484 U.S. 193 (1988), 86-890, Deakins v. Monaghan

Docket Nº:No. 86-890
Citation:484 U.S. 193, 108 S.Ct. 523, 98 L.Ed.2d 529, 56 U.S.L.W. 4060
Party Name:Deakins v. Monaghan
Case Date:January 12, 1988
Court:United States Supreme Court

Page 193

484 U.S. 193 (1988)

108 S.Ct. 523, 98 L.Ed.2d 529, 56 U.S.L.W. 4060

Deakins

v.

Monaghan

No. 86-890

United States Supreme Court

Jan. 12, 1988

Argued October 14, 1987

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR

THE THIRD CIRCUIT

Syllabus

Upon application for a warrant to search one of the corporate respondents' premises for evidence of theft and other crimes that were the subject of an ongoing state grand jury investigation, a state court judge issued a warrant authorizing petitioner law enforcement officers to seize documents. Alleging that petitioners' execution of the warrant violated various of their federal constitutional rights and engendered certain pendent state law claims, respondent business entities and their owners filed suit under 42 U.S.C. § 1983 in Federal District Court seeking equitable relief, including the return of all documents seized, compensatory and punitive damages, and attorney's fees. The court granted petitioners' motion to dismiss on abstention grounds, but the Court of Appeals reversed and remanded, ruling that Younger v. Harris, 401 U.S. 37, and its progeny did not require the District Court to abstain from adjudicating respondents' equitable claims. As to respondents' claims for money damages and attorney's fees, the Court of Appeals applied its Circuit's rule that, even when abstaining entirely from the adjudication of equitable claims, a District Court is required to stay, rather than to dismiss, federal claims that are not cognizable [108 S.Ct. 525] in the state forum. Subsequently, the grand jury returned an indictment against three of the respondents, and the state trial court to which the indictment was assigned took jurisdiction over respondents' equitable claims for the return of the seized documents. Respondents represent here that they wish to withdraw such claims from their federal complaint and seek injunctive relief exclusively in the state proceedings.

Held:

1. In light of respondents' aforesaid representation to this Court, there is no longer a live controversy between the parties over whether a federal court can hear the equitable claims, and the abstention issue is moot in this regard. Accordingly, the portion of the Court of Appeals' judgment addressing those claims is vacated, and the case is remanded with instructions to dismiss the claims with prejudice. This disposition will prevent a regeneration of the controversy by respondents' reassertion of the right to litigate in federal court their equitable claims arising out of the events surrounding the search warrant's execution. Pp. 199-201.

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2. Even if the Younger doctrine required abstention here, the District Court had no discretion to dismiss, rather than to stay, respondents' claims for monetary relief that cannot be redressed in the state proceeding. The Circuit rule requiring a stay in such circumstances is sound, since it allows the parallel state proceeding to go forward without interference from its federal sibling, while enforcing the federal courts' duty to exercise their jurisdiction. Petitioners' assertion that this case presents extraordinary circumstances sufficient to justify abdication of that duty is unpersuasive. First, the speculation that the District Court, if allowed to retain jurisdiction, would "hover" intrusively about the state proceeding is based on the groundless assumption that the District Court would not hold up its end of the comity bargain. Second, even if Pennhurst State School and Hospital v. Halderman, 465 U.S. 89, would prevent the District Court from adjudicating respondents' state law claims as petitioners contend, this would not require the dismissal of respondents' federal damages claims, which are substantial, and sufficient to justify the District Court's retention of jurisdiction. Third, the dismissal of the federal complaint would not prevent piecemeal litigation, which is inevitable even without federal court involvement, since the state criminal proceeding can provide only equitable relief. Pp. 201-204.

798 F.2d 632, affirmed in part, vacated in part, and remanded.

BLACKMUN, J., delivered the opinion of the Court, in which REHNQUIST, C.J., and BRENNAN, MARSHALL, STEVENS, and SCALIA, JJ., joined. WHITE, J., filed a concurring opinion, in which O'CONNOR, J., joined, post, p. 205.

BLACKMUN, J., lead opinion

JUSTICE BLACKMUN delivered the opinion of the Court.

This case presents questions concerning a federal court's obligation to abstain from the adjudication of federal claims

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arising out of an ongoing state grand jury investigation. We granted certiorari, 479 U.S. 1063 (1987), to consider whether the District Court, under Younger v. Harris, 401 U.S. 37 (1971), was required to abstain from adjudicating respondents' claims for injunctive relief, and, if so, whether the court had the discretion to dismiss, rather than to stay, respondents' additional claims for damages and attorney's fees. Because we have concluded that the first issue is now moot, we vacate that portion of the Court of Appeals' judgment and remand with directions to dismiss all claims for equitable relief. We affirm, however, the remaining portion of the [108 S.Ct. 526] Court of Appeals' judgment reversing the District Court's dismissal of respondents' claims for monetary relief.

I

Respondents William Monaghan, Theodore DeSantis, and John James are in the construction business together. They jointly own respondents Foundations & Structures, Inc. (F & S), and MJD Construction Company, Inc., New Jersey corporations, and William E. Monaghan Associates, a New Jersey general partnership. On October 4, 1984, petitioner Albert G. Palentchar, a criminal investigator for the State of New Jersey, applied to the Honorable Samuel T. Lenox, Jr., the "assignment judge" of the Superior Court for Mercer County with supervisory authority over the state grand jury, for a warrant to search the Tuckahoe, N.J., premises of F & S for evidence of theft, bribery, records tampering, and other criminal activities that were the subject of an ongoing state grand jury investigation. Judge Lenox found probable cause and issued a warrant authorizing the seizure of documents, including contracts, minutes, site logs, invoices, correspondence, memoranda, deeds, canceled checks, and bank statements. The validity of this warrant has not been contested.

The following morning, Palentchar and eight other New Jersey law enforcement officers, all petitioners here, executed

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the warrant. The search lasted approximately eight hours. In their federal complaint, respondents allege that, in addition to seizing hundreds of documents, petitioners barricaded the sole exit from the premises, searched all departing vehicles, recorded the serial numbers on F & S machinery, detained in one room all persons on the premises at the time of the search until they produced identification, threatened to tear apart respondents' homes if the documents were not discovered, and engaged in a number of other unlawful activities. See Complaint in No. 84-5369 (D NJ), pp. 7-9, 10. The execution of the warrant gave rise to the federal litigation now before us.

Respondents' attorneys arrived while the search was in progress, and challenged the adequacy under New Jersey law of the inventory procedure. To resolve the dispute, respondents' counsel and petitioner Deakins telephoned Judge Lenox, who ordered all seized materials sealed pending his assessment of the procedure. Ten days later, on October 15, 1984, New Jersey's Deputy Attorney General Julian Wilsey invited respondents' counsel to examine the documents under seal, and to copy whatever documents respondents needed in order to continue the conduct of their business. General Wilsey also informed respondents' counsel that the State was prepared to return any documents discovered that exceeded the scope of the warrant. In the course of this examination, counsel identified numerous documents that they contended were either outside the scope of the warrant or protected by the attorney-client or attorney work-product privilege. The State disagreed, and the disputed documents were resealed under the authority of Judge Lenox's original sealing order.

On December 27, while the documents were still under seal, respondents instituted this civil rights action under 42 U.S.C. § 1983 in the United States District Court for the District of New Jersey. Respondents sought equitable relief, including the return of all documents seized, and, as well, compensatory and punitive damages for the alleged violations

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of their rights under the Fourth, Fifth, Sixth, and Fourteenth Amendments, and attorney's fees. Respondents also asserted certain pendent state claims for trespass, conversion, unlawful confinement, and the intentional or reckless infliction of emotional distress. Prior to filing an answer, petitioners moved to dismiss the complaint, arguing that the existence of an ongoing state grand jury investigation required the federal court to abstain from adjudicating disputes arising out of that investigation. Respondents countered with a motion for a preliminary [108 S.Ct. 527] injunction directing the return of the documents.

While all this was taking place in federal court, Judge Lenox, at the State's behest, entered an ex parte order directing respondents to show cause why he should not lift the seal and make the documents available to the state officials conducting the grand jury investigation. Three days before the scheduled hearing on that order to show cause, the District Court issued a temporary restraining order staying discovery in the federal action and directing the State not to lift the seal before the District Court disposed of the motions pending before it. Several months later, on August 6, 1985, the District Court granted petitioners' motion to dismiss on abstention grounds, and denied...

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