Vonrosenberg v. Lawrence

• Decision Date: 21 February 2017
• Docket Number: No. 15-2284,15-2284
• Citation: 849 F.3d 163
• Parties: The Right Reverend Charles G. VONROSENBERG, individually and in his capacity as Provisional Bishop of the Protestant Episcopal Church in the Diocese of South Carolina, Plaintiff–Appellant, v. The Right Reverend Mark J. LAWRENCE; John Does, 1–10, being fictitious defendants whose names presently are unknown to Plaintiff and will be added by amendment when ascertained, Defendants–Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

849 F.3d 163

The Right Reverend Charles G. VONROSENBERG, individually and in his capacity as Provisional Bishop of the Protestant Episcopal Church in the Diocese of South Carolina, Plaintiff–Appellant,

v.The Right Reverend Mark J. LAWRENCE; John Does, 1–10, being fictitious defendants whose names presently are unknown to Plaintiff and will be added by amendment when ascertained, Defendants–Appellees.

No. 15-2284

United States Court of Appeals, Fourth Circuit.

Argued: December 9, 2016

Decided: February 21, 2017

ARGUED: Thomas S. Tisdale, Jr., HELLMAN YATES & TISDALE, Charleston, South Carolina, for Appellant. Henrietta U. Golding, MCNAIR LAW FIRM, Myrtle Beach, South Carolina, for Appellee. ON BRIEF: Jason S. Smith, HELLMAN YATES & TISDALE, Charleston, South Carolina, for Appellant. C. Alan Runyan, Andrew S. Platte, SPEIGHTS & RUNYAN, Beaufort, South Carolina; Charles H. Williams, WILLIAMS & WILLIAMS, Orangeburg, South Carolina; David Cox, BARNWELL WHALEY PATTERSON & HELMS, Charleston, South Carolina, for Appellee.

Before GREGORY, Chief Judge, MOTZ, Circuit Judge, and Richard D. BENNETT, United States District Judge for the District of Maryland, sitting by designation.

Vacated and remanded by published opinion. Judge Motz wrote the opinion, in which Chief Judge Gregory and Judge Bennett joined.

DIANA GRIBBON MOTZ, Circuit Judge:

This dispute between two clergymen—each claiming to be the Bishop of The Protestant Episcopal Church in the Diocese of South Carolina—comes to us a second time. Bishop Charles G. vonRosenberg initiated this action, seeking declaratory and injunctive relief. He alleges that Bishop Mark J. Lawrence has violated the Lanham Act by falsely advertising himself to be the Bishop of the Diocese of South Carolina. At Bishop Lawrence's request, the district court abstained in favor of related state court proceedings, applying Brillhart v. Excess Insurance Co. of America , 316 U.S. 491, 62 S.Ct. 1173, 86 L.Ed. 1620 (1942), and Wilton v. Seven Falls Co. , 515 U.S. 277, 115 S.Ct. 2137, 132 L.Ed.2d 214 (1995). On appeal, we vacated that order, concluding that Colorado River Water Conservation District v. United States , 424 U.S. 800, 96 S.Ct. 1236, 47 L.Ed.2d 483 (1976), not Brillhart and Wilton , governs abstention decisions in actions where the plaintiff seeks both declaratory and nondeclaratory relief. See vonRosenberg v. Lawrence (vonRosenberg I ), 781 F.3d 731 (4th Cir. 2015). On remand, the district court has again abstained, staying the action pending the conclusion of the state proceedings. For the reasons that follow, we must again vacate and remand for further proceedings.

I.

As discussed in our earlier opinion, Bishop vonRosenberg alleges that The Protestant Episcopal Church in the United States ("the Episcopal Church") removed Bishop Lawrence from his position as the Bishop of the Diocese of South Carolina and installed Bishop vonRosenberg in his place. Bishop vonRosenberg asserts that, despite Bishop Lawrence's removal, Bishop Lawrence continues to use the service marks, names, and symbols of the Diocese and continues to hold himself out as the Bishop of the Diocese. For his part, Bishop Lawrence maintains that he was not removed from office. He contends that the Diocese of South Carolina withdrew from the Episcopal Church and now operates independently of the national organization. Accordingly, Bishop Lawrence argues that, although he no longer serves as a Bishop of the Episcopal Church, he is still the Bishop of the Diocese and thus may represent himself as such.

We briefly sketch the course of the state and federal actions that led to the abstention orders in this case.

A.

On January 4, 2013, the Diocese of South Carolina and various churches and parishes loyal to Bishop Lawrence filed suit in South Carolina state court against the Episcopal Church. They argued that the Diocese had dissociated from the Episcopal Church and sought "resolution of their real and personal property rights." The property at issue included the Diocese's service marks, which the plaintiffs alleged the Episcopal Church had used in violation of South Carolina law.

The Episcopal Church filed an answer and counterclaims, including claims of trademark infringement and dilution under the Lanham Act. It also sought to add Bishop Lawrence and others as individual counterclaim defendants. In September 2013, the state court denied the request to add the proposed additional parties, and it repeatedly denied similar requests throughout the litigation. Accordingly, neither Bishop Lawrence nor Bishop vonRosenberg is a party to the state action. And no Lanham Act false advertising claim against Bishop Lawrence is before the state court.

On February 3, 2015, after more than a year of discovery and a fourteen-day bench trial, the state court issued a final order in favor of the Diocese. It held that the Diocese had validly dissociated from the Episcopal Church and therefore owned the property at issue in the litigation, including the service marks. The state court permanently enjoined the Episcopal Church and its agents from using any of the Diocese's marks. The Episcopal Church appealed to the South Carolina Supreme Court. That court heard oral argument on September 23, 2015, but has issued no opinion to date.

B.

On March 5, 2013, two months after the Diocese filed suit in state court, Bishop vonRosenberg filed this federal action. In it, Bishop vonRosenberg alleges that Bishop Lawrence violated the Lanham Act by engaging in false advertising. Specifically, Bishop vonRosenberg alleges that Bishop Lawrence's continued assertions that he remains the Bishop of the Diocese creates confusion as to who is the true Bishop. Bishop vonRosenberg asserts that this impairs his ability to perform his ecclesiastical duties and to communicate effectively on behalf of the Diocese.¹

In response, Bishop Lawrence asked the federal district court to abstain in favor of the state proceeding. In August 2013—before the state court denied the Episcopal Church's request to add Bishop Lawrence as an individual counterclaim defendant—the district court granted Bishop Lawrence's motion to abstain and dismissed the case. The court based its decision on the broad discretion to decline jurisdiction over cases seeking declaratory relief that the Brillhart/ Wilton doctrine provides federal courts.

Bishop vonRosenberg appealed. In our previous opinion in this case, we held that Colorado River , and not Brillhart/ Wilton , supplied the abstention standard for claims seeking both declaratory and nondeclaratory relief. vonRosenberg I , 781 F.3d at 735. Colorado River establishes a more rigorous abstention standard than the Brillhart/ Wilton standard. Accordingly, we vacated the district court's dismissal order and remanded for a determination of whether "exceptional" circumstances justified abstention under the Colorado River standard. Id. at 736.

On remand, the district court once again abstained, staying the federal proceeding until the conclusion of the state action. Bishop vonRosenberg again timely appealed.²

II.

"The rule is well recognized that the pendency of an action in the state court is no bar to proceedings concerning the same matter in the Federal court having jurisdiction." McClellan v. Carland , 217 U.S. 268, 282, 30 S.Ct. 501, 54 L.Ed. 762 (1910). However, under the Colorado River doctrine, a federal court may abstain from exercising jurisdiction over a duplicative federal action for purposes of "wise judicial administration." 424 U.S. at 818, 96 S.Ct. 1236. But a court must apply Colorado River abstention "parsimoniously." Chase Brexton Health Servs., Inc. v. Maryland , 411 F.3d 457, 463 (4th Cir. 2005). This requires recognizing that our task is not "to find some substantial reason for the exercise of federal jurisdiction by the district court; rather, the task is to ascertain whether there exist ‘exceptional’ circumstances, the ‘clearest of justifications,’ that can suffice under Colorado River to justify the surrender of that jurisdiction." Moses H. Cone , 460 U.S. at 25–26, 103 S.Ct. 927.

In deciding whether such exceptional circumstances exist, a court must first determine whether the federal and state actions are parallel. State and federal suits are parallel only "if substantially the same parties litigate substantially the same issues in different forums." New Beckley Mining Corp. v. Int'l Union, United Mine Workers of Am. , 946 F.2d 1072, 1073 (4th Cir. 1991). It is not enough for parties in the state and federal actions to be merely aligned in interest.

"[W]e have strictly construed the requirement of parallel federal and state suits, requiring that the parties involved be almost identical." Chase Brexton , 411 F.3d at 464. For example, in McLaughlin v. United Virginia Bank , we found the state and federal actions not parallel where the state suit involved claims by several corporations and the federal suit involved personal claims by the president of those corporations. 955 F.2d 930, 934–35 (4th Cir. 1992). We held Colorado River abstention not proper even though resolution of the state suit might have had a res judicata effect on some of the claims in the federal action. See id. at 934 n.*.

In addition, even state and federal claims arising out of the same factual circumstances do not qualify as parallel if they differ in scope or involve different remedies. See, e.g. , Chase Brexton , 411 F.3d at 464 ; New Beckley , 946 F.2d at 1074 ("[S]ome factual overlap does not dictate that proceedings are parallel."). Rather, a federal court may abstain under Colorado River only if it "concludes that the parallel state-court litigation will be an adequate vehicle for the complete and prompt resolution of the issues between the parties." Moses H. Cone , 460 U.S. at 28, 103 S.Ct. 927 (emphasis added). If there is any serious doubt that the state action would resolve all of the claims, "it would be a serious abuse of discretion" to abstain. Id.

Finally, even...