Chair King, Inc. v. Houston Cellular Corp., No. 96-20100

CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)
Writing for the CourtBefore POLITZ, Chief Judge, and HIGGINBOTHAM and DENNIS; DENNIS
Citation131 F.3d 507
Parties26 Media L. Rep. 1244, 11 Communications Reg. (P&F) 142 CHAIR KING, INC., et al., Plaintiffs-Appellants-Cross-Appellees, v. HOUSTON CELLULAR CORPORATION, et al., Defendants-Appellees-Cross-Appellants, Karen Laake, etc., et al., Defendants-Appellees.
Docket NumberNo. 96-20100
Decision Date15 December 1997

Page 507

131 F.3d 507
26 Media L. Rep. 1244, 11 Communications Reg.
(P&F) 142
CHAIR KING, INC., et al., Plaintiffs-Appellants-Cross-Appellees,
v.
HOUSTON CELLULAR CORPORATION, et al.,
Defendants-Appellees-Cross-Appellants,
Karen Laake, etc., et al., Defendants-Appellees.
No. 96-20100.
United States Court of Appeals,
Fifth Circuit.
Dec. 15, 1997.

Page 508

Julius G. Glickman, Dennis G. Herlong, Glickman, Herlong & Hughes, Houston, TX, Samuel Issacharoff, Charles Martin Silver, Austin, TX, for Plaintiffs-Appellants-Cross-Appellees.

Robert C. Bonner, Rex S. Heinke, Alicia J. Bentley, Gibson, Dunn & Crutcher, Los Angeles, CA, for Houston Cellular Corp.

The Kirby Mansion, John P. Venzke, Houston, TX, for Reedy and John Eagle Imports.

David Wayne Medack, Houston, TX, for Don McGill Toyota, Inc.

L. Boyd Smith, Jr., Vinson & Elkins, Houston, TX, for Holiday Inns, Inc.

Robert Hayden Burns, Burns, Wooley & Marseglia, Houston, TX, for McCollum Auto. Group, Inc.

David James Healy, Stephen L. Lundwall, Arnold, White & Durkee, Houston, TX, for Hartford Fire Ins. Co.

Robert Christopher McCabe, Oldenettel & Sadberry, Houston, TX, for Texas Ins. Brokers, Inc.

Richard H. Martin, Houston, TX, for Pettigrew.

Steven M. Zager, Dean Danyl Hunt, Gregory Scott Coleman, Weil, Gotshal & Manges, Houston, TX, for GTE Mobilnet of Houston, Inc.

Jeff P. Murphrey, Tekell, Book, Matthews & Limmer, Houston, TX, for Pearle Vision, Inc.

Page 509

D. Ferguson McNiel, Robert Glen Rigby, Vinson & Elkins, Houston, TX, for Federal Kemper Life Assur. Co.

David R. Sweat, Arlington, TX, for Mail Drop, Inc.

Diann M. Bartek, San Antonio, TX, for Newcity Communications of San Antonio, Inc.

Michael Horne, Dallas, TX, pro se.

Harry Keith Lynch, Garrett & Lynch, Houston, TX, for DBS-Digitec Business Systems, Inc.

Warren Wayne Harris, Bracewell & Patterson, Houston, TX, David L. Burgert, John R. Hawkins, Porter & Hedges, Houston, TX, for Valufax F.A., Inc.

Eugene Zemp DuBose, Dallas, TX, for Data On Tap, Inc.

Gregory Mark Gouner, Baton Rouge, LA, for Heilman.

Appeals from the United States District Court for the Southern District of Texas.

Before POLITZ, Chief Judge, and HIGGINBOTHAM and DENNIS, Circuit Judges.

DENNIS, Circuit Judge:

Because we conclude that Congress granted state courts exclusive subject matter jurisdiction over private actions under the Telephone Consumer Protection Act of 1991, 47 U.S.C. § 227, we vacate the judgment of the district court and remand this case to it with directions to dismiss this cause for want of subject matter jurisdiction.

I.

The Telephone Consumer Protection Act of 1991, 47 U.S.C. § 227, Pub.L. No. 102-243, 105 Stat. 2394 (1991) (TCPA), in pertinent part, provides that "[i]t shall be unlawful for any person within the United States ... to use any telephone facsimile machine, computer, or other device to send an unsolicited advertisement to a telephone facsimile machine." 47 U.S.C. § 227(b)(1)(C). The TCPA creates a private right of action to obtain an injunction or to recover damages or $500, whichever is greater, for each violation. § 227(b)(3). The damage award may be trebled if the court finds that a violation was willful or knowing. Id. The private right of action may be filed "if otherwise permitted by the laws or rules of court of a State, ... in an appropriate court of that State." Id.

II.

The plaintiffs-appellants brought this private action in federal district court for damages under the TCPA alleging that the defendants-appellees had sent unsolicited advertisements to their telephone facsimile machines. In their private action, the plaintiffs also sued on behalf of others who received unsolicited fax advertisements and joined state law claims of civil conspiracy, invasion of privacy, and trespass to chattels. Defendants moved to dismiss under Federal Rules of Civil Procedure 12(b)(1) & (6). The district court dismissed all claims except the trespass to chattels claim, holding that (1) the TCPA only regulates interstate telemarketing activity, (2) the TCPA is preempted by the McCarran-Ferguson Act, 15 U.S.C. § 1012, with respect to the defendants that are insurance companies, and (3) the TCPA does not violate the First or Fifth Amendments of the Constitution of the United States. Notices of appeal were filed by the plaintiffs and the insurance defendants.

III.

Federal courts have only the power authorized them by Congress pursuant to Article III of the Constitution. Bender v. Williamsport Area School District, 475 U.S. 534, 541, 106 S.Ct. 1326, 1331, 89 L.Ed.2d 501 (1986). Because of this, a federal appellate court has a special obligation to satisfy itself subject matter jurisdiction exists in federal courts. Id. The issue of subject matter jurisdiction as a question of law is subject to plenary review by this court. Ingalls Shipbuilding, Inc. v. Asbestos Health Claimants, 17 F.3d 130, 132 (5th Cir.1994).

The question of subject matter jurisdiction in the federal courts of private actions authorized by the TCPA is a matter of first

Page 510

impression in this circuit. Only the Fourth Circuit Court of Appeals and two federal district courts have decided the issue. The Fourth Circuit, in International Science & Technology Institute, Inc. v. Inacom Communications, Inc., 106 F.3d 1146, 1158 (4th Cir.1997), held that the TCPA gives subject matter jurisdiction of claims filed by private citizens only to state courts. The district court for the Southern District of New York adopted the position taken by the Fourth Circuit. Foxhall Realty Law Offices, Inc. v. Telecommunications Premium Services, Ltd., 975 F.Supp. 329 (S.D.N.Y.1997). The district court for the Southern District of Indiana, however, concluded that the TCPA conferred subject matter jurisdiction of private actions upon both the state and federal courts. See Kenro, Inc. v. Fax Daily, Inc., 904 F.Supp. 912 (S.D.Ind.1995) ("Kenro I"), 962 F.Supp. 1162 (S.D.Ind.1997) ("Kenro II"). We agree with the Fourth Circuit and hold that federal courts lack subject matter jurisdiction of private actions under the TCPA.

Article III, Section 1, of the Constitution of the United States vests the federal judicial power in a Supreme Court and "in such inferior courts as Congress may from time to time ordain and establish." U.S. Const. Art. III, § 1. Article III, Section 2 of the Constitution provides that the judicial power of the United States shall extend, inter alia, to all cases arising under the Constitution, the laws of the United States, and treaties made under their authority. Thus, Article III creates no inferior federal courts and vests such courts, when created by Congress, with no jurisdiction. Lockerty v. Phillips, 319 U.S. 182, 187, 63 S.Ct. 1019, 1022, 87 L.Ed. 1339 (1943); Cary v. Curtis, 44 U.S. (3 How.) 236, 244-45, 11 L.Ed. 576 (1845); Turner v. Bank of North America, 4 U.S. (4 Dall.) 8, 11, 1 L.Ed. 717 (1799); 15 MOORE'S FEDERAL PRACTICE § 100App.01, 100App.--4 (3d. ed. 1997). The enumeration in Section 2 of Article III of the cases and controversies to which the federal judicial power extends is not self-executing in relation to the inferior federal courts. Kline v. Burke Const. Co., 260 U.S. 226, 233-234, 43 S.Ct. 79, 82-83, 67 L.Ed. 226 (1922); 15 MOORE'S FEDERAL PRACTICE § 100App.01, 100App.--4 (3d ed. 1997). Within the permissible limits stated in the Constitution, however, Congress can confer some or all of the judicial power upon the inferior federal courts, and attach conditions and limitations to the jurisdictional grant. 15 MOORE'S FEDERAL PRACTICE § 100App.01, 100App.--4 (3d ed. 1997). Accordingly, as the Supreme Court, in Sheldon v. Sill, 49 U.S. (8 How.) 441, 448, 12 L.Ed. 1147 (1850), explained:

[H]aving a right to prescribe, Congress may withhold from any court of its creation jurisdiction of any of the enumerated controversies. Courts created by statute can have no jurisdiction but such as the statute confers. No one of them can assert a just claim to jurisdiction exclusively conferred on another, or withheld from all.

Section 1331 of Title 28 of the United States Code provides, in language that repeats the language of Article III, that the district courts shall have original jurisdiction "of all civil actions arising under the Constitution, laws, or treaties of the United States." Although this language suggests that Congress intended in § 1331 to confer upon federal courts the full breadth of permissible "federal question" jurisdiction, § 1331 has been construed more narrowly than its constitutional counterpart. See Verlinden B.V. v. Central Bank of Nigeria, 461 U.S. 480, 494-95, 103 S.Ct. 1962, 1971-72, 76 L.Ed.2d 81 (1983); Romero v. International Terminal Operating Co. 358 U.S. 354, 379-80, 79 S.Ct. 468, 483-84, 3 L.Ed.2d 368 (1959).

There is no " 'single, precise definition' " of when a case falls within the original "federal question" jurisdiction of the federal courts; "rather, 'the phrase "arising under" masks a welter of issues regarding the interrelation of federal and state authority and the proper management of the federal judicial system.' " Merrell Dow Pharmaceuticals v. Thompson, 478 U.S. 804, 808, 106 S.Ct. 3229, 3231, 92 L.Ed.2d 650 (1986) (quoting Franchise Tax Board v. Constr. Laborers Vac. Trust, 463 U.S. 1, 8, 103 S.Ct. 2841, 2845, 77 L.Ed.2d 420 (1983)). The most familiar definition of the statutory "arising under" limitation is Justice Holmes' statement, "A suit arises under the law that creates the

Page 511

cause of action." American Well Works Co. v. Layne & Bowler Co., 241 U.S. 257, 260, 36 S.Ct. 585, 586, 60 L.Ed. 987 (1916). It is well settled, however, "that Justice Holmes' test is more useful for describing the vast majority...

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  • Landsman & Funk Pc v. Skinder–strauss Associates, Nos. 09–3532
    • United States
    • United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
    • April 4, 2011
    ...courts to entertain them, and silence as to federal court jurisdiction of private actions.” Chair King, Inc. v. Houston Cellular Corp., 131 F.3d 507, 512 (5th Cir.1997). As noted above, we concluded in ErieNet that, based on the language, structure, and legislative history of the statute, t......
  • Eliserio v. Floydada Housing Authority, No. CIV.A. L-05-CV-04.
    • United States
    • United States District Courts. 5th Circuit. United States District Courts. 5th Circuit. Southern District of Texas
    • September 26, 2006
    ...it." Id. However, "the meaning of statutory language, plain or not, depends Page 654 on context." Chair King v. Houston Cellular Corp., 131 F.3d 507, 511 (5th Cir. 1997) (citing King v. St. Vincent's Hospital, 502 U.S. 215, 221, 112 S.Ct. 570, 116 L.Ed.2d 578 (1991)). Accordingly, the statu......
  • Chair King, Inc. v. Gte Mobilnet of Houston, No. 14-00-00711-CV.
    • United States
    • Court of Appeals of Texas
    • May 6, 2004
    ...Circuit ultimately determined that the federal court lacked subject-matter jurisdiction. See Chair King, Inc. v. Houston Cellular Corp., 131 F.3d 507, 509 (5th Cir.1997). The Federal Suit was then The Recipients filed this case in Harris County District Court in 1995. On March 11, 1998, the......
  • Leibowitz v. City of Mineola, Tex., Civil Action No. 6:08CV397.
    • United States
    • United States District Courts. 5th Circuit. United States District Court of Eastern District Texas
    • October 2, 2009
    ...Area School District, 475 U.S. 534, 541, 106 S.Ct. 1326, 1331, 89 L.Ed.2d 501 (1986); Chair King, Inc. v. Houston Cellular Corp., 131 F.3d 507, 509 (5th Cir.1997). "Under our federal constitutional scheme, the state courts are assumed to be equally capable of deciding state and federal issu......
  • Request a trial to view additional results
107 cases
  • Landsman & Funk Pc v. Skinder–strauss Associates, Nos. 09–3532
    • United States
    • United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
    • April 4, 2011
    ...courts to entertain them, and silence as to federal court jurisdiction of private actions.” Chair King, Inc. v. Houston Cellular Corp., 131 F.3d 507, 512 (5th Cir.1997). As noted above, we concluded in ErieNet that, based on the language, structure, and legislative history of the statute, t......
  • Eliserio v. Floydada Housing Authority, No. CIV.A. L-05-CV-04.
    • United States
    • United States District Courts. 5th Circuit. United States District Courts. 5th Circuit. Southern District of Texas
    • September 26, 2006
    ...it." Id. However, "the meaning of statutory language, plain or not, depends Page 654 on context." Chair King v. Houston Cellular Corp., 131 F.3d 507, 511 (5th Cir. 1997) (citing King v. St. Vincent's Hospital, 502 U.S. 215, 221, 112 S.Ct. 570, 116 L.Ed.2d 578 (1991)). Accordingly, the statu......
  • Chair King, Inc. v. Gte Mobilnet of Houston, No. 14-00-00711-CV.
    • United States
    • Court of Appeals of Texas
    • May 6, 2004
    ...Circuit ultimately determined that the federal court lacked subject-matter jurisdiction. See Chair King, Inc. v. Houston Cellular Corp., 131 F.3d 507, 509 (5th Cir.1997). The Federal Suit was then The Recipients filed this case in Harris County District Court in 1995. On March 11, 1998, the......
  • Leibowitz v. City of Mineola, Tex., Civil Action No. 6:08CV397.
    • United States
    • United States District Courts. 5th Circuit. United States District Court of Eastern District Texas
    • October 2, 2009
    ...Area School District, 475 U.S. 534, 541, 106 S.Ct. 1326, 1331, 89 L.Ed.2d 501 (1986); Chair King, Inc. v. Houston Cellular Corp., 131 F.3d 507, 509 (5th Cir.1997). "Under our federal constitutional scheme, the state courts are assumed to be equally capable of deciding state and federal issu......
  • Request a trial to view additional results

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