vonRosenberg v. Lawrence, No. 14-1122 (4th Cir. 2015)

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Justia Opinion Summary

This case involved a dispute between two clergymen, each of whom believed himself to be the proper leader of The Protestant Episcopal Church in the Diocese of South Carolina. Bishop Charles vonRosenberg brought this action against Bishop Mark Lawrence, alleging Lanham Act violations and seeking declaratory and injunctive relief. Bishop Lawrence asked the district court to abstain and stay this action pending resolution of related state court proceedings. The district court granted the motion to abstain and stayed the action, concluding that it had broad discretion to decline to grant declaratory relief under the abstention doctrine articulated in Brillhart v. Excess Insurance Co. of Am. and Wilton v. Steven Falls Co. The Fourth Circuit vacated the stay order, holding (1) Colorado River Water Conservation Dist. v. United States, which permits a federal court to abstain only in “exceptional” circumstances, properly governed the abstention question in this action; and (2) because the district court did not apply the correct abstention standard, the case is remanded for a determination of whether “exceptional” circumstances are present in this case.

The court issued a subsequent related opinion or order on April 17, 2015.

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PUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 14-1122 THE RIGHT REVEREND CHARLES G. VONROSENBERG, individually and in his capacity as Provisional Bishop of the Protestant Episcopal Church in the Diocese of South Carolina, Plaintiff - Appellant, v. THE RIGHT REVEREND MARK J. LAWRENCE; JOHN DOES 1 - 10, being fictitious defendants whose names presently are unknown to Plaintiff and will be added by amendment when ascertained, Defendants - Appellees. Appeal from the United States District Court for the District of South Carolina, at Charleston. C. Weston Houck, Senior District Judge. (2:13-cv-00587-CWH) Argued: January 28, 2015 Decided: March 31, 2015 Before MOTZ, GREGORY, and WYNN, Circuit Judges. Vacated and remanded by published opinion. Judge Motz wrote the opinion, in which Judge Gregory and Judge Wynn joined. ARGUED: Thomas S. Tisdale, Jr., HELLMAN YATES & TISDALE, Charleston, South Carolina, for Appellant. Charles Alan Runyan, SPEIGHTS & RUNYAN, Beaufort, South Carolina, for Appellees. ON BRIEF: Jason S. Smith, HELLMAN YATES & TISDALE, Charleston, South Carolina, for Appellant. Andrew S. Platte, SPEIGHTS & RUNYAN, Beaufort, South Carolina; Henrietta U. Golding, MCNAIR LAW FIRM, Myrtle Beach, South Carolina; Charles H. Williams, WILLIAMS & WILLIAMS, Orangeburg, South Carolina; David Cox, WOMBLE, CARLYLE, SANDRIDGE & RICE, LLP, Charleston, South Carolina, for Appellee The Right Reverend Mark J. Lawrence. 2 DIANA GRIBBON MOTZ, Circuit Judge: This appeal arises from a dispute between two clergymen. Each believes himself to be the proper leader of The Protestant Episcopal Church in the Diocese of South Carolina. Bishop Charles G. vonRosenberg brought this action against Bishop Mark J. Lawrence, declaratory alleging and two Lanham nondeclaratory Act violations relief. In and seeking response, Bishop Lawrence asked the district court to abstain in favor of pending related state court proceedings. Relying on the abstention doctrine articulated in Brillhart v. Excess Insurance Co. of America, 316 U.S. 491 (1942) and Wilton v. Seven Falls Co., 515 U.S. 277 (1995), which affords a federal court broad discretion to stay declaratory judgment actions, the district court stayed the action. Because we conclude that Colorado River Water Conservation District v. United States, 424 U.S. 800 (1976), which permits a federal court to abstain only in “exceptional” circumstances, properly governs the abstention decision in this action seeking both declaratory and nondeclaratory relief, we vacate the stay order and remand for further proceedings. I. Bishop vonRosenberg alleges that in December 2012, the Disciplinary Board of The Protestant Episcopal Church in the United States ousted Bishop Lawrence from his position as Bishop 3 of the Diocese of South Carolina. January 16, installed 2013, him a as Convention Bishop He further alleges that on of the Lawrence’s Diocese elected replacement. and Bishop vonRosenberg claims that Bishop Lawrence, after his ouster, has improperly continued to use the Church’s service marks falsely advertised himself as the leader of the Church. and Bishop Lawrence maintains that he was not removed from office. He contends that Bishop vonRosenberg serves only as leader of an unincorporated Diocese. head, and, Episcopal association created to supplant the Each man views himself “as the Diocese’s veritable thus, the rightful user of its service marks.” vonRosenberg v. Lawrence, No. 13-587, slip op. at 4 (D.S.C. Aug. 23, 2013) (“Abstention Order”). On January 4, 2013 (prior to the filing of this action and before the Convention assertedly installed Bishop vonRosenberg as Bishop Lawrence’s replacement), a faction of Bishop Lawrence’s supporters filed suit in South Carolina state court against the Episcopal Church. That action alleges violations of service mark infringement and improper use of names, styles, and emblems -- all “arising exclusively under South Carolina law.” Id. The state court issued a temporary restraining order preventing anyone other than Bishop Lawrence and those under his direction from using these service marks and names. 4 On March 5, Bishop vonRosenberg filed the present action against Bishop Lawrence seeking declaratory and injunctive relief for two violations of the Lanham Act, 15 U.S.C. § 1114 and § 1125(a)(1)(A) (2012). Bishop vonRosenberg alleges that Bishop Lawrence violated Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), by the unauthorized use of four service marks belonging to the Diocese of South Carolina and by advertising falsely that “he is the true Bishop and ecclesiastical authority of the Diocese.” district court On to March dismiss 28, this Bishop federal Lawrence action asked for lack the of standing or, in the alternative, asked the court to abstain and stay this action pending resolution of the related state court case. That same day, Bishop vonRosenberg’s followers filed answers and counterclaims in the state case, including trademark infringement claims. On April 3, the vonRosenberg followers removed the state action to federal court pursuant to 28 U.S.C. § 1441(a). Six weeks later, the district court remanded that case to state court. On August 23, 2013, the district court granted Bishop Lawrence’s motion to abstain and stayed the present action. The district court held that Bishop vonRosenberg had constitutional and prudential standing to assert individual injuries against Bishop Lawrence for trademark 5 infringement and false advertising. Nevertheless, invoking its “broad discretion to . . . decline to grant[] declaratory relief” under Brillhart and Wilton, the district court granted Bishop Lawrence’s motion to abstain. Abstention Order at 12 (quoting Wilton, 515 U.S. at Bishop vonRosenberg timely noted this appeal. 1 281). II. We “review the district court’s jurisdiction for abuse of discretion.” decision to surrender New Beckley Mining Corp. v. Int’l Union, United Mine Workers, 946 F.2d 1072, 1074 (4th Cir. 1991). requirements But of “[w]hether abstention” subject to de novo review.” a case constitutes satisfies “a legal the basic question Myles Lumber Co. v. CNA Fin. Corp., 233 F.3d 821, 823 (4th Cir. 2000). Bishop vonRosenberg contends that the district court applied the wrong criteria in determining to abstain in this case. He maintains that the principles set forth in Colorado River, rather than those in Brillhart and Wilton, should have guided the abstention inquiry in this action seeking both declaratory and nondeclaratory relief. 1 On February 3, 2015, the state trial court issued a judgment and final order in favor of Bishop Lawrence’s followers. Bishop vonRosenberg’s followers have noted an appeal of that order. 6 In Colorado River, the Supreme Court held that a federal court may abstain from deciding non-frivolous, nondeclaratory claims in favor of a parallel state suit for reasons of “wise judicial administration” circumstances. –- but 424 U.S. at 818. only in “exceptional” The Court explained that a federal court’s “virtually unflagging obligation” to decide such federal claims rendered its authority to stay a federal action for these administrative reasons “considerably more limited than the circumstances appropriate abstention standards. 2 for abstention” under other Id. at 817-18; see also Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 28 (1983). Thus, a court must “parsimoniously.” apply Chase Colorado Brexton Health Maryland, 411 F.3d 457, 463 (4th Cir. 2005). River Servs., abstention Inc. v. Even if a parallel state court suit exists, in deciding whether to abstain for that reason, a court must balance several factors, “with the balance heavily weighted jurisdiction.” in favor of the exercise of [federal] Moses H. Cone Mem’l Hosp., 460 U.S. at 16. We have identified six factors a court must consider in making this decision. See Chase Brexton, 411 F.3d at 463-64. 2 The parties do not contend on appeal that any abstention standard other than that set forth in Colorado River or Brillhart/Wilton governs this case. 7 The district court did not consider any of these factors, rather it simply found Brillhart/Wilton standard. abstention have broad judgment discretion actions under way. when proper under the Those cases recognize that courts to abstain concurrent from state deciding court declaratory proceedings are This wide latitude arises out of “federal courts[’] unique and substantial discretion in deciding whether to declare the rights of litigants.” We have never Wilton, 515 U.S. at 286. expressly held which abstention standard applies to a federal complaint, like the one at hand, which asserts claims for both declaratory and nondeclaratory relief. See VRCompliance LLC v. HomeAway, Inc., 715 F.3d 570, 571-72 (4th Cir. 2013). But, although we have recognized that some circuits have taken other approaches to these mixed cases, we have held that nondeclaratory when a it claim, court is is “not “required at entertaining the declaratory claims.” Gross, 468 F.3d 199, 210 (4th Cir. to liberty entertain” to abstain a from Great Am. Ins. Co. v. 2006). Thus, “when a plaintiff seeks relief in addition to a declaratory judgment, such as damages or injunctive relief, both of which a court must address, then the entire benefit derived from exercising discretion not to grant declaratory relief is frustrated, and a stay would not save any judicial resources.” F.3d at 466 (emphasis in original). 8 Chase Brexton, 411 To apply the complaint seeking otherwise be Brillhart/Wilton injunctive governed by or the standard monetary Colorado to relief, a federal would standard, River which would ignore the very different justifications for the two abstention standards. the rare Colorado River permits a court to abstain only in circumstance administration otherwise are so “virtually in which pressing the as unflagging to 817 (emphasis added). of supersede obligation” jurisdiction over that federal action. at needs to judicial the court’s exercise its Colorado River, 424 U.S. Brillhart/Wilton, by contrast, naturally flows from the broad discretion afforded courts to entertain actions Declaratory and Judgment award Act. declaratory The relief under Brillhart/Wilton the standard therefore provides a poor fit for causes of action over which a federal court generally must exercise jurisdiction -- namely, claims for nondeclaratory relief. For those claims, “[o]nly the clearest of justifications will warrant dismissal” in favor of concurrent state court proceedings. We have previously taken Id. at 819. note of these differences and related considerations, including a federal court’s “unflagging obligation” to adjudicate federal claims for monetary relief over which it has jurisdiction. F.3d at 210; Chase Brexton, 411 F.3d at 466. injunctive or See Gross, 468 We now join several of our sister circuits in holding that Colorado River, 9 not Brillhart/Wilton, must guide a court’s decision to abstain from adjudicating mixed complaints alleging claims for both declaratory and nondeclaratory relief. See New England Ins. Co. v. Cir. Barnett, 561 F.3d 392, 396 (5th 2009); Village of Westfield v. Welch’s, 170 F.3d 116, 124 n.5 (2d Cir. 1999). Cf., United States v. City of Las Cruces, 289 F.3d 1170, 1180-82 (10th Cir. 2002). A contrary approach would deprive a plaintiff of access to a federal forum simply because he sought declaratory relief in addition to an injunction or money damages. Such a penalty for requesting a declaration seems especially unwarranted given that nearly all claims, including those for damages or injunctive relief, effectively ask a court to declare the rights of the parties to the suit. available relief, declaratory monetary To ensure that they have asked for all plaintiffs relief in relief. We commonly add a request addition to requests for decline to adopt rule a for equitable that or would transform that thoroughness into a handicap. The Colorado River standard applies to all mixed claims -even when the “claims for coercive relief are merely ‘ancillary’ to [a party’s] request for declaratory relief.” Ltd. v. 2000). rule United Heritage Corp., 204 F.3d 647, Black Sea Inv., 652 (5th Cir. Indeed, “the only potential exception to this general arises when a party’s request 10 for injunctive relief is either frivolous or is made solely to avoid application of the Id. 3 Brillhart standard.” indicates that relief frivolous is Brillhart/Wilton Bishop or Nothing in the record in this case vonRosenberg’s designed standard. to request avoid Accordingly, for injunctive application the Colorado of the River standard governs the abstention question here. III. In considering whether to abstain in mixed cases, where a plaintiff seeks both declaratory and nondeclaratory relief, a federal court’s task “is not to find some substantial reason for the exercise of federal jurisdiction [but] . . . to ascertain whether there exist ‘exceptional’ circumstances . . . to justify the surrender of that jurisdiction.” Moses H. Cone Mem’l Hosp., 460 U.S. at 25-26 (quoting Colorado River, 424 U.S. at 813). Because standard, the we district must court vacate did its not stay 3 apply order this and abstention remand for a Riley v. Dozier Internet Law, P.C., 371 F. App’x 399 (4th Cir. 2010), an unpublished and therefore non-precedential opinion on which Bishop Lawrence nevertheless heavily relies, is such a case. There we concluded that “the perfunctory inclusion of nondeclaratory requests for relief does not suffice to remove a plaintiff from the ambit of the Brillhart/Wilton rule.” Id. at 404 n.2. For a declaratory judgment plaintiff may not obtain the benefit of “nearly mandatory jurisdiction under Colorado River[] simply by tossing in dependent or boilerplate nondeclaratory requests.” Id. 11 determination whether present in this case. such “exceptional” circumstances are We express no view on that issue. VACATED AND REMANDED 12