State of Iowa v. Union Asphalt & Roadoils, Inc.

Decision Date14 March 1968
Docket NumberCiv. No. 7-1932-C-2.
Citation281 F. Supp. 391
PartiesSTATE OF IOWA, Iowa State Highway Commission, and every other Political Subdivision of the State of Iowa, Plaintiffs, v. UNION ASPHALT & ROADOILS, INC., et al., Defendants.
CourtU.S. District Court — Southern District of Iowa



Richard C. Turner, Atty. Gen., Roger H. Ivie, David B. Hendrickson, Asst. Attys. Gen., Des Moines, Iowa, for plaintiffs.

Herschel G. Langdon, Des Moines, Iowa, Verne H. Maxwell, Dallas, Tex., Colvin A. Peterson, Jr., Kansas City, Mo., Roy W. Meadows, Des Moines, Iowa, C. T. McClure, Oklahoma City, Okl., Max Putnam, Harris M. Coggeshall, Des Moines, Iowa, J. O. Watson, Jr., Indian-ola, Iowa, Elmer B. Hodges, Kansas City, Mo., Robert G. Bridges, Des Moines, Iowa, James R. Eagleton, Tulsa, Okl., Bennett A. Webster, Des Moines, Iowa, Charles W. McDermott, Colorado Springs, Colo., Joseph W. Kennedy, Wichita, Kan., Howard A. Steele, John C. Cortesio, Jr., Des Moines, Iowa, F. R. Olmsted, Kansas City, Mo., J. Rudolph Hansen, John A. McClintock, Des Moines, Iowa, Lynn Adams, Oklahoma City, Okl., John R. Mackaman, Des Moines, Iowa, Charles F. Rice, New York City, Edward F. Howrey, Washington, D. C., J. Riley McManus, Des Moines, Iowa, Neil E. McManus, Keokuk, Iowa, Paul F. Ahlers, Des Moines, Iowa, S. E. Floren, Lewis J. Ottaviani, Bratlesville, Okl., Leroy Jeffers, Houston, Tex., Theodore T. Duffield, James A. Lorentzen, Donald A. Wine, Des Moines, Iowa, J. R. Shanahan, Chicago, Ill., Donald K. McIntosh, New York City, David E. Byers, Des Moines, Iowa, John F. Smith, Kansas City, Mo., D. J. Goode, Des Moines, Iowa, Ernest Godshalk, James K. Eagan, H. Laurance Fuller, Walter T. Kuhlmey, Chicago, Ill., Eugene Davis, Des Moines, Iowa, James O. Sullivan, William C. Weitzel, Jr., New York City, Robert W. Brennan, Des Moines, Iowa, George T. O'Laughlin, Kansas City, Mo., Frank W. Davis, Des Moines, Iowa, Robert J. Woolsey, Lawrence A. Johnson, Tulsa, Okl., for defendants.


HANSON, District Judge.

This ruling is predicated upon an application by attorneys Verne Lawyer and Lex Hawkins for attorney fees and upon their motion to amend an Order of the Court filed on January 10, 1967, permitting their withdrawal. It is only fair to note that there is complete agreement by all that counsel are entitled to fees in some amount. The only question is under what process this can ultimately be consummated.

On January 10, 1967, Lex Hawkins and Verne Lawyer made an application to withdraw as attorneys for the State of Iowa in the above entitled litigation. The Application related that on September 30, 1966, they had been employed to prosecute the action by the then Attorney General of the State of Iowa, Lawrence F. Scalise. On January 5, 1967, the present Attorney General of the State of Iowa, Richard Turner, requested Verne Lawyer to resign and to take no further legal action in the case and on January 6, 1967, made the same request and direction to Lex Hawkins. He further instructed Lex Hawkins to relinquish the files of the cause on January 9, 1967. The applicants complied with the latter demand on January 9 by delivering them to the Attorney General's Office. Due primarily to these events, the applicants made a motion for the Court to permit them to withdraw their appearance and to be relieved of any further responsibility in the case. On January 10, 1967, the Court issued an Order which granted the Application "for good cause shown."

The next day, the Attorney General and Roger H. Ivie, Assistant Attorney General, made a motion for the Court to authorize them to appear in behalf of the State and for "an order withdrawing the names of Lawrence F. Scalise and Nolden Gentry as attorneys of record." The State did not include the Applicants' names in its motion and apparently did not notify them of the motion. The Court granted that motion on the same day.

On August 16, 1967, Mr. Lawyer and Mr. Hawkins presented an application for attorney fees. By an Act of the Sixty-Second General Assembly, their employment was "legalized, validated and confirmed." In addition, Exhibit 1 reads as follows:

"Sec. 2. Awards to such attorneys for services rendered and expenses incurred as a result of such legal representation shall be set and determined by a judge of a court having jurisdiction over the subject matter thereof, after holding a hearing thereon.
Sec. 3. Any such award of judgment rendered by such court shall be a judgment in favor of Lex Hawkins and Verne Lawyer against the state of Iowa and shall be paid in the same manner as a judgment or award against the state of Iowa is paid pursuant to section twenty-five A point eleven (25A.11) of the Code."

The Application alleges that this Court is authorized "pursuant to the authority granted by said Act" to set the amount of attorneys' fees and expenses and render judgment for such amounts. A hearing was held on the Application on September 7, 1967.

A motion was filed by applicants on November 6, 1967, and the motion is grounded on Federal Rule of Civil Procedure 60(b). The applicants urge that the Court should amend its Order of January 10, 1967, upon the grounds of mistake, inadvertence and surprise and permit their withdrawal as counsel only upon condition that they be paid reasonable attorney fees.

The Application can be construed as alleging that the Iowa legislature has bestowed jurisdiction upon this Court. Federal Courts are courts of limited jurisdiction. They have only that jurisdiction which Congress, acting within the limits of the Constitution, confers upon them. See Giancana v. Johnson, 335 F.2d 366 (7 Cir.), cert. den. 379 U.S. 1001, 85 S.Ct. 718, 13 L.Ed.2d 702 (1964); Badger v. Reich Bros. Const. Co., 161 F.2d 289 (5th Cir.); aff'd 333 U.S. 163, 68 S.Ct. 587, 92 L.Ed. 614 (1947), rehear. den. 333 U.S. 878, 68 S. Ct. 900, 92 L.Ed. 1153; Fisch v. General Motors Corp., 169 F.2d 266 (6th Cir.) cert. den. 335 U.S. 902, 69 S.Ct. 405, 93 L.Ed. 436 (1949). A state legislature cannot expand the jurisdiction of the federal courts. Chicago R. I. & P. Ry. Co. v. Stude, 346 U.S. 574, 74 S.Ct. 290, 98 L.Ed. 317, rehear. den. 347 U.S. 924, 74 S.Ct. 512, 98 L.Ed. 1078; Burford v. Sun Oil Co., 319 U.S. 315, 63 S.Ct. 1098, 87 L.Ed. 1424 (1943); Davis v. Ensign-Bickford Co., 139 F.2d 624 (8th Cir.). A state legislature cannot confer jurisdiction which is not authorized by Congress upon a federal court. In re Borough of Fort Lee, 230 F.2d 200 (3rd Cir.); Chicago R. I. & P. Ry. Co. v. Ten (10) Parcels of Real Estate Located in Madison County, Iowa, 159 F.Supp. 140 (D.Iowa); Range Oil Supply Co. v. Chicago R. I. & P. Ry. Co., 140 F.Supp. 283 (D.Minn.). Moreover, the legislature could not control or supervise this Court by directing a hearing to be held upon this matter. Stephenson v. Grand Trunk Western Ry. Co., 110 F.2d 401, 132 A.L.R. 455 (7th Cir.), cert. granted 310 U.S. 623, 60 S.Ct. 1101, 84 L.Ed. 1395, cert. dism'd. 311 U.S. 720, 60 S.Ct. 1107, 85 L.Ed. 469. However, the Court must determine whether it has jurisdiction under the federal Constitution, federal laws, or principles of federal jurisdiction.

The Court will first give its attention to whether the Application for attorney fees should be granted, apart from the question of whether the motion to amend the Court's Order of January 10, 1967, will be granted. The resolution of two issues will be dispositive of the first question: (1) whether the determination of attorney fees is within the boundaries of the traditional realm of federal jurisdiction; and, (2) whether consideration of the Application is now precluded because of the Order of January 10. The Court will then discuss the question of whether that Order must be amended to condition withdrawal upon the remittance of reasonable attorney fees. If the Court decides to amend its Order, the application for attorney fees will automatically be granted.

The applicants urge that jurisdiction of the matter of attorney fees may be sustained by the doctrine of federal ancillary jurisdiction. The ancillary jurisdiction theory is relatively simple — once federal jurisdiction properly attaches to a primary case, the court also has jurisdiction over certain subsidiary or subordinate disputes even though it might not independently be able to proceed to adjudicate them. See, e. g., Murphy v. Kodz, 351 F.2d 163 (9 Cir.); Lee v. Terminal Transport Co., 282 F.2d 805 (7 Cir.), cert. den. 365 U.S. 828, 81 S.Ct. 713, 5 L.Ed.2d 705 (1960); Aetna Ins. Co. v. Chicago, R. I. & P. R. Co., 229 F.2d 584 (10 Cir.); Glen Falls Indem. Co. v. United States, etc., 229 F.2d 370 (9 Cir.). It is well-settled that upon substitution of attorneys in litigation, a client may be required to either pay the attorney or to post security for reasonable fees as ancillary to the Court's jurisdiction of the main case. See e. g., National Equipment Rental, Ltd. v. Mercury Typesetting Co., 323 F.2d 784 (2 Cir.); Maddox v. Jinkens, 66 App.D.C. 362, 88 F.2d 744; Woodbury v. Andrew Jergens Co., 69 F.2d 49 (2 Cir.). In the situation at hand, the Court's jurisdiction to fix attorney fees is generated by its auxiliary relation to the antitrust action by the State. It may be true that the practice of injecting a condition of departure into an Order of removal is proper, but the Court cannot agree that it must be done in every case. The precepts of the ancillary jurisdiction doctrine dictate that the federal courts should extend their jurisdiction to encompass orbital disputes subordinate to the principal action so that complete justice may be done. See Walmac Co. v. Isaacs, 220 F.2d 108 (1 Cir.); Cooperative Transit Co. v. West Penn Elec. Co., 132 F.2d 720 (4 Cir.); Ancillary Jurisdiction of the Federal Courts, 48 Iowa L.Rev. 383 (1963). Considerations of judicial economy and fairness to all parties underlie the ancillary jurisdiction theory. Consolo v. Federal Maritime...

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