Radioshack Corp. v. Ruffin
| Decision Date | 22 February 2012 |
| Docket Number | Case No. 12-2014-JTM |
| Parties | RADIOSHACK CORPORATION, Plaintiff, v. PHILLIP G. RUFFIN, Defendant. |
| Court | U.S. District Court — District of Kansas |
This matter comes before the court on plaintiff RadioShack Corporation's Application for Restraining Order and Preliminary Injunction (Dkt. No. 9) seeking to restrain and enjoin Phillip Ruffin from declaring it in default under a lease and from proceeding with an eviction proceeding he filed in state court. This court must determine whether it has jurisdiction under the Anti-Injunction Act to grant the requested relief and whether RadioShack has met the temporary restraining order standard. Because there is a pending state court action, the Anti-Injunction Act prohibits this court from enjoining the state court proceeding. Regardless, RadioShack has not met its burden of showing irreparable harm.
The court held a hearing on the temporary restraining order motion on February 16, 2012, ruled from the bench. This Memorandum and Order memorializes the court's findings.
On June 1, 1973, Mr. Ruffin and Tandy Corporation (the name in which RadioShack formerly conducted business) entered into a lease for retail space at the Peachtree Shopping Center in Wichita, Kansas. The initial lease expired on June 18, 1983, but was extended to 1988. Further extensions were obtained under the lease terms in 1994, 2000, and 2005. Plaintiff's current lease expires on June 30, 2013. The 1994 extension lease also modified the lease terms by including an "Excessive Vacancies" clause. This clause provides:
8. Excessive vacancies: If, at any time during the Extension Term, the Gross Leasable Area of the Shopping Center is less than sixty percent (60%) actively occupied by other retail tenants or a major tenant [any tenant that occupies more than fifteen percent (15%) of the Gross Leasable Area of the Shopping Center] discontinues its operations and a similar tenant does not replace it within a period of six (6) months, then Tenant shall have the option of (a) terminating this Lease by giving Landlord sixty (60) days prior notice thereof and all rights and obligations of both parties shall cease upon the expiration of the aforesaid sixty (60) day period, or (b) paying Landlord three percent (3%) of Tenant's monthly Gross Sales, in arrears, within twenty (20) days after the end of each calender month, in lieu of Tenant's obligation to pay Fixed Minimum Rent and Percentage Rent as set forth in the Lease. Tenant shall be entitled to pay such percentage of Gross Sales until such time as at least sixty percent (60%) of the Gross Leasable Area of the Shopping Center is actively occupied by other retail tenants, and all major tenants, as defined above, are conducting normal retail operations within the Shopping Center. Notwithstanding Tenant's election to pay a percentage of sales as described, Tenant shall retain the right to terminate the Lease pursuant to the provisions of this paragraph.
Dkt. No. 9, Ex. 5. The subsequent 2000 and 2005, leases do not expressly mention the "Excessive Vacancies" clause. On February 26, 2007, RadioShack sent Mr. Ruffin a letter indicating it was exercising its right under the Excessive Vacancies clause and that it would begin paying rent according to that clause's terms. RadioShack paid rent under the clause until November 15, 2011—a period of nearly five years. On November 15, Mr. Ruffin offered to buy out the lease so he could demolish the shopping center and rebuild it. RadioShack rejected the offer and proposed a higher one. Thereafter, on December 6, 2011, Mr. Ruffin sent RadioShack a letter demanding full rentunder the lease, rejecting the Excessive Vacancies clause, and demanding back rent of $73,591.15. On December 13, 2011, RadioShack received the Notice to Quit. RadioShack paid the amount due in the Notice under protest. On December 28, 2011, RadioShack received another letter from Mr. Ruffin in which he demanded $75,888.03 in back rent and threatened to evict RadioShack.
RadioShack filed this case on January 6, 2012, and served Mr. Ruffin on January 9. In the Complaint, RadioShack seeks an order "[p]reliminarily enjoining Ruffin from attempting to evict RadioShack or otherwise gain possession of the Property pending the resolution of this action." Dkt. No. 1. On January 27, Mr. Ruffin filed a Forcible Detainer Petition in Sedgwick County District Court seeking a writ of restitution restoring him to the property. RadioShack has been served with the Detainer Petition. Under Kan. Stat. Ann. § 61-3805 RadioShack must appear/answer within 14 days of the issuance of the summons. And trial must be conducted within 14 days after the appearance. Id. § 3807.
Mr. Ruffin primarily argues this court must deny RadioShack's motion because the court does not have jurisdiction to enjoin the state court proceeding under the Anti-Injunction Act, 28 U.S.C. § 2283. Congress has explicitly restricted the ability of federal courts to enjoin state court actions under the Act. "The historical legacy and the prevailing policy against federal court intervention in state court proceedings are well documented." Brown v. McCormick, 608 F.2d 410, 415-16 (10th Cir. 1979) (citing cases). Section 2283 provides:
A court of the United States may not grant an injunction to stay proceedings in a State court except as expressly authorized by Act of Congress, or where necessary in aid of its jurisdiction, or to protect or effectuate its judgments.
The Supreme Court has held that this statute prohibits federal courts from enjoining state court actions on any other basis than the three enumerated exceptions. Atlantic Coast Line R. Co. v. Brotherhood of Locomotive Eng'rs, 398 U.S. 281, 286-87 (1970). The Atlantic Coast Line Court wrote:
On its face the present Act is an absolute prohibition against enjoining state court proceedings, unless the injunction falls within one of three specifically defined exceptions. The respondents here have intimated that the Act only establishes a [sic] 'principles of comity,' not a binding rule on the power of the federal courts. The argument implies that in certain circumstances a federal court may enjoin state court proceedings even if that action cannot be justified by any of the three exceptions. We cannot accept any such contention. In 1955 when this Court interpreted this statute, it stated: Amalgamated Clothing Workers v. Richman Bros., 348 U.S. 511, 515-516, 75 S. Ct. 452, 455, 99 L. Ed. 600 (1955). Since that time Congress has not seen fit to amend the statute and we therefore adhere to that position and hold that any injunction against state court proceedings otherwise proper under general equitable principles must be based on one of the specific statutory exceptions to § 2283 if it is to be upheld. Moreover since the statutory prohibition against such injunctions in part rests on the fundamental constitutional independence of the States and their courts, the exceptions should not be enlarged by loose statutory construction. Proceedings in state courts should normally be allowed to continue unimpaired by intervention of the lower federal courts, with relief from error, if any, through the state appellate courts and ultimately this Court.
Id. The Act, however, does not apply to an injunction that prohibits the initiation of a state court proceeding. Torries v. Hebert, 111 F. Supp.2d 806, 814 (W.D. La. 2000) () (citing Dombrowski v. Pfister, 380 U.S. 479, 485 (1965)).
First, RadioShack argues this case falls into the "in aid of jurisdiction" exception to the Anti-Injunction Act because this is an in rem action rather than an in personam one. In support of this position, RadioShack cites Lattimore v. Nw. Cooperative Homes Assoc., No. Civ. A. 90-0049, 1990WL 10521534 (D.D.C. Mar. 26, 1990). In Lattimore, the plaintiff filed for a federal restraining order seeking to prevent the defendant from evicting her from a housing unit she occupied. Id. at *1. The court held that the Anti-Injunction Act "in aid of jurisdiction" exception applied because the case did not involve a "strictly in personam" action. Id. at *4. The court stated:
Although the federal action is formally a personal one, it essentially seeks to adjudicate rights and interests in land and, as explained above, unless the status quo is maintained there is a risk that the Court's ability to make plaintiffs whole and effectively grant the remedy of rescission will be impaired. An interlocutory injunction is therefore 'necessary in aid of [this Court's] jurisdiction.
Id. (quoting Barancik v. Investors Funding Corp. of New York, 489 F.2d 933, 935 n.6 (7th Cir. 1973)).
The Supreme Court, however, has held that the "in aid of jurisdiction" exception is not broad. In fact, it should be narrowly construed like the other exceptions:
First, a federal court does not have inherent power to ignore the limitations of § 2283 and to enjoin state court proceedings merely because those proceedings interfere with a protected federal right or invade an area preempted by federal law, even when the interference is unmistakably clear. This rule applies regardless of whether the federal court itself has jurisdiction over the controversy. . . . Second, if the District Court does have jurisdiction, it is not enough that the requested injunction is related to that jurisdiction, but it must be 'necessary in aid of' that jurisdiction. While this language is admittedly broad, we conclude that it implies something similar to the concept of injunctions to 'protect or effectuate' judgments. Both exceptions to the general prohibition of § 2283 imply that some...
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