In re Goldstein
| Decision Date | 26 September 1996 |
| Docket Number | Bankruptcy No. 95-10656,Adversary No. 96-1030. |
| Citation | 201 BR 1 |
| Parties | In re Charles GOLDSTEIN, Debtor. Charles A. GOLDSTEIN, Plaintiff, v. MARINE MIDLAND BANK, N.A. and Williamson and Williamson, P.C., Defendants. |
| Court | U.S. Bankruptcy Court — District of Maine |
Jennie Clegg, Pierce, Atwood, Scribner, Allen & Lancaster, Portland, ME, for Debtor.
Gary M. Growe, Trustee, Bangor, ME.
The defendants' pending motion to dismiss challenges this court's subject matter jurisdiction over three counts of the plaintiff/debtor's complaint. Although the defendants acknowledge jurisdiction over alleged violations of the Bankruptcy Code's automatic stay (Count I) and discharge injunction (Count II), they contend jurisdiction does not exist over those counts alleging post-petition violations of the Fair Debt Collections Practices Act (F.D.C.P.A.) (Count III), seeking costs and fees under the statute authorizing "courts of the United States" to sanction those who "unreasonably and vexatiously" multiply proceedings (28 U.S.C. § 1927) (Count V), and seeking damages under state tort law (Count VI).1 Although the F.D.C.P.A. and tort claims arise from the same facts that underlie allegations that the defendants breached the automatic stay and the discharge injunction, I conclude that they must be dismissed because this court is without subject matter jurisdiction over them. The § 1927 claim, lodged only against defendant Williamson & Williamson, P.C., will be dismissed on other grounds.2
I will consider the defendants' motion to dismiss under the following standard:
In ruling upon the motion to dismiss, "whether on the ground of lack of jurisdiction over the subject matter or for failure to state a cause of action, the allegations of the . . . complaint should be construed favorably to the pleader." Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974); Cioffi v. Old Stone Bank (In re C.A.C. Jewelry, Inc.), 124 B.R. 419, 421 n. 3 (Bankr.D.R.I.1991); Realty Data, Inc. v. Lanciaux (In re Lanciaux), 76 B.R. 254, 256 (Bankr.D.R.I. 1987). See Watterson v. Page, 987 F.2d 1, 3 (1st Cir.1993) () (citing Monahan v. Dorchester Counseling Ctr., Inc., 961 F.2d 987, 988 (1st Cir.1992)). See 5A Wright & Miller, Federal Practice & Procedure: Civil 2d §§ 1350, 1363 (1990).
Boyajian v. DeLuca (In re Remington Dev. Group, Inc.), 180 B.R. 365, 367 (Bankr.D.R.I. 1995); see Bohrmann v. Maine Yankee Atomic Power Co., 926 F.Supp. 211, 216 (D.Me.1996). Only if the complaint presents no set of facts justifying recovery will a motion to dismiss be granted. The Dartmouth Review v. Dartmouth College, 889 F.2d 13, 16 (1st Cir.1989).
Taking the complaint's allegations as true, the events critical to my inquiry are as follows:
Charles A. Goldstein filed a voluntary Chapter 7 petition on August 29, 1995. His discharge was entered on January 18, 1996. On May 28, 1996, he filed this adversary proceeding against Marine Midland Bank, N.A., and Williamson & Williamson, P.C., collection attorneys retained by Marine Midland.
Goldstein owed money to Marine Midland for credit card debt when he filed his petition. He has not used the credit card since. Notwithstanding notice of his bankruptcy case, Marine Midland billed Goldstein for prepetition debt in October and November 1995. Thereafter, notwithstanding Goldstein's counsel's specific advice of the Chapter 7 petition, Marine Midland continued to send Goldstein bills. On September 25 and November 30, 1995, Marine Midland obtained credit reports providing additional notice of Goldstein's Chapter 7 filing. Marine Midland or its agents also made post-petition telephonic payment demands.
The bank's collection attempts persisted beyond Goldstein's discharge. Marine Midland's agent or employee phoned Goldstein in February 1996. On March 6, 1996, Goldstein's counsel wrote again to Marine Midland, by telecopy and certified mail, to advise it of the bankruptcy and discharge. Thereafter, Marine Midland billed Goldstein's former spouse, although she was not contractually liable on the debt. In March 1996 Marine Midland or its agent called Goldstein's home attempting to reach his former spouse regarding the credit card debt.
On May 3, 1996, Williamson & Williamson sent a demand on Marine Midland's behalf, referencing the prepetition debt and advising Goldstein that, if a payment agreement was not reached within 30 days, "we intend to commence litigation against you as soon as it is practical for us to do so."
Congress defined the scope of bankruptcy jurisdiction in 28 U.S.C. § 1334 and authorized the district courts to delegate that jurisdiction to the bankruptcy courts in 28 U.S.C. § 157(a).
Section 1334 provides that district courts shall have "original and exclusive" jurisdiction of "all cases under title 11," § 1334(a), and "original but not exclusive jurisdiction of all civil proceedings arising under title 11, or arising in or related to cases under title 11." § 1334(b). The district courts may refer bankruptcy jurisdiction to bankruptcy courts: "Each district court may provide that any or all cases under title 11 and any or all proceedings arising under title 11 or arising in or related to a case under title 11 shall be referred to the bankruptcy judges for the district." § 157(a).
In re Remington Dev. Group, Inc., 180 B.R. at 368; see also Celotex Corp. v. Edwards, ___ U.S. ___, ___, 115 S.Ct. 1493, 1498, 131 L.Ed.2d 403 (1995); Paris Mfg. Corp. v. Ace Hardware Corp. (In re Paris Indus. Corp.), 132 B.R. 504, 507 (D.Me.1991); 1 William L. Norton, Jr., Norton Bankruptcy Law and Practice 2d § 4:38 at 4-226 (1994) hereinafter "Norton"; 1 Collier on Bankruptcy ¶ 3.01cii at 3-25 (Lawrence P. King ed., 15th ed. 1996) hereinafter "Collier"; 1 Chapter 11 Theory and Practice § 4.13 () hereinafter "Queenan". By its August 1, 1984, Order of Reference, the U.S. District Court for the District of Maine has executed completely its § 157(a) reference authority.
Proceedings "arise under" title 11 if they involve a "cause of action created or determined by a statutory provision of the Bankruptcy Code." Norton, § 4:38 at 4-230; see Wood v. Wood (In re Wood), 825 F.2d 90, 96-97 (5th Cir.1987); see also Maitland v. Mitchell (In re Harris Pine Mills), 44 F.3d 1431, 1435 (9th Cir.1995), cert. denied, ___ U.S. ___, 115 S.Ct. 2555, 132 L.Ed.2d 809 (1995); Zerand-Bernal Group, Inc. v. Cox, 23 F.3d 159, 162 (7th Cir.1994); Gray v. Polar Molecular Corp. (In re Polar Molecular Corp.), 195 B.R. 548 (Bankr.D.Mass. 1996); see generally Collier, ¶ 3.01ciii at 3-26; Queenan, § 4.14.
"Proceedings `arising in' a bankruptcy case `are those that are not based on any right expressly created by title 11, but nevertheless, would have no existence outside of the bankruptcy.'" Norton, § 4:30 at 4-231 (quoting In re Wood, 825 F.2d at 96-97); see also In re Harris Pine Mills, 44 F.3d at 1435; Zerand-Bernal Group, Inc., 23 F.3d at 162; see generally Collier, ¶ 3.01cv at 3-32; Queenan, § 4:15.
The final, and most expansive, component of § 1334(b) is "related-to" jurisdiction. As recently explained:
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