Klein & Vibber, P.C. v. Collard & Roe P.C., CIV. 3:97CV693 (HBF).

• Decision Date: 06 February 1998
• Docket Number: No. CIV. 3:97CV693 (HBF).,CIV. 3:97CV693 (HBF).
• Citation: 3 F.Supp.2d 167
• Court: U.S. District Court — District of Connecticut
• Parties: KLEIN & VIBBER, P.C. and Arthur O. Klein v. COLLARD & ROE P.C. and Allison C. Collard.

Page 167

3 F.Supp.2d 167

KLEIN & VIBBER, P.C. and Arthur O. Klein v. COLLARD & ROE P.C. and Allison C. Collard.

No. CIV. 3:97CV693 (HBF).

United States District Court, D. Connecticut.

February 6, 1998.

Arthur O. Klein, Westport, CT, for Plaintiff.

Arthur O. Klein, Westport, Solomon M. Lowenbraun, New York City, George M. Moreira, Carmody & Torrance, Waterbury, CT, for Defendants.

RULING ON DEFENDANT'S MOTION TO DISMISS

FITZSIMMONS, United States Magistrate Judge.

Arthur Klein and the law firm Klein & Vibber, P.C. bring this three count complaint against Allison Collard and the law firm of Collard & Roe for: (1) violation of the Trademark Act of 1946 (Lanham Act); (2) common law trademark infringement and unfair competition; and (3) violation of the Fifth and Fourteenth Amendments to the United States Constitution, all arising out of a 1990 agreement to sell the law practice of Klein & Vibber to Collard & Roe.

Defendants moved to dismiss for lack of subject matter jurisdiction, pursuant to Fed. R.Civ.P. 12(b)(1), and for failure to state a claim upon which relief can be granted, pursuant to Fed.R.Civ.P. 12(b)(6).

For the reasons that follow, defendants' Motion to Dismiss [Doc. # 17] is GRANTED.¹

Subject Matter Jurisdiction

We first address defendants' contention that the Court lacks subject matter jurisdiction.

A party may move to dismiss because of lack of subject matter jurisdiction at any time during the course of an action. Rule 12(b)(1), Fed.R.Civ.P.; Rule 12(h)(3), Fed.R.Civ.P.; John B. Hull, Inc. v. Waterbury Petroleum Products, Inc., 588 F.2d 24, 27 (2d Cir.1978), cert. denied, 440 U.S. 960, 99 S.Ct. 1502, 59 L.Ed.2d 773 (1979); Grafon Corp. v. Hausermann, 602 F.2d 781, 783 (7th Cir.1979). Lack of subject matter jurisdiction may be raised, sua sponte, prior to, during or after trial, even at the appellate level. Clark v. Paul Gray, Inc., 306 U.S. 583, 59 S.Ct. 744, 83 L.Ed. 1001 (1939); 5A Charles A. Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 1350, at 220 (1990 & Supp.1993). Generally, litigants cannot waive subject matter jurisdiction by express consent, conduct, or estoppel. Insurance Corp. of Ireland, Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702, 102 S.Ct. 2099, 72 L.Ed.2d 492 (1982); 13 Charles A. Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 3522, at 66-67.

Once subject matter jurisdiction is challenged, the burden of establishing it rests on the party asserting jurisdiction. Thomson v. Gaskill, 315 U.S. 442, 62 S.Ct. 673, 86 L.Ed. 951 (1942); Grafon, 602 F.2d at 783. Unlike a motion to dismiss pursuant to 12(b)(6), Fed.R.Civ.P., however, dismissals for lack of subject matter jurisdiction are not predicated on the merits of the claim. Exchange Nat. Bank of Chicago v. Touche Ross & Co., 544 F.2d 1126, 1130-31 (2d Cir.1976), cert. denied, 469 U.S. 884, 105 S.Ct. 253, 83 L.Ed.2d 190 (1984).

In a motion to dismiss for lack of subject matter jurisdiction, the court construes the complaint broadly and liberally in conformity with the principle set out in Rule 8(f), Fed.R.Civ.P., "but argumentive inferences favorable to the pleader will not be drawn." 5A Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure, § 1350, at 218-219. The mover and the pleader may use affidavits and other materials beyond the pleadings themselves in support of or in opposition to a challenge to subject matter jurisdiction. Land v. Dollar, 330 U.S. 731, 67 S.Ct. 1009, 91 L.Ed. 1209 (1947); Exchange, 544 F.2d at 1130. However, "[i]f the jurisdictional allegations of the complaint are complete, uncontradicted, and sufficient, the court must overrule a motion directed merely at the language of the pleading." 5A Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 1350, at 223.

At issue is whether the jurisdictional allegations of this complaint meet the pleading standard for establishing subject matter jurisdiction. Specifically, defendants contend that all of the claims asserted in this lawsuit have been determined in a New York state court action between Collard & Roe, P.C. as plaintiff and Arthur O. Klein and Klein & Vibber, P.C. as defendants. Accordingly, defendants assert that this suit is barred under the doctrine of res judicata.

BACKGROUND FACTS

1. Klein & Vibber, P.C. (K & V) is a Connecticut professional corporation, located in Westport, Connecticut. [Compl. ¶ 7]

2. Arthur O. Klein is a Connecticut resident, a member of the Connecticut Bar, and the President of K & V. Id. ¶¶ 6. 7.

3. Collard & Roe, P.C. (C & R) is a New York professional corporation located in Roslyn, New York. Id. ¶ 10.

4. Allison C. Collard is a New York resident, a member of the New York Bar, and President and sole shareholder of C & R. [Compl. ¶¶ 8, 10; Doc. # 18 ¶ 1]

5. On January 26, 1990, C & R entered into a written agreement with K & V to purchase all of K & V's files, and the library, furniture, and equipment from K & V's New York City office. [Compl. ¶¶ 12].

6. The parties agreed to an affiliation between K & V and C & R for a period of five years. After such time, and the fulfillment of certain conditions, C & R would fully absorb K & V. Id. ¶ 13.

7. On or about July 1991, K & V informed its clients of the dissolution of the K & V-C & R affiliation, demanded that C & R return all K & V files, and instructed the U.S. postal authorities to forward all mail addressed to K & V and/or Arthur Klein to K & V's address in Westport, CT. Id. ¶¶ 16, 17.

New York State Action

8. On April 11, 1992, C & R commenced a civil action against K & V in the Supreme Court of the State of New York ("New York state action"), seeking (1) payment of $123,000; (2) an order restraining Mr. Klein from representing clients of K & V; and (3) an order restraining Mr. Klein from referring clients of K & V to another patent and trademark attorney. [Compl. ¶ 31].

9. K & V counterclaimed, alleging violation of the Lanham Act, 15 U.S.C. § 1125(a). Id.

10. Among other relief, the counterclaims sought (1) an order enjoining the Plaintiff from continuing to hold himself out as the law firm of K & V or its successor; (2) return of the files belonging to K & V; and (3) access to records of a New York bank account which C & R maintained in the name of K & V. Id.

11. Sometime in 1995 or 1996, the New York Supreme Court defaulted K & V on its counterclaims. [Doc. # 20 at 13, 16].

12. On December 17, 1996, the New York Supreme Court issued a decision for plaintiff. Judgment entered on February 28, 1997. [Doc. # 17, Ex. Y].

13. On April 2, 1997, the New York Appellate Division dismissed K & V's appeal from the December 17, 1996 decision and the February 28, 1997 judgment. The Court also denied appellant's motion to stay enforcement of the judgment. (Doc. # 17, Ex. Y).

14. On April 10, 1997 the Appellate Division denied K & V's motion for reargument. [Doc. # 17, Ex. X].

Connecticut Federal Court Actions

Civil Action 3:94CV1861(TFGD)

15. In November 1994, K & V commenced a civil action against C & R in the United States District Court for the District of Connecticut ("Connecticut federal action"), CIV NO. 3:94CV1861(TFGD), alleging violation of the Trademark Act of 1946 (Lanham Act) and common law trademark infringement and unfair competition. [see Civ. No. 3:94CV1861 Doc. # 1].

16. K & V also sought a preliminary injunction and expedited discovery. [see Civ. No. 3:94CV1861 Doc. # 3].

17. On November 23, 1994, C & R moved to dismiss the Connecticut federal action on the grounds that (1) issues pending in the federal action were already pending in the state action; and (2) the subject matter of the federal action commenced by K & V is the same matter alleged in the counterclaims asserted by K & V in the state action. [see Civ. No. 3:94CV1861, Doc. # 7].

18. On January 24, 1995, Judge Daly dismissed civil action 3:94CV1861, stating

It is well settled in this Circuit that "under the congnate doctrine of `prior action pending,' although a prior action has not yet proceeded to judgment, `[t]he court has the inherent power to dismiss or stay [an] action in favor of the [prior] litigation presenting the same claims and issues.'" Schlaifer Nance & Co., Inc. v. Estate of Warhol, 764 F.Supp. 43, 45 (S.D.N.Y.1991). See also Continental Time Corp. v. Swiss Credit Bank, 543 F.Supp. 408, 410 (S.D.N.Y.1982); In re Interstate Stores, Inc., 558 F.2d 1046, 1047 (2d Cir.1977) (per curiam) (dismissal proper because prior action will bar instant claim when it is concluded). After careful review, and in light of the fact that the plaintiff's complaint involves the same parties and the same claims and issues as those raised in the New York action, the instant motion is hereby GRANTED.

[see Civ. No. 3:94CV1861, Doc. # 7].

Civil Action 3:94CV2053 (TFGD)

19. On December 20, 1994, Arthur Klein and Klein & Vibber filed a motion to remove the New York State action to the federal court for the District of Connecticut [Civ. No. 3:94CV2053(TFGD), Doc. # 6].

20. On January 24, 1995, Judge Daly dismissed civil action 3:94CV2053, finding the removal improper and ordering the case remanded to the Supreme Court of the State of New York, Nassau County [Civ. No. 3:94CV2053(TFGD), Doc. # 6].²

Removal of State Court Action to the Eastern District

21. In January 1995, defendants K & V and Arthur Klein removed the New York State action to federal court for the Eastern District of New York. By order dated May 12, 1995, the district court (Wexler, J .) remanded the New York State action to the Supreme Court of State of New York pursuant to 28 U.S.C. § 1446(c) for failure to file timely notice of removal. On January 6, 1996, the Circuit Court dismissed Klein & Vibber and Arthur Klein's appeal of the district court's remand.³ See Collard & Roe, Inc. v. Klein & Vibber P.C., 100 F.3d 941 (2d Cir. Jan.3, 1996) (dismissing appeal) (unpublished).

DISCUSSION

Rooker-Feldman...