Cohen v. Birrane, 1:16-cv-00893

Plaintiff Jeffrey Cohen, an inmate and founder/sole shareholder of IDG Companies, LLC and Indemnity Insurance Corporation, RRG (llC), sued defendants (including attorneys and insurance professionals involved in Delaware receivership) under 42 U.S.C. § 1983 and asserted supplemental Delaware-law claims related to the Court of Chancery receivership/liquidation of llC.
Delaware regulators (Commissioner Stewart) placed llC into delinquency and then receivership/liquidation after solvency concerns; multiple Chancery and Delaware Supreme Court rulings upheld the proceedings, including an April 9, 2014 Delaware Supreme Court opinion.
Cohen pursued related federal suits in Maryland and elsewhere; those actions were dismissed for lack of jurisdiction or abstention. Cohen later pleaded guilty in a federal criminal case and is incarcerated.
Cohen filed the instant pro se complaint (signed Aug 16, 2016; mailed Sept 2016) seeking declaratory and injunctive relief and damages, alleging due-process violations and various state-law torts stemming from defendants’ conduct during the receivership.
The District Court screened the complaint under 28 U.S.C. §§ 1915 and 1915A and found multiple defects warranting dismissal: Younger abstention, statute-of-limitations bar to § 1983 claims, and failure to plausibly plead state-action for some defendants.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether federal court should hear claims that interfere with ongoing Delaware receivership	Cohen seeks injunctions and declarations addressing how defendants operated llC and use of llC/IDG funds	Defendants argue federal court should not intervene in active state receivership	Court abstained under Younger — federal interference with state receivership is barred
Timeliness of § 1983 claims	Cohen contends constitutional violations occurred up to April 2014 and seeks relief in 2016	Defendants (and court on screening) contend § 1983 claims accrued in 2014 and are time-barred by Delaware’s two-year statute	§ 1983 claims are dismissed as time-barred; amendment would be futile
Whether complaint states a § 1983 claim against private attorneys/professionals (state action)	Cohen alleges defendants’ conduct during receivership violated due process	Defendants (and court) note absence of plausible allegations that attorneys acted under color of state law	Court found § 1983 claims legally deficient/frivolous as pleaded
Whether to exercise supplemental jurisdiction over state-law claims	Cohen seeks negligence, conversion, breach of fiduciary duty, fraud, conspiracy under Delaware law	Defendants argue federal remedies improper if federal claims dismissed/abstention applies	Court declined supplemental jurisdiction and dismissed state-law claims without prejudice

Simbraw, Inc. v. United States, 367 F.2d 373 (3d Cir. 1966) (a business entity cannot appear pro se through a nonattorney representative)
Phillips v. Tobin, 548 F.2d 408 (2d Cir. 1976) (shareholder cannot represent corporation in court without counsel)
Cohen v. State ex rel. Stewart, 89 A.3d 65 (Del. 2014) (Delaware Supreme Court affirming Court of Chancery rulings in llC delinquency proceedings)
Younger v. Harris, 401 U.S. 37 (1971) (federal courts must abstain from interfering with certain ongoing state proceedings)
Middlesex Cnty. Ethics Comm. v. Garden State Bar Ass'n, 457 U.S. 423 (1982) (Younger abstention extended to certain civil/administrative state proceedings)
Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading standard requiring plausibility)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (further explication of plausibility pleading standard)