Opinion ID: 783388
Heading Depth: 4
Heading Rank: 1

Heading: Wiretapping Claims

Text: 71
72 Under Washington law, when a court lacks jurisdiction over the subject matter of a counterclaim, it cannot hear and determine the issues raised in the claim. Thus, the failure to assert a counterclaim under such circumstances does not act as a bar to a subsequent action in a proper forum. See Centennial Flouring Mills Co. v. Schneider, 16 Wash.2d 159, 132 P.2d 995, 998 (1943); 3A Lewis H. Orland & Karl B. Teglund, Washington Practice 303 (4th ed.1992). Noel argues that his wiretapping claims were not compulsory counterclaims because the damages he sought exceeded the Clark County District Court's statutory limit, and therefore it lacked jurisdiction to hear his claims. We disagree. 73 Noel's current wiretapping claims far exceed the $35,000 jurisdictional limit of the Clark County District Court. 8 However, the Washington Rules for Courts of Limited Jurisdiction (CRLJ) provide a remedy for this problem. CRLJ 14A provides: 74 When a defendant, third party defendant, or cross-claimant in good faith asserts a claim in an amount in excess of the jurisdiction of the district court or seeks a remedy beyond the jurisdiction of the district court, the district court shall order the entire case removed to superior court. 75 CRLJ 14A(b); see 4B Karl B. Teglund, Washington Practice 317 (6th ed.2002) (noting that CRLJ 14A was enacted to avoid splitting causes of action). Because Washington procedural rules would have required the district court to remove the case to superior court, we find no merit in Noel's jurisdictional argument. See J & J Drilling, Inc. v. Miller, 78 Wash.App. 683, 898 P.2d 364, 367 (1995). 76 Noel also argues that the Clark County District Court lacked jurisdiction to consider his federal wiretapping claims. Again, we find no merit in his argument. Noel claims that only a court of competent jurisdiction may hear cases arising under the federal wiretapping statute, and that a state court is not such a court. The provision he cites, 18 U.S.C. § 2518(1), concerns which judges may authorize wiretap orders; it has nothing to do with civil suits. The provision authorizing civil actions, 18 U.S.C. § 2520, includes no jurisdictional restriction. See Allen v. McCurry, 449 U.S. 90, 103-05, 101 S.Ct. 411, 66 L.Ed.2d 308 (1980) (holding that a state-court judgment on a question of federal law is entitled to preclusive effect in federal court). Because Noel's jurisdictional argument fails, we move on to consider the application of Washington's compulsory counterclaim rule. 77
78 Washington's compulsory counterclaim rule, Civil Rule (CR) 13(a), provides: 79 Compulsory Counterclaims: A pleading shall state as a counterclaim any claim which at the time of serving the pleading the pleader has against any opposing party, if it arises out of the transaction or occurrence that is the subject matter of the opposing party's claim and does not require for its adjudication the presence of third parties of whom the court cannot acquire jurisdiction. But the pleader need not state the claim if (1) at the time the action was commenced the claim was the subject of another pending action.... 80 CR 13(a); CRLJ 13(a). 9 If a party does not assert a compulsory counterclaim, that party is barred from asserting that claim as an independent claim or as a counterclaim in any other action. Krikava v. Webber, 43 Wash.App. 217, 716 P.2d 916, 918 (1986). The Washington Supreme Court has adopted [a] liberal and broad construction of Rule 13(a) to avoid a multiplicity of suits. Schoeman v. N.Y. Life Ins. Co., 106 Wash.2d 855, 726 P.2d 1, 5 (1986). 81 Under Washington's Rule 13(a), the criteria for a compulsory counterclaim are that the claim must arise from the same transaction or occurrence, must not require parties over whom the court may not assert jurisdiction, must not be the subject of a pending action, and must lie against an opposing party. We address each of these requirements separately. 82
83 Washington has adopted a logical relationship test to determine whether a claim and counterclaim arise from the same transaction or occurrence: 84 [C]ourts should give the phrase `transaction or occurrence that is the subject matter' of the suit a broad realistic interpretation in the interest of avoiding a multiplicity of suits.... [A]ny claim that is logically related to another claim that is being sued on is properly the basis for a compulsory counterclaim. 85 Id. at 6 (quoting Rosenthal v. Fowler, 12 F.R.D. 388, 391 (S.D.N.Y.1952)) (first alteration in original). All nine of Noel's claims dismissed by the district court on summary judgment arose from events surrounding the same horse, same mobile home, and same tape recordings as those in the state-court suits. 86 Noel's wiretapping claims all relate to the tape-recorded conversations found in the mobile home. These recordings were the subject of Sandra Hall's 1998 suit against Noel in Clark County District Court. In that suit, Sandra Hall claimed that Noel had intercepted private communications, listened to them without her consent, and used embarrassing information to humiliate her. Noel now claims that in May 1997 the Halls entered the mobile home and stole the tapes, disclosed the contents of the tapes to discredit him, and attempted to use the tapes to extort and blackmail him and to interfere with his business. We conclude that the two sets of claims are logically related within the meaning of Washington law. See id. at 6. 87
88 Noel asserts that his wiretapping claims are not unasserted compulsory counterclaims under Rule 13(a) because they involve three additional parties—Gabrielle Lennartz, Michelle Merchant, and Herb Weisser—over whom the Washington courts could not have acquired jurisdiction. Noel alleges that Lennartz, Merchant, and Weisser conspired with the Halls to use the tape-recorded conversations removed from the mobile home against him in various ways. Noel argues that he could not have asserted counterclaims against these three defendants in the Clark County District Court suit concerning the wiretapping violations because that court could not have asserted personal jurisdiction over them. 89 Even if we assume that Washington courts could not have acquired personal jurisdiction over these three defendants, for Noel's argument to be valid, they would have had to have been so important to Noel's counterclaims that they would have been not merely necessary but indispensable parties under Washington's Rule 19, thus requiring the dismissal of the counterclaims in their absence. See CRLJ 19(a); Harvey v. Bd. of County Comm'rs, 90 Wash.2d 473, 584 P.2d 391, 392 (1978). Noel has made no showing that these three defendants would have been indispensable parties to any otherwise compulsory counterclaims in Washington State courts. 90 Moreover, we do not agree with Noel's assertion that Washington State courts would not have been able to acquire personal jurisdiction over Lennartz, Merchant, and Weisser. Under Washington law, the following factors must coincide for there to be personal jurisdiction over a nonresident defendant: (1) The nonresident defendant ... must purposefully do some act or consummate some transaction in the forum state; (2) the cause of action must arise from, or be connected with, such act or transaction; and (3) the assumption of jurisdiction ... must not offend traditional notions of fair play and substantial justice. Shute v. Carnival Cruise Lines, 113 Wash.2d 763, 783 P.2d 78, 80 (1989) (internal quotation marks omitted); see Wash. Rev.Code § 4.28.185. Noel accuses Lennartz, Merchant, and Weisser of conspiring to use the tapes removed from the mobile home to injure him and his business. Based on these actions, Washington courts could have asserted personal jurisdiction over them under Washington law. These actions also satisfy the minimum contacts requirement of the federal Due Process Clause. See Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945). 91
92 Washington's Rule 13(a) excuses a defendant from asserting an otherwise compulsory counterclaim if at the time the action was commenced the claim was the subject of another pending action. Noel argues that his wiretapping claims are not barred as unasserted compulsory counterclaims because on January 29, 1998, when Sandra Hall filed her complaint against Noel in Clark County District Court for privacy and wiretap violations, Noel had pending in superior court in Skamania County a claim relating to the tape-recorded conversations under the federal wiretapping statute, 18 U.S.C. §§ 2511-2520. On May 28, 1998, however, four months after Hall filed her complaint in the Clark County District Court, the Skamania court, following Hall's unopposed motion for voluntary dismissal, dismissed both Hall and Noel's wiretapping claims. The court explained that another action was pending in Clark County District Court and Clark County would be a forum more convenient to the parties. 93 When the Skamania court dismissed the wiretapping claims, Noel had already filed his answer in Clark County District Court two months earlier, on March 27, 1998. In his answer, Noel had raised as a defense the fact that the action was already pending in Skamania County. Although Noel argued in his answer that the Skamania County action had priority, he did not oppose the motion to dismiss the wiretapping claims from the Skamania County lawsuit. Noel then elected not to amend his pleadings in the Clark County action to assert his wiretapping claims as counterclaims in that suit. Under Washington Rule 15(a), leave to amend a pleading shall be freely given when justice so requires. CRLJ 15(a); see also Wilson v. Horsley, 137 Wash.2d 500, 974 P.2d 316, 319 (1999) (discussing liberal amendment policy under the identically worded CR 15(a)). Although Noel would have had to seek permission from the Clark County District Court to amend his pleading to assert his wiretapping claims, we can see no bar in Washington law to such an amendment. 94 We have found no Washington authority interpreting the pending claim exception to Rule 13(a). The purpose of the exception, however, is to prevent Party A from forcing Party B, who has a pending claim against Party A in another forum, into a forum of Party A's choosing. See Union Paving Co. v. Downer Corp., 276 F.2d 468, 470 (9th Cir.1960) (interpreting the analogous federal Rule 13(a)). Here, the Skamania County Superior Court dismissed the pending claims specifically to allow the parties to litigate all the wiretapping claims in the Clark County District Court. Noel neither opposed the motion to dismiss, nor argues to us that he could not have asserted his wiretapping claims in the Clark County suit after they were dismissed from the Skamania County suit. We therefore conclude that Noel's failure to amend his pleadings in the Clark County suit does not now allow him to escape the characterization of his unasserted claims in that court as compulsory. 95
96 Rule 13(a) makes compulsory only counterclaims against an opposing party in the lawsuit. Noel's wiretapping claims are logically related to and thus should have been brought as counterclaims in Sandra Hall's Clark County wiretapping and privacy suit. Therefore, Noel should have brought his wiretapping claims against Sandra Hall in the Clark County suit, and they are now precluded as unasserted compulsory counterclaims. 97 Brian Hall, however, was not a plaintiff— and thus not an opposing party—in Sandra Hall's Clark County suit. Therefore, Noel's wiretapping claims against him were not compulsory counterclaims in that suit. The Washington courts have adopted a strict reading of Rule 13(a)'s requirement that a pleader must bring compulsory counterclaims against any opposing party. In Nancy's Product, Inc. v. Fred Meyer, Inc., 61 Wash.App. 645, 811 P.2d 250 (1991), the Washington appeals court held: 98 To interpret the term opposing party in the context of the court rules so as to include a nonparty with an adverse interest is a non sequitur. We hold that an opposing party for purposes of CR 13(a) is one who asserts a claim against the prospective counterclaimant in the first instance. 99 Id. at 253. 100 Thus, even though Noel's present claims were compulsory counterclaims in the earlier suit as to Sandra, they were not as to Brian. We therefore reverse the district court's grant of summary judgment for Brian Hall with respect to Noel's wiretapping claims (Claim 1, 2, 6, 8, 9, and 10).