Cite as Crowley Cutlery Company v. U.S., 849 F.2d 273 (7th Cir
1988)

             Crowley Cutlery Company, Plaintiff-Appellant,

                                  v.

United States of America and Commissioner of Customs of the United 
States Customs Service, Defendants Appellees.

                             No. 87-2836.

           United States Court of Appeals, Seventh Circuit.

                        Argued April 22, 1988.

                         Decided June 6, 1988.

         Rehearing and Rehearing En Banc denied June 29, 1988.

      Nathan Bey Myers, Chicago, Ill., for plaintiff-appellant

      Patrice Scully, U.S. Dept. of Customs, Chicago, Ill., for
defendants-appellees.

      Before WOOD, Jr. and POSNER, Circuit Judges, and ESCHBACH,
Senior Circuit Judge.

      POSNER, Circuit Judge.

      In this improbable suit, Crowley Cutlery Company asked a
federal district court in Illinois for a declaration that the
Switchblade Knife Act, 15 U.S.C. sections 1241 et seq., which
forbids the importation of switchblade knives or their interstate
transportation or distribution, violates the due process clause of
the Fifth Amendment. The district judge dismissed the suit, and
Crowley appeals.

      The roots of the case are in Minnesota, where Douglas Nelson
imported switchblades, in violation of the Act, and sold them from
his home, and also (unbeknownst to his employer) from an office at
the department store where he worked. The U.S. Customs Service
repeatedly seized shipments to him of switchblade knives. On
October 10, 1986, Nelson incorporated Crowley Cutlery Company in
Illinois. He is the sole stockholder and officer, and the company
has as yet no assets and no employees and has conducted no
business, but represents that it intends to import switchblade
knives into Illinois. Twelve days after it was incorporated,
Crowley filed this suit. While the suit was pending in the district
court Nelson was indicted in a federal district court in Minnesota
for criminal violations of the Switchblade Knife Act and other
federal statutes. He was convicted (the court having rejected the
same constitutional challenge to the Act that Crowley has mounted
in the present suit), and shortly before the oral argument of this
appeal was sentenced to a year in prison and fined $5,000. He was
due to surrender on May 23 to begin serving his sentence, bail
pending appeal to the Eighth Circuit having been denied. He intends
to argue in that appeal that the Act is unconstitutional.

      There is a serious question whether the present suit involves
an actual controversy within the meaning of Article III of the
Constitution. The timing of the incorporation of Crowley Cutlery
Company, and its lack of staff or assets, create an
inference-strongly reinforced by its counsel's insistence that
Nelson might have formed a dozen one-man corporations in order to
place his constitutional challenge to the Switchblade Knife Act
before all of the regional federal courts of appeals--that this
suit was brought not to enable Crowley to remove a legal impediment
to conducting a business in imported switchblade knives in Illinois
but to enable Nelson to litigate his constitutional challenge in
another circuit besides the Eighth. Events since the filing of the
suit augment our suspicions. For with Nelson about to enter prison,
and his switchblade business strictly a one-man band, the prospects
for his starting up a business in Illinois are dim whatever the
outcome of the present suit. If all he is seeking by this suit is
a precedent, the suit is not within the jurisdiction of the federal
courts. United States v. Articles of Drug, 818 F.2d 569, 571, 574
(7th Cir.1987); see Golden v. Zwickler, 394 U.S. 103, 89 S.Ct. 956,
22 L.Ed.2d 113 (1969).

      Yet when he brought this suit he could not be sure he would be
convicted, and the conviction may, for all we know, be reversed on
appeal, though not on the constitutional grounds advanced in this
suit. And maybe he really did plan to relocate to Illinois if he
won a favorable decision in this suit--though this is unlikely; in
addition to our previous points we note that Illinois has its own
statute forbidding the sale or possession of switchblade knives.
Ill.Rev.Stat. ch. 38, para. 24-1(a)(1). If Nelson were serious
about relocating his business from Minnesota he would doubtless
have incorporated in one of the states that does not have such a
law; such states, and his major market, are in the South, not-the
Midwest.

      Even if Nelson were deadly serious about relocating to
Illinois if he wins this suit, intentions alone do not make a case
or controversy in the constitutional sense. You cannot go to a
federal court for advice on the legality of a proposed course of
action. You must be party to an existing legal dispute. This is
true whether you are seeking a declaratory judgment or any other
form of relief; the declaratory-judgment statute cannot amend
Article III. See, e.g., Illinois ex rel. Barra v. Archer Daniels
Midland Co., 704 F.2d 935, 941-43 (7th Cir.1983). So we must ask
whether Nelson (or his alter ego, Crowley) has a dispute with
either the U.S. Customs Service or the United States Attorney for
the Northern District of Illinois, or both.

      If the federal authorities would pounce the minute Crowley
started importing switchblade knives into the Port of Chicago, and
if, but for fear of their claws, Crowley would indeed import
switchblade knives forthwith into the Port of Chicago, there would
be enough present adverseness between the parties to satisfy the
requirements of Article III. See; e.g., Steffel v. Thompson, 415
U.S. 452, 458-59, 94 S.Ct. 1209, 125-16, 39 L.Ed.2d 505 (1974);
Babbitt v. United Farm Workers National Union, 442 U.S. 289, 298-
303, 99 S.Ct. 2301, 2308-11, 60 L.Ed.2d 895 (1979); Bingham, Ltd.
v. Smith, 774 F.2d 1069 (11th Cir.1985) (threat to prosecute under
the Switchblade Knife Act). The first "if" is less dubious than the
second.  At argument the government's lawyer speculated that the
Customs Service might not discover that Nelson was importing
switchblade knives into Chicago and that even if it did-and
reported him to the U.S. Attorney the latter might, in the exercise
of his prosecutorial discretion, decline to prosecute him. We are
not impressed. It is after all one government, and a government
that would look uncommonly silly if after having pursued Nelson
pertinaciously in Minnesota it turned a blind eye to his relocating
his criminal enterprise to Illinois.

      Although there is enough question whether Crowley would begin
a switchblade business in Illinois if it won the present suit to
make us doubt the justiciability of this suit, cf. United States v.
Articles of Drug, supra, 818 F.2d at 575-74, where a suit has a
variety of jurisdictional infirmities there is no need to worry
each to death if one is clearly fatal. The Supreme Court has
frequently said that a suit which is frivolous does not invoke the
jurisdiction of the federal courts. See, e.g., Levering & Garrigues
Co. v. Morrin, 289 U.S. 103, 53 S.Ct. 549, 77 L.Ed. 1062 (1933);
Bell v. Hood, 327 U.S. 678, 66 S.Ct. 773, 90 L.Ed. 939 (1946);
Oneida Nation v. County of Oneida, 414 U.S. 661, 666-67, 94 S.Ct.
772, 776-77, 39 L.Ed.2d 73 (1974); Hagans v. Lavine, 415 U.S. 528,
537, 94 S.Ct 1372, 1379, 39 L.Ed.2d 1372 (1974); Duke Power Co. v.
Carolina Environmental Study Group, Inc., 438 U.S. 59, 70-72, 98
S.Ct 2620, 2628-29, 57 L.Ed.2d 595 (1978). Although most of the
Court's statements of the principle have been dicta rather than
holdings, and the principle has been questioned, see, e.g., Rosado
v. Wyman, 397 U.S. 397, 404, 90 S.Ct. 1207, 1213, 25 L.Ed. 26 442
(1970); Yazoo County Industrial Development Corp. v. Suthoff, 454
U.S. 1157, 102 S.Ct. 1032, 71 L.Ed.2d 316 (1982) (Rehnquist, J.,
dissenting from denial of certiorari), it is an established
principle of federal jurisdiction and "remains the federal rule."
Hagans v. Lavine, supra, 415 U.S. at 538, 94 S.Ct at 1379, see 13B
Wright, Miller & Cooper, Federal Practice and Procedure section
3564 (26 ed. 1984). It is the basis of a large number of
lower-court decisions (cited in id.), and at this late date only
the Supreme Court can change it.

      We relied on the principle in two recent cases, Dozier v. Loop
College, 776 F.2d 752 (7th Cir.1985), and Cronson v. Clark, 810
F.2d 662 (7th Cir.1987), and, with all respect to its distinguished
critics, we think it is a sound principle. The most important
difference between dismissing a case on the merits and dismissing
it for lack of jurisdiction because it is frivolous is that the
latter form of dismissal is possible, indeed-mandatory, even if the
defendant fails to preserve the ground that demonstrates the suit's
lack of merit. And that is an option that ought to be available to
a court. There is, no doubt, the danger emphasized by Judge
Friendly in Fogel v. Chestnutt, 668 F.2d 100, 105-07 (2d Cir.
1981), of confusing an absence of jurisdiction with an absence of
a meritorious claim. The issue in that case was the existence of an
implied right to sue for damages under the Investment Company Act,
and the court held that this was an issue about the merits rather
than about jurisdiction. We have no quarrel with that
classification, any more than with the same classification of a
similar issue (an implied right of damages under the Constitution)
in Bell v. Hood. But these decisions do not hold or imply that a
court must wrestle with difficult jurisdictional questions if,
those questions surmounted, the case would have to be tossed out
even if the defendant failed to put up an effective defense; this
result is achieved by calling a dismissal for frivolousness
jurisdictional too.

      Against this position it can be argued that any claim which
may be said to arise under the Constitution or a federal statute
invokes the jurisdiction of the federal courts, where
"jurisdiction" is viewed as marking off the judicial power of the
United States from other sources of governmental authority. And
whatever the grounds of the present suit, they are federal rather
than state grounds. Many decisions hold, however, that the concept
of "arising under" is not a matter merely of labels; consider for
example Andrews v. Louisiana  Nashville R.R., 406 U.S. 320, 92
S.Ct. 1562, 32 L.Ed.2d 95 (1972), which held that a suit by a
railroad worker for wrongful discharge under state law actually
arose under the federal Railway Labor Act. Andrews is different
from the present case; the idea behind it is that Congress wanted
to keep the class of litigation represented by Andrews' suit out of
the state courts. But, by the same token, the principle that
frivolous suits do not invoke federal jurisdiction retards efforts
by plaintiffs to recast what are really state-law claims as federal
claims; the principle enables these claims to be dismissed at the
earliest possible opportunity. It also spares the federal courts
from having to entertain--merely because the defendant did not have
the wit to point out the deficiencies in the plaintiff's
case--litigation not reasonably grounded in federal law. A federal
court should not be required to decide a dispute over an alleged
fraud in the sale of bananas merely because the defendant fails to
point out that bananas are not securities within the meaning of the
Securities Exchange Act of 1934, or perhaps prefers to litigate his
dispute with the plaintiff in federal court. An utterly groundless
suit is not grounded in the ostensible source of the plaintiff's
claim.

      The entire issue, though fascinating to aficionados of federal
jurisdiction, has limited practical importance now that three judge
district courts (convenable only if the plaintiff's federal claim
was "substantial") have virtually been abolished (compare 28 U.S.C.
section 2284(a) with 28 U.S.C. sections 2281 and 2325 (1948 ed.)
(repealed)), and now that district courts relinquish jurisdiction
over pendent state claims whenever the federal claim drops out
early, whether on jurisdictional or nonjurisdictional grounds. In
Bell v. Hood the majority and dissenting Justices assumed that the
consequence of dismissing the federal claim on the merits rather
than for lack of jurisdiction would be to force the district court
to adjudicate the pendent state-law claims; today, dismissal of the
federal claim before trial normally requires the district court to
relinquish jurisdiction over the pendent claims. See United Mine
Workers v. Gibbs, 383 U.S. 715, 726, 86 S.Ct 1130, 1139, 16 L.Ed.
2d 218 (1966); Graf v. Elgin, Joliet & Eastern Ry., 790 F.2d 1341,
1344, 1347-48 (7th Cir.1986).

      No one doubts the authority of a federal district judge to
dismiss a frivolous suit on his own initiative, and whether he
calls it a dismissal for failure to state a claim or a dismissal
for lack of jurisdiction is a detail. However, if frivolous suits
do not invoke federal jurisdiction, dismissal is mandatory. See
Fed.R.Civ.P. 12(h)(3). So there is a small difference. Notice that
plaintiffs will often be better off by this mode of dismissal,
which will deprive the judgment of res judicata or collateral
estoppel effect so far as any related state-law claims may be
concerned.

      Is a suit frivolous, for purposes of determining the federal
court's jurisdiction over it, if it is frivolous for purposes of
awarding sanctions under Rule 11 of the civil rules (or other
sources of judicial authority to punish the filing of frivolous
pleadings), and vice versa? In deciding whether a claim is so
insubstantial as not to invoke federal jurisdiction, the cases
sometimes use language more emphatic than one encounters in modern
Rule 11 cases, see, e.g., Goosby v. Osser, 409 U.S. 512, 518-19, 93
S.Ct. 854, 858-59, 35 L.Ed.2d 36 (1973), though the differences may
well be rhetorical, and the cases in question precede the 1983
amendment that made Rule 11 the scourge of frivolous filers that it
is today. We incline to doubt that distinguishing the frivolous
from the utterly frivolous is within the practical capacity of a
court, but note that the concepts of frivolousness in the two
contexts of jurisdiction and Rule 11 cannot be completely
symmetrical, if only because jurisdiction is based on what the
pleadings show while sanctions under Rule 11 may be imposed for a
failure to conduct an adequate factual inquiry before filing suit.
A suit that fails to invoke federal jurisdiction by reason of being
frivolous must be frivolous on its face, that is, frivolous when
the pleadings and other relevant materials setting forth the
plaintiff's claims (for example, an answer to a motion to dismiss)
are read against the relevant statutory or decisional background.
See, e.g., Ex parte Poresky, 290 U.S. 30, 54 S.Ct. 3, 78 L.Ed 152
(1933) per curiam). Rule 11 is not so cabined.

      The present suit is frivolous.  Compare Bingham, Ltd. v.
Meese, 817 F.2d 98 (11th Cir.1987) (per curiam), and United States
v. Murphree, 783 F.2d 605 (6th Cir. 1986)-both cases summarily
rejecting constitutional challenges to the Switchblade Knife Act.
Crowley's principal argument is that the due process clause forbids
an outright ban on the importation, sale, possession, or use of a
good that (1) has some proper uses and (2) is not inherently
dangerous, though Crowley would apparently-and
inconsistently-permit heavy taxation that might be prohibitory in
its practical effects. A switchblade knife indeed satisfies both of
Crowley's conditions--but so too, counsel acknowledged at argument,
does a machine gun. In Crowley's view, the private possession of
nuclear bombs, dynamite, and nitroglycerine can be banned because
they are inherently dangerous, but a switchblade knife cannot be,
because it can be used for every proper use that a regular knife
can be used for; it is just a knife with a spring. Of course,
explosives have legitimate uses too.

      The other branch of Crowley's constitutional case is an
argument that the distinction between a spring knife and a manual
knife is too slight to be considered rational. (This sounds like an
equal protection argument, but Crowley does not rely on the equal
protection clause.) The spring enables the knife to be opened
without taking off one's mittens or scratching the polish on one's
long fingernails; it is not only useful, but benign.

      These arguments do not come close to demonstrating the
unconstitutionality of the Switchblade Knife Act. Switchblade
knives are dangerous, and the due process clause does not forbid
the banning of dangerous products. "Congress is free to exclude
from interstate commerce articles whose use in the states for which
they are destined it may reasonably conceive to be injurious to the
public health, morals or welfare." United States v. Carolene
Products Co., 304 U.S. 144, 147, 58 S.Ct 778, 781, 82 L.Ed. 1234
(1938). Switchblade knives are more dangerous than regular knives
because they are more readily concealable and hence more suitable
for criminal use. So it is rational to ban them, and not regular
knives as well. It would be absurd to suggest that the only lawful
method of banning switchblade knives would be to ban all knives,
including we suppose the plastic knives provided on airlines and in
prison cafeterias. Nevertheless that is Crowley's position.

      All this is not to say that the issue of the Switchblade Knife
Act's constitutionality necessarily is frivolous. It is the
specific grounds articulated by Crowley that are frivolous, and
make the suit frivolous.

      The district court followed an alternative route to dismissal.
The federal declaratory-judgment statute empowers but does not
require federal courts to issue declaratory judgments (provided
there is an "actual controversy"), see 28 U.S.C. section 2201, and
a long line of cases makes clear that the issuance of such a
judgment is indeed discretionary. See, e.g., Brillhart v. Excess
Ins. Co., 316 U.S. 491, 494, 62 S.Ct. 1173, 1175, 86 L.Ed. 1620
(1942); Tempco Electric Heater Corp. v. Omega Engineering, Inc.,
819 F.2d 746, 747-49 (7th Cir.1987). The plaintiff in a
declaratory-judgment action is not seeking immediate relief, and
judges ought to be alert to the possibility that he may be trying
to enlist them in a tactical maneuver undeserving of the
expenditure of federal judicial resources. See American Automobile
Ins. Co. v. Freundt, 103 F.2d 613, 617 (7th Cir.1939). That is an
apt description of the present suit, the most plausible explanation
of which is that Nelson, pessimistic about his prospects for
persuading the federal courts in Minnesota to invalidate the
Switchblade Knife Act, sought what he thought might be a more
hospitable forum.

      It is a hotly disputed question whether and to what extent a
litigant should be able to litigate parallel claims in state and
federal court simultaneously. Against is the desire to preserve the
somewhat tattered remnants of state sovereignty in a federal system
and conserve the limited resources of the federal courts; in favor
is the sense that the federal courts are the primary protectors of
federal rights (a modern view; Congress did not even confer a
general federal-question jurisdiction on the federal courts until
the Act of March 3, 1875, ch. 137, 18 Stat. 470). The case against
has persuaded the Supreme Court to hold that a federal court may
not (save in exceptional circumstances) enjoin a state-court
prosecution, see Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746, 27
L.Ed.2d 669 (1971); and in a companion case to Younger the
principle was applied to a request for declaratory relief. See
Samuels v. Mackell, 401 U.S. as, 91 S.Ct. 764, 27 L.Ed.2d 668
(1971). The order of the state and federal suits is not critical.
Hicks v. Miranda, 422 U.S. 332, 95 S.Ct 2281, 45 L.Ed.2d 223
(1975).

      The analogy to Nelson's attempted end run around the United
States Attorney in Minnesota should be plain. But we need not rely
on analogy, for the question whether a litigant should be able to
litigate the same issue at the same time in more than one federal
court is an easy one--he should not be. For the application of this
principle where one of the suits seeks declaratory relief, see
Kerotest Mfg. Co. v. C-O-Two Fire Equipment Co., 342 U.S. 180, 72
S.Ct 219, 96 L.Ed. 200 (1952); Tempco Electric Heater Corp. v.
Omega Engineering, Inc, supra, 819 F.2d at 748-49; National Health
Federation v. Weinberger, 518 F.2d 711 (7th Cir.1975); and for
necessary qualification, see 10A Wright, Miller & Kane, Federal
Practice and Procedure section 2758 (2d ed. 1983). The Judicial
Panel on Multi-District Litigation (see 28 U.S.C. section 1407)
symbolizes the principle of consolidating parallel federal lawsuits
in one federal district court. The principle is an important one,
and though in the present case the frivolousness of the plaintiff's
declaratory suit has minimized the amount of judicial time
necessary to decide it, the litigation of this declaratory-judgment
action in the federal courts in Illinois, while the identical issue
presented by that action is before the Eighth Circuit, is a waste
of federal judicial resources. We reject the characterization by
Crowley's counsel at argument of the Seventh and Eighth Circuits as
"different countries."

      Since the only relief sought by Crowley was declaratory, the
decision not to grant such relief required the district court to
relinquish jurisdiction of the suit.

      AFFIRMED.