Opposition Brief — Mattei v. Laborers Combined Funds of Western Pennsylvania

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No. 91-500 CT 22 19S?

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In The at

Supreme Court of the United States

October Term, 1991

———e +e

AMIDIO MATTEI, JOSEPH MATTEL,

and DOMENIC J. MATTE],

Petitioners,

LABORERS COMBINED FUNDS OF WESTERN

PENNSYLVANIA, as agent for PETER J. LIVOLSI

and ALBERT W. BETLER, Trustees ad Litem,

LABORERS DISTRICT COUNCIL OF WESTERN

PENNSYLVANIA WELFARE AND PENSION FUNDS,

THE CONSTRUCTION INDUSTRY ADVANCEMEN|

PROGRAM OF WESTERN PENNSYLVANIA, and

LABORERS DISTRICT COUNCIL OF

WESTERN PENNSYLVANIA and

its affiliated local unions,

Respondent

—— —— @

On Petition For A Writ Of Certiorari To The

Supreme Court Of Pennsylvania

— — ¢@ -

RESPONDENTS’ BRIEF IN OPPOSITION TO

PETITION FOR WRIT OF CERTIORARI

——— -@ —_

RicHARD B. Tucker, III], Esquire:

(Counsel of Record)

Gary P. Hunt, Esouirt

TuckerR ARENSBERG, P.C

1200 Pittsburgh National Building

Pittsburgh, PA 15222

(412) 566-1212

Counsel for Respondent

QUESTION PRESENTED

Whether a final judgment based on a state statute,

having been affirmed on appeal, can be collaterally

attacked on subject matter jurisdiction grounds in a sec-

ond proceeding where a United States Court of Appeals

determined during the pendency of the appeal in the first

proceeding that the state statute was preempted, where

the Court of Appeals decision was expressly called to the

attention of the state appellate court and the appellants,

where the appellants failed to argue the preemption issue

during the first proceeding, and where the preemption

issue was Only raised years later after execution proceed-

ings were initiated to enforce the final judgment.

TABLE OF CONTENTS

Page

Pr Pe ye caaveses bose ee eeee i

pe rr Ror Arr ren et ii

ee Ce ID ok ries a ao ae Raden kooks iii

NS Gr. Tee GN oo oo oo See Soca eee eutenee l

SuUmary OF TRO APMUOUE. oo ic ikn cece cicrseenes 5

‘a? eae MEER EU ETT PTET ETT EL ETE ee 6

I. There Are No Special Or Important Reasons For

Granting Certiorari In This Case.............. 6

II. There Is No Need To Grant Certiorari In Any

Event Because The Superior Court’s Decision Is

Peer eee Cee eT re ee oe et 7

III. Principles Of Res Judicata Also Support The

eg eg Be eer rrr 13

A SS DE ci oe RNS CEN ee 16

iii

TABLE OF AUTHORITIES

CASES

Amalgamated Cotton Garment and Allied Indus-

tries Fund v. Dion, 341 Pa. Super. 12, 491 A.2d

ba yay ver ass cece vrsevesess

Armstrong v. Armstrong, 696 F.2d 1237 (9th Cir.),

coe. weneee, Soe W.5. 939 (1963)...............

Camp v. Camp, 142 Cal. App.3d 217, 191 Cal. Rptr.

Va ean Ved bes dewecevesesscass

Carpenters Health and Welfare Fund v. Kenneth

R. Ambrose, Inc., 727 F.2d 279 (3rd Cir. 1983)..

Chevron Oil Co. v. Huson, 404 U.S. 97 (1971)....

Chicot County Drainage Dist. v. Baxter State Bank,

er

Duke v. Duke, 98 Nev. 148, 643 P.2d 1205 (1982)

Erspan v. Badgett, 659 F.2d 26 (5th Cir. 1981), cert.

Seer ee Gs Oe AEOGZ)...... 2... 6... eee.

Federated Department Stores, Inc. v. Moitie, 452

I nee s vv cs ecw se ctr ssc ccee ess

Fellers v. Fellers, 125 Cal. App.3d 254, 178 Cal.

ee -

In re Marriage of Sheldon, 124 Cal. App.3d 371,

177 Cal. Rptr. 380 (1981), appeal dismissed for

want of a substantial federal question, 456 U.S. 941

i od ings Wx sexe ee ve ee vee 9,

International Longshoremen’s Ass’n., AFL-CIO v.

Sevie, Gre to. Geo (1986)....................

James B. Beam Distilling Co. v. Georgia, ___ US.

a |

Page

iv

TABLE OF AUTHORITIES - Continued

Page

Kalb v. Feuerstein, 308 U.S. 433 (1940)..... ..... 14, 15

Laborers Combined Funds of Western Pennsylva-

nia v. Mattei, 359 Pa. Super. 399, 518 A.2d 1296

bo PE eee Tee POE ETT LCC TC TAT OeT OEE 4

Laborers Combined Funds of Western Pennsylva-

nia v. Mattei, 402 Pa. Super. 486, 587 A.2d 354

hi) rae fair ys See bang ae Pe ra a eee nee 5

Marriage of Vinson, 57 Or. App. 355, 644 P.2d 635,

review denied, 293 Or. 456, 650 P.2d 928 (1982)...... 9

McCarty v. McCarty, 453 U.S. 210 (1981)........... 8, 9

McMahon v. McDowell, 794 F.2d 100 (3rd Cir),

cert. denied, 479 U.S. 971 (1986) ............... passim

Northern Pipeline Construction Co. v. Marathon

Pipe Line Co., 458 U.S. 50 (1982) .......... 9, 10, 12

Rice v. Sioux City Memorial Park Cemetery, Inc.,

See a Oe EE eee ee chesaet crc su he date eked 6

Rodriguez v. Rodriguez, 133 Ariz. 88, 649 P.2d 291

RR ike HG RIO ed eh een OO AD eee eee ie ile. )

Schreiber v. Republic Intermodal Corp., 473 Pa.

O58, SED Fe NBOO CIITT a nn nec decodes ncew neues 12

Segrest v. Segrest, 649 S.W.2d 610 (Tex.), cert.

Geman, SOG WD. GPE TINE os oo ocd le ess. 9

Sheldon v. Sheldon, 456 U.S. 941 (1982).............. 8

Whenry v. Whenry, 98 N.M. 737, 652 P.2d 1188

hg» RRA PY EADE ah Pa Ren ar yen aan hrs Atuebe gate Aaa oy eCrnatde de 9

White v. White, 731 F.2d 1440 (9th Cir. 1984)......... 8

Wilson v. Wilson, 667 F.2d 497 (Sth Cir.), cert.

gentem, 4356 UG. T1G7 (IGRE).. 2... cece cee ccv ere 9

TABLE OF AUTHORITIES - Continued

Page

STATUTES

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ee ay on rath cd oee uch ak ee whe eee awe. 2

ee ND a Cee ag eae aware bi wes owe ov ote 5

RULES

Rule 10 of the U.S. Sup. Ct. Rules, 28 U.S.C.A....... 6

STATEMENT OF THE CASE

This petition for a writ of certiorari filed by the

Petitioners, Amidio Mattei and Domenic J. Mattei! (here-

inafter collectively “the Matteis”), is part of the Matteis’

second attempt, through appellate proceedings, to have

the judgment entered against them on January 13, 1986,

overturned. The original lawsuit against the Matteis was

commenced in the Court of Common Pleas of Allegheny

County, Pennsylvania, on March 1, 1984, when the

Respondents? filed their complaint in assumpsit seeking

recovery from the Matteis of pension, welfare, industry

and dues payments owed to the Respondents by Mattei

Brothers, Inc. (hereinafter (“MBI”) pursuant to a certain

collective bargaining agreement. Liability was asserted

against the Matteis as “employers” under the Pennsylva-

nia Wage Payment and Collection Law, 43 PS. §260.1 et

seq. (hereinafter “the WPCL”) because of the Matteis’

status as “officers and/or agents” of MBI.

On April 6, 1984, the Matteis answered the Respon-

dents’ complaint and denied any liability. Although the

Matteis included new matter in their answer, they did not

assert that the WPCL had been preempted by the

' The non-jury verdict and judgment in this case were

against Amidio Mattei and Domenic J. Mattei only; the trial

court found in favor of Joseph Mattei (Petition for Writ of

Certiorari, Appendix, p. A17).

2 The Laborers Combined Funds of Western Pennsylvania

is a Pennsylvania nonprofit corporation with no parent or

subsidiaries. The remaining Respondents are not corporate

entities.

Employee Retirement Income Security Act of 1974, 29

U.S.C. §1001 et seq. (hereinafter “ERISA”) or that the

Court of Common Pleas lacked subject matter jurisdiction

over the lawsuit.

A trial was held on October 11, 1985. The relevant

facts were not seriously disputed. On October 27, 1982,

MBI had entered into a collective bargaining agreement

(hereinafter “the Agreement”) with the Laborers District

Council of Western Pennsylvania which represented eight

local unions. Pursuant to the Agreement, MBI was

required to make, for the benefit of employees covered

under the Agreement, certain monthly payments to the

Respondents for union dues, welfare fund contributions,

pension fund contributions, and contributions to the

industry advancement or safety educational programs.

MBI failed to make timely payments to the Respondents

with the result that for the period from May 1, 1983,

through November 15, 1983, the principal amount due

was $359,398.12. .

During this time period, Amidio Mattei served as

president of MBI and Domenic J. Mattei served as secre-

tary-treasurer. The Matteis contended that MBI’s book-

keeper had embezzled some $374,000.00, with the result

that MBI had been unable to pay the Respondents the

amounts owed pursuant to the Agreement. MBI eventu-

ally filed a bankruptcy petition.

On October 16, 1985, the trial court rendered a non-

jury verdict in favor of the Respondents and against the

Matteis in the amount of $44,247.65. The Matteis thereaf-

ter filed exceptions to the verdict. Neither the issue of

preemption nor the lack of subject matter jurisdiction was

raised in the exceptions. The exceptions were dismissed

by an Order dated December 30, 1985; and on January 13,

1986, judgment was entered. The Matteis appealed to the

Superior Court of Pennsylvania.

While the appeal was pending, the United States

Court cf Appeals for the Third Circuit rendered its Opin

ion in McMahon v. McDowell, 794 F.2d 100 (3rd Cir),

denied, 479 U.S. 971 (1986), in which it held that the WPCI

was preempted by ERISA to the extent that the WPC!

related to employee benefit plans. In their Briet kon

cert

Appellees filed with the Superior Court on July 16, 1986,

the Respondents expressly brought the McMahon decision

to the attention of the Superior Court and of the Matteis

In a footnote, the Respondents stated

The Matteis did not raise below, and have

not raised on this appeal, the issue of whether

the WPCL has been preempted by the Employ e

Retirement Income Security Act of 1974, 29

U.S.C. §§1001 et seq. (“ERISA”). Since they

failed to raise this issue in the lower court, it

cannot be considered for the first time on

appeal. Amalgamated Cotton Garment and Allied

Industries Fund v. Dion, 341 Pa. Super 12, 491

A.2d 123 (1985) (appellant attempted to rai the

issue of the WPCL’s preemption by ERISA for

the first time on appeal) hus, the Third (¢

cuit’s recent decision in McMahon MA

bk. 2d (3rd Cir., No. 85-3570, tiled June 24

1986) is irrelevant to this Court’ onsiderati

of the pending appeal

In th econd round of | ed he ( t f (

mon Pleas noted the prior reference to McMahon and qu

the footnote in it Opinion (Petition tor Writ i Certiorar

Appendix, p. A9)

ee ee

The Matteis took no action in response to being advised

of the McMahon decision. They did not file a reply brief

with the Superior Court in which they challenged the

Respondents’ assessment of the applicability of the

McMahon decision. Nor did they file a reply brief arguing

that the trial court’s judgment was void ab initio because,

despite their initial failure to raise the issue, the trial

court had lacked subject matter jurisdiction.

On December 17, 1986, the Superior Court affirmed

the judgment of the trial court. Laborers Combined Funds of

Western Pennsylvania v. Mattei, 359 Pa. Super. 399, 518

A.2d 1296 (1986) (Petition for Writ of Certiorari, Appen-

dix, pp. Al6-A27). Although the Matteis could have

sought reargument before the Superior Court or could

have petitioned the Supreme Court of Pennsylvania for

the allowance of an appeal, therein raising the question of

whether the judgment was void ab initio, they failed to do

so. Nor did they take any other action to challenge the

validity of the judgment against them until nearly three

vears after the Superior Court’s affirmance.

In November of 1989, after the Respondents had

initiated execution proceedings, including the scheduling

of a sheriff’s sale of certain real estate, the Matteis pre-

sented to the Court of Common Pleas of Allegheny

County, Pennsylvania, a petition for a rule to show cause

why the judgment should not be opened and/or stricken

and for a stay of the execution proceedings. The Matteis

claimed that the judgment was void, citing as authority

the Third Circuit’s Opinion in McMahon v. McDowell,

supra.

On November 28, 1989, the Matteis’ petition was

denied (Petition for Writ of Certiorari, Appendix, p. A38).

The Matteis appealed to the Pennsylvania Superior Court

for a second time. On February 26, 1991, the Superior

Court affirmed. Laborers Combined Funds of Western Penn-

sylvania v. Mattei, 402 Pa. Super. 486, 587 A.2d 354 (1991)

(Petition for Writ of Certiorari, Appendix, pp. A2-A7).

The Matteis petitioned the Pennsylvania Supreme Court

for the allowance of an appeal, but on August 8, 1991,

that Court denied their petition (Petition for Writ of Cer-

tiorari, Appendix, p. Al). The Matteis have now filed a

Petition for Writ of Certiorari with this Honorable Court.

¢

SUMMARY OF THE ARGUMENT

Review on a writ of certiorari is not a matter of right,

but of judicial discretion, and will be granted only when

there are special and important reasons therefor. Cases

having an isolated significance only to the litigants, and

being of no public importance, should not be reviewed.

The Matteis’ efforts to raise a preemption issue in a

second collateral proceeding, after knowingly having

failed to raise it in their first appeal, is not of public

importance; and certiorari should not be granted.

No writ of certiorari should be issued in any event,

because the Pennsylvania Superior Court’s decision,

which the Pennsylvania Supreme Court declined to

review, is proper and correct. Decisions recognizing fed-

eral preemption do not render final state court judgments

void for lack of subject matter jurisdiction simply because

such judgments were entered after Congress enacted its

preemptive legislation. The courts have repeatedly

rejected such a contention. In also rejecting this conten-

tion, the Superior Court applied criteria adopted by this

Court for determining the retroactive applicability of new

decisions, such as McMahon. The Superior Court correctly

analyzed this case under those criteria. Regardless of

those criteria, however, retroactivity in civil cases must be

limited by the need for finality and the bar of res judicata.

A final judgment on the merits precludes the parties

from relitigating issues that were or could have been

raised in that action. This preclusion includes jurisdic-

tional questions, such as the one raised by the Matteis.

The Matteis were not privileged to remain silent with

respect to the question of preemption and raise it in a

subsequent collateral attack on the judgment against

them. Their Petition for Writ of Certiorari should accord-

ingly be denied.

ARGUMENT

I. There Are No Special Or Important Reasons For

Granting Certiorari In This Case.

As clearly delineated in Rule 10 of the U.S. Sup. Ct.

‘Rules, 28 U.S.C.A., review on writ of certiorari is not a

matter of right, but of judicial discretion, and will be

granted only when there are special and important rea-

sons therefor. In Rice v. Sioux City Memorial Park, Inc., 349

U.S. 70, 74 (1955) (decided under the similar provisions of

former Rule 19 of the U.S. Sup. Ct. Rules), this Court

elaborated on the criteria under which the Court deter-

mines whether a particular case merits consideration:

A federal question raised by a petitioner may be

“of substance” in the sense that abstractly con-

sidered, it may present an intellectually interest-

ing and solid problem. But this Court does not

sit to satisfy a scholarly interest in such issues.

Nor does it sit for the benefit of the particular

litigants. [citations omitted]. “Special and

important reasons” imply a reach to a problem

beyond the academic or the episodic.

No special or impor!.at reasons exist for granting cer-

tiorari in the present case.

Over four years ago, the Matteis elected not to peti-

tion the Pennsylvania Supreme Court for the allowance of

an appeal from the Superior Court’s first decision affirm-

ing the judgment against them. At the time, the Matteis

had been advised of the McMahon decision, but had failed

to make any arguments based thereon. The question of

whether the Matteis, who knowingly failed to raise the

preemption issue in their first appeal, can raise that issue

years later in a second proceeding collaterally attacking

the original judgment may be of importance to the Mat-

teis, but it is not of importance to the public.

Ii. There Is No Need To Grant Certiorari In Any Event

Because The Superior Court’s Decision Is Correct

The Superior Court’s decision in this case is correct

and is not in conflict with any decision of this Court. The

Matteis’ contention that ERISA vitiated the state court’s

subject matter jurisdiction and rendered the judgment

against them void ab ititio is without merit.

The Superior Court’s decision in this case is the first

to deal with the effect of McMahon on existing judgments

under the WPCL. However, analogous decisions relating

to other areas of federal preemption cfearly demonstrate

that decisions recognizing federal preemption do not ren-

der state court judgments void for lack of subject matter

jurisdiction even though such judgments were entered

after Congress had enacted its preemptive legislation. In

McCarty v. McCarty, 453 U.S. 210 (1981), this Court deter-

mined that federal law preempted state community prop-

erty laws to the extent that the community property laws

authorized state courts to divide military retirement pay.

Following this decision, challenges were raised to prior

property distribution decisions on the basis that the

courts rendering these decisions lacked subject matter

jurisdiction with respect to military pay. These challenges

were rejected, most notably by this Court in Sheldon v.

Sheldon, 456 U.S. 941 (1982) where the Court dismissed an

appeal from the Court of Appeals of California for want

of a substantial federal question. As the Ninth Circuit

noted in White v. White, 731 F.2d 1440 (9th Cir. 1984), this

Court’s summary dismissa! of the appeal for want of a

substantial federal question operated as a decision on the

merits as to the challenges presented in the statement of

jurisdiction, including the challenge to the Court of

Appeals’ refusal! to void the prior state court judgment.

Accordingly, the Ninth Circuit concluded that this

Court’s action in Sheldon v. Sheldon foreclosed the argu-

ment that McCarty rendered contrary state court judg-

ments void for lack of subject matter jurisdiction. White 2.

White, supra. See also Armstrong v. Armstrong, 696 F.2d

1237 (9th Cir.), cert. denied, 464 U.S. 933 (1983).

Other challenges to existing judgments based upon

McCarty were equally unsuccessful. See Erspan v. Badgett,

659 F.2d 26 (5th Cir. 1981), cert. denied, 455 U.S. 945 (1982),-

Wilson v. Wilson, 667 F.2d 497 (5th Cir.), cert. denied, 458

U.S. 1107 (1982); Segrest v. Segrest, 649 S.W.2d 610 (Tex.),

cert. denied, 464 U.S. 894 (1983); Camp v. Camp, 142 Cal.

App.3d 217, 191 Cal. Rptr. 45 (1983); Fellers v. Fellers, 125

Cal. App. 3d 254, 178 Cal. Rptr. 35 (1981); Whenry v.

Whenry, 98 N.M. 737, 652 P.2d 1188 (1982); Rodriguez v.

Rodriguez, 133 Ariz. 88, 649 P.2d 291 (1982); Marriage of

Vinson, 57 Or. App. 355, 644 P.2d 635, review denied, 293

Or. 456, 650 P.2d 928 (1982); Duke v. Duke, 98 Nev. 148, 643

P.2d 1205 (1982).

As the trial court and Superior Court recognized,

many of these courts rejected the retroactive application

of McCarty by analyzing the three considerations recog-

nized by this Court in Northern Pipeline Construction Co. v.

Marathon Pipe Line Co., 458 U.S. 50 (1982), as bearing upon

the issue of retroactivity. See e.g. In re Marriage of Sheldon,

124 Cal. App.3d 371, 177 Cal. Rptr. 380 (1981), appeal

dismissed for want of a substantial federal question, 456 US.

941 (1982); Segrest v. Segrest, supra; Whenry v. Whenry,

supra. In Northern Pipeline, this Court considered the fol-

lowing three criteria: (1) whether the decision established

a new principle of law, either by overruling clear past

precedent on which litigants may have relied or by

deciding an issue of first impression whose resolution

was not clearly foreshadowed; (2) whether retrospective

application would further or retard the purpose and

effect of the decision; and (3) whether retrospective appli-

cation would bring about substantial inequitable results

10

in individual cases. See also Chevron Oil Co. v. Huson, 404

U.S. 97 (1971).

With respect to the present case, nothing in the

McMahon decision itself suggests that it is to be given

retroactive application to void all prior WPCL judgments

entered, after the enactment of ERISA, against corporate

officers for their corporations’ failure to pay contribu-

tions to employee benefit plans. Moreover, the Superior

Court correctly applied the criteria set forth in Northern

Pipeline and Chevron Oil in refusing to apply McMahon

retroactively to void the judgment against the Matteis.

In the first place, the McMahon decision overruled

clear past precedent upon which litigants were unques-

tionably relying in filing WPCL claims against corporate

officers. Only three years before McMahon, the Third

Circuit had concluded that the WPCL was not preempted

by ERISA. In Carpenters Health and Welfare Fund v. Kenneth

R. Ambrose, Inc., 727 F.2d 279, 282, n.5 (3rd Cir. 1983), the

Court had stated that the preemption argument was

“without merit.”

The second criterion also favors a non-retroactive

application of McMahon in this case. The purpose of the

preemption provisions in ERISA is clearly to allow for the

uniform operation of the comprehensive framework

designed by Congress to regulate the field of employee

benefit plans. McMahon advanced that goal by finding the

WPCL to be preempted. That goal is not advanced, how-

ever, by voiding existing judgments already entered pur-

suant to the WPCL. As the Superior Court correctly

noted, quoting from the trial court, “While the instant

11

type of suit could conceivably frustrate that [ERISA] pro-

cedure in the future, the overturning of judgments years

later when no other procedure could then be followed not

only would not further the plan of ERISA, but would

hinder it further.” (Petition for Writ of Certiorari, Appen-

dix, p. A6).

Finally, consideration of potential inequitable results

strongly mitigates against retroactive application of

McMahon. The trial court and the Superior Court properly

recognized that there would be inequities which would

arise both from any general retroactive application of

McMahon to final judgments and from any retroactive

application of McMahon. to this case.

With respect to the former, the trial Court and Supe-

rior Court correctly cited the potential disharmony and

prejudice which could arise from the vacation of existing

judgments which had resolved labor and management

strife. The trial court and Superior Court also correctiy

recognized the potential inequity and the immense bur-

den which would be placed upon the judicial system if re-

litigation were permitted with respect to all WPCL pen-

sion and welfare plan judgments. Cf. In re Marriage of

Sheldon, supra.

Moreover, the peculiar facts of this case make relief

from the prior judgment totally inequitable and inap-

propriate. Specifically, the Matteis were apprised of the

McMahon decision while the case against them was still

pending on appeal. They could have, and should have,

raised this issue then. Cf. James B. Beam Distilling Co. v.

Georgia, __ U.S. __, 111 S.Ct. 2439 (1991) (applying

recent decision retroactively to claims not yet barred);

12

Schreiber v. Republic Intermodal Corp., 473 Pa. 614, 375 A.2d

1285 (1977) (applying recent decision retroactively to a

pending case); In re Marriage of Sheldon, supra (allowing

limited retroactivity to certain cases on appeal). Instead,

although obviously aware of the McMahon decision, they

elected not to raise the issue while their case was pend-

ing. They waited for more than three years after being

advised of the McMahon decision to take any action. It

would be grossly unfair to the Respondents at this late

date to allow the Matteis to raise an issue they could have

raised while their case was still pending on appeal. Their

conduct should be viewed as a waiver of any right the

Matteis might otherwise have had to vacate the judg-

ment. The Superior Court correctly applied the Northern

Pipeline and Chevron Oil criteria.

While this Court’s recent decision in James B. Beam

Distilling Co. v. Georgia, supra, may have called into ques-

tion the continued vitality of the Northern Pipeline and

Chevron Oil criteria in determining non-retroactivity with

respect to certain pending or pursuable claims, Justice

Souter’s Opinion announcing the judgment of the Court

emphasizes the inappropriateness of retroactivity with

respect to cases in which a final judgment has been

entered.

Of course, retroactivity in civil cases must

be limited by the need for finality [citation omit-

ted]; once suit is barred by res judicata or by

statutes of limitation or repose, a new rule can-

not reopen the door already closed.

James B. Beam Distilling Co. v. Georgia, __ U.S. at __, 111

S.Ct. at 2446 (Opinion of Souter, J.). In the present case,

13

the Superior Court was asked to apply decisions estab-

lishing ERISA’s preemptive nature to a final judgment

rendered years earlier. The Superior Court correctly

refused to do so.

III. Principles Of Res Judicata Also Support The Supe-

rior Court’s Decision

Although the Superior Court did not expressly rely

upon principles of res judicata, such principles clearly

support the correctness of the decision. In Federated

Department Stores, Inc. v. Moitie, 452 U.S. 394, 398 (1981),

this Court stated:

A final judgment on the merits of an action

precludes the parties or their privies from

relitigating issues that were or could have been

raised in that action. [citations omitted]. Nor are

the res judicata consequences of a final, unap-

pealed judgment on the merits altered by the

fact that the judgment may have been wrong or

rested on a legal principle subsequently over-

ruled in another case. [citations omitted]. . . .

[A]n “erroneous conclusion” reached by the

court in the first suit does not deprive the defen-

dants in the second action “of their right to rely

upon the plea of res judicata... . A judgment

merely voidable because based upon an erro-

neous view of the law is not open to collateral

attack, but can be corrected only by a direct

review and not by bringing another action upon

the same cause [of action].”

This Court has applied this rationale in a situation where

the lower court’s jurisdiction was conferred by a statute

which was later held to be unconstitutional:

14

The remaining question is simply whether

respondents, having failed to raise the [jurisdic-

tional] question in the proceeding to which they

were parties and in which they could have

raised it and had it finally determined, were

privileged to remain quiet and raise it in a sub-

sequent suit. Such a view is contrary to the well-

settled principle that res judicata may be pleaded

as a bar, not only as respects matters actually

presented to sustain or defeat the right asserted

in the earlier proceeding, “but also as respects

any other available matter which might have

been presented to that end.”

Chicot County Drainage Dist. v. Baxter State Bank, 308 U.S.

371, 378 (1940).

In the present case the Matteis failed to raise the

McMahon jurisdictional issue in the first proceeding,

where they could have had it finally determined. Consis-

tent with the reasoning in Chicot, they were not privi-

leged to remain silent and raise it in a subsequent suit.

Their silence in this case is even more egregious because

they were unquestionably aware of the decision upon

which they now base their argument. Principles of res

judicata bar their belated attempt to raise the issue in a

second proceeding.

The Matteis cite Kalb v. Feuerstein, 308 U.S. 433 (1940)

to support their claim that they can collaterally attack the

judgment against them. The Matteis’ reliance upon Kalb is

misplaced, however. Kalb involved the self-executing

automatic stay provisions of the former Bankruptcy Act.

These provisions contained explicit prohibitions against

the exercise of jurisdiction by all courts other than the

bankruptcy court. This Court concluded that Congress

15

had plenary power over bankruptcy matters and had

exercised that power to limit the jurisdiction of state and

federal courts over the person or property of debtors

under the bankruptcy law. This Court further concluded

that Congress had manifested its intention that the debtor

be protected even if the issue of jurisdiction was not

contested or even raised by the debtor in the state or

federal court proceeding.

In the present case there is no statutory prohibition

against the exercise of state court jurisdiction with

respect to the provisions of the WPCL. All that has hap-

pened as a result of the generally worded preemption

provision in ERISA, 29 U.S.C. § 1144(a), is that the WPCL

no longer provides a scheme of state substantive law with

respect to employee benefit plans. And even this conclu-

sion was unclear enough to result in an initial determina-

tion that the WPCL was not preempted at all by ERISA.

See Carpenters Health and Welfare Fund v. Kenneth R.

Ambrose, Inc., supra. The ERISA preemption provision is

clearly not the type of express prohibition against the

exercise of jurisdiction which wes found in the former

Bankruptcy Act. Nor does it expressly manifest a Con-

gressional intent to protect litigants from state court pro-

ceedings where they fail to raise the preemption issue

until after a final judgment has been entered. Cf. Interna-

tional Longshoremen’s Ass‘n., AFL-CIO v. Davis, 476 US.

380 (1986) (Congressional intent demonstrated to fore-

close state court’s jurisdiction to adjudicate). Kalb is

therefore inapplicable to the present case. The partial

preemption of the WPCL by ERISA does not render

WPCL judgments void ab initio for lack of subject matter

jurisdiction.

16

CONCLUSION

The Pennsylvania Superior Court correctly deter-

mined that McMahon should not be applied to void the

final judgment previously rendered in this case, and the

Pennsylvania Supreme Court correctly refused to review

that determination. No special or important reasons exist

for reviewing those decisions. Accordingly, the Matteis’

petition seeking a writ of certiorari should be denied.

Respectfully submitted,

RicHarD B. Tucker, III, Esquire

(Counsel of Record)

Gary P. Hunt, Esquire

TUCKER ARENSBERG, P.C.

1200 Pittsburgh National Building

Pittsburgh, PA 15222

(412) 566-1212

Counse! for Respondents