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ARONSON v. SPRINT SPECTRUM

January 12, 2000

MARK B. ARONSON, AND JOSEPH G. KANFOUSH, PLAINTIFFS,
V.
SPRINT SPECTRUM, L.P., AND SPRINT COMMUNICATIONS COMPANY, L.P., EACH INDIVIDUALLY AND EACH DOING BUSINESS AS SPRINT PERSONAL COMMUNICATIONS SERVICES, DEFENDANTS.



The opinion of the court was delivered by: Ziegler, Chief Judge.

OPINION

Pending before the court is the motion (doc. no. 2) of defendants, Sprint Spectrum, L.P., Sprint Communications Company, L.P., and Sprint Personal Communications Services (collectively "Sprint"), to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) and the motion (doc. no. 5) of plaintiffs, Mark B. Aronson and Joseph G. Kanfoush, to remand pursuant to 28 U.S.C. § 1447(c) for lack of jurisdiction. For the reasons that follow, defendants' motion will be denied and plaintiffs' motion will be granted.

I. FACTS

On or about September 23, 1999, plaintiffs commenced this action in the Court of Common Pleas of Allegheny County, Pennsylvania, alleging invasion of privacy. Plaintiffs claimed that defendants' account system improperly allowed any person access to personal, confidential information. Specifically, plaintiffs asserted that Sprint customers who accessed their account information via the internet or the Sprint toll-free customer service number (when answered by a live person) were required to provide a predesignated secret account password ("PIN"). However, those persons accessing the toll-free number and using automated customer service, or any person with a wireless telephone that works on the Sprint network who dials "2 TALK," "2 SEND," "2 OK," or "2 CALL," could access account information by inputting the five digit post office zip code of the address where Sprint mails the monthly statement for that Sprint telephone number. Plaintiffs asserted that a third party could gain access to any Sprint customers' account if the third party knew the telephone number and billing address zip code for that customer, without using a PIN. Notwithstanding this practice, plaintiffs did not allege that any third party had gained access to their private accounts.

On or about October 29, 1999, Sprint removed the action to federal court, asserting federal preemption of plaintiffs' state law claims. Thereafter, Sprint filed the pending motion to dismiss claiming that plaintiffs' state law claim is preempted by section 222 of the Federal Telecommunications Act of 1996 and that any claim for injunctive relief plaintiffs might subsequently seek are unavailable because plaintiffs had not exhausted available administrative remedies. Defs.' Br. at 4-10. Plaintiffs filed a motion to remand the action, contending that the court lacks jurisdiction to address the issues raised in the state court complaint. We will consider these arguments below.

II. DISCUSSION

We will first consider plaintiffs' motion to remand for this decision affects our jurisdiction over other pending matters, including Sprint's motion to dismiss. Plaintiffs argue that remand is warranted because this court lacks subject matter jurisdiction over this controversy. Specifically, plaintiffs reason that federal jurisdiction is wanting because the invasion of privacy claim does not arise under the Federal Telecommunications Act of 1996 ("FTA"), 47 U.S.C. § 151 et seq. Rather, the "subject matter, the issues raised, and the relief sought are each regulated by the Commonwealth of Pennsylvania. 66 Pa. C.S.A. § 1302 (Supp)." Pls.' Mot. ¶ 8.*fn1 Plaintiffs further reason that jurisdiction cannot be exercised because the Pennsylvania Public Utility Commission ("PUC") regulates Sprint's practices. Pls.' Mot. ¶ 9. Finally, plaintiffs contend that section 221 of the FTA supports the motion for remand*fn2 and section 222 is irrelevant to the instant lawsuit. Defendants rejoin that removal is appropriate because section 222 of the FCA preempts state regulation in this area. Defs.' Br. in Opp'n Mot. Dismiss at 5-10.

When confronted with a motion to remand, the removing party has the burden of establishing the propriety of removal. See Packard v. Provident Nat'l Bank, 994 F.2d 1039, 1045 (3d Cir.), cert. denied sub nom. Upp v. Mellon Bank, N.A., 510 U.S. 964, 114 S.Ct. 440, 126 L.Ed.2d 373 (1993); accord Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990), cert. denied, 498 U.S. 1085, 111 S.Ct. 959, 112 L.Ed.2d 1046 (1991). Accordingly, we will consider defendants' arguments initially.

Plaintiffs' state court complaint relies solely on state law. Under 28 U.S.C. § 1441, only state court actions over which "the district courts of the United States have original jurisdiction, may be removed by the defendant." As the asserted basis of federal jurisdiction in this case is 28 U.S.C. § 1331 (federal question), see Doc. No. 1 ¶ 6, the "well-pleaded complaint rule" applies. For a case to be removable under § 1441 and § 1331, the well-pleaded complaint rule requires the federal question to be presented on the face of the plaintiff's properly pleaded complaint. See Rivet v. Regions Bank of La., 522 U.S. 470, 475, 118 S.Ct. 921, 139 L.Ed.2d 912 (1998); Caterpillar Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987); Gully v. First Nat'l Bank, 299 U.S. 109, 112-13, 57 S.Ct. 96, 81 L.Ed. 70 (1936). In addition, under this rule:

a case may not be removed to federal court on the basis of a federal defense, including the defense of pre-emption, even if the defense is anticipated in the complaint, and even if both parties concede that the federal defense is the only question truly at issue.

Caterpillar, 482 U.S. at 393, 107 S.Ct. 2425 (emphasis added); Rivet, 522 U.S. at 475, 118 S.Ct. 921; Gully, 299 U.S. at 112, 57 S.Ct. 96.

The Supreme Court, however, has fashioned an "independent corollary" to the well-pleaded complaint rule, known as the "complete preemption doctrine." The complete preemption doctrine provides that "Congress may so completely preempt a particular area, that any civil complaint raising that select group of claims is necessarily federal in character." Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63-64, 107 S.Ct. 1542, 95 L.Ed.2d 55 (1987). In such cases, "any complaint that comes within the scope of the federal cause of action [created by the federal statute] necessarily `arises under' federal law" for purposes of removal based on federal question jurisdiction. Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 24, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983); Rivet, 522 U.S. at 475-76, 118 S.Ct. 921.

The Supreme Court has narrowly interpreted the scope of the complete preemption doctrine. Since 1968, the Court has found complete preemption in only two settings: (1) claims alleging a breach of a collective bargaining agreement that fall under § 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185, see Avco Corp. v. Aero Lodge No. 735, 390 U.S. 557, 88 S.Ct. 1235, 20 L.Ed.2d 126 (1968), and (2) claims for benefits or enforcement of rights under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1132(a)(1)(B), see Metropolitan Life, 481 U.S. at 63-67, 107 S.Ct. 1542. Indeed, in a well-noted concurrence, Justice Brennan cautioned that, "[i]n future cases involving [the application of the complete preemption doctrine to] other statutes, the prudent course for a federal court that does not find a clear congressional intent to create removal jurisdiction will be to remand the case to state court." Metropolitan Life, 481 U.S. at 68, 107 S.Ct. 1542. Therefore, as with remand motions generally, all doubts should be resolved against removal and in favor of remand to the state court. See Boyer, 913 F.2d at 111.

The Court of Appeals, recognizing the limited basis for "recharacterizing a state law claim as a federal claim removable to district court," has articulated a two-prong test to determine the applicability of the complete preemption doctrine. See Railway Labor Executives. Ass'n v. Pittsburgh & Lake Erie R.R. Co., 858 F.2d 936, 942 (3d Cir. 1988); see also Goepel v. National Postal Mail Handlers Union, 36 F.3d 306, 311 (3d Cir. 1994), cert. denied, 514 U.S. 1063, 115 S.Ct. 1691, 131 L.Ed.2d 555 (1995). First, the purported preempting statute must contain "civil enforcement provisions within the scope of which the plaintiff's state claim falls." Railway, 858 F.2d at 942. If this is satisfied, a district court then must determine "whether there is a clear indication of a Congressional intention to permit removal despite the plaintiff's exclusive ...


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