IN THE UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF PENNSYLVANIA

DEANGELO BROTHERS, INC., :

: Case No. 4:05-cv-0800

Plaintiff, :

: (Judge Jones)

v. :

:

OTIS EUGENE LONG, :

Defendant. :

MEMORANDUM AND ORDER

June 1, 2005

THE BACKGROUND OF THIS ORDER IS AS FOLLOWS:

Pending before the Court is Plaintiff DeAngelo Brothers Incorporated’s

(“DBI” or “Plaintiff”) Emergency Motion to Remand, filed on April 21, 2005 

(Rec. Doc. 2). This immediately followed Otis Eugene Long’s (“Long” or

“Defendant”) removal of the action from the Court of Common Pleas of Luzerne

County to this Court on April 20, 2005. Oral argument was held on May 20, 2005

and the Motion is now ripe for our review.

For the following reasons, Plaintiff’s Motion will be granted to the extent

that we find that removal was improper. The Motion will be denied to the extent

that we decline to award DBI any sum with respect to its claim for attorneys’ fees. 

This action will be remanded to the Luzerne County Court of Common Pleas.

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1

 We agree with Defendant that Plaintiff likely meant “prospective” and not “perspective”

as that word appears in Count III of the complaint.

2

 Counts II and III also include a request for punitive damages and all three counts

include a request for preliminary and permanent injunctive relief. Id.

2

PROCEDURAL HISTORY & STATEMENT OF FACTS

As noted, Plaintiff initiated this action in the Luzerne County Court of

Common Pleas on February 15, 2005. Its complaint alleged violations of state law

in three separate counts: (1) breach of contract, (2) misappropriation of

confidential business information; and, (3) tortious interference with perspective

[sic] economic advantage. (Rec. Doc. 2, Ex 1).1

 In each of the three counts within

the complaint, Plaintiff states that it seeks the following relief:

a. damages in an amount in excess of $50,000.00 ....

...

c. all attorneys fees and costs expended in enforcement

d. such other relief as this Court deems just and equitable.

Id. at 12, 14, 16.2

 Immediately upon the filing of the complaint, President Judge

Michael T. Conahan of the Luzerne County Court of Common Pleas issued a

temporary order enjoining Long from engaging in conduct that violated a certain

Non-Disclosure and Non-Competition Agreement (the “Agreement”) that Long

had, at some point in his employment with DBI, signed. (See id.). 

The order by Judge Conahan was followed by a preliminary injunction

hearing held before another member of his court, Judge Peter Paul Olszewski, Jr.

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on February 22, 2005. Following that proceeding, Judge Olszewski entered a

preliminary injunction which extended the same relief afforded by Judge

Conahan’s temporary order. Over a month later, on March 31, 2005, Long filed

preliminary objections to the complaint under the applicable Pennsylvania Rule of

Civil Procedure. On April 7, 2005, before the preliminary objections were

resolved, DBI filed a motion seeking to have Long held in contempt for allegedly

disregarding Judge Olszewski’s order. As a result, a hearing was scheduled before

Judge Olszewski on April 25, 2005. Five days before that scheduled contempt

hearing, and sixty-four days after DBI served its complaint on Long, Long

removed the action to this Court. It is this removal that DBI challenges via the

instant Motion. (See Rec. Docs. 1 and 2).

DISCUSSION:

Removal to federal court of an action brought in state court is governed by 

28 U.S.C. § 1446. The removal statute is strictly construed against removal. 

Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108 (1941)(holding that

Congress intended for courts to strictly construe the removal statute against

removal). In relevant part, the statute states:

(b) The notice of removal of a civil action or proceeding shall be

filed within thirty days after the receipt by the defendant,

through service or otherwise, of a copy of the initial pleading

setting forth the claim for relief upon which such action or

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proceeding is based, or within thirty days after the service of

summons upon the defendant if such initial pleading has then

been filed in court and is not required to be served on the

defendant, whichever period is shorter. 

If the case stated by the initial pleading is not removable,

a notice of removal may be filed within thirty days after receipt

by the defendant, through service or otherwise, of a copy of an

amended pleading, motion, order or other paper from which it

may first be ascertained that the case is one which is or has

become removable, except that a case may not be removed on

the basis of jurisdiction conferred by section 1332 of this title

more than 1 year after commencement of the action.

 28 U.S.C. § 1446(b). Here, Defendant does not dispute that he moved for removal

beyond the thirty day window initially contemplated by the statute. Therefore,

Defendant’s removal must proceed under the one-year exception, which as noted

allows removal within thirty days of an event that allows a party to “ascertain that

the case is one which is or has become removable.” Id. Defendant contends that

the complaint as filed was not removable, but that DBI’s subsequent petition for

contempt was an event that allowed the Defendant to ascertain that the case was

removable. Neither party controverts that the removal occurred within thirty days

of the filing of DBI’s petition for contempt.

In opposition to removal, DBI makes two alternative arguments. First, DBI

contends that removal was invalid since the complaint as filed sought greater than

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 Clearly, the diversity aspect necessary to invoke our jurisdiction under § 1332 has been

satisfied, and the instant dispute involves the monetary threshold only.

5

$75,000 in damages and thus was removable ab initio.

3

 In the alternative, DBI

argues that even if its complaint was not removable at its inception, nothing stated

within its petition for contempt should have altered the litigation in such a way that

it converted the case to one which was then removable to federal court. We will

address each of these issues in turn.

A. Removal and DBI’s Complaint as Filed 

As noted, DBI first contends that removal was not proper because it

occurred greater than thirty days after the filing of a complaint that was removable

ab initio under § 1332. Specifically, DBI alleges that the damages ($50,000)

alleged in each of the three counts should be totaled so that they aggregate to at

least $150,000 (plus attorneys’ fees and punitive damages). The resulting claims

would thus far exceed the $75,000 needed to invoke our jurisdiction.

The Third Circuit instructs that in determining the amount in controversy we

are to aggregate the claims brought by a party in its complaint. Suber v. Chrysler

Corp., 104 F.3d 578, 588 (3d Cir. 2003)(“The general rules is that claims brought

by a single plaintiff against a single defendant can be aggregated when calculating

the amount in controversy, regardless of whether the claims are related to each

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other.”). As Defendant rightly notes, however, we can only aggregate claims for

which a plaintiff could in theory simultaneously recover. As Suber explains,

claims are not to be aggregated if a plaintiff:

could not recover damages for both. That is, if these claims are

alternative bases for recovery for the same harm under state law, [the

plaintiff] could not be awarded damages for both, and a court should

not aggregate the claims to arrive at the amount in controversy.

Id. 

In an effort to argue that we should not aggregate DBI’s claims, Long raises

the “gist of the action” doctrine. Long contends that under Pennsylvania law this

doctrine would prevent the Plaintiff from a simultaneous recovery under its tort

counts (II and III) because this action’s “gist” lies in contract. The “gist of the

action” doctrine has been explained as follows:

When a plaintiff alleges that the defendant committed a tort in the

course of carrying out a contractual agreement, Pennsylvania courts

examine the claim and determine whether the ‘gist’ or gravamen of it

sounds in contract or tort; a tort claim is maintainable only if the

contract is ‘collateral’ to conduct that is primarily tortious.

Yocca v. Pittsburgh Steelers Sports, Inc., 906 A.2d 936, 944 (Pa. Commw. Ct.

2002)(quoting Sunquest Info. Sys. Inc. v. Dean Witter Reynolds, Inc., 40

F.Supp.2d 644, 651 (W.D.Pa. 1999)). 

The purpose of the “gist of the action” doctrine is to maintain the conceptual

distinction between a breach of contract claim and a tort claim. “Tort actions lie

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for breaches of duties imposed by law as a matter of social policy, while contract

actions lie only for breaches of duties imposed by mutual consensus agreements

between particular individuals.” Etoll, Inc. v. Elias/Savion Advertising, Inc., 811

A.2d 10, 14 (Pa. Super. 2002). 

Long thus argues that we should consider only Count I, which sounds in

breach of contract, in evaluating the amount in controversy because Counts II and

III are tort claims and accordingly subsumed within the “gist” of Count I. Long

cites us to Valhal Corp. v. Sullivan Assocs. Inc., which he claims stands for the

proposition that we must make a “gist of the action” analysis at this juncture. 44

F.3d 195 (3d Cir. 1995). In Valhal Corp., a post-trial motion was brought by the

defendant challenging original diversity jurisdiction in federal court. The court

overturned a jury verdict on the basis that the “gist of the action” doctrine

prevented the plaintiff from succeeding at trial on both tort and contract claims. 

We believe that Long’s reference to Valhal Corp. is inapt. To be sure, there is a

dearth of guiding federal authority relating to the “gist of the action” as it relates to

evaluating whether we have jurisdiction. However, we have found that state courts

have frequently been reluctant to dismiss tort counts in complaints which appear to

involve, in the main, contract disputes. For example, in a recent opinion from the

Court of Common Pleas of Philadelphia, a “gist of the action” argument similar to

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Long’s was made at the outset in the defendant’s preliminary objections. 

See Gemini Bakery Equip. v. Baktek, 2005 WL 957635 at *3 (Phila. Comm. Pl.

April 11, 2005). In that action, the plaintiff brought a complaint alleging breach of

contract, misappropriation of trade secrets, tortious interference, and unfair

competition. The court acknowledged that there was likely a contractual

agreement between the parties, but explained that:

it is premature to dismiss plaintiff’s alternative tort claims [under the

gist of the action doctrine.] At this point, it is not clear whether

defendants admit to or deny the existence of an agreement between

themselves and plaintiff. Thus the Court will not dismiss the tort

claims at this point because it may eventually be found that there was

no agreement between the parties.

Id., see also Greencourt Condominium Assoc. v. Greencourt Partners, 2004 WL

3051336 (Phila. Comm. Pl. Dec. 22, 2004)(In overruling a defendant’s preliminary

objections, the court explained that it was reluctant to consider a “gist of the

action” argument because the allegations did not affirmatively establish the

existence of a contractual relationship). 

Here we are faced with a situation similar to that in Gemini Bakery. At oral

argument, Defendant’s counsel explained that in his view it is far from certain

whether this is a contract action at all, as Long contends that the Agreement has

expired:

Mr. Nowalis: Your Honor, just because the Court touched on the

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merits of the underlying cause of action on the

alleged illegal competition, we are not to the point

where the defendant has had to address the merits

of the claim. In addition to the jurisdictional

defect, we have a defense on the merits of the

claims inasmuch as the noncompete in our view

terminated three years ago. Mr. Long was hired

in 1999, signed the noncompete, he terminated his

relationship with the plaintiff the following spring,

did not compete with them for two years; that

would take us to 2003. He -- subsequent to the

termination he was hired again by the plaintiff but

was not required and did not sign another

noncompete. So our view of the merits of the

case is the noncompete expired in 2003.

(emphasis added). If Defendant himself contends that there is no contract, it is

difficult for us to conceive why we should find that one exists in a hypothetical

sense simply to defeat a remand of this action.

Because the “gist of the action” doctrine cannot be utilized to collapse the

counts in the complaint at this early stage, we may properly aggregate the damages

requested by the plaintiff in order to determine the amount in controversy. The

resulting total, before any additional claims for attorneys’ fees or punitive

damages, is $150,000, which as noted is far in excess of the $75,000 required for 

diversity jurisdiction. Therefore, we hold that DBI’s original complaint as initially

filed in state court was removable on its face under § 1332. 

Finally, it is worth noting that even if we were to accept Long’s argument

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that Counts II and III of DBI’s complaint collapse into Count I because of the “gist

of the action” doctrine, we would in that event still find it difficult to contemplate

that Count I does not indicate damages in excess of $75,000 such that the action

was removable on its face under § 1332. It is not disputed that punitive damages

and attorneys’ fees, both of which are claimed in Count I, are to be included in

calculating an amount in controversy for jurisdictional purposes. See Suber, 104

F.3d 578 at 585(“[I]n calculating the amount in controversy, we must consider

potential attorneys’ fees”); Angus v. Shiley, 989 F.2d 142, 145-46 (3d Cir.

1993)(holding that a “reasonable reading of the value of the rights being litigated”

includes a consideration of punitive damages). A plain reading of the complaint

makes it difficult to see how it can be contended that these claims would not

aggregate to greater than $25,000, which is all that was needed to reach the amount

required to invoke our jurisdiction under § 1332. Put another way, had Long

properly removed the action within the initial period, and it the event DBI sought

remand, we would have been hard pressed to grant such relief.

B. The Motion for Contempt and its Relation to the Amount in

Controversy

Assuming arguendo, that we had found that it was not readily apparent from

the four-corners of the complaint that the $75,000 amount in controversy

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requirement for diversity jurisdiction had been met, we nonetheless would find that

DBI’s petition for contempt filed in County Court did not alter the action so that it

suddenly placed Defendant on notice that an amount in excess of $75,000 was

being claimed by Plaintiff. In its petition for contempt, DBI requests that the

Luzerne County Court:

impose appropriate sanctions upon Mr. Long including, but not

limited to, an unconditional fine for his contemptuous conduct, a

requirement that he pay all damages suffered by DBI as a result of his

conduct, including all costs and attorneys fees incurred by DBI related

to this Petition and such other relief as this Court deems just, equitable

and appropriate to further deter such unlawful and contemptuous

conduct.

(Rec Doc. 1 Ex. 11 at 9-10). We fail to see how Long could have read this passage

to indicate such a sudden and dramatic increase in the damages requested by DBI. 

This is a particularly problematic argument for Long in light of his previous

argument that we read the complaint as one which alleges less than $75,000 in

damages in any event.

As we stated to Defendant’s counsel during argument, we believe that it is

generally fair for an attorney to use most procedural tools within the legal toolbox

in the course of competent and zealous representation of a client, and certainly we

cast no aspersions upon counsel for doing so here. However, we have been

“around the block,” so to speak, and as a result can only find that the removal of

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this case to our docket, on the very eve of Long’s scheduled appearance in Judge

Olszewski’s courtroom for a contempt hearing, is highly suspect. In the face of

DBI’s Motion, Long seeks to have us engage in what we believe is not only a

tortured and premature reading of the complaint, but also to accept what we view

as a contrived argument relating to the import of the contempt action. We decline

to do either, and will accordingly remand this action to Judge Olszewski’s capable

hands.

C. Attorneys’ Fees

Finally, DBI requests that this Court award it the fees and costs incurred in

contesting Long’s removal. In Roxbury Condominium Ass’n Inc. v. Anthony S.

Cupo Agency, the Third Circuit explained that an award of attorneys’ fees is not

warranted when removal was made “under [] less than bright-line circumstances.” 

316 F.3d 224, 228 (3d Cir. 2003). Although Long has attempted to interpose a

novel argument involving the “gist of the action” doctrine, we cannot say that the

attempted removal was made against “bright-line” precedent. Therefore, we

believe it appropriate to deny DBI’s Motion to the extent that it seeks attorneys’

fees, as they are not warranted under all of the circumstances of this case. 

NOW, THEREFORE, IT IS ORDERED THAT:

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1. Plaintiff’s Emergency Motion for Remand (Rec. Doc. 2) is

GRANTED to the extent that this action shall be remanded to Luzerne

County Court. The Motion is DENIED to the extent that no award of

attorneys’ fees is warranted.

2. The Clerk is directed to transfer this action to the Luzerne County

Court of Common Pleas.

3. The Clerk is further directed to close the file on this case.

s/ John E. Jones III 

John E. Jones III

United States District Judge

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