Meridian Investing & Development Corp. v. Suncoast Highland Corp., 80-5086

• Decision Date: 14 October 1980
• Docket Number: No. 80-5086,80-5086
• Citation: 628 F.2d 370
• Parties: MERIDIAN INVESTING & DEVELOPMENT CORPORATION, Plaintiff-Appellant, v. SUNCOAST HIGHLAND CORPORATION, Defendant-Appellee. Summary Calendar. . Unit B
• Court: U.S. Court of Appeals — Fifth Circuit

Page 370

628 F.2d 370

MERIDIAN INVESTING & DEVELOPMENT CORPORATION, Plaintiff-Appellant, v. SUNCOAST HIGHLAND CORPORATION, Defendant-Appellee.

No. 80-5086

Summary Calendar.

United States Court of Appeals Fifth Circuit.

Unit B.

Oct. 14, 1980.

Taub & Williams, Robert V. Williams, Gregory E. Mierzwinski, Tampa, Fla., for plaintiff-appellant.

Whitson & Whitson, Edmund S. Whitson, Jr., Clearwater, Fla., for defendant-appellee.

Appeal from the United States District Court for the Middle District of Florida.

Before RONEY, FRANK M. JOHNSON, Jr. and HENDERSON, Circuit Judges.

FRANK M. JOHNSON, Jr., Circuit Judge:

This is an appeal from the denial of motions for preliminary and permanent injunctions filed by Meridian Investing & Development Corporation against Suncoast Highland Corporation.

The controversy stems from Meridian's attempts to collect on a federal court judgment. Meridian is a Delaware corporation having its principal place of business in New York. Suncoast is a Florida corporation having its principal place of business in Florida. In May 1976, Suncoast made and delivered to Meridian a promissory note. In August 1977, Meridian brought suit against Suncoast in the United States District Court for the Southern District of New York alleging that Suncoast was in default. No question was (or has been) raised as to the Southern District's jurisdiction. Suncoast appeared, defended itself against Meridian's claims, and lost. In July 1979, the district court granted summary judgment to Meridian and entered a judgment in Meridian's favor in the amount of over $200,000. In August 1979, Meridian filed suit in Florida circuit court seeking to reduce the judgment to a state court judgment for the purpose of instituting immediate collection procedures through the Florida court system, and seeking immediate judicial action to prevent Suncoast from dissipating its assets before Meridian could collect. In September 1979, when the time for appeal of the New York federal court judgment had expired with no notice of appeal having been filed by Suncoast, Meridian registered the judgment in the United States District Court for the Middle District of Florida pursuant to 28 U.S.C. § 1963 ¹ and initiated federal proceedings to collect. On Suncoast's motion, the Florida circuit court enjoined Meridian from so proceeding. ² Meridian sought relief from this injunction (1) by filing a motion in state court for its dissolution and (2) by filing a motion in the Middle District of Florida for a preliminary and permanent injunction. In December 1979, the federal district court denied the motion on the ground that "since the jurisdiction of the Pinel(l)as County Circuit Court first attached, (this) Court is precluded from exercising its jurisdiction over the same property so as to defeat or impair the state court's injunction." ³ Meridian filed a notice of appeal. In March 1980, the state court denied Meridian's motion to dissolve its injunction and also denied Meridian's motions to strike and dismiss challenges to the validity of the New York federal court judgment that had been pled by Suncoast as affirmative defenses to Meridian's state court complaint. Following the state court's action, Meridian renewed its motion in the Middle District of Florida for a preliminary and permanent injunction. The motion was again denied and Meridian filed another notice of appeal. The two appeals have been consolidated for our consideration here.

Meridian first contends that the district court erred in failing to issue the injunction Meridian requested directing Suncoast to cause the dissolution of the Florida state court injunction. This contention has merit. It is settled law that state courts have no authority to bar-by injunction or otherwise-the prosecution of in personam actions in federal courts. As the Supreme Court stated in General Atomic Co. v. Felter, 434 U.S. 12, 98 S.Ct. 76, 54 L.Ed.2d 199 (1977), "the rights conferred by Congress to bring in personam actions in federal courts are not subject to abridgment by state-court injunctions . . . ." 434 U.S. at 17, 98 S.Ct. at 78. See also Donovan v. Dallas, 377 U.S. 408, 412-13, 84 S.Ct. 1579, 1582, 12 L.Ed.2d 409 (1964). Meridian's federal court action was an action in personam. See, e. g., Byrd-Frost, Inc. v. Elder, 93 F.2d 30, 32-33 (5th Cir. 1937), cert. denied, 303 U.S. 647, 58 S.Ct. 646, 82 L.Ed. 1108 (1938). See generally 1 Am.Jur.2d Actions §§ 39-41 (2d ed. 1962). ⁴ Thus the district court should have issued the requested relief. See, e. g., Ermentrout v. Commonwealth Oil Company, 220 F.2d 527, 530 (5th Cir. 1955) ("federal court may not abdicate its authority or duty in favor of the state jurisdiction"). The district court's contrary decision evidenced a belief that a pending state court action to enforce a federal court judgment precludes supplementary proceedings in aid of execution in federal court. Such is not the case. See 12 Wright & Miller, Federal Practice and Procedure § 3013 (1973). Indeed, in cases such as this one, in which execution of the federal court judgment is pursued through registration in another federal district court, see 28 U.S.C. § 1963, quoted in note 1, supra, the filing of concurrent state and federal suits may be the judgment creditor's only effective course of action. ⁵

Meridian also contends that the district court erred in failing to grant its motion to enjoin Suncoast from relitigating the validity of the New York federal court judgment in Florida state court. This contention also has merit. The law is well settled that "federal courts may enjoin the relitigation in state court of issues that federal courts have fully and finally adjudicated." International Association of Machinists & Aerospace Workers v. Nix, 512 F.2d 125, 130 (5th Cir. 1975). See 28 U.S.C. § 2283. ⁶ As we explained in Woods Exploration & Producing Company v. Aluminum Company of America, 438 F.2d 1286 (5th Cir. 1971), cert. denied, 404 U.S. 1047, 92 S.Ct. 701, 30 L.Ed.2d 736 (1972), the federal courts' capacity to issue such injunctions " 'prevents multiple litigation of the same cause of action and it assures the winner in a federal court that he will not be deprived of the fruits of his victory by a later contrary state judgment which the Supreme Court may or may not decide to review.' " 438 F.2d at 1312, quoting Note, 74 Harv.L.Rev. 726, 734 (1961). See also Scott v. Hunt Oil Co., 398 F.2d 810, 811 (5th Cir. 1968) ("Litigation must come to an end and the victors are entitled to the fruits of that victory. And the losers must abide the loss."). The record here indicates that Suncoast seeks to relitigate in the state court proceeding issues that have already been decided by the Southern District of New York. See generally Montana v. United States, 440 U.S. 147, 153-54, 99 S.Ct. 970, 973-974, 59 L.Ed.2d 210 (explaining doctrines of collateral estoppel and res judicata). Issuance of an order enjoining Suncoast from so proceeding was and is appropriate.

The district court has inherent power to enforce such orders through use of appropriate sanctions. See, e. g., Scott v. Hunt Oil Company, 398 F.2d at 811.

REVERSED AND REMANDED FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION.

1 28 U.S.C. § 1963 provides as follows:

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