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INSURANCE FEDN. OF PENNSYLVANIA v. SUPREME COURT O

April 17, 1980

INSURANCE FEDERATION OF PENNSYLVANIA, INC., et al.
v.
SUPREME COURT OF PENNSYLVANIA, et al.



The opinion of the court was delivered by: NEWCOMER

MEMORANDUM AND ORDER

This is a suit by twelve named institutional plaintiffs against the Supreme Court of Pennsylvania and its member Justices, challenging the constitutionality of Pennsylvania Rule of Civil Procedure 238 under the Fourteenth Amendment to the United States Constitution. Jurisdiction of this Court is based on 28 U.S.C. ยงยง 1331 and 1343. Rule 238 provides that "damages for delay" shall be added to any judgment recovered in an action for personal injury, death or property damage in the Pennsylvania courts, in the amount of ten percent of the underlying judgment, per annum, for each year or part thereof during which the case is pending. The Rule also provides that damages for delay will not be assessed from the date a settlement offer is made if the offer is in an amount equal to or greater than eighty percent of the judgment ultimately recovered by the personal injury plaintiff. *fn1"

 The plaintiffs seek a declaration that Rule 238 denies them equal protection and due process of law as defendants in the Pennsylvania courts *fn2" , and they seek to enjoin the continued application of Rule 238 in the courts of the Commonwealth.

 The defendants have moved to dismiss the plaintiffs' complaint. For the reasons set forth below, the defendants' motion is granted.

 This Court will not, indeed cannot, reach merits of the plaintiffs' constitutional claims. Principles of federalism preclude our consideration of the substantive issues raised in the complaint.

 One of the apparent objects of Rule 238 is to compensate plaintiffs for the loss of the use of funds to which they are entitled, that is, to make them whole. Part (e) of Rule 238 indicates, however, that the Rule has purposes other than compensation of injured plaintiffs. If a plaintiff has refused to accept a settlement offer that is as low as eighty percent of his actual loss as determined by judgment, delay damages will not be assessed for the time after which the offer was made. An obvious purpose of the provision is to encourage early settlements. The state's interest in the operation of the Rule is manifest. *fn3"

 This case is controlled by the decision of the United States Supreme Court in Juidice v. Vail, 430 U.S. 327, 97 S. Ct. 1211, 51 L. Ed. 2d 376 (1977). There, the Court held that principles of comity and federalism require the federal courts to abstain from exercising jurisdiction over federal constitutional claims where the exercise of jurisdiction would result in unnecessary infringement of a state's interest in the administration of civil litigation in its courts.

 Juidice was a suit against members of the New York judiciary, brought in the United States District Court for the Southern District of New York, challenging the constitutionality of New York's procedures governing civil contempt. The federal plaintiffs were state court judgment debtors who were held in civil contempt in the state courts for failure to appear at post-judgment proceedings relating to satisfaction of judgments. A thre-judge federal district court declared the New York contempt provisions constitutionally invalid because they permitted a civil litigant to be held in contempt of court, fined and jailed, without appropriate notice, a full adversary hearing, and representation by counsel. Vail v. Quinlan, 406 F. Supp. 951, 959-60 (S.D.N.Y.1976).

 On appeal, the Supreme Court reversed, holding that the district court should not have reached the merits of the constitutional claims, but instead should have abstained in favor of state court adjudication of those claims. The Court set forth the reasons for its decision in language particularly instructive to the case at hand:

 
"(T)he principles of Younger (v. Harris, 401 U.S. 37, 91 S. Ct. 746, 27 L. Ed. 2d 669 (1971)) and Huffman (v. Pursue, Ltd., 420 U.S. 592, 95 S. Ct. 1200, 43 L. Ed. 2d 482 (1975)) are not confined solely to the types of state actions which were sought to be enjoined in those cases. As we emphasized in Huffman, the "more vital consideration' behind the Younger doctrine of nonintervention lay not in the fact that the state criminal process was involved but rather in
 
" "the notion of "comity' that is, a proper respect for state functions, a recognition of the fact that the entire country is made up of a Union of separate state governments and a continuance of the belief that the National Government will fare best if the States and their institutions are left free to perform their separate functions in their separate ways." " Huffman, 420 U.S. at 601, (95 S. Ct. at 1206), quoting Younger, 401 U.S. at 44, 91 S. Ct. at 750.
 
These principles apply to a case in which the State's contempt process is involved. A State's interest in the contempt process, through which it vindicates the regular operation of its judicial system, so long as that system itself affords the opportunity to pursue federal claims within it, is surely an important interest. . . . The contempt power lies at the core of the administration of a State's judicial system (citation omitted). Whether disobedience of a court-sanctioned subpoena, and the resulting process leading to a finding of contempt of court, is labeled civil, quasi-criminal, or criminal in nature, we think the salient fact is that federal-court interference with the State's contempt process is "an offense to the State's interest . . . likely to be every bit as great as it would be were this a criminal proceeding,' Huffman, supra, (420 U.S.), at 604, (95 S. Ct. at 1208). Moreover, such interference with the contempt process not only "unduly interfere(s) with the legitimate activities of the Stat(e),' Younger, supra (401 U.S.), at 44 9 (91 S. Ct. at 750), but also "can readily be interpreted as reflecting negatively upon the state court's ability to enforce constitutional principles.' Huffman, supra,(420 U.S.), at 604 (95 S. Ct. at 1208)."

 Juidice v. Vail, supra, 430 U.S. at 334-6, 97 S. Ct. at 1217-1218.

 The similarities between the facts of Juidice and those of the instant case bear enumeration. Both cases were brought by defendants in pending state civil litigation against members of the state judiciary to invalidate, on federal constitutional grounds, state law governing civil procedure. In both cases the language of the state law is unambiguous and a narrowing interpretation is unlikely. See Vail v. Quinlan, supra, 406 F. Supp. at 957-8. Both suits are challenges to state laws affecting the collection or assessment of money damages by or on behalf of prevailing civil litigants. See Juidice, supra, 430 U.S. at 329-30, 97 S. Ct. at 1214. Both laws further the states' interests in affording civil litigants prompt vindication of their rights. Finally, ...


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