Grant v. Kamehameha Schools/Bernice Pauahi Bishop Estate et al

Filing 85

APPENDIX of Unpublished Cases in support of 84 Opposition by Jane Doe, John Doe (Attachments: # 1 Exhibit Bou-Matic Decision, # 2 Exhibit J.G. Boswell Tomato Co. Decision, # 3 Exhibit Lenscrafters Decision)(Stein, Jerry) Modified on 10/17/2008 (Benson, A).

Page 1 2 0 0 7 U.S. Dist. LEXIS 71101, *

LE X SE E LENSCRAFTERS, INC., et al., Plaintiffs, v. LIBERTY M U T U A L FIRE I N S U R A N C E COM P A N Y , et al., Defendants. N o . C 07-2853 SBA U N I T E D STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF C A L IF O R N IA 2 0 0 7 U.S. Dist. LEXIS 71101

S e p t e m b e r 18, 2007, Decided September 18, 2007, Filed P R I O R HISTORY: Lenscrafters, Inc. v. Liberty Mut. F i r e Ins. Co., 2005 U.S. Dist. LEXIS 22709 (N.D. Cal., O c t. 5, 2005) C O U N S E L : [*1] For Lenscrafters, Inc., Eyexam of C a lifo r n ia , Inc., Plaintiffs: Richard DeNatale, LEAD A T T O R N E Y , Celia M. Jackson, Heller Ehrman LLP, S a n Francisco, CA. F o r Liberty Mutual Fire Insurance Company, Defendant: A le x a n d e r Friedland Stuart, LEAD ATTORNEY, W illo u g h b y, Stuart & Bening, Inc., San Jose, CA. F o r Executive Risk Specialty Insurance Company, D e fe n d a n t , Counter-claimant, Cross-claimant: Monique M . Fuentes, Ross Dixon & Bell, LLP, Irvine, CA; T e r r e n c e Reilly Mclnnis, Ross Dixon 7 Bell LLP, Irvine, CA. F o r United States Fire Insurance Company, Defendant: M a r k Craig Goodman, LEAD ATTORNEY, Amy Rose, S q u ir e , Sanders & Dempsey L.L.P., San Francisco, CA. F o r M a r k e l American Insurance Company, Defendant, C r o s s -c la im a n t: Chip B. Cox, LEAD ATTORNEY, A tto r n e y at Law, San Francisco, CA. F o r W e s t c h e s t e r Fire Insurance Company, Defendant, C r o s s - c l a i m a n t , Cross-defendant, Counter-claimant, C o u n te r -d e fe n d a n t: Robert David Dennison, LEAD A T T O R N E Y , Harris, Green & Dennison, Los Angeles, CA. F o r United States Fire Insurance Company, Crossd e fe n d a n t: Amy Rose, Squire, Snaders & Dempsey LLP, S a n Francisco, CA. F o r Liberty Mutual Fire Insurance Company, Crossd e fe n d a n t, Counter-defendant: Alexander Friedland [*2] S tu a r t, W illo u g h b y, Stuart & Bening, Inc., San Jose, CA.

F o r Executive Risk Specialty Insurance Company, Crossd e f e n d a n t : Terrence Reilly Mclnnis, Ross Dixon 7 Bell L L P , Irvine, CA; Monique M. Fuentes, Ross Dixon & B e ll, LLP, Irvine, CA. F o r Lenscrafters, Inc., Eyexam of California, Inc., C o u n te r -d e fe n d a n ts : Celia M. Jackson, Heller Ehrman L L P , San Francisco, CA. F o r Lenscrafters, Inc., Cross-defendant: Richard D e N a ta le , LEAD ATTORNEY, Celia M. Jackson, Heller E h r m a n LLP, San Francisco, CA. J U D G E S : SAUNDRA BROW N ARMSTRONG, United S t a te s District Judge. O P I N I O N BY: SAUNDRA BROW N ARMSTRONG O P IN IO N O RDER [Docket Nos. 25, 27] T h is matter comes before the Court on Defendant U . S . Fire Insurance Company's ("U.S. Fire") motion to d i s m i s s or stay this action in favor of a pending New Y o r k state court action [Docket No. 25] and related r e q u e s t for judicial notice [Docket No. 27]. Having read a n d considered the arguments presented by the parties in t h e papers submitted to the Court, the Court finds this m a t te r appropriate for resolution without a hearing. The C o u r t hereby GRANTS U.S. Fire's request for judicial n o t i c e [Docket No. 27] and DENIES the motion to d is m is s or stay [Docket No. 25]. BACKGROUND I. The Snow Action In March 2002, [*3] Melvin Gene Snow filed a

Page 2 2 0 0 7 U.S. Dist. LEXIS 71101, * c l a s s action complaint in San Francisco Superior Court a g a in s t LensCrafters, Inc., EYEXAM of California, Inc. ( " E Y E X A M " ) and several other entities (LensCrafters, I n c . and EYEXAM are referred to together as " L e n s C r a f t e r s . " ) . Melvin Gene Snow, et al. v. L e n s C r a f t e r s , Inc., et al., San Francisco Superior Court, C a s e No. CGC-02-40554 ("Snow Action"). The Snow A c tio n arose from the business model used by L e n s C r a f t e r s , Inc. at its 90 stores in California and its b u s in e ss relationship with EYEXAM, a Californial i c e n s e d health care plan. The complaint alleges that L e n s C r a fte rs ' business practices and its procedures for h a n d lin g patient information violate several California la w s , including B u s in e ss & Professions Code 655 ( p r o h i b i tin g certain business relationships between o p t i c i a n s and optometrists) and the California C o n fid e n tia lity of Medical Information Act ("COMIA") ( C a l . Civ. Code § 56, regulating disclosure of c o n f i d e n t i a l medical information). The Snow plaintiffs s e e k to certify a California-only class of more than a m i l li o n consumers who had their eyes examined by a C a lifo r n ia -lic e n s e d optometrist employed by EYEXAM a n d who purchased eyewear from LensCrafters [*4] on th e same day. Schechter Decl., PP 1, 8; Rose Decl., Ex. 1 . Presently, only LensCrafters and EYEXAM remain s u b j e c t to any liability in Snow. Schechter Decl., PP 4-7. I I . The 2004 Coverage Action In This Court In March 2004, LensCrafters filed an insurance c o v e r a g e action in this Court, LensCrafters, Inc., et al. v. L ib e rty Mutual Fire Ins. Co., et al., Case No. C-040 1 0 0 1 SBA, 2005 U.S. Dist. LEXIS 22709 ("the 2004 C a lifo r n ia Action"). The 2004 California Action p r e se n te d claims for declaratory relief and breach of c o n tr a c t with respect to insurance coverage for the Snow A c t i o n . LensCrafters' two primary insurers, Liberty M u tu a l ("Liberty") and ERSIC, were defendants in the l a w s u it. The 2004 California Action raised issues c o n c e r n i n g both the duty to defend and the duty to i n d e m n ify for any damages that might be paid to the S n o w plaintiffs. Jackson Decl., 4, 5 & Ex. 2. I n the 2004 California Action, this Court decided th r e e sets of cross-motions for summary judgment r e g a rd in g the duty to defend that were filed by L e n sC r a f te r s , Liberty and ERSIC. The Court issued two m a i n rulings: (1) that Liberty and ERSIC both have a d u t y to defend LensCrafters for the claims asserted in S n o w , and (2) that Liberty's policy is [*5] primary to E R S I C 's for the purposes of the Snow claims. Jackson D e c l., PP 7, 8. Judgments were entered in November 2 0 0 5 and are on appeal to the Ninth Circuit. Id., P 9. L e n s C r a fte rs ' indemnity claims did not become ripe fo r resolution in the 2004 California Action. Thus, p u r s u a n t to the parties' stipulation, the Court ordered that th e indemnity claims be dismissed without prejudice, w i t h the following conditions: (1) any party could re-file in d e m n i ty claims when they ripened, (2) such action had to be filed in the Federal District Court for the Northern D i s t r i c t of California, and (3) the parties consented to e x c l u s i v e jurisdiction and venue in this Court. Id., P 10 & E x . 4. I I I . The Filing Of The 2007 Coverage Action The Snow Action was litigated from 2002 to early 2 0 0 7 . Defendant U.S. Fire and the other insurers attended m e e t in g s in San Francisco in January 2006, January 2 0 0 7 , and April 2007 to discuss the progress of the litig a tio n and the prospects for settlement, as well as a m e d ia tio n session in San Francisco in November 2005. J a c k s o n Decl., PP 11, 14. On April 27, 2007, the parties to Snow, along with Liberty, U.S. Fire and the other in s u r e r s , attended a mediation in California [*6] at w h i c h significant progress was made towards settlement, b u t no deal was reached. Id., P 12. According to L e n s C r a fte r s , by the end of May 2007 it had become a p p a r e n t that the insurers' positions on certain insurance is s u e s, including whether the Snow claims are covered, w h e th e r the insurers have a duty to approve and fund a s e ttle m e n t, and how settlement funding should be a l l o c a t e d , were significant obstacles to settlement. Id. O n May 31, 2007, LensCrafters filed this action for d e c la r a to r y relief. As required pursuant to this Court's e a r lie r Order dismissing indemnity claims from the 2004 C a l i fo r n i a Action, LensCrafters re-filed its indemnity c la im s in this Court. It sued both the two insurers that w e r e defendants in the 2004 California Action and the o t h e r excess insurers: U.S. Fire, M a r k e l , and W e s t c h e s t e r . On June 15, 2007, the Court deemed this a c t i o n to be related to the 2004 California Action. See D o c k e t No. 10. I n June 2007, LensCrafters reached a settlement in th e Snow Action, contingent on approval and funding by in s u r e r s . Jackson D e c l ., P 13. On June 21, LensCrafters a s k e d the insurers to accept and fund the settlement. Id. A further mediation session was scheduled for July [*7] 2 6 , 2007 to finalize the settlement and obtain the in s u r e r s ' consent and funding. The Superior Court h a n d lin g Snow issued an order requiring the insurers to a t t e n d ; U.S. Fire did not attend. Id. & Ex. 5. The insurers d i d not accept and fund the Snow settlement, and the S n o w settlement has not been finalized. E l e v e n days after the July 26, 2007 mediation s e s s i o n failed to finalize the settlement of Snow, L e n s C r a f t e r s moved to amend its Complaint in this a c t i o n to add claims for breach of contract against all i n s u r e r s and claims for tortious breach of the covenant of g o o d faith and fair dealing against U.S. Fire, Markel and W e s tc h e s t e r . Jackson Dec., P 17. The hearing on that m o t i o n is set for October 2, 2007. Id.

Page 3 2 0 0 7 U.S. Dist. LEXIS 71101, * I V . U.S. Fire's New York Action On May 24, 2007, one week before LensCrafters file d the 2007 California Action, U . S . Fire filed a d e c l a r a to r y relief action in New York state court, seeking a declaration that its policies do not cover the Snow A c tio n , and seeking apportionment of any liability it has fo r Snow among a number of LensCrafters' insurers. U.S. F i r e 's suit names as defendants LensCrafters and E Y E X A M , the two insureds seeking coverage for Snow. J a c k s o n Decl., P 16. It [*8] also names some of the other e n t i ti e s insured by the policies that do not face liability in S n o w . U.S. Fire named three of the other insurers from w h ic h LensCrafters seeks coverage, but did not name E R S I C , a fourth insurer from which LensCrafters seeks c o v e r a g e for Snow, Id., P 18. L e n s C r a f te r s has filed a motion in the New York c o u r t seeking dismissal or a stay of U.S. Fire's lawsuit on fo r u m nonconveniens grounds. Jackson Decl., P 22. In a d d itio n , EYEXAM has requested dismissal from the N e w York action based on lack of personal jurisdiction. I d . , PP 21, 22. Luxottica U.S., U.S. Shoe and EyeMed a ls o seek dismissal on the additional grounds that they a r e improperly joined and that there is no justiciable c o n tr o v e r s y as to them, because they do not seek c o v e r a g e for Snow. Id. T h e New York Court has stayed d is c o v e ry in that action and set a hearing on L e n s C r a fte rs ' motion for October 29, 2007. V . U.S. Fire's M o t io n to Dismiss or Stay U.S. Fire filed the instant motion to dismiss or stay th is action on July 18, 2007, arguing that this Court s h o u l d dismiss or stay this action in deference to the p a r a l le l proceedings U.S Fire initiated in New York, one w e e k before LensCrafters filed this lawsuit [*9] in this C o u r t. U.S. Fire argues that since each of the policies at is s u e were "negotiated between New York-based c o m p a n i e s . . . in New Y o r k State and the policies were e a c h issued in New York," this is fundamentally a New Y o r k state action and will involve the interpretation of N e w York contract law. Mot. at 3. F r o m 1998 to 2000, Luxottica, a New York-based s u b s id i a r y of Luxottica Group S.p.A., an eyewear c o n g lo m e r a te that controls LensCrafters, worked with a N e w York-based insurance broker, BlumencranzK le p p e r - W ilk in s , Ltd., to negotiate and purchase the r e l e v a n t insurance policies from U . S . Fire. See Mot. at 3; R o s e Decl., Ex. A at PP 5-9, 30-33, Ex. B. U.S. Fire a l l e g e s that Luxottica also "negotiated and purchased" its p r im a r y commercial general liability coverage from 1998 u n t i l at least 2006 in New York from Liberty Mutual, " w h ic h policies were also issued in New York," see C o m p l a in t at P 16; Rose Decl., Exs. G-I at 1, and that Luxo ttica p urchased p rim a ry M a n aged C are O r g a n iz a tio n Errors and Omissions Liability insurance f o r a number a years from Executive Risk Specialty I n s u r a n c e Company ("ERSIC"), which was "negotiated a n d issued in New York." (See Rose Decl., Ex. J at 5, fn. [ * 1 0 ] 5.). U.S. Fire further alleges that Luxottica p u r c h a s e d an additional excess insurance from defendant W e s tc h e s te r Fire Insurance Company, a New York c o m p a n y . Id. T h u s , U.S. Fire argues, since the insurance policies w e r e "negotiated and issued" in New York between p r im a r ily New York-based entities, the instant action, w h i c h currently only involves claims for declaratory r e l i e f , will needless duplicate the New York state p r o c e e d in g s and will needlessly decide issues of New Y o r k state law. L E G A L STANDARDS As a general matter, the decision to retain j u r is d i c t io n over a declaratory judgment action lies w i t h i n the sound discretion of the district court. Brillhart v . Excess Ins. Co. of America, 316 U.S. 491, 494, 62 S. C t . 1173, 86 L. Ed. 1620 (1942); Wilton v. Seven Falls C o . , 515 U.S. 277, 278, 115 S. Ct. 2137, 132 L. Ed. 2d 2 1 4 (1995) (district court's decision to exercise j u r i s d i c t i o n "should be reviewed for abuse of d i s c r e t i o n " ) ; Huth v. Hartford Ins. Co. of the Midwest, 2 9 8 F.3d 800, 803 (9th Cir. 2002). W h e re a federal d e c l a r a t o r y relief action based on diversity jurisdiction is c o m m e n c e d in reaction to or in anticipation of a state c o u r t action involving the same parties and state law i s s u e s , it is settled law that the federal court should a b s ta in from [*11] exercising jurisdiction and dismiss t h e action in favor of the state court proceeding. Wilton, 5 1 5 U.S. at 289; Brillhart, 316 U.S. at 494. A s the Supreme Court explained in Brillhart, " o r d i n a rily it would be uneconomical as well as v e x a t io u s for a federal court to proceed in a declaratory j u d g m e n t suit where another suit is pending in a state c o u r t presenting the same issues, not governed by federal la w , between the same parties." Brillhart, 316 U.S. at 4 9 5 . Indeed, "where another suit involving the same p a r tie s and presenting opportunity for ventilation of the s a m e state law issues is pending in state court, a district c o u r t might be indulging in 'gratuitous interference' if it p e r m i t t e d the federal declaratory action to proceed." W ilto n , 515 U.S. at 283 (quoting Brillhart, 316 U.S. at 495). H o w e v e r , the pendency of a state court action does n o t, of itself, require a district court to refuse federal d e c l a r a t o r y relief. Government Employees Ins. Co. v. D iz o l, 133 F.3d 1220, 1225 (9th Cir. 1998). The B r illh a r t factors are simply "the philosophic touchstone" f o r the district courts. Id. The doctrinal teaching of B r illh a r t is that the district court: 1) should avoid n e e d l e s s determination [*12] of state law issues, 2) s h o u l d discourage litigants from filing declaratory a c t i o n s as a means of forum shopping, and 3) should

Page 4 2 0 0 7 U.S. Dist. LEXIS 71101, * a v o i d duplicative litigation. Id. I n addition to the Brillhart factors, courts may i n q u i r e : 1) whether the declaratory action will settle all a s p e c ts of the controversy; 2) whether the declaratory a c tio n will serve a useful purpose in clarifying the legal r e l a t i o n s at issue; 3) whether the declaratory action is b e i n g sought merely for the purposes of "procedural fe n c in g " or to obtain a 'res judicata' advantage; and 4) w h e t h e r the use of a declaratory action will result in e n t a n g l e m e n t between the federal and state court s y s t e m s . Id. at 1225 n. 5, quoting American States Ins. C o . v. Kearns, 15 F.3d 142, 145 (9th Cir. 1994) (J. G a r th , concurring). Additionally, the district court might c o n s id e r the convenience of the parties, and the a v a i la b ility and relative convenience of other remedies. Id . A N A L Y S IS I. LensCrafters' M o t io n To Amend As an initial matter, LensCrafters argues that since it h a s filed a motion seeking leave to amend its complaint i n this action to add breach of contract and bad faith c la im s based on events that took place after the initial c o m p l a i n t [*13] was filed, the Court should deny the m o tio n to dismiss or stay on the grounds that claims o t h e r than declaratory relief are at issue. See Docket No. 3 6 . LensCrafters argues that in determining whether to a p p ly the Brillhart doctrine here, the Court should takes i n t o account LensCrafters' request for leave to amend in lig h t of the liberal policy permitting amendment. Under D i z o l , federal courts have a "virtually unflagging" o b lig a t io n to resolve non-declaratory relief claims, and w h e n those claims are presented along with a declaratory r e l i e f claim, the court should retain jurisdiction over all o f the claims. Dizol, 133 F.3d at 1225-1226. H a d LensCrafters amended its complaint prior to the filin g of U.S. Fire's motion to dismiss, this argument m i g h t have had some force. However, the Court has not y e t granted the motion to amend, which is noticed for h e a r in g on October 2, 2007, and as such the amended c o m p l a i n t is currently only a theoretical entity. It would b e inappropriate for the Court to analyze the Brillhart fa c t o r s pretending that the amended complaint is the o p e r a tiv e one, and, accordingly the Court will proceed w ith the analysis based on the operative, unamended c o m p la i n t, which [*14] seeks solely declaratory relief. I I . The Brillhart Factors A . The Same Issues For The Same Parties As noted above, the Brillhart doctrine is applicable w h e r e there is a pending state court action that presents " t h e same issues" between the same parties." Brillhart, 3 1 6 U.S. at 495. In considering whether "the same p a r tie s " are involved, the district court should inquire " w h e th e r necessary parties have been joined [or] whether s u c h parties are amendable to process in that [state] p r o c e e d in g ." Wilton, 515 U.S. at 283. LensCrafters a r g u e s that the instant action is broader than the New Y o r k action in several respects. First, LensCrafters a r g u e s that one of the two insureds seeking coverage, E Y E X A M , is not subject to the New Y o r k court's j u r is d i c tio n , and has requested dismissal from the New Y o r k action. LensCrafters argues that EYEXAM c o n d u c t s business exclusively in California, and has no N e w York operations. See Grossman Dec., PP 6, 7. H o w e v e r , this jurisdictional dispute is beyond the p u r v i e w of this Court, and the fact is that EYEEXAM is th e same party in either case. S e c o n d , U.S. Fire did not sue ERSIC in the New Y o r k action, although ERSIC issued a policy that p o te n tia l ly covers the [*15] Snow claims, as this Court r u l e d in the 2004 California Action, and therefore is, a c c o r d i n g to LensCrafters, a necessary party to this d is p u t e . U.S. Fire does not dispute that ERSIC is a n e c e s s a r y party, but argues that the absence of ERSIC fr o m the New Y o r k Action does not prevent the Court fr o m declining to exercise its jurisdiction in because E R S I C is subject to jurisdiction in New York, "and can b e easily added to the New York Action." (See Rose D e c l., Ex. J at 5 fn. 5 (noting that the ERSIC policies at is s u e were negotiated and issued in New York)). U.S. F i r e argues that under the Brillhart test, "the fact that E R S I C has not yet been added to the New York Action d o e s not change the fact that 'the same parties' are litig a tin g in both fora." Reply at 6. U .S . Fire's argument is not entirely persuasive. E R S I C is not a party to the New York action; therefore, th e New York lawsuit and the instant one do not involve t h e same parties, period. W h i l e ERSIC may be amenable to process in New Y o r k , it is undisputed that a necessary p a r ty is not involved in the New York Action. However, a s noted in Wilton, the Court may consider whether a p a r ty is amendable to process when analyzing the B r illh a r t [*16] factors. 515 U.S. at 283. Given the c o n s id e r a tio n s related to EYEEXAM and ERSIC, the " s a m e party" analysis favors neither party. B . Needless Determination Of State Law Issues The Supreme Court's first concern in Brillhart was to "avoid having federal courts needlessly determine is s u e s of state law."" Continental Cas. Co. v. Robsac I n d u s tr ie s, 947 F.2d 1367, 1371 (9th Cir. 1991) o v e r r u le d on other grounds by Dizol, 133 F.3d 1220 ( c itin g Brillhart, 316 U.S. at 493-495, 62 S. Ct. at 11757 6 ) . Both sides agree that this case involves the in te r p r e ta tio n of state law issues, however, the parties v i g o r o u s l y dispute whether California or New York state l a w will apply to the relevant insurance contracts. This

Page 5 2 0 0 7 U.S. Dist. LEXIS 71101, * r a i s e s a novel issue with respect to the "needless d e t e r m i n a t i o n of state law" analysis. Since, contrary to th e typical Brillhart abstention scenario, the state law a c t io n has been filed in a different state than where f e d e r a l district court resides, the analysis of this factor is s o m e w h a t different than the traditional case: if California l a w applies, this Court is better suited than a New York s t a t e court to determine the issues; of course, if New Y o r k law predominates, a New York court is better s u ite d to [*17] resolve the issues. S o m e w h a t ironically, both sides urge this court to a v o id engaging in a choice of law analysis, yet s im u l t a n e o u s ly devote substantial briefing to the issue. " L e n s C r a f t e r s and U.S. Fire agree on one thing -- this C o u r t need not determine which state's law will apply b e fo r e determining that it should defer to the prior-filed s t a t e court action." Reply at 13. The parties are correct in th e ir agreement: the Court cannot conduct a choice of la w analysis here, as no specific conflict between New Y o r k and California law has been identified. See Van W in k le v. Allstate Ins. Co., 290 F.Supp.2d 1158, 1162 (C . D . Cal. 2003) ("The fact that two states are involved d o e s not itself indicate that there is a 'conflict of laws' or 'c h o ic e of law' problem.") (quoting Hurtado v. Superior C o u r t, 11 Cal.3d 574, 580, 114 Cal. Rptr. 106, 522 P.2d 6 6 6 (1974)) (internal citation omitted); Stonewall Surplus L i n e s Ins. Co. v. Johnson Controls, Inc., 14 Cal.App.4th 6 3 7 , 645, 17 Cal. Rptr. 2d 713 (1993) (under California te s t , the first step is to identify an issue where there is a d iffe r e n c e in the law of the states). S i n c e the Court is not in a position to determine w h ic h state's law applies to the insurance contracts at is su e , the "needless determination [*18] of state law is s u e s" analysis also favors neither side. C . Forum Shopping A key purpose of the Brillhart doctrine is to d is c o u r a g e the filing of declaratory relief actions as a m e a n s of forum shopping. Dizol, 133 F.3d at 1225. Here, e a c h side accuses the other of forum shopping. In the p r o t o t y p i c a l Brillhart abstention case, the plaintiff files a n action in state court, and the defendant then files a " r e a c t iv e " declaratory relief action in federal court s e e k in g a more favorable venue. In such a scenario, the p r e s u m p t i o n that federal courts should abstain in d e fe r e n c e to the state court action is sound. "[I]f a d e c la r a to r y judgment suit is defensive or reactive, that w o u l d justify a court's decision not to exercise j u r is d ic tio n ." Continental Cas., 947 F.2d at 1371. L e n sC r a ft e r s argues that here, however, the typical B r illh a r t situation is turned on its head: U.S. Fire, k n o w i n g that LensCrafter was obligated, pursuant to C o u r t order, to bring its declaratory relief action in this C o u r t , filed a "preemptive" state law action in order to fr u s tr a te LensCrafter's attempts to gain relief. As for the t i m i n g of its 2007 action, LensCrafter alleges that this s u i t was filed one week later than U.S. [*19] Fire's a c t i o n only because LensCrafters was "acting judiciously to try to resolve its dispute informally before reinstituting its indemnity action, while U.S. Fire raced to New York i n an effort to avoid at all costs litigating before this C o u r t." Opp. at 16-17. U .S . Fire counters that LensCrafter's second-filed fe d e r a l case is the archetypal "reactive" lawsuit and was file d to frustrate U.S. Fire's state court action. However, U . S . Fire can point to nothing other than the fact that it f i le d first that indicates LensCrafters was engaged in fo r u m -s h o p p in g . Indeed, LensCrafter was required to file i t s declaratory relief action in this Court pursuant to s tip u la t io n . U.S. Fire absurdly suggests that the 2005 s tip u la tio n was somehow a "reactive" attempt to preclude its 2007 state law case, however this is belied by the f a c t s : LensCrafters actually originally filed its d e c l a r a t o r y relief claims in 2004, which were ultimately d i s m i s s e d as unripe. U.S. Fire's argument that this was s o m e h o w "reactive" to a non-existent suit does not merit d i s c u ss io n . T h i s factor favors LensCrafters. U.S. Fire was aware o f the 2004 action and should have been reasonably a p p r is e d that LensCrafters would re-file [*20] its d e c la r a to r y relief claims in this forum. The Court also n o t e s that U.S. Fire lamely opposed the motion to relate t h e 2007 case to the 2004 case, which would have r e s u lte d in a trifurcation of the proceedings. This smacks p r e c i s e l y of the "procedural fencing" that Brillhart a b s t e n t i o n is meant to discourage. Dizol, 133 F.3d at 1 2 2 5 , n. 5. To the extent that there is any forum shopping h e r e , U.S. Fire is the shopper. D . Duplicative Litigation The sole factor militating in favor of granting the m o tio n to dismiss or stay is the avoidance of duplicative litig a t io n . However, while, in the present posture, there a p p e a r s to be two parallel actions, as LensCrafters notes, t h e New York action is in its nascent stages, and to date little substantive activity has taken place in it other than th e filing of the complaint, answers, and crossc o m p l a i n t s , and the filing of LensCrafters' motion to d i s m i s s or stay the case. See Jackson Decl., P 19, 22. L e n s C r a f te r 's motion to dismiss could potentially dispose o f the New York action, and other essential parties have file d motions that would substantially alter the landscape o f the New Y o r k case if granted. Indeed, the New York c o u r t may come to the [*21] same conclusion as this C o u r t and dismiss the New York action in deference to th e federal action. Thus, while the fact that there are two p o te n tia lly parallel proceedings militates in favor of d i s m i s s i n g or staying the case, it is not enough to c o u n te r v a il the concerns related to forum shopping.

Page 6 2 0 0 7 U.S. Dist. LEXIS 71101, * I I I . Other Factors The other salient factor in favor of denying the m o tio n is "the convenience of the parties." Dizol, 133 F . 3 d at 1225 n. 5. As LensCrafters points out, the related c a s e has been proceeding in this forum since 2004, and th e underlying Snow action, from which the bulk of the f a c t s and evidence will be drawn, relates exclusively to L e n s C r a fte r's business practices in connection with its 90 s to r e s in California. The witnesses to those business p r a c tic e s are in California, and the alleged violations of p a t ie n t privacy occurred here. N e w York has no interest in the Snow Action, and n o related litigation has yet taken place there. Simply put, t h i s is a California case, and the Court should exercise its d is c r e tio n to retain jurisdiction over LensCrafters' d e c l a r a t o r y judgment action. Brillhart, 316 U.S. at 494. C O N C L U S IO N Accordingly, the motion to dismiss or stay [Docket N o . 25] is DENIED. [*22] U.S. Fire's request for j u d i c i a l notice [Docket No. 27] is GRANTED. 1 1 U.S. Fire requests judicial notice of the c o m p l a in t in the New York action. LensCrafters d o e s not object to the granting of the request, but o b j e c ts to U.S. Fires's characterization of the c o m p la in t as "parallel." This pointless objection is overruled. I T IS FURTHER ORDERED THAT the Case M a n a g e m e n t Conference currently scheduled for S e p te m b e r 18, 2007 at 1:00 p.m. shall be CONTINUED to December 6, 2007 at 2:30 p.m. The parties shall meet a n d confer prior to the conference and shall prepare a j o i n t Case Management Conference Statement which s h a ll be filed no later than 10 days prior to the Case M a n a g e m e n t Conference that complies with the Standing O r d e r For All Judges Of The Northern District Of C a l i fo r n i a and the Standing Order of this Court. Plaintiffs s h a ll be responsible for filing the statement as well as for a r r a n g i n g the conference call. All parties shall be on the lin e and shall call [phone] at the above indicated d a t e and time. I T IS SO ORDERED. D a te d : 9/18/07 S A U N D R A BROW N ARMSTRONG U n ite d States District Judge