Friday, December 6, 2013

Jones v. Ford Motor Credit Co. case brief

Jones v. Ford Motor Credit Co. case brief summary
358 F.3d 205 (2004)

The United States District Court for the Southern District of New York entered a judgment dismissing appellant financing company's permissive counterclaims against appellee car buyers for lack of subject matter jurisdiction in a case where the car buyers sued the financing company for allegedly discriminating against them based on race regarding their purchase of vehicles using the company's financing plan. The financing company appealed.

The car buyers sued the financing company and alleged it engaged in racial discrimination under the Equal Credit Opportunity Act, 15 U.S.C.S. § 1691 et seq. They had purchased vehicles under the financing company's financing plan. They alleged that the financing company permitted vehicle dealers to mark up the financing rate based on subjective criteria, including race. According to the car buyers, African-American buyers were penalized by having to pay higher rates than those imposed on similarly-situated Caucasian buyers. The financing company denied the discrimination charge and asserted state-law counterclaims against three of the car buyers for the amounts of their unpaid car loans. The trial court determined the counterclaims were permissive and granted the car buyers' motion to dismiss the counterclaims for lack of subject matter jurisdiction.


  • On appeal, the appellate court found the financing company's counterclaims were permissive. 
  • It also found that the trial court's discretion about whether to exercise supplemental jurisdiction over the permissive counterclaims should not be determined until the trial court ruled on the car buyers' motion for class certification.

The trial court's judgment dismissing the financing company's permissive counterclaims was vacated and the case was remanded for further proceedings.

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