Court Opinion

ID: 178937
Source: CourtListenerOpinion
Date Created: 2010-11-08 17:43:08+00
Date Added: 2024-06-11T17:25:46.622227
License: Public Domain

IN THE UNITED STATES COURT OF APPEALS
                           FOR THE THIRD CIRCUIT
                              ________________

                                     NO. 09-4054
                                  ________________

                                JAMES DICKERSON,
                                           Appellant

                                          v.

                  DESIMONE, INC., doing business as DESIMONE
                AUTO GROUP; RANDY FOREMAN, doing business
                as DESIMONE AUTO GROUP; ANTHONY WEISS,
                   doing business as DESIMONE AUTO GROUP
                                 _______________

                   On Appeal From the United States District Court
                      For the Eastern District of Pennsylvania
                       (D.C. Civil Action No. 2-09-cv-01551)
                     District Judge: Hon. Mary A. McLaughlin
                                 ________________

                   Submitted Pursuant to Third Circuit LAR 34.1(a)
                                 November 2, 2010

                   BEFORE: SCIRICA, STAPLETON and ROTH,
                               Circuit Judges

                          (Opinion Filed: November 8, 2010)
                                 _________________

                             OPINION OF THE COURT
                               __________________

STAPLETON, Circuit Judge

      According to the complaint, after being advised that he had been pre-approved for

financing, plaintiff purchased a pickup truck from defendant Desimone Auto Group, Inc.,

(“Desimone”) on January 12, 2008, and promptly replaced the spinning rims. On January
21, 2008, plaintiff concluded that Desimone and its employees, the other defendants, had

failed to secure financing on his behalf and voluntarily returned the truck the next day

without its original spinning rims. That same day defendant Foreman called plaintiff and

demanded return of the original rims. On January 24, 2008, officers of the Philadelphia

Police Department arrived at plaintiff’s home and, after he showed them the rims of the

truck, arrested him for theft of the rims. The prosecution of this offense was ultimately

nolle prossed.

       Plaintiff’s complaint alleges that the sale and financing of the truck violated his

rights under the Pennsylvania Unfair Trade Practices and Consumer Protection law, the

Pennsylvania Motor Vehicle Sales Finance Act, and the Federal Equal Credit

Opportunity Act. It also asserts claims of abuse of process, malicious prosecution and

violation of 42 U.S.C. § 1983 based on plaintiff’s arrest and the ensuing criminal

proceedings.

       Defendants moved to compel the arbitration of all plaintiff’s claims under an

arbitration agreement entered into by plaintiff in connection with the truck purchase.

They also insisted that the abuse of process and malicious prosecution claims failed to

state a claim as a matter of law. Significantly, while defendants maintained that the civil

rights count should be arbitrated, their motion and brief did not argue that it failed to state

a claim for relief. As a result, the plaintiff’s responding brief did not address that issue.

At oral argument, the Court asked plaintiff’s counsel a question regarding whether the

defendants were state actors for purposes of § 1983. In response, counsel pointed out to

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the Court that this was ‘not an issue for the motion to dismiss,” but “off the top of [his]

head,” gave a brief “answer [to] the Court’s question.” 24A-25A.

       The District Court held that plaintiff’s claims for abuse of process, malicious

prosecution and violation of plaintiff’s civil rights were not within the scope of the

arbitration agreement. The remaining claims, however, were found to be within the

scope of that agreement. The Court dismissed those remaining claims and ordered that

they proceed to arbitration. The abuse of process and malicious prosecution claims were

dismissed with prejudice for failure to state a claim. The Court sua sponte also dismissed

with prejudice the civil rights claim for failure to state a claim.

       Following the District Court’s decision, the plaintiff moved for reconsideration

contending inter alia that he should be granted leave to amend his abuse of process and

malicious prosecution claims to cure the deficiencies found by the Court. In an

alternative argument, plaintiff pointed out that the Court’s order dismissed all of the

federal claims and that there was no diversity. Plaintiff contended that under these

circumstances the Court was required to amend its order to provide that the abuse of

process and malicious prosecution claims were dismissed without prejudice so that they

could be pursued in state court. The District Court denied the motion for reconsideration

without opinion.

       Essentially for the reasons set forth in its opinion, we agree with the District Court

that the arbitration agreement is unambiguous and serves to bar plaintiff’s pursuit in this

case of those claims which it directed the parties to arbitrate. Accordingly, we will affirm

that aspect of its judgment.

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       The defendants are correct that a district court in some circumstances may sua

sponte raise the issue of the deficiency of a pleading under Rule 12. One of those

circumstances is where the claim if dismissed would deprive the Court of jurisdiction.

Nevertheless, even in such instances, the Court must afford a plaintiff a fair opportunity

to address the issue before deciding it. Roman v. Jeffes, 904 F.2d 192 (3d Cir. 1990).

Such a fair opportunity was not afforded here with respect to whether the civil rights

count failed to state a claim. Plaintiff had no notice that that issue would be submitted for

decision at the oral argument on defendants’ motions. We will remand so that a fair

opportunity to address that issue can be afforded.

       If after hearing the plaintiff on remand, the Court remains of the view that the civil

rights claim must be dismissed, it should address his contention that it should refrain

from exercising its supplemental jurisdiction under 28 U.S.C. § 1367 over the abuse of

process and malicious prosecution claims. “[W]here the claim over which the district

court has original jurisdiction is dismissed before trial, the district court must decline to

decide the pendent state jurisdiction claims unless considerations of judicial economy,

convenience and fairness to the parties provide an affirmative justification for doing so.”

Borough of West Miffflin v. Lancaster, 45 F.3d 780 (3d Cir. 1995) (citing United Mine

Workers v. Gibbs, 383 U.S. 715 (1996)). The current record does not establish that the

District Court has considered this issue and, even if it has, the absence of an opinion

regarding it deprives us of the capacity to review the Court’s exercise of discretion.

       If the District Court dismisses the civil rights claim and exercises its discretion in

favor of retaining supplemental jurisdiction over the abuse of process and malicious

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prosecution claims, it should provide a brief record explanation of its affirmative

justification for doing so. If it retains supplemental jurisdiction and declines to grant

leave to amend those claims, it should provide a similar explanation for that decision as

well.

        While we affirm the District Court’s rulings regarding arbitration, we will vacate

its judgment and remand for further proceedings consistent with this opinion.

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