Berish Berger v. Richard Zeghibe
666 F. App'x 119
| 3rd Cir. | 2016Background
- Judgment Creditors obtained a $33 million federal judgment against Ravinder Chawla for fraud; collection efforts have been unsuccessful because Ravinder appears to hold few assets on paper while benefiting from family business subsidies.
- Jatinder Chawla (his wife) holds ownership interests in several family real-estate entities, receives a $20,000 monthly stipend from one entity, and received a $200,000 distribution from Philadelphia Chancellor; Philadelphia Chancellor stood to receive proceeds from a $25 million property sale that could yield the family $8–10 million.
- Judgment Creditors moved post-judgment under Rule 69 (and Pennsylvania summary procedures) to declare Jatinder’s assets effectively Ravinder’s or, in the alternative, to enjoin distributions or require escrow of payments pending adjudication of Ravinder’s interest.
- After an evidentiary hearing, the District Court preliminarily enjoined Philadelphia Chancellor from paying Jatinder and ordered payments placed in escrow until the court resolves whether Ravinder has a partnership interest in the assets.
- Jatinder appealed, arguing lack of subject-matter jurisdiction, lack of authority under Rule 69 to enjoin a nonparty, and abuse of discretion in granting the injunction.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the District Court had subject-matter jurisdiction to enter the post-judgment injunction | Jatinder: No federal subject-matter jurisdiction over post-judgment relief affecting her | Judgment Creditors: District court has ancillary/supplemental jurisdiction to enforce and protect its judgment | Court: Ancillary/supplemental jurisdiction exists to adjudicate post-judgment actions that are factually interdependent and to vindicate its orders; jurisdiction proper |
| Whether the court could enjoin a nonparty under Rule 69 and related state/federal authority | Jatinder: Rule 69 and Pa. procedures do not authorize injunctive relief against a nonparty like her | Judgment Creditors: Rule 69 requires following state procedure (Pa. R. C. P. 3118) and All Writs Act permits injunctions against nonparties who can frustrate enforcement | Court: Rule 69, Pa. R. C. P. 3118, and the All Writs Act authorize injunctions against nonparties positioned to frustrate judgment enforcement |
| Whether the District Court abused its discretion in granting the preliminary injunction | Jatinder: The injunction was unnecessary and prejudicial; facts didn’t justify restraining her receipt of funds | Judgment Creditors: Showed reasonable probability Ravinder has an interest in assets, risk of dissipation, minimal harm to Jatinder, and public interest in enforcing judgments | Court: No abuse of discretion—movants met the four-factor preliminary injunction test (probability of success, irreparable harm, balance of harms, public interest) |
Key Cases Cited
- IFC Interconsult, AG v. Safeguard Int’l Partners, LLC, 438 F.3d 298 (3d Cir. 2006) (ancillary/supplemental jurisdiction for post-judgment matters)
- Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 (U.S. 1994) (ancillary jurisdiction limited to matters necessary to effectuate judgments)
- United States v. N.Y. Tel. Co., 434 U.S. 159 (U.S. 1977) (All Writs Act permits orders against nonparties when necessary to protect court orders)
- Catalytic, Inc. v. Monmouth & Ocean Cty. Bldg. Trades Council, 829 F.2d 430 (3d Cir. 1987) (All Writs Act can reach nonparties who could frustrate enforcement)
- Greater Valley Terminal Corp. v. Goodman, 202 A.2d 89 (Pa. 1964) (Pennsylvania summary proceedings to preserve status quo in aid of execution)
- Iles v. de Jongh, 638 F.3d 169 (3d Cir. 2011) (four-factor preliminary injunction standard)
- Maldonado v. Houstoun, 157 F.3d 179 (3d Cir. 1998) (standard of appellate review for preliminary injunctions)