Court Opinion

ID: 9452776
Source: CourtListenerOpinion
Date Created: 2023-08-04 17:51:37.066855+00
Date Added: 2024-06-11T17:33:21.187505
License: Public Domain

GANEY, Circuit Judge
(dissenting).
In this country federal jurisdiction was originally vested in the courts of the United States under the Judiciary Act of 1789. By the Eleventh Section thereof the courts of the United States were vested with original jurisdiction of “all suits of a civil nature at common law or in equity” where the amount in dispute exceeded the sum of $500 and the parties were citizens of different states. Present jurisdiction is vested under 28 U.S.C.A. § 1332(a) (1) in which, under the 1948 revision of this section, the words “civil action” were substituted for the words “suits of a civil nature”, but this was done only to conform to Rule 2 of the Federal Rules of Civil Procedure and the change had no substantial effect on the jurisdiction of the courts. Rosen v. Alleghany Corp., D.C., 133 F.Supp. 858, 865. Here, there is a requisite citizenship between different states among the parties and it is submitted that the aggregate value of the plaintiff’s sixty-two shares of stock in the company is in excess of $10,000 and, accordingly, the amount in controversy is measured by the value of the shareholder’s investment and, therefore, the jurisdictional amount is well pleaded. Lapides v. Doner, D.C., 248 F.Supp. 883, 895.
The focal point of our inquiry here is since the action laid in the complaint is one for mandamus whether, in the exercise of the court’s jurisdiction, it has the power to dispose of it.
There can be no denying the assertion by the majority, as it is abundantly evident that under the All Writs Act, 28 U.S.C.A. § 1651, where mandamus is sought by way of relief under a federal •statute, it will not lie and that it can only be invoked in furtherance of a jurisdiction already acquired. This is established by an almost unanimous authority beginning with Mclntire v. Wood, 7 Cranch 504, 3 L.Ed. 420, through Smith v. Allyn, 22 Fed.Cas.No. 13,001, 1 Paine 453; Graham v. Norton, 15 Wall. 427, 21 L.Ed. 177; Bath County v. Amy, 80 U.S. 244, 20 L.Ed. 539; Knapp v. Lake S. & M. S. Ry., 197 U.S. 536, 537, 25 S.Ct. 538, 49 L.Ed. 870 to Covington and Cincinnati Bridge Co. v. Hager, 203 U.S. 109, 111, 27 S.Ct. 24, 51 L.Ed. 111, the reason stated being that the courts of the United States, in construing the All Writs Act, have no power to issue a writ of mandamus in an original action brought for the purpose of securing relief by the writ.
Likewise, the courts have followed like reasoning in diversity cases relying on the same reasoning given in Mclntire v. Wood, supra, and the other cases following it, citing County of Greene v. Daniel, 102 U.S. 187, 26 L.Ed. 99; Davenport v. County of Dodge, 105 U. S. 237, 26 L.Ed. 1018; Rosenbaum v. Bauer, 120 U.S. 450, 7 S.Ct. 633, 30 L. Ed. 743, though, here, there was a dissent which applied the conformity statute then in effect, § 914, Rev.Stat., and it is suggested that the majority may have felt that since the conformative statute was a federal statute, the same restriction on the jurisdiction of the court applied as in all the other cases theretofore.
However, in spite of this great weight of authority, it is my opinion that the writ should issue. In so holding it is unnecessary to breast the great tide of authority hereinbefore mentioned, for, in my judgment, in construing these diversity cases, the courts have never *208accorded Erie R. R. v. Tompkins, 304 TJ.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188, its full authority in this field, nor have they given proper acceptance to its complete potential. It is submitted that a proper basis for allowing the issuance of the writ is to give full effect to the power of a federal court expressed therein. This for the reason that in the growing complexities of modern business, through mergers and absorptions of corporate entities which spread over many states, the federal courts should not be shackled from granting relief as here, but should embrace, within the orbit of Erie R. R. v. Tompkins, supra, an expansive reach in order to meet the growing needs of the substantive rights embodied in state statutes and grant a remedy, if one is provided by state statutes, as in our case, and, even in its absence, fashion a remedy of its own under its inherent equity power.
The instant case provides an excellent example for, under the Pennsylvania Business Corporation Law, a substantial civil right is given to a shareholder. Further, this substantial civil right given by § 308(B) of the Business Corporation Law of May 5, 1933, P.L. 364, is properly enforceable in Pennsylvania by the legal action of mandamus. Hagy v. Premier Manufacturing Corp., 404 Pa. 330, 172 A.2d 283. In a federal court, under Erie R. R. v. Tompkins, supra, sitting as a state court, the granting of the writ exercises no involvement of the All Writs Act or its successor statutes and, accordingly, no power to do so flows therefrom, for, irrespective of it, the court has full power to give effect to a substantial right given by a state and to give to it the enforcement thereof granted by the highest decisional court in that state and, accordingly, draws on no federal power for its enforcement, but gives effect to authority rooted in state law and thereby merely follows state procedure.
An indication of this approach finds basis in this court. In Susquehanna Corp. v. General Refractories Co., 250 F.Supp. 797, 802, the lower court spoke as follows: “But even if that were not so [discussing the insufficient length of time between the granting of the writ and the stockholders’ meeting], it is by no means certain that the federal diversity court could not grant mandamus when that remedy would be granted by a state court as a matter of state law. The cases defendants cite, holding mandamus to be beyond the powers of the federal courts, do not specifically consider the question in the context of a state mandamus statute sought to be applied in the federal court under Erie [Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188]. As Loss remarks, ‘on the assumption that the equitable remedial rights doctrine is dead * * * the statutory case is easy: the federal courts will use the state statute * * * ’ 2 Loss 1005. But see Newark Morning Ledger Co. v. Republican Company, 188 F.Supp. 813 (D.Mass.1960). For Erie purposes, the ‘remedy’ of mandamus may be a matter of substantive state law which the diversity court would be bound to apply.” The lower court was affirmed by this court in a per curiam opinion at 3 Cir., 356 F.2d 985. It is to be noted here that in Newark Morning Ledger Co. v. Republican Co., D.C., 188 F.Supp. 813, this approach under Erie R. R. v. Tompkins, supra, was not taken into consideration by the court.
Likewise, in Hertz v. Record Publishing Co., 219 F.2d 397, where mandamus was permitted because it was in aid of a jurisdiction previously acquired, nevertheless stated in footnote 2, page 398, by way of dictum, “However, even if title to stock were not in issue, the district court had jurisdiction to issue the order. Under Pennsylvania law a shareholder has the substantive right to have his stock transferred on the corporation’s books and to have a new certificate issued. Mandamus is available to him by statute.” Accordingly, it would seem proper that this court should now come full cycle and hold that a substantive civil right granted by a state statute which the highest court of that state, in its decisional rul*209ings, holds might be enforced by a mandamus statute of that state, should not only recognize the substantive right granted under the statute, but, as well, the remedy provided by the state statutes, in a diversity case.