Peeler, Sallie N. v. MCI, Incorporated ( 2006 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 01-3019
SALLIE N. PEELER,
Plaintiff-Appellant,
v.
MCI, INC., and MCI WORLDCOM
NETWORK SERVICES, INC.,
Defendants-Appellees.
____________
Appeal from the United States District Court for the
Southern District of Indiana, Indianapolis Division.
No. IP 01-983-C-Y/G—Richard L. Young, Judge.
____________
ARGUED JANUARY 24, 2002—DECIDED MAY 8, 2006
____________
Before EASTERBROOK and WOOD, Circuit Judges.†
PER CURIAM. Sallie Peeler filed this action in a state
court seeking an injunction against the installation of fiber-
optic cable along the Monon Trail, an abandoned railroad
right-of-way in which Peeler claims an interest as the
owner of an adjacent parcel. After the suit’s removal under
the diversity jurisdiction, the district court denied Peeler’s
†
Circuit Judge Ripple, the third member of the panel originally
assigned to this appeal, recused himself on April 20, 2006,
following a change of counsel and took no further part in the
proceedings.
2 No. 01-3019
request for a preliminary injunction. Events during the
pendency of Peeler’s appeal make it unnecessary to decide
whether the district judge erred.
First, MCI completed the installation of the cable, so that
step cannot be enjoined. Second, the corporation formerly
known as MCI WorldCom, Inc. (the original defendant)
became a debtor in bankruptcy, leading us to stay consider-
ation of Peeler’s appeal. 11 U.S.C. §362. Peeler did not file
a claim in WorldCom’s bankruptcy, so the general discharge
that WorldCom eventually received extinguishes her
principal claims—that Indiana law requires a deposit of
compensation before a public utility may lay cable under a
railroad right-of-way, and that the existence and use of the
cable without compensation are trespasses. Similar claims
have been considered, and held to be discharged, not only
by the district court that handled the WorldCom bank-
ruptcy but also by our colleagues on the eighth circuit. See
International Paper Co. v. MCI WorldCom Network Ser-
vices, Inc., 442 F.3d 633 (8th Cir. 2006); Browning v. MCI,
Inc., 2006 U.S. Dist. LEXIS 14228 (S.D.N.Y. Mar. 30, 2006).
We agree with these decisions and need not add to their
exposition. Claims based on the existence of the under-
ground conduit, and the cable’s use to transmit photons
that carry voice and data traffic, have been discharged.
Peeler’s situation differs in one respect from that of the
landowners in International Paper and Browning. MCI
installed a “fiber box” on land in which Peeler asserts an
interest. This structure, which permits workers to access
the cable should it need repair or replacement, occupies
about 15 square feet of the surface. Any obligation to pay
compensation on account of the box’s existence has been
discharged; but if MCI should use the box in the future to
access the underground cable then the repair teams would
re-enter Peeler’s land. MCI lacks Peeler’s consent to do this.
Cf. Leo Sheep Co. v. United States, 440 U.S. 668 (1979). A
discharge does not permit the debtor to engage in fresh
No. 01-3019 3
injurious acts after a bankruptcy’s conclusion. See Ohio v.
Kovacs, 469 U.S. 274 (1985); In re CMC Heartland Partners,
966 F.2d 1143 (7th Cir. 1992); In re Torwico Electronics,
Inc., 8 F.3d 146 (3d Cir. 1993); In re Chateaugay Corp., 944
F.2d 997 (2d Cir. 1991).
Because the possibility of future entries to repair existing
cable was not the basis of Peeler’s motion for equitable
relief in 2001, it does not provide any basis for disturbing
the district court’s decision. But it does show that the case
is not moot. We therefore affirm rather than vacate the
district court’s decision—limited as it is to an order (now
five years old) declining to enjoin MCI’s installation and use
of the cable.
Before the district court takes up whether Indiana law
entitles Peeler to either an injunction against future
entry or compensation for an easement, it must decide
whether Peeler has the ownership interest she asserts. MCI
denies that she has any legal interest in the land on which
the fiber box sits. If Peeler does have a property inter-
est—and if MCI has not secured an easement through
condemnation proceedings in state court, see Ind. Code §32-
24-4-1—the district court must decide whether to certify the
proceeding as a class action, as Peeler has proposed. See
Smith v. Sprint Communications Co., 387 F.3d 612 (7th Cir.
2004); Uhl v. Thoroughbred Technology & Telecommunica-
tions, Inc., 309 F.3d 978 (7th Cir. 2002); Isaacs v. Sprint
Corp., 261 F.3d 679 (7th Cir. 2001).
Decisions on these questions may be unnecessary if the
district judge relinquishes supplemental jurisdiction. 28
U.S.C. §1367(c). When WorldCom removed the case, federal
jurisdiction was supplied by the fact that an injunction
against completing and using the cable would have cost
WorldCom more than $75,000. All controversy about the
cable’s existence and use having been resolved by the
bankruptcy, however, the remaining dispute about access
4 No. 01-3019
to the fiber boxes (the one near Peeler’s land and 12 others
along the Monon Trail) likely is worth less than $75,000. If
so, that claim would depend on the supplemental jurisdic-
tion, for it would not have supported removal independ-
ently. If the jurisdictional amount is not satisfied with
respect to this distinct claim for relief, the district court
should consider returning this case to state court.
AFFIRMED AND REMANDED
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—5-8-06