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KAEMPFER v. BROWN

March 18, 1988

J. W. Kaempfer, Jr., et al., Plaintiffs,
v.
Philip J. Brown, et al., Defendants



The opinion of the court was delivered by: PRATT

 JOHN H. PRATT, Judge, United States District Judge.

 The present action is one in a long series of lawsuits, bankruptcy proceedings, arbitrations and appeals relating to the commercial development of property located at 1250 24th St., N.W., Washington, D.C. by J.W. Kaempfer and affiliated groups. This adversary proceeding was transferred to us from the United States Bankruptcy Court on January 6, 1987. Plaintiffs seek declaratory and injunctive relief regarding their purchase of a 37.5% interest in the property identified above. Defendants, *fn1" owners of the remaining interest in the property, have answered plaintiffs' complaint and in turn asserted counterclaims against plaintiffs, American Security Bank, N.A., *fn2" and Robert McChesney. *fn3"

 In a Memorandum Order dated June 2, 1987 we granted American Security Bank and Robert McChesney's motions to dismiss the counterclaims against them. In the motion presently before us, American Security Bank (American) seeks to enjoin these defendants from 1) continuing to prosecute an action entitled Philip J. Brown, et al. v. American Security Bank, N.A., C.A. No. 7403-87, in the Superior Court of the District of Columbia, *fn4" and 2) commencing future litigation, or "serving any legal process upon" American without the prior approval of this court. Upon careful consideration of the briefs filed by the parties and the record as a whole, we grant American's motion in its entirety.

 Background

 In 1979 the debtor-defendants agreed to lease Loretto Brown's 37.5% interest in the family's property at 1250 24th Street for as long as Loretto Brown lived. The Agreement provided the Brown family, upon Loretto Brown's death, the right to purchase his interest in the real estate within six months of his death by paying "all cash" to the Estate.

 In 1981, the Browns and their company, B&W Management, filed for bankruptcy under Chapter 11 of the United States Bankruptcy Code. As part of the Amended Plan of Arrangement approved by the Bankruptcy Court in 1983, the Kaempfer Company obtained the right to purchase Loretto Brown's interest in the estate in the final month of the six-month period, if the defendants did not purchase it earlier. After Loretto Brown's death on March 28, 1986, the Browns sought financing to purchase the 37.5% interest. They were ultimately unable to tender the "cash" necessary to satisfy the Estate's requirements for purchase within the period provided.

 On September 3, 1986, Kaempfer Company transferred its previously acquired right to purchase the property interest to 1250 24th Street Associates Limited Partnership (Associates). On the same day Associates tendered $ 1.8 million in cash to the Estate of Loretto Brown. The Estate accepted the tender and delivered the deed to Associates.

 Plaintiffs J.W. Kaempfer, the Kaempfer Company, Associates, 1250 24th Street Associates Land Partnership and the Estate of Loretto Brown bring this suit seeking a declaratory judgment that the purchase of the property was valid and effective, and that they are in no way liable to the defendants or Trustee. As noted, defendants filed a counter-claim against American, alleging in essence that American acted improperly to "block" efforts by the Brown family to obtain a loan to finance their acquisition of the 37.5% interest in the property. Defendants alleged tortious interference with contract and tortious interference with business opportunity or expectation by American.

 Discussion

 I. Motion for Injunction of District of Columbia Superior Court Action

 A. The 'Relitigation Exception' to the Anti-injunction Act

 The authority and equitable power to enjoin a proceeding in a state court is restricted and limited by Title 28 of the United States Code. Section 2283 of that Title prohibits a federal court from enjoining 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 " (emphasis added). 28 U.S.C. ยง 2283 (1982). The latter exception to the general prohibition against enjoining state court proceedings is known as the "relitigation exception."

 American asserts that an injunction is necessary in order to "protect or effectuate" our earlier judgment of June 2, 1987 denying defendants' cross-claim against American. It is well settled that when a final judgment has been rendered in a federal court on the same matter as asserted in the state court suit, the federal court is empowered to protect that judgment by granting the type of injunctive relief sought here. See Woods Exploration and Production Co. v. Aluminum Company of America, 438 F.2d 1286, 1312-13 (5th Cir. 1971), cert. denied, 404 U.S. 1047, 30 L. Ed. 2d 736, 92 S. Ct. 701 (1972); In Re National Student Marketing Litigation, 655 F. Supp. 659, 662 (D.D.C. 1987). It is within the court's discretion to decide whether or not to take ...


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