Filed: June 6, 2000

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 99-1874

(CA-99-1360-AMD, et al)

Theodore Matthews, Jr., et al,

Plaintiffs - Appellants,

versus

Germantown Injury Care Center, Inc., et al,

Defendants - Appellees.

ORDER

The court amends its opinion filed May 19, 2000, as follows:

On page 3, first paragraph -- the sentence which starts on

line 4 is changed to begin “She was later brought to court ....”

For the Court - By Direction

/s/ Patricia S. Connor

Clerk
UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

In Re: THEODORE MATTHEWS, JR. and

ALEXIS DIANNE MATTHEWS,

Debtors.

THEODORE MATTHEWS, JR.; ALEXIS

DIANNE MATTHEWS,

Plaintiffs-Appellants, No. 99-1874

v.

GERMANTOWN INJURY CARE CENTER,

INCORPORATED; PARAGON

MANAGEMENT SYSTEMS,

INCORPORATED,

Defendants-Appellees.

Appeal from the United States District Court

for the District of Maryland, at Baltimore.

Andre M. Davis, District Judge.

(CA-99-1360-AMD, BK-97-1-5344-DK,

AP-98-1-A482-DK)

Argued: April 3, 2000

Decided: May 19, 2000

Before MICHAEL and TRAXLER, Circuit Judges, and

Roger J. MINER, Senior Circuit Judge of the

United States Court of Appeals for the Second Circuit,

sitting by designation.

_________________________________________________________________

Affirmed by unpublished per curiam opinion.
COUNSEL

ARGUED: Murray Leonard Deutchman, Rockville, Maryland, for

Appellants. Peter Thomas McDowell, Timonium, Maryland, for

Appellees. ON BRIEF: Edward L. Blanton, Jr., Towson, Maryland,

for Appellees.

_________________________________________________________________

Unpublished opinions are not binding precedent in this circuit. See

Local Rule 36(c).

_________________________________________________________________

OPINION

PER CURIAM:

This case presents an appeal from an order of the United States

District Court for the District of Maryland (Davis, J.) adopting the

recommendation of the United States Bankruptcy Court to dismiss, on

res judicata grounds, the plaintiffs-appellants' damages claims under

11 U.S.C. § 362 and Maryland common law claims for abuse of process, false imprisonment, and malicious prosecution. The plaintiffsappellants also appeal from so much of the district court's order as

dismissed their joint claim for loss of consortium. Finding no error,

we affirm.

In 1994, plaintiff-appellant Alexis Matthews ("Alexis") sustained

serious injuries for which she obtained medical treatment. Among her

medical care providers was the defendant-appellee Germantown

Injury Care Center, Inc. ("Germantown"). Subsequently, Alexis was

unable to timely pay her medical and other bills and the Matthews

(Alexis and Theodore, her husband) filed a joint petition for bankruptcy under Chapter 7. On June 1, 1997, the bankruptcy court issued

a Notice of Commencement of Case, which contained instructions

that creditors should not take any action against the debtors without

first seeking the permission of the bankruptcy court. Nevertheless, on

July 7, 1997, Germantown requested the issuance of a body attachment for Alexis so she would appear in court in aid of Germantown's

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efforts to collect on the past due debt. The Clerk of the District Court

of Maryland caused a bench warrant to issue, the body attachment

was executed, and Alexis was taken into custody, handcuffed, and

incarcerated. She was later brought to

court, where she was released on bond pending resolution of the

bankruptcy.

Alexis applied to the bankruptcy court for the entry of an order

holding Germantown in contempt for causing the body attachment to

issue in violation of the bankruptcy court stay. In her application,

Alexis specifically asserted that Germantown's actions were taken

"notwithstanding the provisions of the United States Bankruptcy

Code Section 362."* She requested (1) a declaratory judgment that

Germantown had violated the bankruptcy laws; (2) damages in the

form of attorneys' fees and costs; (3) a permanent injunction against

further efforts to collect the debt without court permission; and (4)

whatever further relief would be proper. With her application, Alexis

submitted a proposed order to show cause to the bankruptcy court. On

January 26, 1998, the bankruptcy court signed the proposed order,

issuing a "Show Cause Order For Contempt and Damages Pursuant

to 11 U.S.C. Section 362(h)." After the signed order had been entered,

copies were sent to Alexis' attorney. Section 362(h) provides that

"[a]n individual injured by any willful violation of a stay provided by

this section shall recover actual damages, including costs and attorneys' fees, and, in appropriate circumstances, may recover punitive

damages."

On February 13, 1998, the Matthews filed a complaint against Germantown in the United States District Court for the District of Maryland, seeking damages of $300,000 for violation of Section 362,

malicious abuse of process, false imprisonment, and loss of consortium.

Thereafter, the bankruptcy court went forward with the contempt

proceeding. After the first day of evidentiary hearings, Alexis moved

to dismiss the proceedings because she had filed the February 13th

complaint. The court denied Alexis' motion. The evidentiary hearing

continued and the court ultimately ruled that Germantown had wil-

_________________________________________________________________

*See 11 U.S.C. § 362.

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fully violated the bankruptcy stay and that damages for attorneys' fees

and costs were appropriate.

On May 11, 1998, the district court referred the suit arising out of

the February 13th complaint to the bankruptcy court for consolidation

with the show cause proceeding. By Memorandum of Decision dated

May 10, 1999, the bankruptcy court dismissed all but the loss of consortium claim in the second action. The court found that the Matthews' claims for violation of Section 362, malicious abuse of

process, false imprisonment, and malicious prosecution were barred

under res judicata by Alexis' earlier litigation of the contempt application.

The bankruptcy court reasoned that Section 362 permits debtors to

seek consequential and punitive damages by motion and that the Matthews could have brought their claims before the bankruptcy court in

the contempt hearing. Finding that the Matthews were required to

bring all of their claims arising out of this same transaction or occurrence at the same time, the court concluded that their failure to do so

barred their subsequently filed claims. The court found that (1) the

determination that Germantown violated the stay order was a final

judgment on the merits; (2) the contempt case involved the same

cause of action; and (3) both cases involved the same parties.

However, the court found that res judicata did not bar Theodore's

claim for loss of consortium because the earlier action had only been

brought by Alexis. The bankruptcy court reasoned that "[a] claim for

loss of consortium is not entirely derivative of the Section 362(h)

claim." Thus, the court found it unreasonable to require Theodore to

join "his loss of consortium claim with A. Matthews' Motion."

On May 18, 1999, the district court issued a Memorandum and

Order substantially adopting the bankruptcy court's recommendations. The sole point of disagreement related to the decision of the

bankruptcy court that Theodore's claim for loss of consortium was

not barred by res judicata. Finding that Maryland loss of consortium

claims stem from the marital entity and that Maryland would not permit a "lone spouse" to "pursue a free-standing loss of consortium

claim," the district court held that res judicata also barred Theodore's

claim. The court stated,

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Unquestionably, as a matter of Maryland common law, not

only are spouses "in privity" in respect to a claim for loss

of consortium, but indeed, under state law, a loss of consortium claim may only be maintained by the entireties, as it is

a joint claim belong[ing] to the marital entity, and not (as in

some states) a divisible claim maintainable by each spouse

individually.

This appeal followed.

We review a district court decision to dismiss on the basis of res

judicata de novo. See In re Varat Enterprises, Inc., 81 F.3d 1310,

1314 (4th Cir. 1996). Our review reveals that the district court was

correct to dismiss the Matthews' claims on res judicata grounds. With

regard to the Matthews' claims for malicious abuse of process, false

imprisonment, malicious prosecution, and violation of Section 362(h),

we affirm for substantially the same reasons given by the district and

bankruptcy courts. While the loss of consortium claim raises a somewhat more complicated issue, we agree with the district court that the

special nature of the claim under Maryland law precludes its litigation

in light of the earlier contempt proceeding. The only element in the

question with regard to the loss of consortium claim is the identity of

the parties.

The Matthews contend that res judicata should not bar the loss of

consortium claim because the alleged damage to the marital entity

giving rise to the loss of consortium claim "did not have to automatically be raised in the bankruptcy proceedings." Under Maryland law,

there are three elements that must be established for res judicata to

apply: (1) identity of the parties; (2) the same cause of action; and (3)

a final judgment on the merits in the earlier suit by a court of competent jurisdiction. See Kutzik v. Young, 730 F.2d 149, 151 (4th Cir.

1984) (citing Alvey v. Alvey, 225 Md. 386, 390 (1961)).

The Maryland Court of Appeals has recently discussed the nature

of loss of consortium claims under Maryland law, stating as follows:

A claim for loss of consortium arises from the loss of

society, affection, assistance, and conjugal fellowship suffered by the marital unit as a result of the physical injury to

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one spouse through the tortious conduct of a third party.

Deems v. Western Maryland Railway Company, 247 Md.

95, 100, 231 A.2d 514 (1967). . . . A comprehensive discussion of the consortium claim was set forth by this Court in

Deems in which we held that damage to the marital relationship is a compensable injury. We further concluded that a

consortium claim must be filed jointly by a couple and tried

concurrently with the claim of the physically injured spouse

in order to avoid duplication of awards.

Oaks v. Connors, 339 Md. 24, 33 (1995).

Here, the identity of the parties element is established by Maryland's rule that a loss of consortium claim belongs to the husband and

wife jointly and may only be brought in a joint action. This rule

places Theodore and Alexis in privity, extends the reach of res judicata to Theodore, and satisfies the identity of the parties requirement.

See Kutzik, 730 F.2d at 151 (holding that privity establishes identity

of the parties element). Moreover, in this case, equity favors the application of res judicata to the loss of consortium claim: Theodore was

aware of the show cause proceeding; Alexis and Theodore had both

filed for bankruptcy in a joint petition; and Alexis consciously chose

to proceed under 362(h), an action that permitted the addition of the

damages claim they later brought.

AFFIRMED

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