Sixth Circuit Finds No Federal Question Jurisdiciton in Shareholder Suit Raising Tax Code Issues

The Sixth Circuit in Mikulski v. Centerior Energy Corp., No. 03-4486 (Jan. 26, 2006), recently held that in a shareholder suit in alleging state breach of contract and fraud claims arising out of corporate misreporting of taxable dividends was properly in state court, notwithstanding the fact that the federal tax code is cited in the complaint. The suit, said the court, was not preempted by the Internal Revenue Code, raising issues too incidental to state law claims to warrant federal question jurisdiction.