424 F.2d 1200 (7th Cir. 1970), 17502, Koehring Co. v. Hyde Const. Co.

Docket Nº:17502-17504.
Citation:424 F.2d 1200
Party Name:KOEHRING COMPANY, a Wisconsin corporation, Plaintiff-Appellant, v. HYDE CONSTRUCTION COMPANY, Inc., a Mississippi corporation, Vardaman S. Dunn, an individual, Charles Clark, an individual, Jack N. Hayes, an individual, David H. Sanders, an individual; Gable, Gotwals, Hays, Rubin & Fox, a partnership, Cox, Dunn& Clark, a partnership, United States
Case Date:March 19, 1970
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit
 
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Page 1200

424 F.2d 1200 (7th Cir. 1970)

KOEHRING COMPANY, a Wisconsin corporation, Plaintiff-Appellant,

v.

HYDE CONSTRUCTION COMPANY, Inc., a Mississippi corporation, Vardaman S. Dunn, an individual, Charles Clark, an individual, Jack N. Hayes, an individual, David H. Sanders, an individual; Gable, Gotwals, Hays, Rubin & Fox, a partnership, Cox, Dunn& Clark, a partnership, United States Fidelity & Guaranty Co., a Maryland corporation, The First National Bank of Jackson, a Mississippi corporation, Circle 'L' Electric Company, a partnership, and Fidelity and Deposit Company of Maryland, a Maryland corporation, Defendant-Appellees and Cross-Appellants.

Nos. 17502-17504.

United States Court of Appeals, Seventh Circuit.

March 19, 1970

Page 1201

Steven E. Keane, William A. Denny, Maurice J. McSweeney, Milwaukee, Wis., for appellant, Koehring Co.

Walter A. John, Milwaukee, Wis., for appellant Fidelity and Deposit Company of Maryland.

Reginald W. Nelson, Milwaukee, Wis., Vardaman S. Dunn, Charles Clark, Jackson, Miss., Cox, Dunn & Clark, Jackson, Miss., Whyte, Hirschboeck, Minahan, Harding & Harland, Milwaukee, Wis., for appellees.

Before HASTINGS, Senior Circuit Judge, CUMMINGS, Circuit Judge, and DILLIN, District Judge. [*]

DILLIN, District Judge.

This appeal was taken by the plaintiff, Koehring Company (Koehring), a Wisconsin corporation, from a ruling of the District Court dismissing its statutory action in the nature of interpleader, filed pursuant to 28 U.S.C.§§ 1335, 1397. Defendant Fidelity and Deposit Company of Maryland (Fidelity), plaintiff's co-debtor in a Mississippi judgment recovered by the defendant Hyde Construction Company, Inc. (Hyde), 1 appeals from a similar ruling dismissing its cross-claim for interpleader against its codefendants. We affirm.

The history of the antecedent litigation between Koehring and Hyde, including ancillary matters involving Vardaman S. Dunn, one of Hyde's attorneys, is contained in some seventy-eight pages of federal and state reports, the order from which this appeal is taken being reported at 297 F.Supp. 731. 2 This formidable body of legal literature discloses that Hyde commenced its simple suit for breach of warranty in the Chancery Court of Hinds County, Mississippi in 1961, having first initiated the same as a diversity action in the United States District Court for the Southern District of Mississippi only to have that action transferred to the Northern District of Oklahoma, pursuant to 28 U.S.C. § 1404(a). Koehring could clearly have removed the Chancery Court action to the same Mississippi District Court, 28 U.S.C. § 1441(a), but declined to do so and answered on the merits. The result is that the Chancery Court has had jurisdiction of the principal action, long since final but for collection of the judgment, since 1961.

Having failed to extricate itself from the jurisdiction of the Chancery Court by the simple expedient of removal, Koehring has nevertheless resisted the exercise of that jurisdiction by other means for nearly a decade. Specifically, it first prevailed upon the Oklahoma District Court to enjoin proceedings in the Chancery Court, and when the Chancery Court nevertheless proceeded to try the case, it obtained a further Oklahoma injunction enjoining Hyde from attempting to collect its judgment. All of such injunction proceedings were in derogation

Page 1202

of 28 U.S.C. § 2283, as held in Hyde Construction Company v. Koehring Company, 10 Cir., 1968, 388 F.2d 501, cert. den. 391 U.S. 905, 88 S.Ct. 1654, 20 L.Ed.2d 419. Even after the Tenth Circuit's decision became final by the denial of certiorari by the Supreme Court on May 6, 1968, Koehring persisted in its efforts to thwart the Chancery Court by intervening in a criminal contempt proceeding pending against Hyde in the Oklahoma court, again seeking an injunction to prevent Hyde from proceeding in Mississippi to collect its judgment. This time the Oklahoma court wisely declined, by order dismissing Koehring's petition on May 23, 1968.

Free at last, Hyde sought to enforce its judgment, so bitterly won. On May 24, 1968, it proceeded in accordance with normal practice to cause a writ of execution to issue to the sheriff, who in turn issued several writs of garnishment against firms indebted to Koehring and Fidelity. Its freedom proved illusory. Time and the course of litigation had not left all parties in the status quo ante. By 1968 Hyde had become insolvent and the judgment had been twice assigned and was subject to attorneys' liens and other claims. On this pretext Koehring, alleging fear of being exposed to multiple claims, commenced its interpleader action on March 27, 1968 and secured yet another ex parte injunction, this time from the Wisconsin court...

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