Thursday, July 31, 2008
The Fifth Circuit addressed the removal and jurisdictional issue yesterday, and held for the malpractice plaintiff against his defendants, the Duane Morris law firm and its attorney Richard Redano. This is in an opinion [here in pdf] authored by Judge Jerry Smith. The "case within the case" dealt with trademark rights to "Testmasters." The Fifth Ciruit's holding is nicely summarized by the Fifth Circuit Civil News, per Robert McKnight, in an email this morning:
After Redano represented Singh in unsuccessful trademark litigation, Singh sued Redano in Texas state court for legal malpractice. Redano removed on the ground that Singh would have to prove causation by establishing that he should have prevailed in the trademark dispute, and so resolution of trademark issues was necessary to the malpractice claim. The district court agreed, denied Singh's motion to remand, and then dismissed his claim [based on a pending summary judgment motion on the merits].
Holding: Vacated and dismissed for lack of subject matter jurisdiction. "[M]erely because the alleged malpractice occurred in a prior federal trademark suit .... does not confer subject matter jurisdiction under § 1331 or § 1338(a)." The test in a situation such as this is whether "(1) resolving a federal issue is necessary to resolution of the state-law claim; (2) the federal issue is actually disputed; (3) the federal issue is substantial; and (4) federal jurisdiction will not disturb the balance of federal and state judicial responsibilities." Redano could not establish items (3) or (4).
The California-based TestMasters site says, "Our company offers services under the name TestMasters everywhere except Texas. In Texas our company offers services under the name ScorePerfect." The URL of testmasters.com takes you to this Texas-based company. I am likely confused. [Alan Childress]