NOT PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

_____________

No. 19-3291

_____________

AMERICAN BUILDERS INSURANCE COMPANY,

 Appellant

v.

CUSTOM INSTALLATIONS CONTRACTING SERVICES, INC.

COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF 

LABOR & INDUSTRY; UNINSURED EMPLOYERS GUARANTY FUND;

JAMES SCOTT,

 Intervenors in District Court 

_____________________________________

On Appeal from the United States District Court for the 

Western District of Pennsylvania

(District Court No.: 3-15-cv-00295)

District Judge: Honorable Kim R. Gibson

_____________________________________

Argued on April 22, 2020

(Opinion filed May 29, 2020)

Before: HARDIMAN, RENDELL, and FISHER, Circuit Judges

John A. Bass, Esq.

Ira L. Podheiser, Esq.

Ralph M. Monico, Esq. (Argued)

Burns White

48 26th Street
2

Burns White Center

Pittsburgh, PA 15222

Counsel for Appellant

Martin A. Dietz, Esq. Suite 505

304 Ross Street

Pittsburgh, PA 15219

Counsel for Appellee

Bruce P. Merenstein, Esq. (Argued)

Schnader Harrison Segal & Lewis

1600 Market Street

Suite 3600

Philadelphia, PA 19103

Counsel for Intervenor Appellee Uninsured Employers Guaranty Fund

Matthew S. Faher, Esq. (Argued)

Rudberg Law Offices

2107 Sidney Street

Pittsburgh, PA 15203

Counsel for Intervenor Appellee James Scott
3

OPINIO N*

RENDELL, Circuit Judge.

American Builders Insurance Company (“American Builders”) appeals the District 

Court’s dismissal of its lawsuit against its policyholder, Custom Installations Contracting 

Services, Inc. (“Custom”). We will affirm the District Court’s judgment.1

In July 2015, American Builders issued a workers’ compensation insurance policy 

to Custom.

2 A. 23, 66. American Builders alleges that during the policy application 

process, Custom falsely represented that it did not perform roofing work. A. 23, 66-74. 

Several months later, during the policy period, a Custom employee, James Scott, Jr., was 

injured on the job and subsequently made a claim for workers’ compensation benefits, 

which initiated a proceeding before the Pennsylvania Bureau of Workers’ Compensation. 

A. 24, 74. American Builders accepted responsibility for Scott’s workers’ compensation 

claim by issuing a Notice of Compensation Payable to Mr. Scott. Appellants’ Br. at 3.

American Builders continues to pay Mr. Scott and his medical providers under the 

* This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7 does not 

constitute binding precedent.

1 The District Court had jurisdiction because a “federal court always has jurisdiction to 

determine its jurisdiction.” Orie v. Dist. Att’y Allegheny Cty., 946 F.3d 187, 190 n.7 (3d 

Cir. 2019) (quoting Zambelli Fireworks Mfg. Co., Inc. v. Wood, 592 F.3d 412, 418 (3d 

Cir. 2010)). We have jurisdiction over this appeal from a final order of the District Court 

under 28 U.S.C. § 1291.

2 Because we write for the parties, who are familiar with the facts and the procedural 

posture to date, we only include what is necessary to explain our decision.
4

insurance policy it issued to Custom and states that, at the time of this appeal, it has paid 

out more than $2,500,000 in wage benefits and compensation for medical care to

Mr. Scott and his medical providers. Appellants’ Br. at 4.

While the workers’ compensation proceeding was pending, American Builders 

filed this lawsuit against Custom. A. 22-23. In a two-count complaint, American 

Builders alleged that Mr. Scott’s injury occurred while he was performing roofing work, 

despite Custom’s representations that it did not do any such work. A. 23, 66-79. 

American Builders sought a declaration that, among other things, “the false and 

inaccurate facts provided by Custom during the [a]pplication process induced American

[Builders] to sell and issue the Policy to Custom,” that “American [Builders] is entitled to 

rescind the Policy based on . . . mutual mistakes of fact,” that “the Policy is hereby 

RESCINDED and rendered VOID AB INITIO,” and that “American [Builders] has no 

legal or contractual obligation to Custom or its employees, including [Mr.] Scott, under 

the rescinded Policy, or under any theory of law or equity.” App. 76. American Builders 

also included a cause of action for insurance fraud. A. 23, 75-79. American Builders

eventually moved for summary judgment on its declaratory judgment claim. A. 23. 

Custom did not oppose the motion, and the District Court accordingly granted summary 

judgment to American Builders. A. 45, 46, 49.

American Builders then filed several petitions in Mr. Scott’s workers’ 

compensation proceeding. A.24, Appellant’s Br. at 6. American Builders sought to 

terminate its obligations to pay Mr. Scott wage benefits or make payments to his medical 

providers, or, in the alternative, asked for a review of Mr. Scott’s workers’ compensation 
5

benefits. A.24, Appellant’s Br. at 6. The other parties to Mr. Scott’s workers’ 

compensation proceeding opposed the petitions in various ways, and the administrative 

law judge issued a temporary stay. A. 24, Appellant’s Br. at 6.

American Builders then returned to federal court and filed a motion for temporary 

restraining order and preliminary injunction in this case asking the District Court to 

enjoin all parties involved in Mr. Scott’s workers’ compensation case, including 

Mr. Scott and Mr. Scott’s medical provider, UPMC Mercy, from attempting to 

circumvent enforcement of the Court’s summary judgment order granting rescission of 

the insurance policy. A. 25. In response, the District Court issued an order requesting

briefing on whether American Builders’ lawsuit was appropriately before the District 

Court. A. 25. American Builders, Mr. Scott, UPMC Mercy, the Pennsylvania 

Department of Labor & Industry, and the Pennsylvania Uninsured Employers Guaranty 

Fund submitted briefs and other materials in response to this order.

3

 A. 25-26. American 

Builders then conceded that its motion for temporary restraining order and preliminary 

injunction was moot and filed a motion for entry of judgment pursuant to Federal Rule of 

Civil Procedure 54(b). A. 27.

The District Court dismissed and vacated its order granting summary judgment to 

American Builders. App. 48. It ruled that “American Builders’ rescission claim must be 

pursued before the [Pennsylvania Bureau of Workers’ Compensation] and the ALJ.” 

3 Mr. Scott, the Pennsylvania Department of Labor & Industry, and the Pennsylvania 

Uninsured Employers Guaranty Fund have also intervened in this appeal and filed briefs 

in opposition to American Builders’ opening brief.
6

App. 55. The District Court reasoned that if the Pennsylvania workers’ compensation 

system allows “workers’ compensation insurance companies [to] receive the benefit of 

being shielded from separate bad faith lawsuits,” American Builders, a workers’ 

compensation insurance company, “also cannot file separate lawsuits for related 

insurance claims” like the declaratory judgment and fraud claims at issue in this case. 

App. 57.

In reaching this conclusion, the District Court relied on our decision in Winterberg 

v. Transportation Insurance Company, in which we held that the exclusivity provision of 

the Pennsylvania Workers’ Compensation Act, 77 Pa. Cons. Stat. § 481(a), barred an 

injured worker’s insurance bad faith and other common law and statutory claims against 

her employer’s workers’ compensation insurance provider. 72 F.3d 318, 320-21 (3d Cir. 

1995). The District Court highlighted our statement in Winterberg that “[b]ecause of the 

historical background for Pennsylvania’s [workers’] compensation system, courts have 

been very cautious about permitting common law litigation in matters arguably connected 

with work-related injuries.” Id. at 322 (citing Kuney v. PMA Ins. Co., 578 A.2d 1285, 

1286 (Pa. 1990)), in which the Supreme Court of Pennsylvania disallowed an employee’s 

tort action against his employer’s insurer for defrauding the employee of his workers’ 

compensation benefits). American Builders then timely appealed the District Court’s 

dismissal of its lawsuit.
7

We agree with the District Court’s reasoning and disposition of this case.4 We 

continue to approve of our observation in Winterberg, quoted by the District Court, that

courts “have been very cautious about permitting common law litigation in matters 

arguably connected with work-related injuries.” Id. at 322. We are also mindful of the 

Supreme Court of Pennsylvania’s admonitions in Kuney that the Pennsylvania workers’ 

compensation statute was “designed and intended to establish exclusive jurisdiction, 

practice and procedure in all matters pertaining to such subject matter,” 578 A.2d at 1287 

(quoting American Cas. Co. of Reading v. Kligerman, 74 A.2d 169, 172 (Pa. 1950)), and 

that “[w]hen the allegations of a claim have as their ultimate basis an injury compensable 

under the [Workers’] Compensation Act, the claim must be considered within the 

framework of the statute,” id. Accordingly, we will affirm the District Court’s judgment.

4 The parties dispute the standard of review. We do not rule on this question because we 

reach the same result whether we review de novo, see, e.g., United States v. Dohou, 948 

F.3d 621, 623 (3d Cir. 2020) (“We review the District Court’s jurisdictional holding de 

novo.”) (citing United States v. Charleswell, 456 F.3d 347, 351 (3d Cir. 2006)), or for

abuse of discretion, see Reifer v. Westport Ins. Corp., 751 F.3d 129, 137-38 (3d Cir. 

2014) (reviewing district court decision to decline jurisdiction over a declaratory 

judgment claim for abuse of discretion).