                                                                                                                           Opinions of the United
2002 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


7-15-2002

Bracken v. Matgouranis
Precedential or Non-Precedential: Precedential

Docket No. 01-3800




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Recommended Citation
"Bracken v. Matgouranis" (2002). 2002 Decisions. Paper 389.
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PRECEDENTIAL

       Filed July 15, 2002

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

Nos. 01-3800 and 01-3801

CHERYL ANN BRACKEN;
H. DAVID ROTHMAN,
       Appellants in 01-3800

v.

PANOREA MATGOURANIS; DIANNA CALABOYIAS
WYRICK; WILLIAM J. WYRICK; REED SMITH, a
partnership or limited liability partnership; MEYER,
DARRAGH, BUCKLER, BEBENEK & ECK, a partnership
or limited liability partnership
(Western District of Pennsylvania (Pittsburgh)
D.C. # 01-cv-00288)

CHERYL ANN BRACKEN;
H. DAVID ROTHMAN,
       Appellants in 01-3801

v.

MARTIN P. MATGOURANIS; PANOREA MATGOURANIS;
DIANNA C. WYRICK; WILLIAM J. WYRICK
(Western District of Pennsylvania (Pittsburgh)
D.C. # 01-cv-00420)

On Appeal from the United States District Court
For the Western District of Pennsylvania
D.C. Nos. 01-cv-00288 and 01-cv-00420
District Judge: Honorable Donetta W. Ambrose




Submitted Under Third Circuit LAR 34.1(a)
June 14, 2002

Before: ROTH, RENDELL, and ROSENN, Circuit Jud ges.

(Filed: July 15, 2002)

       H. David Rothman
       Suite 310E
       100 Bryn Mawr Court
       Pittsburgh, PA 15221

        Counsel for Appellants

       John W. Murtagh, Jr.
       Murtagh & Cahill
       110 Swinderman Road
       Wexford, PA 15090-8613
       Mary Kate Coleman
       Riley, McNulty, Hewitt & Sweitzer
       650 Washington Road Suite 300
       Pittsburgh, PA 15228

        Counsel for Appellee
       Panorea Matgouranis

       W. Thomas McGough, Jr.
       John C. Unkovic
       Roy W. Arnold
       Reed Smith
       435 Sixth Avenue
       Pittsburgh, PA 15219

        Counsel for Appellees
       Dianna C. Wyrick and Reed Smith
       Shaw & McClay

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       Louis C. Long
       Meyer, Darragh, Buckler,
        Bebenek & Eck
       2000 The Frick Building
       Pittsburgh, PA 15219

       David B. White
       Carol L. Hesz
       Jennifer H. Guinee
       Burns, White & Hickton
       120 Fifth Avenue, Suite 2400
       Pittsburgh, PA 15222

        Counsel for Appellees
       William J. Wyrick and Meyer,
       Darragh, Buckler, Bebenek & Eck

OPINION OF THE COURT

ROSENN, Circuit Judge.

This appeal presents an esoteric question of federal
jurisdiction considered by the United States Supreme Court
nearly a century ago in Louisville & Nashville Railroad Co.
v. Mottley, 211 U.S. 149 (1908), and rarely reviewed since.
The issue is whether the plaintiffs in a state-suit for
defamation confer subject-matter jurisdiction on a federal
court by raising a first amendment issue in response to an
anticipatory defense.

The plaintiffs, Cheryl Ann Bracken and her attorney, H.
David Rothman, brought suit in the Allegheny County,
Pennsylvania, Court of Common Pleas, alleging that
Panorea Matgouranis’s attorney, defendant William J.
Wyrick, defamed them during Bracken’s December 8, 2000,
deposition. The plaintiffs also filed a second cause of action
based on the alleged defamation, seeking an accounting
and the imposition of a constructive trust on the assets of
Panorea Matgouranis and her husband, Martin.

The plaintiffs, in their Complaint, anticipated that the
defendants would assert a defense of absolute privilege
under Pennsylvania law. The plaintiffs, therefore, asserted

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that the exercise of such privilege would violate their first
amendment rights under the United States Constitution.
Based on this argument, as delineated in the plaintiffs’
Complaint, the defendants successfully petitioned to have
both cases removed to the United States District Court for
the Western District of Pennsylvania.

The plaintiffs, asserting lack of federal jurisdiction,
moved to remand the cases to the state court pursuant to
28 U.S.C. S 1447. The District Court denied the motion,
holding that the plaintiffs "have clearly raised federal
constitutional issues in their complaint." The defendants
moved to dismiss the cases, and, in due course, the District
Court granted the motion. We hold that the District Court
erred in assuming jurisdiction, and we will reverse.

I.

The plaintiffs allege that on November 6, 2000, Martin
Matgouranis (Martin) gave Bracken, his employee and lover,
a horrible beating that culminated in Martin shooting
Bracken execution-style and leaving her for dead. Bracken
survived and underwent facial surgery to reconstruct and
repair her orbital area. Bracken was released from the
hospital the same week she was admitted.

Rothman, on Bracken’s behalf, wrote two letters to
Martin’s attorneys. Rothman requested that Martin advance
Bracken money because she was disabled and unable to
support herself during her convalescence. Rothman
indicated that if and when Martin appeared for sentencing
in any criminal proceeding arising out of the alleged assault
on Bracken, Bracken would inform the sentencing judge of
any "belated compassion shown" by Martin. Rothman
further stated that any ex post facto lack of compassion
would also be revealed at any sentencing proceeding arising
out of the alleged assault.

On November 27, 2000, in the Court of Common Pleas of
Allegheny County, Bracken filed an action to discover and
freeze Martin’s assets. On December 8, 2000, the
defendants deposed Bracken. During the course of the
deposition, Wyrick, attorney to Panorea Matgouranis,
established that Bracken had approved Rothman’s letters to

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Martin’s attorneys. Wyrick then accused Bracken and
Rothman of attempting to extort money from Martin.
Thereupon, the plaintiffs filed the action for defamation and
intentional infliction of emotional distress.

II.

Title 28 U.S.C. S 1447(d) provides "[a]n order remanding
a case to the State Court from which it was removed is not
reviewable on appeal or otherwise." AlthoughS 1447(d)
narrows the circumstances under which this Court can
review a District Court’s order granting remand, appellate
review of District Court orders denying remand is not
prohibited. Spring Garden Assocs., L.P. v. Resolution Trust
Corp., 26 F.3d 412, 414 (3d Cir. 1994). Irrespective of what
S 1447 provides, this Court has a continuing obligation to
sua sponte raise the issue of subject matter jurisdiction if
it is in question. Shaffer v. GTE North, Inc. , 284 F.3d 500,
502 (3d Cir. 2002); see also Mottley, 211 U.S. at 152.

We exercise plenary review in determining whether the
District Court had subject matter jurisdiction. Wujick v.
Dale & Dale, Inc., 43 F.3d 790, 792 (3d Cir. 1994).
Removing state-court cases to federal court is proper only
when federal courts would have had original jurisdiction
over the case. 28 U.S.C. S 1441(a);1 Caterpillar Inc. v.
Williams, 482 U.S. 386, 392 (1987); V.I. Hous. Auth. v.
Coastal Gen. Constr. Servs. Corp., 27 F.3d 911, 915 (3d Cir.
1994).

The Complaint, alleging defamation and intentional
infliction of emotional distress, sounds entirely in
Pennsylvania law. The parties are not diverse, and thus the
District Court’s assumption of removal jurisdiction was
predicated on original federal question jurisdiction
pursuant to 28 U.S.C. S 1331.2 Because the Complaint
_________________________________________________________________

1. The statute provides, in pertinent part: "[A]ny civil action brought in
a State court of which the district courts of the United States have
original jurisdiction, may be removed by the defendant . . . to the district
court of the United States." 28 U.S.C. S 1441(a) (emphasis added).

2. The statute provides: "The district courts shall have original
jurisdiction of all civil actions arising under the Constitution, laws, or
treaties of the United States." 28 U.S.C. S 1331.

                                5


predicted that the defendants would assert a defense of
absolute privilege under Pennsylvania law and in response
asserted that such a defense would violate the United
States Constitution, the District Court allowed the removal
of the cases to federal court. The plaintiffs argued that the
privilege defense was not an essential element of their state
claims and moved to remand the cases to state court. The
District Court denied the motion. Approximately a century
of precedent compels us to reverse the District Court.

This appeal raises fundamental questions regarding
federal jurisdiction, and this Court may not ignore
applicable law. The plaintiffs argue that there is no federal
subject matter jurisdiction, because their complaints sound
in defamation and intentional infliction of emotional
distress, and any reference to their rights of free speech
was surplusage and not essential to their claims. Although
the plaintiffs have asserted the correct legal principle, they
failed to cite precedential cases in support of this
proposition to either the District Court or this Court.
Mottley, not cited by any of the parties, is the appropriate
starting point for our analysis.

Mottley involved alleged injuries resulting from a collision
of railroad trains that were owned by the defendant railroad
company. 211 U.S. at 150. The plaintiffs and the defendant
there reached a settlement in which the plaintiffs released
the defendant from liability for damages in return for free
railroad passes. The defendant allegedly performed its
duties for several years and then it refused to renew the
plaintiffs’ passes. The plaintiffs asserted that the
defendant’s refusal to comply with the agreement was a
consequence of a federal law forbidding free passes. Id. at
151. The plaintiffs argued that the federal law did not
prohibit free passes under the circumstances of their case.
Alternatively, the plaintiffs argued that if the federal law
prohibited their free passes, the law was unconstitutional.

The District Court, based on the plaintiffs’ anticipation of
the defendant’s defense, assumed jurisdiction. The United
States Supreme Court reversed. Referring to the language
of S 1331’s statutory predecessor, the Court stated:

       It is the settled interpretation of these words, as used
       in this statute, conferring jurisdiction, that a suit

                                6


       arises under the Constitution and laws of the United
       States only when the plaintiff ’s statement of his own
       cause of action shows that it is based upon those laws
       or that Constitution. It is not enough that the plaintiff
       alleges some anticipated defense to his cause of action
       and asserts that the defense is invalidated by some
       provision of the Constitution of the United States.
       Although such allegations show that very likely, in the
       course of the litigation, a question under the
       Constitution would arise, they do not show that the
       suit, that is, the plaintiff ’s original cause of action,
       arises under the Constitution.

Id. at 152; see also Gully v. First Nat’l Bank, 299 U.S. 109,
113 (1936) (noting that a Complaint will not create federal
jurisdiction by going beyond a cause of action statement
and anticipating or replying to a likely defense); Krashna v.
Oliver Realty, Inc., 895 F.2d 111, 113 (3d Cir. 1990)
(actions not removable based on federal defenses). Thus,
the presence of federal question jurisdiction turns on the
"well-pleaded complaint rule," which dictates that federal
jurisdiction lies only when a federal question is presented
on the face of the plaintiff ’s properly pleaded complaint.
Williams, 482 U.S. at 392.

The Supreme Court has labeled the "well-pleaded
complaint rule" both reasonable and fair, Boston &
Montana Consol. Copper & Silver Mining Co. v. Montana Ore
Purchasing Co., 188 U.S. 632, 639 (1903), and has applied
the rule consistently since its promulgation. E.g., Franchise
Tax Bd. v. Constr. Laborers Vacation Trust, 463 U.S. 1, 9-11
(1983). The Court stated that speculation on possible
defenses and responding to such defenses in an attempt to
demonstrate that a federal question would likely arise is not
a necessary element of a plaintiff ’s cause of action, and
thus does not create federal subject matter jurisdiction.
Montana Ore, 188 U.S. at 638-40.

The plaintiffs’ Complaint sounds entirely in State law.
Indeed, in terms of federal proximity, this case is one
degree further removed than was Mottley. In Mottley, the
plaintiffs anticipated a federal defense and offered their
reply to it. Here, on the other hand, the plaintiffs have
anticipated a state defense (i.e., absolute privilege), and

                                7


have developed a first amendment response to the defense
in their Complaint (i.e., absolute privilege violates the
United States Constitution). Speculation on a state defense
and a constitutional answer to it just cannot be the basis
for federal question jurisdiction.

Accordingly, the order of the District Court will be
reversed and the proceedings remanded to the District
Court with directions to vacate its order denying remand of
the cases to the Allegheny County Court of Common Pleas.
Upon remand, the District Court is instructed to enter an
order granting plaintiffs’ motion for remand to the state
court, with costs taxed against the defendants.

A True Copy:
Teste:

       Clerk of the United States Court of Appeals
       for the Third Circuit

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