, then move on with speed. 2 THE COURTROOM DEPUTY: I'll send an e-mail. 3 THE COURT: Heather says she's going to send an e-mail 4 to you all and then we will have oral argument on it at an 5 appropriate time. 6 Does anybody have anything else for the Court? 7 Mr. Sutter? 8 MR. SUTTER: No, sir. Thank you for your time. 9 THE COURT: Mr. Mickel? 10 MR. MICKEL: No, your Honor. Thank you. 11 THE COURT: Okay. Very well. See you all later. 12 Adjourned. 13 (Proceedings concluded at 9:38 a.m.) 14 REPORTER'S CERTIFICATE 15 I certify that the foregoing is a correct transcript from the record of proceedings in the above-entitled matter. 16 17 /s/Graham Higdon, RMR, CRR Date: March 4, 2026 United States Court Reporter 18 19 20 21 22 23 24 25 Graham Higdon, RMR, CRR, United States Court Reporter