|Filed February 15, 2002
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
U.S. EXPRESS LINES, LTD.; BRENT NOYES, M.D.;
HAMILTON; LENORE MYERS; FRANCIS MYERS, H/W;
MICHAEL PACOR; LLOYD FEIGENBAUM; LYNDA
FEIGENBAUM, H/W; KENNETH DETATO; BRAD MOSES;
MARY POSSI; ERIC N. RUBINO; THOMAS CRAWFORD;
SUSAN M. SIMPSON; JOHN BURKE; GREGORY REPPA;
LEO RASIS, M.D.; JEFFREY W. ALLEN; PATRICIA
ALLEN; WARREN CONSTANTINE, JR.,
ANN-MICHELE HIGGINS, ESQ.; RAWLE & HENDERSON;
UNITED SHIPPING SERVICES THREE, INC.; UNITED
SHIPPING SERVICES ONE, INC.; HACI ISMAIL
KAPTANOGLU SHIP MANAGEMENT & TRADING
LTD.; HARRY G. MAHONEY, ESQ.; THOMAS C.
SULLIVAN; DEASEY, MAHONEY & BENDER, LTD.;
SUNRISE MARITIME INC; ZODIAC MARITIME AGENCIES,
LTD.; A. ROBERT DEGEN, ESQ.; FOX, ROTHSCHILD,
O'BRIEN & FRANKEL; TRADE SHIPPING MANAGEMENT,
S.A.; LAURENCE SHTASEL, ESQ.; JEFFREY S.
ESQ.; BLANK ROME COMISKY & MCCAULEY,
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
(D.C. No. 99-cv-00992)
District Judge: Honorable John R. Padova
Argued November 26, 2001
Before: ROTH, FUENTES and WEIS, Circuit Judges
Filed February 15, 2002
Thomas S. Myers, Jr., Esquire
1800 East Lancaster Avenue
Paoli, Pennsylvania 19301
Vincent P. DiFabio, Esquire
Platt, DiGiorgio & DiFabio
1800 East Lancaster Avenue
Paoli, Pennsylvania 19301
Attorneys for Appellants
Robert B. White, Jr., Esquire
Law Offices of Robert B. White, Jr.,
1515 Market Street, Suite 1800
Philadelphia, Pennsylvania 19102
Jeffrey P. Lewis, Esquire
McKissock & Hoffman, P.C.
P.O. Box 3086
West Chester, Pennsylvania 19381
William H. Lamb, Esquire
Lamb, Windle & McErlane, PC
24 E. Market Street
West Chester, Pennsylvania 19381
Albert P. Massey, Jr., Esquire
Lentz, Cantor & Massey, Ltd.
Chester County Commons
20 Mystic Lane
Malvern, Pennsylvania 19355
Attorneys for Appellees
OPINION OF THE COURT
WEIS, Circuit Judge.
In this appeal, we decide that the defendant
decision to invoke federal case law, rather
procedural rule, in persuading a district
judge to issue a
maritime attachment does not give rise to
a cause of action
for malicious abuse of civil process under
state law. The
lawyers did not act in bad faith because
they disclosed the
existence of the alternative courses to the
Court. We also
conclude that the conflict between the procedural
the opinion of a United States Court of Appeals
federal question sufficient to support removal
malicious abuse of process claim from the
state court to the
federal forum. We will affirm the District
in favor of the defendants.
Plaintiff U.S. Express Lines, Ltd. ("Express
Lines") is a
Pennsylvania corporation that chartered vessels
various shipowners to carry cargo for its
company maintained its principal place of
Paoli, Pennsylvania, within the Eastern District
Express Lines had arranged financing through
a line of
credit from Founders Bank, secured by certificates
deposit purchased by the individual plaintiffs.
company encountered cash flow problems in
1997, it began
negotiating for further financial support
institutions. In January 1998, it advised
including the defendant vessel owners, of
progress of its efforts.
Nevertheless, on February 11, 1998, one of
owners, through its counsel, defendant Ann-Michele
Higgins of defendant law firm Rawle &
to the United States District Court for the
of Pennsylvania for the attachment of "all
and chattels, belonging to" Express Lines.
In seeking the
attachments, the defendant attorneys cited
law an opinion of the Court of Appeals for
Circuit, rather than the Supplemental Rules
Claims. On February 17, 1998, the District
that the certificates of deposit at Founders
Other creditor vessel owners took similar
their attorneys, defendants A. Robert Degen
and the law
firm of Fox, Rothschild, O'Brien, & Frankel,
Shtasel and Jeffrey S. Moller, both of defendant
Rome Comisky & McCauley, and Harry G.
Thomas C. Sullivan, of the defendant law
Mahoney, & Bender, Ltd. As a result of
these legal actions,
Express Lines defaulted on its loan agreements
forced to suspend and eventually cease its
The District Court vacated the attachments
5, 1998, concluding that its decision to
depart from the
restrictions imposed by Rule B of the Supplemental
for Certain Admiralty and Maritime Claims
of the Federal
Rules of Civil Procedure ("Supplemental Rule
B") was in
error. The Court then directed the parties
to arbitration in
accordance with the terms of the charter
that the assets that Founders Bank had deposited
interpleader action remain in the Court's
retained jurisdiction pending arbitration.
On January 28, 1999, Express Lines and the
owners of the certificates of deposit at
Founders Bank filed
suit in the Court of Common Pleas of Chester
Pennsylvania, against the vessel owners and
counsel. The complaint sought compensatory
damages for abuse of process, conspiracy,
wrongful use of
civil proceedings, and other torts.
Plaintiffs contend that defendants secured
the writs of
attachment in direct violation of Rule B,
the seizure of maritime assets if the debtor
is found within
the district in which the litigation is commenced.
assert that defendants were well aware that
kept its principal office in the Eastern
Pennsylvania and thus, they acted in bad
faith in seeking
attachments in that district.
The defendant vessel owners were never served
process, and the claims against them were
dismissed.1 The lawyer defendants removed
the case to the
District Court, and the plaintiffs moved
to remand. The
District Court refused, concluding that,
based as it was on
the issuance of maritime attachments, "[t]he
element [of the litigation] cuts to the heart
of each of
Plaintiffs' claims" and, therefore, federal
The District Court dismissed the case under
of Civil Procedure 12(b)(6), holding that
lawyers' actions were privileged because
they had not
misled the Court as to the underlying facts
or relevant law
in obtaining the attachment. The Court added
had been no abuse of process in the defendants'
maritime attachments to collect debts whose
plaintiffs did not contest. Because the writs
issued with court authorization, the defendants
acted in a grossly negligent manner or without
cause. Accordingly, the Court held that the
failed to establish their state law claims.
In this appeal, plaintiffs contend that the
attorneys misled the Court in securing the
and that the efforts to obtain them were
made in bad faith
because the charter party required that disputes
arbitrated. The plaintiffs also assert that
the District Court
erred in declining to remand the case to
the state court.
The defendants deny that they engaged in any
and argue that the state law claims fail
as a matter of law.
Alternatively, they contend that because
activity occurred in a federal court, no
state cause of action
may be applied to their conduct. Finally,
that because of an omission in the plaintiffs'
appeal, this Court lacks appellate jurisdiction.
We exercise plenary review of the District
dismissal for failure to state a claim under
1. The plaintiffs have not contested the dismissal
of the defendant
shipowners and have treated this case as
directed solely against the
lawyers. We will do likewise.
Jordan v. Fox, Rothschild, O'Brien & Frankel,
20 F.3d 1250,
1261 (3d Cir. 1994). When considering a Rule
motion, courts accept as true the allegations
complaint and its attachments, as well as
inferences construed in the light most favorable
plaintiffs. Id. Although a district court
may not consider
matters extraneous to the pleadings, "a document
to or explicitly relied upon in the complaint
considered without converting the motion
to dismiss into
one for summary judgment." In re Burlington
Sec. Litig., 114 F.3d 1410, 1426 (3d Cir.
quotations omitted); see also Pension Benefit
Guar. Corp. v.
White Consol. Indus., 998 F.2d 1192 (3d Cir.
of public record).
We review de novo a district court's denial
Angus v. Shiley Inc., 989 F.2d 142, 143 n.1
(3d Cir. 1993);
see also Luckett v. Delta Airlines, Inc.,
171 F.3d 295, 298
(5th Cir. 1999).
We first address jurisdictional issues. The
complaint alleges violations of state law.
parties are not diverse, our jurisdiction,
as well as that of
the District Court, must rest upon the existence
of a federal
question. 28 U.S.C. SS 1331, 1441(b).
At the outset, we address an error in the
brief that cites Lusardi v. Xerox Corp.,
975 F.2d 964 (3d
Cir. 1992), as dispositive of our appellate
Lusardi holds that, with certain exceptions
here, an appeal taken from a specified judgment
or part of
a specified judgment does not confer upon
the court of
appeals jurisdiction to review other judgments
not specified or inferred from the notice
of appeal. 975 F.2d
Defendants contend that because plaintiffs
designate the order denying remand in their
appeal, we do not have authority to review
that issue. This
argument is oblivious to the duty of federal
examine their subject matter jurisdiction
at all stages of the
litigation sua sponte if the parties fail
to raise the issue.
That obligation extends to removal cases,
as well as to
those originally filed in the district courts.
Meritcare Inc. v.
St. Paul Mercury Ins. Co., 166 F.3d 214,
217 (3d Cir. 1999);
Trent Realty Assocs. v. First Fed. Sav. &
Loan Ass'n of
Phila., 657 F.2d 29, 30 (3d Cir. 1981). Clearly,
inapposite to the removal jurisdiction issue
in this case.
Any civil action brought in state court may
by the defendant to the federal district
court in the district
where such action is pending, if the district
have original jurisdiction over the matter.
S 1441(a); Franchise Tax Bd. of Cal. v. Constr.
Vacation Trust for S. Cal., 463 U.S. 1, 7-8
(1983). Where the
parties are not diverse, removal is appropriate
only if the
case falls within the district court's original"federal
question" jurisdiction: "all civil actions
arising under the
Constitution, laws, or treaties of the United
U.S.C. SS 1331, 1441(b); Franchise Tax Bd.,
463 U.S. at 8.
In determining whether a case arises under
courts are instructed to look to the plaintiff
complaint." Merrell Dow Pharm. Inc. v. Thompson,
804, 808 (1986). It is not enough that a
federal question is
or may be raised as a defense. Id.; Trent
Realty, 657 F.2d
at 33. "[T]he controversy must be disclosed
upon the face of
the complaint, unaided by the answer or by
the petition for
removal." Westmoreland Hosp. Ass'n v. Blue
Cross of W.
Pa., 605 F.2d 119, 122 (3d Cir. 1979) (quoting
Gully v. First
Nat'l Bank in Meridian, 299 U.S. 109, 113
Attachments to the complaint are considered
part of it.
The state suit need not invoke a federal law
in order to
"arise under" it for removal purposes. It
is sufficient that
the merits of the litigation turn on a substantial
issue that is "an element, and an essential
one, of the
plaintiff 's cause of action." Gully, 299
U.S. at 112. The
controversy must be "genuine and present
. . . not merely
. . . conjectural." Id. at 113. In short,
the federal law "must
be in the forefront of the case and not collateral,
or remote." Merrell Dow, 478 U.S. at 813
n.11; see also
United Jersey Banks v. Parell, 783 F.2d 360,
367 (3d Cir.
1986) (no federal question existed because
right to relief
under state law did not require resolution
of a substantial
question of federal law). It need not, however,
be a situation
in which federal law completely preempts state
Goepel v. Nat'l Postal Mail Handlers Union,
36 F.3d 306 (3d
Cir. 1994) (discussing "complete preemption"
The case before us does not involve the "artful
doctrine, which requires a court to peer
through what are
ostensibly wholly state claims to discern
question lurking in the verbiage. See, e.g.,
Banks, 783 F.2d at 367. The complaint filed
in the state
court is quite detailed and is augmented
documents, such as the motions for attachment,
charter party, and the order attaching Express
assets. The complaint and the documents affixed
charge the defendants with malicious abuse
of process in
causing the District Court to override Rule
in erroneous reliance on a Court of Appeals
The plaintiffs argue that the mere fact that
attachments were granted pursuant to maritime
law is an
inadequate basis for removal. They point
out that under the
saving to suitors clause, 28 U.S.C. S 1333(1),
state courts have concurrent jurisdiction
matters. See Supplemental Rule B(1); Romero
Terminal Operating Co., 358 U.S. 354 (1959);
In re Dutile,
935 F.2d 61, 62-63 (5th Cir. 1991); Furness
(Chartering), Inc., Panama v. World Energy
Inc., 854 F.2d 410, 411 n.1 (11th Cir. 1985).
The saving to suitors clause "preserves alternatives
suing on the `law side' of the federal court
or in state court,
with admiralty and maritime law applied to
George K. Walker, Supplemental, Pendent &
Jurisdiction in Admiralty and Maritime Cases:
Federal Judicial Code Revision Project and
Practice, 32 J. Mar. L. & Com. 567, 568
(2001); see also id.
at 568 n.8 (listing cases); Lewis v. Lewis
& Clark Marine,
Inc., 531 U.S. 438, 444-45 (2001) (explaining
that saving to
suitors clause preserves concurrent jurisdiction
courts over some admiralty and maritime claims);
Charles A. Wright et al., Fed. Prac. &
Proc. S 3672, at 301-
05 (3d ed. 1998). The plaintiffs' argument
weight if their state cause of action were
a maritime one.
But it is not; it is a claim for malicious
use of process, a
state tort not confined to admiralty.
The Supreme Court, construing federal question
jurisdiction in the removal context, has
held that admiralty
cases do not fall within the scope of 28
which designates as appropriate for removal
cases "arising under the Constitution, treaties
or laws of
the United States." Romero, 358 U.S. at 368-69.
admiralty case filed in state court may only
be removed if
there exists some independent basis for federal
such as diversity of citizenship. Id. at
380-381. We need not
here discuss the logic or reasoning of Romero
, which has
spawned more than its share of commentary.2
It is enough
for us to recognize its existence, because
we conclude that
it is not applicable.
As we have noted, the removed case is not
action but one involving state tort law.
federal question at the heart of this litigation
applicability and construction of Supplemental
Although the Rule sets out procedures to
be followed in
maritime attachments, it is in fact part
of the Federal Rules
of Civil Procedure, adopted under the authority
of the Rules
Enabling Act, 28 U.S.C. S 2072.
The Rules of Practice in Admiralty and Maritime
which took effect in 1920, were rescinded
as of July 1,
1966. At that time, admiralty rules were
merged into the
Rules of Civil Procedure. This consolidation
was similar to
that which abolished the distinction between
2. See, e.g., Kenneth G. Engerrand, Removal
and Remand of Admiralty
Suits, 21 Tul. Mar. L.J. 383, 385 (1997)
(discussing removal of admiralty
cases and stating that "[d]espite the fact
that the `congressional language
. . . is perfectly understandable in ordinary
English,' the determination
whether admiralty cases can be removed has
been affected by historical
accident rather than traditional principles
of statutory interpretation;" id.
at 386-90 (explaining Romero's effect on
federal question jurisdiction in
admiralty claims); George Rutherglen, The
Federal Rules for Admiralty
and Maritime Cases: A Verdict of Quiescent
Years, 27 J. Mar. L. & Com.
581, 590-92 (1996) (discussing complexities
in saving to suitors clause
actions resulting from Romero); David J.
Sharpe, The Future of Maritime
Law in the Federal Courts: A Faculty Colloquium,
31 J. Mar. L. & Com.
217, 232-34 (2000) (recognizing the confusion
as to removal in
Since 1966, admiralty procedure has therefore
governed by the Federal Rules of Civil Procedure.
governing these procedures are recommended
Advisory Committee on Civil Rules and adopted
accordance with the conventions of the Rules
Although Rule B delineates procedures that
applicable to the unique features of maritime
it is nonetheless an integral part of the
Federal Rules of
It is noteworthy that Romero was decided in
to the consolidation of the admiralty and
civil rules. Thus,
any effect that Romero might have had on
of rules of admiralty procedure was abrogated
consolidation. Support for this position
is found in the
language of the Rules Enabling Act itself,
that "[a]ll laws in conflict with such rules
shall be of no
further force or effect after such rules
have taken effect." 28
U.S.C. S 2072(b); see Henderson v. United
States, 517 U.S.
654 (1996) (holding that Fed. R. Civ. P.
service provision in the Suits in Admiralty
At the heart of each of the plaintiffs' state
law claims is
the assertion that the defendants acted in
bad faith by
urging the District Court to disregard a
federal rule of
procedure, which would have barred the attachments,
to rely instead on case law, which permitted
The plaintiffs have thus alleged a substantial
federal law involving an apparent clash between
procedural rule and a contrary holding by
a United States
Court of Appeals.3 Moreover, this conflict
arises in the area
of maritime attachments, a subject of particular
the federal courts, and one where national
uniformity is of
some importance. See Yamaha Motor Corp.,
Calhoun, 516 U.S. 199, 209-11 (1996) (discussing
contexts in which "vindication of maritime
3. That the federal question was an essential,
and ultimately dispositive,
element is demonstrated by the fact that
were we to decide that
Leonhardt, discussed infra, was the correct
statement of the law, the
plaintiffs' case could be dismissed on that
basis alone. Moreover,
Express Lines sustained its injury at the
time the attachments were
served and the assets seized. The District
Court's decision vacating the
attachments came too late to save the company.
demanded uniform adherence to a federal rule
with no leeway for variation or supplementation
law."). Although not determinative, it is
worth noting that
this case also implicates the Federal Arbitration
U.S.C. S 1 et seq.
Fundamentally, the plaintiffs argue that the
Circuit opinion is incorrect, and it is that
erroneous interpretation of federal law upon
state claim depends. Where a plaintiff 's
the juxtaposition of a court of appeals decision
apparently conflicting procedural rule, the
may properly claim jurisdiction. This is
where, as here, the decision in controversy
has not been
overruled or reversed. The Eleventh Circuit
opinion is a
carefully reasoned exposition, concluding
that Rule B does
not limit admiralty's historic jurisdiction.
The Court did not
overlook Rule B, but analyzed it and found
restrictions did not apply.
We are persuaded that in the unique circumstances
the federal issue set forth in the complaint
is an essential
element of the plaintiffs' cause of action.
case was properly removed and the District
Court did not
err in denying the motion to remand.
Having resolved the jurisdictional issue,
we now consider
the federal and pendent state claims on the
invoke our discretion in choosing to first
federal defenses to the state suit.
The fact that a federal question permits removal
go so far as to support the defendants' contention
preemption applies. They argue that because
complained of occurred in a federal court,
the state claims
are superseded and the plaintiffs are limited
to the relief
afforded by Federal Rule of Civil Procedure
11, 28 U.S.C.
S 1927, and the inherent powers of a court
as explicated in
Chambers v. Nasco, Inc., 501 U.S. 32 (1991).
Not surprisingly, the plaintiffs disagree.
They rely on
Pennsylvania's Dragonetti Act, 42 Pa. C.S.A.S
8351 et seq.,
and common law, both of which provide a cause
for the wrongful use of civil proceedings.
establishes liability when "[a] person who
takes part in the
procurement, initiation or continuation of
against another" acts "in a grossly negligent
without probable cause and primarily for
purpose. Id. S 8351(a). A plaintiff may recover
under the Act
for harm resulting from interference with
use of land, chattels or other things, and
which include reasonable attorneys' fees,
reputation, specific pecuniary loss resulting
proceedings, emotional distress, and punitive
The recovery under Dragonetti can be more
than the sanctions available under Rule 11,
generally limited to counsel fees or fines,
or counsel fees
alone under 28 U.S.C. S 1927. Even assessments
under the inherent power of the courts have
not been held
to cover such matters as consequential damages,
reputation, or emotional distress.4
The breadth of the remedy provided by the
is a strong indication of its substantive
nature. Under the
Rules Enabling Act, 28 U.S.C. S 2072(b),
may not supplant substantive rights but the
4. The damages that might be awarded for wrongful
attachment have not
been fully explored. Neither party has raised
or briefed the preemption
aspect in this context. A brief examination
of the case law indicates that
damages in this area, if awarded at all,
generally consist of attorneys'
fees, costs, and expenses "directly" attributable
to the attachment. See
Furness Withy (Chartering), Inc., Panama
v. World Energy Sys. Assocs.,
Inc., 772 F.2d 802 (11th Cir. 1985) (no bad
faith, therefore no damages
awarded); Ocean Ship Supply, Ltd. v. MV Leah,
729 F.2d 971 (4th Cir.
1984) (same); Frontera Fruit Co., Inc. v.
Dowling, 91 F.2d 293 (5th Cir.
1937) (same). See also Coastal Barge Corp.
v. M/V Maritime Prosperity,
901 F. Supp. 325 (M.D. Fla. 1994) (damages
attorneys' fees and expenses, direct and
derivative damages); State Bank
& Trust Co. of Golden Meadow v. Boat
"D.J. Griffin," 755 F. Supp. 1389
(E.D. La. 1991) (attorney's fees and lost
profits assessed). We have not
encountered an award of such items as consequential
damages, loss of
reputation, or punitive damages that are
available under the Dragonetti
procedure and substance is notoriously difficult
to draw. In
Burlington Northern Railway Co. v. Woods,
480 U.S. 1
(1987), the Supreme Court held that "Rules
incidentally affect litigants' substantive
rights do not
violate" the Rules Enabling Act if they are
necessary to maintain the integrity of that
system of rules."
480 U.S. at 5 (emphasis added).
Following that rationale, the Court later
Rule 11 was intended to deter frivolous suits
in the district
courts. Business Guides, Inc. v. Chromatic
Enters., Inc., 498 U.S. 533, 552-53 (1991).
In pursuing that
goal, courts can impose sanctions by way
of attorneys' fees
without reallocating the burdens of litigation,
by the American Rule set forth in Alyeska
Co. v. Wilderness Society, 421 U.S. 240 (1975).
Business Guides also rejected the argument
that "Rule 11
creates a federal common law of malicious
498 U.S. at 553. Continuing, the Court stated,
objective of the Rule is not to reward parties
victimized by litigation," but to deter baseless
Although it conceded that sanctioning a party
its adversary, the Court was "confident that
will resist the temptation to use sanctions
for tort damages," id., and noted that in
the event that a
district court misapplied the Rule in a particular
error could be corrected on appeal. Id. at
Guides found no need for such a correction
the district court had properly declined
consequential damages in awarding attorneys'
fees and out-
of-pocket expenses. Id.
In Tarkowski v. County of Lake, 775 F.2d 173,
Cir. 1985), the court held that the state
tort law of
malicious abuse of process applies to federal
well. Our experience in this field has been
limited, but two
of our opinions that we will discuss support
The Bankruptcy Code provides more extensive
than those afforded by the Rules of Civil
Procedure or 27
U.S.C. S 1927. Section 303(i)(2) of the Code
assessment of damages -- including those
of a punitive
nature -- caused by a person who files a
involuntary bankruptcy in bad faith. 11 U.S.C.
Despite the broad scope of remedies available
in the Code
and the general exclusivity of the federal
bankruptcy, we have held that a state claim
abuse of process was not preempted. Paradise
v. Bank of Nova Scotia, 842 F.2d 47, 51-52
(3d Cir. 1988).
In that case, we discovered that because of
a gap in the
text the Code failed to provide a remedy
against a creditor
that had improperly filed an involuntary
bankruptcy against a debtor. We concluded
did not intend preemption to extend to the
point of barring
a debtor from the use of a state remedy.5
Id.; see also Silver
v. Mendel, 894 F.2d 598 (3d Cir. 1990) (malicious
involuntary petition for bankruptcy not protected
Our review of extant case law persuades us
Federal Rules of Civil Procedure do not preempt
abuse of process and similar torts providing
misconduct in federal litigation. Therefore,
victims of such
misconduct may, in appropriate circumstances,
to recover damages under state causes of
In a number of cases, district courts within
have reached conflicting results on the preemption
5. We recognize that the Court of Appeals
for the Ninth Circuit has held
that the Bankruptcy Code completely preempts
state actions for
malicious use of process, Gonzales v. Parks,
830 F.2d 1033 (9th Cir.
1987), and is thus in tension with Paradise
6. Compare Mruz v. Caring, Inc., 39 F. Supp.2d
495 (D.N.J. 1999)
(district court whose federal question jurisdiction
has been invoked
applies federal rather than state law on
abuse of process), and Thomason
v. Lehrer, 183 F.R.D. 161 (D.N.J. 1998) (federal
court is exclusive forum
to seek redress for litigation abuses committed
in a federal suit), with
Fumo v. Gallas, 2001 WL 115460 (E.D. Pa.
Feb. 6, 2001) (federal law
does not preempt state law claims), T.B.
Proprietary Corp. v. Sposato
Builders, Inc., 1996 WL 674016 (E.D. Pa.
Nov. 20, 1996) (stating that
neither Rule 11 nor 28 U.S.C. S 1927 preempts
state law cause of action
for abuse of process), Cannon v. Sheller,
825 F. Supp. 722 (E.D. Pa.
1993) (Dragonetti Act not preempted by ERISA
where action does not
relate directly or indirectly to ERISA plan),
and Plavin v. Bristol Borough,
1988 WL 100814 (E.D. Pa. Sept. 27,1988) (recognizing
that there is no
federal tort of malicious prosecution, and
state law reaches litigation
We recognize that some of these courts have
legitimate public policy concerns in concluding
federal rules foreclose state claims in the
nature of abuse of
process arising out of federal litigation.
acknowledge that inevitably conflicts will
arise between the
federal rules and state substantive claims.
Although federal preemption would forestall
controversies, the precepts of federalism
congressional decision to restrict the sanctions
within the federal system militate against
such a resolution
of the problem. As in so many other overlapping
federal and state law, we must rely on the
comity between the two systems to deal adequately
innovatively with such common problems.
Under Pennsylvania law, lawyers may be sued
individual capacities for wrongful use of
E.g., Dietrich Indus., Inc. v. Abrams, 455
A.2d 119 (Pa.
Super. 1982). That tort as applied in Pennsylvania
conforms with section 674 of the Second Restatement
Torts. Rosenfield v. Pennsylvania Auto. Ins.
Plan, 636 A.2d
1138, 1141 (Pa. Super. 1994). The Dragonetti
definition of the tort is in agreement with
that of the
Restatement, Rosen v. American Bank of Rolla,
190, 192 (Pa. Super. 1993), and an attorney
prosecutes a groundless action to accomplish
purpose may be held accountable under the
Act. Elec. Lab.
Supply Co. v. Cullen, 712 A.2d 304 (Pa. Super.
Some distinction has been drawn between malicious
of process and abuse of process. Malicious
use has to do
with the wrongful initiation of civil process,
with abuse, which is concerned with perversion
after litigation has begun. Dumont Television
& Radio Corp.
v. Franklin Elec. Co. of Phila., 154 A.2d
585, 587 (Pa. 1959).
Whatever may have been the importance of that
distinction before the Dragonetti Act was
appears that both torts are subsumed within
scope of the Act, which includes persons
who take part in
the procurement, initiation or continuation
proceedings for wrongful purposes. 42 Pa.
Liability attaches to those who act in a
manner or without probable cause and primarily
purpose other than adjudication of a claim.
Id . In addition,
the proceeding must have been terminated
in favor of the
person who invokes the Act. Id. S 8351(a)(2).
It may be seen that a party seeking redress
Dragonetti bears a heavy burden. Here, it
questionable whether the allegedly offending
terminated in favor of the plaintiff. Although
attachments have been dissolved, the District
noted earlier, retained jurisdiction pending
Thus, no final judgment has been entered
in favor of the
plaintiffs. Section 674(b) of the Restatement,
makes an exception from the finality rule
in ex parte
proceedings. In view of the somewhat unusual
status of the
earlier litigation and in the interests of
judicial economy, we
will assume arguendo that we may, under state
proceed to the merits because the ex parte
proceedings had been terminated in favor
of the plaintiffs.
The plaintiffs' first contention is that seeking
attachments, despite the arbitration clause
in the charter
party, demonstrated bad faith. This argument
lacking in merit. The Federal Arbitration
Act provides that
in admiralty actions, "the party claiming
to be aggrieved
may begin his proceeding . . . by libel and
seizure of the
vessel or other property of the other party
according to the
usual course of admiralty proceedings, and
the court shall
then have jurisdiction to direct the parties
to proceed with
the arbitration . . . ." 9 U.S.C. S 8.
Indeed, so fundamental is the right to attach
parties cannot consent in advance to forego
that remedy. In
The Anaconda v. American Sugar Refining Co.,
322 U.S. 42,
43 (1944), the charter party provided for
specifically precluded application of section
the aggrieved party began legal process by
attachment. The Supreme Court held that although
parties had agreed to arbitrate, the attachment
could be enforced. Id. at 45-46. See also
Corp. v. Dreyfus, 284 U.S. 263, 275 (1932)
("By the express
terms of S 8, the libel and seizure are authorized
initial step in a proceeding to enforce the
arbitration . . . ."). Clearly, the defendants
in this case did
not act in bad faith by carrying out procedures
by the Federal Arbitration Act.
The plaintiffs next argue that the defendants,
that Federal Rule B did apply, nevertheless
the writs of attachment by improperly prevailing
the District Court to follow the opinion
Schiffahartsgesellschaft Leonhardt &
Co. v. A. Bottachi S.A.
De Navegacion, 773 F.2d 1528 (11th Cir. 1985)
The District Court later released the attachments,
that Rule B, rather than Leonhardt, provided
law. The plaintiffs seize on this reversal
by the District
Court of its earlier ruling as evidence of
the defendants' bad
faith in misleading the court.
We cannot accept the plaintiffs' argument.
opinion was written by a distinguished judge
Eleventh Circuit for an en banc court. The
Court was fully
aware of Rule B, but after reviewing the
history of admiralty
law determined that federal courts are empowered
maritime procedures as they existed at the
time of the
Constitution's adoption. Leonhardt, 773 F.2d
at 1533. In
the Court's view, Rule B was not intended
to be the
exclusive source of maritime attachments
available to the
court, nor was it intended to limit or impair
power of the court in exercising admiralty
The defendants' motions for issuance of a
attachment stated, "This court has the power
Rule B to issue a maritime attachment" and
Leonhardt. The defendants, therefore, did
not misinform the
District Court as to the interplay between
Rule B and the
Court of Appeals opinion. In announcing the
vacate the attachments, the District Judge
"The Court may have been wrong but there
deception on the Court."
There is a paucity of case law on this particular
and it reaches the point of absurdity to
competent attorneys were guilty of bad faith
in urging the
District Court to follow this respectable
authority. The fact
that the District Court later reversed its
reliance on the
Eleventh Circuit case and concluded that Rule
does not establish that the lawyers exercised
let alone bad faith. Indeed, in a number
of cases, Rule B
has been attacked as being unconstitutional.
See , e.g.,
Polar Shipping Ltd. v. Oriental Shipping
Corp., 680 F.2d 627,
642-45 (9th Cir. 1982) (Byrne, J., dissenting).
We conclude that the plaintiffs have failed
bad faith as required under the Dragonetti
Pennsylvania common law. Accordingly, we
District Court's dismissal of the state law
Having explored the background at length and
that the plaintiffs have not shown bad faith
on the part of
the defendants, we find it unnecessary to
conflict between Leonhardt and Rule B. On
the facts, the
plaintiffs cannot recover under either version
of the law.
Consequently, we will affirm the District
of the entire case.
The judgment of the District Court will be
FUENTES, Circuit Judge, dissenting:
I respectfully dissent because, in my view,
presents no federal element sufficient to
confer 28 U.S.C.
S 1441(b) "arising under" jurisdiction. Since
this case was
improperly removed to federal court, the
District Court had
no underlying jurisdiction to adjudicate
the merits of
Express Lines's action, and we are without
jurisdiction to address the merits of the
appeal. I would
agree with the Ninth Circuit, which held,
circumstances, that a previously dismissed
does not cause a subsequently filed state
malicious prosecution to "arise under" federal
law. See Berg
v. Leason, 32 F.3d 422 (9th Cir. 1994).
The majority concludes that the conflict between
procedural rule and an opinion of the Eleventh
"raises a federal question sufficient to
support removal of
the malicious abuse of process claim from
the state court
to the federal forum." See Maj. Op. at 3.
underlying state court action, however, was
filed only after
the federal action had been dismissed, and
thus only after
it was no longer necessary to resolve any
Leonhardt and Rule B. As the majority notes,
not been overturned by the Eleventh Circuit.
At best, it
remains the jurisprudence of another circuit,
and it is
undisputed that it is simply not the law
of this Circuit. To
my knowledge, the only time Leonhardt has
by any court in this Circuit was by the District
Court in the
underlying attachment action here. The District
previously noted, ultimately rejected Leonhardt
, and its own
earlier reliance on it, and this decision
has not been
appealed by either party. Therefore, any
between Leonhardt and the Federal Rules does
a sufficient federal question upon which
It is well settled that "[o]nly state-court
originally could have been filed in federal
court may be
removed to federal court by the defendant."
v. Williams, 482 U.S. 386, 392 (1987) (citing
S 1441(a)). Additionally, we have held that
statute should be strictly construed against
that if there is any doubt as to the propriety
of a removal,
a case should not be removed to federal court.
Boyer v. Snap-on Tools Corp., 913 F.2d 108,
111 (3d Cir.
1990); Abels v. State Farm Fire & Cas.
Co., 770 F.2d 26, 29
(3d Cir. 1985).
In considering a motion to remand where federal
jurisdiction is at issue, three recognized
be satisfied: (1) the federal question must
arise from a well-
pleaded complaint, see, e.g., Rivet v. Regions
Louisiana, 522 U.S. 470, 475 (1998); Westmoreland
Hospital Ass'n v. Blue Cross of Western Pennsylvania
F.2d 119, 122 (3d Cir. 1979); (2) federal
law must be an
essential element of the plaintiff 's cause
of action, see, e.g.,
Rivet, 522 U.S. at 475; and (3) the federal
question must be
substantial. See, e.g., City of Chicago v.
College of Surgeons, 522 U.S. 156, 164 (1997).
I do not
believe that any of these removal requirements
satisfied in this case.
1. The Well-Pleaded Complaint Rule
As the Supreme Court has held on several occasions,
"[t]he presence or absence of federal-question
governed by the `well-pleaded complaint rule,'
provides that federal [question] jurisdiction
where a federal question is presented on
the face of the
plaintiff 's properly pleaded complaint."
Caterpillar Inc., 482
U.S. at 392. See also American National Red
Cross v. S.G.
and A.E., 505 U.S. 247, 258 (1992); Oklahoma
v. Graham, 489 U.S. 838, 840-41 (1989). Thus,
asserted federal question must arise from
complaint, and not from the answer, the petition
removal, or an actual or theorized defense.
Under the well-
pleaded complaint rule, if a complaint is
state law, federal question jurisdiction
may be established
only if "some substantial, disputed question
of federal law
is a necessary element of one of the well-pleaded
claims," or that, due to complete preemption,
the plaintiff 's
claim is "really one of federal law." See
Goepel v. National
Postal Mail Handlers Union, a Division of
Luna, 36 F.3d
306, 310 (3d Cir. 1994) (internal quotations
omitted). Also, a state case may arise under
" `where the vindication of a right under
necessarily turn[s] on some construction
of federal law.' "
See Merrell Dow Pharmaceuticals Inc. v. Thompson,
U.S. 804, 808 (1986) (quoting Franchise Tax
Construction Laborers Vacation Trust, 463
U.S. 1, 9 (1983)).
"[T]he vast majority of the cases brought
under the general
federal question jurisdiction of the federal
courts are those
in which federal law creates the cause of
Here, however, none of Express Lines's causes
were created by federal law, and nothing
in the allegations
Express Lines presented in its complaint
calls for a
resolution of any tension between the Eleventh
decision in Leonhardt and the Federal Rules.
noted, no genuine conflict exists in this
Leonhardt and the Federal Rules. To prevail
in its case,
Express Lines needs to show only that based
Defendants knew and believed, which are factual
they proffered Leonhardt without probable
cause and for a
purpose other than obtaining the proper adjudication
their claim. See 42 Pa. C.S.A. S 8351 (stating
person who takes part in the procurement,
continuation of civil proceedings against
another is subject
to liability to the other for wrongful use
of civil proceedings,
. . . [if h]e acts in a grossly negligent
manner or without
probable cause and primarily for a purpose
other than that
of securing the proper discovery, joinder
of parties or
adjudication of the claim in which the proceedings
based . . ."); Silver v. Mendel, 894 F.2d
598, 603-04 (3d Cir.
1990) (finding that, under the Dragonetti
"imposition of liability for the wrongful
use of civil
proceedings [in Pennsylvania] occurs only
when litigation is
instituted both without probable cause and
primarily for a
purpose other than that of securing the proper
of the claim in which the proceedings are
based"). In other
words, Express Lines needs to show only that
acted either negligently or without probable
without a proper purpose in proffering Leonhardt
Since no genuine conflict exists between Leonhardt
the Federal Rules in this Circuit, any legal
assertions as to
1. Since I do not believe we have the requisite
jurisdiction to address this
case on its merits, I will refrain from commenting
on the strength of
Express Lines's claims or evidence.
the validity of Leonhardt, if made at all,
would only properly
be made by Defendants in their Answer or
in their defense.
Neither invocation, according to the Supreme
adequate to confer federal question jurisdiction.
2. The "Essential" Element Requirement
In accordance with Supreme Court jurisprudence,
law must be an essential element of a plaintiff
's cause of
action in order to confer federal subject
The meaning of the "essential element" requirement
stated in Hunter v. United Van Lines, 746
F.2d 635 (9th Cir.
[A court must] determine whether the federal
in the claim was "basic" as opposed to "collateral,"
"necessary" as opposed to "merely possible."
. . . .
Similarly, courts have looked to whether
element in the claim was "pivotal," . . .
. . . as opposed to merely "incidental[ ],"
. . . or whether
it was "direct and essential" as opposed
"attenuated," . . . or "paramount" as opposed
"collateral," . . . . Thus, the resolution
of the federal
question must play a significant role in
Id. at 646 (internal citations omitted). Here,
showing that a federal issue played a "significant
role in the
proceedings," the majority determined that
"unnecessary" to resolve the issue asserted
as the basis for removal. See Maj. Op. at
18. That this case
may be decided without resolving any alleged
between Leonhardt and Rule B severely undermines
idea that this issue was essential to evaluating
claims. The majority correctly states that
a federal issue
sufficiently essential to invoke federal
jurisdiction must be
"genuine and present, [and] not merely .
. . conjectural."
See id. at 7 (citing Merrell Dow, 478 U.S.
at 813-14 & n.11).
Yet, it is difficult to understand how an
issue could be any
more conjectural or any less essential than
disposition is explicitly deemed "unnecessary."
3. The "Substantial" Federal Question Requirement
As the majority notes, the federal law present
properly removed case "must be in the forefront
of the case
and not collateral, peripheral, or remote."
Yet from the
outset, Express Lines's case was clearly
comprised solely of
state law claims, and the majority's ability
to resolve this
case without addressing the purported federal
highlights the fact that any federal issue
in this case is
"collateral, peripheral, or remote."
Further, in Merrell Dow, the Supreme Court
held that no
substantial federal question existed where
alleged a violation of a federal statute
as an element of a
state cause of action. The Court explained
sometimes found that formally federal causes
of action were
not properly brought under federal-question
because of the overwhelming predominance
issues." Merrell Dow, 478 U.S. at 814 n.
12. Invoking an
earlier ruling, the Court noted that "the
violation of the
federal standard as an element of state tort
recovery did not
fundamentally change the state tort nature
of the action."
Id. (citing Moore v. Chesapeake & Ohio
R. Co., 291 U.S.
205, 216-17 (1934)). The Court also noted
that "S 1331
[federal question] decisions can best be
understood as an
evaluation of the nature of the federal interest
at stake." Id.
(emphasis in original).
Here, as in Merrell Dow, the state law nature
Lines's claims is fundamentally unchanged
by the asserted
tension between Leonhardt and the Federal
Rules. There is
also little, if any, cognizable federal interest
in having a
federal court in our Circuit assess the legitimacy
Eleventh Circuit case whose viability is
not an open issue
anywhere in this Circuit.
Following the guidance of Merrell Dow, the
has held in a case very similar to ours that
prior federal action does not render a fundamentally
law action cognizable in federal court. In
Berg , the plaintiff
brought a malicious prosecution action in
state court after
successfully defending himself in a federal
in which he was accused of violating federal
racketeering laws. The defendant removed
to federal court,
and the District Court denied the plaintiff
's Motion to
Remand. On appeal, the Ninth Circuit held
that "the federal
element is insufficiently substantial to
jurisdiction because the malicious prosecution
only decide whether the underlying claim was
tenable[;]' the cause of action is created
by state law, and
state law controls the standard by which
the strength of the
federal claim in the underlying action is
132 F.3d at 423. The Ninth Circuit elaborated
law cannot be controlling when the degree
of substance in
the federal claim necessary to trigger the
state-law cause of
action is a question of state law." Id. at
then, "federal law is not dispositive because
the degree of
strength required to put the underlying claim
probable cause threshold is determined by
state law." Id.
The same conclusion applies here.
In examining the state law elements of the
claim, the Ninth Circuit noted that, far
from the case
requiring a legal resolution of federal questions,"[a]
factfinder must determine what the defendant
believed about the facts." Id. Similarly,
here, the subjective
beliefs, purpose, and purported bad faith
of the Defendants
are at issue, and "the court looks at the
merits of a claim
for malicious prosecution through the prism
of state law."
This case only asks whether Defendants' underlying
claim, that Leonhardt could trump the Federal
legally viable enough to have been asserted
not in contravention of the Dragonetti Act.
case presents no real or substantial question
of federal law
that compels resolution in a federal court.
case was, from the outset, a state case that
brought in state court originally.
For the aforementioned reasons, I would find
case was improperly removed to federal court,
District Court had no underlying jurisdiction
the merits of Express Lines's claim, and
that we are thus
without appellate jurisdiction to entertain
this appeal. I
A True Copy:
Clerk of the United States Court of Appeals
for the Third Circuit