Breen v. Knapp

640 F.Supp.3d 568

Kacie M. BREEN v. Aaron KNAPP, et al.

CIVIL ACTION No. 22-3962

United States District Court, E.D. Louisiana

Signed November 10, 2022

Richard Lynn Ducote, Richard Ducote, PC, Covington, LA, for Kacie M. Breen.

Donald Lucas Hyatt, II, Donald L. Hyatt, II, APLC, Mandeville, LA, for Aaron D. Knapp.

SECTION I

ORDER & REASONS

LANCE M. AFRICK, UNITED STATES DISTRICT JUDGE

Before the Court is a motion¹ by plaintiff Kacie Breen ("Kacie") for a temporary restraining order. Defendant Aaron Knapp ("Aaron")² opposes³ the motion. For the reasons below, the Court denies the motion.

I. FACTUAL BACKGROUND

In 2015, Kacie shot and killed her husband, Wayne Breen, in their St. Tammany Parish home. Law enforcement determined that she acted in self-defense. Kacie was the named beneficiary on her husband's life insurance policies. Two insurance companies which held policies on Wayne Breen's life commenced interpleader actions pursuant to Rule 22 of the Federal Rules of Civil Procedure in the Eastern District of Louisiana to determine to whom the insurance proceeds would be paid. The two cases were consolidated as Pruco Life Insurance Co. v. Breen, E.D. La. Case No. 15-3250 c/w 15-6946.

In the interpleader action, five of Wayne Breen's children from a prior marriage and the administrator of his estate sought to receive the benefits of the insurance policies. Pruco Life Ins. Co. v. Breen, 289 F. Supp. 3d 777, 779 (E.D. La. 2017). Before trial, Aaron, another adult child of Wayne Breen, though by a different mother, sought to intervene in the Pruco case, but his motion was denied because it was untimely.⁴ In denying the motion to intervene, the U.S. Magistrate Judge also noted that Wayne Breen's other children would "adequately represent [Aaron's] interest" in the interpleader litigation.⁵

The five children who were parties to the interpleader action argued that Kacie could not receive the life insurance policy benefits because Louisiana's "slayer rule" statute, La. Stat. Ann. § 22:901(D)(1), prohibits a person who kills another from benefiting from the deceased's insurance policies. Because Kacie was the named beneficiary of the policies, "the burden of proving her disqualification under this statute rest[ed] on those seeking to negate her beneficiary status." Pruco Life Ins. Co., 289 F. Supp. 3d at 779. In order to carry that burden, Wayne Breen's children needed to prove that "Kacie Breen participated in the intentional, unjustified killing of the individual insured, i.e., her husband." Id. at 798. After a trial, another section of this Court determined that they had not carried that burden and it concluded that Kacie was therefore entitled to the insurance money. Id. at 799.

The Fifth Circuit affirmed this ruling. Pruco Life Ins. Co. v. Breen, 734 F. App'x 302 (5th Cir. 2018) ("[W]e affirm the district court's judgment for essentially the reasons given in its Order and Reasons."). One of Wayne Breen's adult children, Sean Breen ("Sean"), then sought reconsideration from the district court, which was denied.⁶

Aaron, who had been denied intervention in the federal case, and Sean also pursued litigation in state court.⁷ Both state cases at issue here were filed in 2015.⁸ In one case, Sean Breen v. Kacie Breen, et al., Sean and Aaron sued Kacie for wrongful death.⁹ The state trial court determined that lawsuit was barred by res judicata, based on the Pruco decision.¹⁰ The state trial court then dismissed the action.¹¹ Sean and Aaron also asserted claims in Doctors for Women LLC v. Breen, a concursus action to determine who is entitled to Wayne Breen's pension funds. The state trial court in that case likewise determined that the lawsuit was barred on the basis of res judicata.¹² It granted summary judgment to Kacie.¹³ Sean and Aaron have appealed both of those rulings.¹⁴

Oral arguments as to both cases were set to be heard in the state appellate court on October 19, 2022.¹⁵ On October 18, 2022, Kacie filed the instant motion for a temporary restraining order, asking this Court to enjoin the state proceedings.¹⁶ This Court held a telephone conference with counsel for Kacie and Aaron and issued an order scheduling briefing on the motion.¹⁷

II. LEGAL STANDARD

When a party seeks an injunction against a state court proceeding, the Anti-Injunction Act, 28 U.S.C. § 2283, may bar that relief. Pursuant to that Act, a federal court "may not grant an injunction to stay proceedings in a state court" unless one of the three following preconditions is satisfied: the injunction (1) is expressly authorized by Congress, (2) is necessary in aid of the federal court's jurisdiction, or (3) is necessary to protect or effectuate the federal court's judgments. Id.; In re Vioxx Prods. Liab. Litig., 869 F. Supp. 2d 719, 724 (E.D. La. 2012) (Fallon, J.) (citing Smith v. Bayer Corp., 564 U.S. 299, 306, 131 S.Ct. 2368, 180 L.Ed.2d 341 (2011)). These exceptions "are to be interpreted narrowly" and "any 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." La. Health Serv. & Indem. Co. v. Ctr. for Restorative Breast Surgery, LLC, No. 17-4171, 2017 WL 2256765, at *2 (E.D. La. May 23, 2017) (Morgan, J.) (citations omitted).

Only the third exception to the Anti-Injunction Act is at issue here. This exception, often called the "relitigation exception," "authorizes an injunction to prevent state litigation of a claim or issue that previously was presented to and decided by the federal court." In re Vioxx Prods. Liab. Litig., 869 F. Supp. 2d at 724 (quoting Smith, 564 U.S. at 307, 131 S.Ct. 2368). The Fifth Circuit has instructed that four requirements must be satisfied in order for the relitigation exception to apply:

(1) parties in the later action must be identical to or in privity with the parties in the previous action; (2) judgment in the prior action must have been rendered by a court of competent jurisdiction; (3) the prior action must have concluded with a final judgment on the merits; and (4) the same claim or cause of action must be involved in both suits.

IDs Prop. Cas. Ins. Co. v. Meeks, 537 F. App'x 513, 517 (5th Cir. 2013) (quoting Moore v. State Farm Fire & Cas. Co., 556 F.3d 264, 273 (5th Cir. 2009)).

"The Supreme Court has established, however, that the Full Faith and Credit Act, 28 U.S.C. § 1738, which requires federal courts to give state judicial proceedings the same full faith and credit they would have in that state, trumps the relitigation exception where a state court has finally determined the res judicata effect of a federal court's order." Raj v. Tomasetti, No. 03-1993, 2008 WL 2718905, at *3 (E.D. La. July 11, 2008) (Vance, J.) (citing Parsons Steel, Inc. v. First Alabama Bank, 474 U.S. 518, 524-25, 106 S.Ct. 768, 88 L.Ed.2d 877 (1986)). Accordingly, before entering an injunction pursuant to the relitigation exception, the court must "assess whether a state court has issued a final decision that operates to bar re-assessment of the preclusive effect of a prior federal action." Regions Bank of La. v. Rivet, 224 F.3d 483, 493 (5th Cir. 2000). In this assessment, the court "look[s] to state law" to determine whether any judgments issued by the state courts are final judgments that bar reconsideration of the res judicata issue. Id.

Even if the relitigation exception applies, the issuance of an injunction against a state court proceeding is "at the discretion of the federal court" and that discretion must be "exercised in the light of the historical reluctance of federal courts to interfere with state judicial proceedings." Blanchard 1986, Ltd. v. Park Plantation, LLC, 553 F.3d 405, 407-08 (5th Cir. 2008) (internal quotations and citation omitted). " '[A] complainant must make a strong and unequivocal showing of relitigation of the same issue in order to overcome the federal courts' proper disinclination to intermeddle in state court proceedings.' " Id. (quoting Southern Cal. Petroleum Corp. v. Harper, 273 F.2d 715, 719 (5th Cir. 1960)).

III. ANALYSIS

a. Jurisdiction

Kacie asserts that this Court has jurisdiction over the instant proceeding "pursuant to the relitigation exception of the Anti-Injunction Act."¹⁸ Aaron questions whether this Court has jurisdiction to entertain Kacie's request because "the prior judgment from the interpleader action was satisfied" and "there is no remaining interest in protecting a fully satisfied judgment."¹⁹

Neither party is correct. The Anti-Injunction Act is not jurisdictional. Regions Bank of La., 224 F.3d at 493. "Instead, jurisdiction is based on the original case" and "[i]t is not necessary for the district court to have jurisdiction over the second suit as an original action." Id. Here, it is undisputed that this Court had jurisdiction over the interpleader action.

Generally speaking, "[i]t is well settled that a federal district court can exercise ancillary jurisdiction over a second action in order 'to secure or preserve the fruits and advantages of a judgment or decree rendered' by that court in a prior action." Royal Ins. Co. of Am. v. Quinn-L Cap. Corp., 960 F.2d 1286, 1292 (5th Cir. 1992) (quoting Southmark Properties v. Charles House Corp., 742 F.2d 862, 868 (5th Cir. 1984)). Because the federal court undisputedly had jurisdiction over the interpleader action, this Court concludes that it has jurisdiction over the instant matter. Regions Bank of La., 224 F.3d at 493.²⁰

b. Parsons Steel

The parties originally did not address Parsons Steel in their arguments, and the Court ordered additional briefing on this issue. In Parsons Steel, the Supreme Court indicated that the relitigation exception is

limit[ed] . . . to those situations in which the state court has not yet ruled on the merits of the res judicata issue. Once the state court has finally rejected a claim of res judicata, then the Full Faith and Credit Act becomes applicable and federal courts must turn to state law to determine the

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