Dueling Bishops Sue for ‘False Advertising’

In this dispute between two clergymen, each of whom claims to be the Bishop of The Protestant Episcopal Church in the Diocese of South Carolina, the 4th Circuit vacates a district court abstention order and stay of the action pending the con­clusion of state proceedings, and remands the case for a second time.

False advertising

Bishop Charles G. vonRosenberg ini­tiated this action for declaratory and in­junctive relief. He alleges Bishop Mark J. Lawrence has violated the Lanham Act by falsely advertising himself to be the Bishop of the Diocese of South Carolina. At Bishop Lawrence’s request, the district court abstained in favor of related state court proceedings. On appeal, we vacat­ed that order, concluding that Colorado River Water Cons. Dist. v. U.S., 424 U.S. 800 (1976), governs abstention decisions in actions where the plaintiff seeks both declaratory and nondeclaratory relief. On remand, the district court has again ab­stained, staying the action pending the conclusion of the state proceedings. We again vacate and remand.

Bishop vonRosenberg argues that the district court’s application of Colorado River abused its discretion because the state and federal actions are not parallel. We must agree.

We recognize that our opinion in vonRosenberg i focused solely on deter­mining the appropriate abstention stan­dard in cases asking for both declaratory and nondeclaratory relief. We expressed no view as to the propriety of abstention under that standard – the one articulated in Colorado River – and we did not ana­lyze the similarity between the state and federal cases.

Exceptional circumstances allowing for abstention under Colorado River do not exist when state and federal cases are not duplicative, but merely raise similar or overlapping issues. Moreover, we must address whether abstention is appropri­ate based upon the current posture of the state court actions.

Here, events occurring after the dis­trict court’s first abstention order and before its second order make clear that the two actions are not parallel – the state action will not resolve every claim at issue in the federal action. Neither Bishop vonRosenberg nor Bishop Law­rence is a party to the state action; in­deed, the state court has denied the Epis­copal Church’s request to add Bishop Lawrence as an individual counterclaim defendant. Furthermore, as the district court noted, the state court has held that the Episcopal Church’s proposed Lan­ham Act claims were not before it. Nor is it Bishop vonRosenberg’s individual false advertising claim, alleging harms to his ecclesiastical authority distinct from the harms of the Episcopal Church, before the state court. Thus, because the state and federal cases involve different parties and different claims, the district court abused its discretion under Colo­rado River by abstaining in favor of the state court proceedings.

As the district court correctly recog­nized, however, the state and federal proceedings do involve the resolution of the same underlying issue – whether the Diocese validly withdrew from the Episcopal Church. Moreover, the dis­trict court may well be correct that the resolution of the issue in the state court proceeding may have collateral estoppel effect on claims asserted in this litiga­tion. We leave the determination of those questions to the district court.

Abstention order vacated and case re­manded.

Right Rev. Charles G. vonRosenberg v. Right Rev. Mark J. Lawrence (Motz) No. 15-2284, Feb. 21, 2017; USDC at Charles­ton, S.C. (Houck) Thomas S. Tisdale Jr. for appellant; Henrietta U. Golding for appellee. VLW 017-2-044, 10 pp.