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ISAAC JOHNSON v. MOBIL OIL CORPORATION (05/26/89)

decided: May 26, 1989.

ISAAC JOHNSON, APPELLEE,
v.
MOBIL OIL CORPORATION, APPELLANT



Appeal from the Orders of the Superior Court Entered on May 8, 1987 and July 21, 1987, at No. 1547 Philadelphia, 1986 Reversing and Remanding the Order of the Court of Common Pleas of Chester County, Civil Action, No. 118 August Term, 1982 Entered May 5, 1986. Pa. Superior Ct. , A.2d (19 ).

COUNSEL

Edward F. Mannino, John M. Elliott, Virginia Lynn Hogben, Richard B. Wickersham, and Ann M. Caldwell, Philadelphia, for appellant.

John L. Lachall, West Chester, for Isaac Johnson.

Nix, C.j., and Larsen, Flaherty, Zappala, Papadakos and Stout, JJ. Flaherty, J., files a dissenting opinion in which Nix, C.j., joins. McDermott, J., did not participate in the consideration or decision of this matter. Stout, former J., did not participate in the decision of this matter.

Author: Papadakos

[ 522 Pa. Page 107]

OPINION OF THE COURT

This case arises from an action brought by Appellee, Isaac Johnson, involving a trial franchise agreement to operate a gasoline service station. Appellee brought suit in the Court of Common Pleas of Chester County against Appellant, Mobil Oil Corporation ("Mobil") along with one of its employees (who is no longer involved in this appeal). That court granted summary judgment and partial summary judgment against Appellee on Counts I and II of his complaint; and dismissed Count III for lack of subject matter jurisdiction. Count III was based on the Petroleum Marketing Practices Act ("PMPA"), 15 U.S.C. §§ 2801-2806, and the trial court thought that suit under this Act could be brought only in federal court. The Superior Court, in an opinion by President Judge Cirillo, reversed the summary judgments on Counts I and II, and also reversed the dismissal of Count III for lack of jurisdiction.

In August, 1981, Appellee became an independent dealeroperator for Mobil under a trial franchise agreement which was to run for a period of one year. By an expressed notice of non-renewal, the franchise agreement was not renewed by Mobil and thereby was terminated at the end of the one year. In not renewing the trial franchise agreement, Mobil asserts that it fully complied with all the requirements of the PMPA applicable to trial franchises. Following this non-renewal, Appellee filed the aforementioned three-count Complaint in the Court of Common Pleas of Chester County. Appellee alleged in Count I that Mobil was liable under Pennsylvania law for breach of contract in not renewing the trial franchise agreement. In Count II, he alleged that Mobil was liable under Pennsylvania law for fraud. In Count III, he alleged that Mobil violated the PMPA by failing to renew the trial franchise agreement. 15 U.S.C. § 2802 provides that no franchisor may terminate any franchise prior to the conclusion of the term or fail to renew any franchise relationship except upon grounds expressly set forth in the statute. The trial court granted summary

[ 522 Pa. Page 108]

    judgment in Mobil's favor on Appellee's state law claims (Counts I and II), finding them to be preempted by the PMPA; and dismissed Count III for lack of subject matter jurisdiction, holding that Congress vested exclusive jurisdiction in the federal courts over claims brought under the PMPA. The Superior Court reversed holding that Appellee's state law claims were not preempted by the PMPA. The Superior Court further held that a state court has concurrent jurisdiction over claims brought directly under the PMPA, like Count III, 364 Pa. Super. 275, 528 A.2d 155.

This Court granted Mobil's Petition for Allowance of Appeal limited to the issue of whether federal courts have exclusive jurisdiction over claims brought directly under the PMPA -- the issue raised by Count III of Appellee's Complaint. We are convinced that the Superior Court's holding that state courts have concurrent jurisdiction over PMPA claims ignores the relevant legislative history and Congress' clear intent that the Act be applied uniformly across the country. For the reasons set forth below, we reverse the Superior Court's reinstatement of Count III of Appellee's Complaint, thereby affirming the trial court's dismissal of Count III.

There is a presumption that state courts have concurrent jurisdiction over actions arising under a federal statute, but that presumption may be rebutted "by unmistakable implication from legislative history, or by a clear incompatibility between state-court jurisdiction and federal interests." Gulf Offshore Co. v. Mobil Oil Corp., 453 U.S. 473, 478, 101 S.Ct. 2870, 2875, 69 L.Ed.2d 784 (1981). See also, Charles Dowd Box Co. v. Courtney, 368 U.S. 502, 82 S.Ct. 519, 7 L.Ed.2d 483 (1962); Valenzuela v. Kraft, Inc., 739 F.2d 434 (9th Cir. 1984). In reviewing the few cases which deal with the precise question of whether that presumption is applicable here such that there is concurrent state court jurisdiction over ...


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