Meadow Valley Contractors Incorporated v. C&S Engineers Incorporated et al

Filing 33

ORDER denying 22 Motion to Remand and/or for Abstention. (See document for further details). Signed by Judge G Murray Snow on 5/14/12.(LAD)

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WO

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Meadow Valley Contractors, Inc., a)
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Nevada corporation,
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Plaintiff/Counter-Defendant, )
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vs.
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C&S Engineers, Inc., a New York)
corporation; John and Jane Does I-X; ABC)
Corporation I-X; and XYZ Partnerships I-)
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X,
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Defendants/Counter-Claimants.)
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No. CV-11-8154-PCT-GMS
ORDER

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Pending before the Court is Defendant’s Motion to Remand and/or For Abstention.
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(Doc. 22). For the reasons discussed below, the motion is denied.
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BACKGROUND
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On April 5, 2010, Plaintiff Meadow Valley Contractors, Inc., a Nevada corporation,
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entered into a construction contract with the Town of Springerville, Arizona to resurface the
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Springerville Municipal Airport (the “Project”). At some point after starting work on the
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Project, Meadow Valley requested that the project be suspended, claiming that the contract
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plans, specifications and drawings (the “Design Documents”) were faulty. On September
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26, 2011, Meadow Valley filed its Complaint in this action in Apache County Superior Court
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against Defendant C&S Engineers, Inc., a New York corporation and the designer for the
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Project. In the Complaint, Meadow Valley brings claims against C&S for negligence,

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negligent misrepresentation, breach of implied warranty, and tortious interference with

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contract.

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On October 11, 2011, C&S removed the action to this Court, asserting complete

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diversity of the parties as the basis for the Court’s jurisdiction. (Doc. 1). On October 19,

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2011, C&S filed its Answer and brought counterclaims against Meadow Valley for

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negligence and negligent misrepresentation. On November 14, 2011, Meadow Valley filed

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its motion to dismiss the counterclaims for failure to state a claim, a motion which is still

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pending in this Court. (Doc. 8).

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On February 7, 2012, Meadow Valley filed a complaint in Apache County Superior

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Court against the Town for breach of contract and breach of the covenant of good faith (the

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“State-court Action”). C&S asserts—and Meadow Valley does not deny—that the State-

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court Action is “based on the same factual allegations” as this action. (Doc. 22 at 3). Given

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the existence of the closely related State-court Action, C&S now moves for remand of this

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action back to the Apache County Superior Court. (Doc. 22).

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DISCUSSION

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Defendant asserts that it is seeking remand pursuant to the Younger and Colorado

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River abstention doctrines. (Doc. 22). Plaintiff asserts in response that “[a]lthough remand

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may be appropriate at some point,” the Court should first decide Plaintiff’s motion to dismiss

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and various discovery disputes between the Parties. (Doc. 26 at 2).

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The Supreme Court has held that“federal courts have the power to dismiss or remand

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cases based on abstention principles only where the relief being sought is equitable or

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otherwise discretionary.” Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 731 (1996)

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(emphasis added). In the instant action, Plaintiff seeks “general, consequential, punitive, and

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special damages.” (Doc. 1-1, Ex. 1 at 7). The Court therefore lacks power to remand this case

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under the Younger or Colorado River abstention doctrines. See Quackenbush, 517 U.S. at

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731 (“Because this was a damages action, we conclude that the District Court’s remand order

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was [ ] unwarranted.”).
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Should the Parties decide to stipulate to a remand without conditions, they are directed

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to file their stipulation with the Court within fourteen (14) days of the date of this Order. See

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CDN Inc. v. Kapes, 197 F.3d 1256, 1258 (9th Cir.1999) (“Because stipulations serve both

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judicial economy and the convenience of the parties, courts will enforce them absent

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indications of involuntary or uninformed consent.”); Randy’s Trucking Inc. v. City of Shafter,

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2008 WL 5156665, *3 (E.D. Cal. Dec. 9, 2008) (“In light of the stipulation to remand, the

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parties are directed to submit a proposed order/stipulation to remand this case to the Kern

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County Superior Court.”); Bonvillian v. United Auto Credit, 2007 WL 810097, *4 (E.D. Cal.

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Mar. 15, 2007) (“Given the uncertainty of jurisdiction in this particular case, under these

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particular facts, and in the interest of economy and justice, the parties stipulated to remand

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this case to State court for adjudication of the sole state law based claim.”). Should the

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Parties not so stipulate, the Court will rule on Meadow Valley’s motion to dismiss and

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proceed with this case. See Kline v. Burke Const. Co., 260 U.S. 226, 228 (1922). (“Each

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court is free to proceed in its own way and in its own time, without reference to the

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proceedings in the other court. Whenever a judgment is rendered in one of the courts and

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pleaded in the other, the effect of that judgment is to be determined by the application of the

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principles of res adjudicata . . .The rule, therefore, has become generally established that .

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. . another action for the same cause in another jurisdiction is not precluded.”).

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IT IS THEREFORE ORDERED that Defendant’s Motion to Remand and/or for
Abstention (Doc. 22) is DENIED.
DATED this 14th day of May, 2012.

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