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United States of America, For the Use and Benefit of v. Travelers Casualty and Surety Company

October 16, 2011

UNITED STATES OF AMERICA, FOR THE USE AND BENEFIT OF GREENMOOR, INC., PLAINTIFF,
v.
TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA, AND BURCHICK CONSTRUCTION COMPANY, INC.,
DEFENDANTS.



The opinion of the court was delivered by: Magistrate Judge Cathy Bissoon*fn1

MEMORANDUM AND ORDER

I.MEMORANDUM

Pending before the Court are Defendant Burchick Construction Company, Inc.‟s ("Defendant‟s") Motion for Preliminary Injunction (Doc. 195) and Defendant‟s Motion for Leave to Deposit Money With Court (Doc. 197). For the reasons stated herein, the Court will deny Defendant‟s motion for preliminary injunction, and grant in part and deny in part Defendant‟s motion for leave.

BACKGROUND

The facts of this case were set forth in the Court‟s Findings of Fact and Conclusions of Law (Doc. 143). Following a bench trial, the Court entered judgment on December 4, 2009, awarding monetary relief to both Plaintiff Greenmoor, Inc. and Defendant (Doc. 144). The judgment was amended on August 20, 2010 (Doc. 165) and August 4, 2011 (Doc. 188), to specify the amount of statutory interest to be awarded to Plaintiff, and to specify the amount of attorneys‟ fees and costs to be awarded to Defendant. The amount of the monetary award to Defendant combined with the amount of the attorneys‟ fees and costs award exceeds the amount of the monetary award to Plaintiff, but the monetary award to Plaintiff continues to accumulate interest under the Pennsylvania Contractor and Subcontractor Payment Act ("CSPA"). The monetary award to Plaintiff was partially based upon a finding that Defendant breached an escrow agreement when it failed to release funds to Plaintiff from an escrow account. See Findings of Fact and Conclusions of Law at 102-05, 108-09 (Doc. 143). This Court found that "Greenmoor is entitled to the escrow account balance, as well as the accumulated interest owed on that balance." Id. at 108-09. This Court further found that, pursuant to the CSPA, Defendant was liable to Plaintiff for interest on the escrow account balance. Id.

On August 4, 2011, Defendant submitted a letter to the escrow agent requesting payment of all funds in the escrow account to Defendant. Doc. 190-1 at 22. On August 5, 2011, Defendant tendered a check to Plaintiff for $174,244.48. Letter from K. Fernsler to J. Katarincic (Aug. 5, 2011) (Doc. 196-6). According to Defendant, this amount represented the escrow account balance at the time, minus the amount Plaintiff owed Defendant as a result of this Court‟s judgment, and thus was being tendered "in full and final satisfaction of all of the final judgments of the Court to date."*fn2 Id. On August 29, 2011, Plaintiff returned the $174,244.48 check to Defendant. Letter from J. Katarincic to D. Jameson III (Aug. 29, 2011) (Doc. 196-7).

On August 26, 2011, Plaintiff filed a complaint against Joseph E. Burchick and Defendant in the Court of Common Pleas of Allegheny County, asserting causes of action for fraud and conversion. Katarincic Decl. (Doc. 190). In Plaintiff‟s State court complaint, Plaintiff alleges that Defendant made a fraudulent representation to the escrow agent in order to have the escrowed funds released to Defendant. See State Court Complaint (Doc. 190-1).

Also on August 26, 2011, Plaintiff filed a notice of appeal (Doc. 191) in this case. On September 8, 2011, Defendant filed a notice of cross-appeal (Doc. 193). On September 19, 2011, Defendant filed its Motion for Preliminary Injunction (Doc. 195) to stay Plaintiff‟s State court action. On the same day, Defendant filed its Motion for Leave to Deposit Money With Court (Doc. 197), requesting leave to deposit $174,244.48 with this Court. Defendant‟s "Motion for Leave" also requests that this Court "declare that interest on the judgment amount owed by [Defendant] to [Plaintiff] stopped accruing as of August 5, 2011, so long as [Defendant] deposits the designated amount with the Court within the time provided by the Order of Court." Motion for Leave at 3 (Doc. 197).

ANALYSIS

A.Motion for Preliminary Injunction

Despite the pending appeal, this Court maintains jurisdiction to rule on Defendant‟s motion for preliminary injunction. See Fed. R. App. P. 8(a)(1)(C); Mary Ann Pensiero, Inc. v. Lingle, 847 F.2d 90, 97 (3d Cir. 1988).

The Anti-Injunction Act provides that:

A court of the United States may not grant an injunction to stay proceedings in a State court except as expressly authorized by Act of Congress, or where necessary in aid of its jurisdiction, or to protect or effectuate its judgments.

28 U.S.C. § 2283. The Act prohibits enjoining state court proceedings, unless the injunction falls within one of the three specifically defined statutory exceptions. Choo v. Exxon Corp., 486 U.S. 140, 146 (1988); Atl. Coast Line R.R. Co. v. Bhd. of Locomotive Eng‟rs, 398 U.S. 281, 286 (1970). "[A]ny doubts as to the propriety of a federal injunction against state court proceedings should be resolved in favor of permitting the state courts to proceed." Smith v. Bayer Corp., __ U.S. __, __, 131 S.Ct. 2368, 2375 (2011) (quoting Atl. ...


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