Covidien LP et al v. Esch

Filing 82

Judge Nathaniel M. Gorton: ENDORSED ORDER entered. MEMORANDUM AND ORDERFor the foregoing reasons, defendants motion to stay or dismiss proceedings (Docket No. 73) is DENIED.So ordered.(Caruso, Stephanie)

United States District Court
District of Massachusetts
)
Covidien LP and Covidien Holding )
Inc.,
)
)
Plaintiffs,
)
)
v.
)
)
Brady Esch,
)
)
Defendant.
)

Civil Action No.
16-12410-NMG

MEMORANDUM & ORDER
GORTON, J.
In January, 2017, defendant Brady Esch (“Esch”) filed a
motion to dismiss or, alternatively, to transfer venue claiming
that this Court lacks personal jurisdiction over Esch, that a
necessary and indispensable party was not joined and that this
case would be more properly litigated in California.

In

September, 2017, this Court denied that motion.
This Court rejected defendant’s argument that Venclose, a
start-up company that Esch founded, was a necessary party for
this litigation.

It also rejected defendant’s request to

transfer venue to the Northern District of California.

The

Court stated that it would hold the parties to their agreement
(the forum selection clause) in all but the most exceptional
cases.
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In October, 2017, defendant filed a motion to stay the
present case pursuant to the Colorado River doctrine, the
Wilton/Brillhart doctrine and the Court’s inherent authority to
manage its own docket.

Because no new developments in this case

have occurred that alter the analysis in this Court’s September,
2017, memorandum and order, defendant’s motion to stay or
dismiss proceedings (Docket No. 73) will be denied.
The Colorado River doctrine provides that when similar
actions are pending in state and federal court, it is
appropriate “in some instances for the federal court to defer to
the state court.” Bacardi Int’l Ltd. v. V. Suarez & Co., 719
F.3d 1, 14 n. 17 (1st Cir. 2013) (citing Colo. River Water
Conservation Dist. v. United States, 424 U.S. 800, 817 (1976)).
“Of all the abstention doctrines,” Colorado River “is to be
approached with the most caution,” with only the clearest cases
warranting dismissal. Jimenez v. Rodriguez-Pagan, 597 F.3d 18,
27 (1st Cir. 2010) (citing Colo. River, 424 U.S. at 819).

Eight

non-exclusive factors are weighed to determine if the
“exceptional circumstances necessary for abstention” exist:
(1) whether either court has assumed jurisdiction over a
res; (2) the [geographical] inconvenience of the federal
forum; (3) the desirability of avoiding piecemeal
litigation; (4) the order in which the forums obtained
jurisdiction; (5) whether state or federal law controls;
(6) the adequacy of the state forum to protect the parties'
interests; (7) the vexatious or contrived nature of the
federal claim; and (8) respect for the principles
underlying removal jurisdiction.
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Rio Grande Cmty. Health Ctr., Inc. v. Rullan, 397 F.3d 56, 60,
71 (1st Cir. 2005) (citation omitted).
Defendant has failed to show that exceptional circumstances
are present in this case as demonstrated by reference to the
following relevant factors:
1. The geographical inconvenience of the federal forum does
not weigh in defendant’s favor because defendant contracted to
litigate in Massachusetts. See Atlantic Marine Constr. Co., Inc.
v. U.S. Dist. Court for the Western Dist. of Texas, 134 S.Ct.
568, 5882 (2013) (observing that “when parties agree to a forumselection clause, they waive the right to challenge” that forum
as inconvenient).
2. To the extent that defendant wishes to avoid piecemeal
litigation, he could do so by interpleading Venclose. See Fed.
R. Civ. P. 20.

The piecemeal litigation factor weighs “in favor

of dismissal only if there is some exceptional basis for
dismissing one action” and no such exceptional basis exists in
this case.

See KPS & Assocs., Inc. v. Designs By FMC, Inc., 318

F.3d 1, 11 (1st Cir. 2003) (citations omitted) (internal
quotation marks omitted).
3. The chronological order in which the forums obtained
jurisdiction weighs against defendant because this case was
filed earlier and is more advanced than any of the parallel
actions.
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4. Because this case “amounts to a simple breach of
contract case involving straightforward issues of state law,”
this factor, with respect to whether state or federal law
controls, does not weigh in favor of abstention. See Spark
Energy Gas, LP v. Toxikon Corp., 864 F. Supp. 2d 210, 220 (D.
Mass. 2012) (citing Nazario-Lugo v. Caribevision Holdings, Inc.,
670 F.3d 109, 118 (1st Cir. 2012)).
5. The present action is the first-filed action and this
Court has already found plaintiffs’ claims plausible. See
Covidien LP v. Esch, 2017 WL 3971278 (D. Mass. Sept. 7, 2017)
(denying defendant’s motion to dismiss); Covidien LP v. Esch,
229 F. Supp. 3d 94, 99 (D. Mass. 2017) (concluding that
plaintiffs “have shown a likelihood of success on the merits”).
The claims are neither vexatious nor contrived.
The remaining Colorado River factors are either irrelevant
or neutral.
Because defendant has not demonstrated the exceptional
circumstances that Colorado River requires, this Court will
decline to dismiss or stay plaintiffs’ claims for coercive
relief.
Similar to the Colorado River doctrine, the
Wilton/Brillhart doctrine states that when a federal court is
asked to issue a declaratory judgment while a parallel state
court action is pending, the federal court may exercise its
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discretion to stay or dismiss the case. See Brillhart v. Excess
Ins. Co. of Am., 316 U.S. 491 (1942); Wilton v. Seven Falls Co.,
515 U.S. 277 (1995).

Such abstention is unwarranted here. The

present action is first-filed, is in the most advanced stage and
arises from a contract which includes Massachusetts choice-oflaw and forum selection provisions.

The Court will not abstain

on Wilton/Brillhart grounds.
For the same reasons, the Court will decline to stay or
dismiss the present case pursuant to the Court’s inherent
authority to control its docket.
ORDER
For the foregoing reasons, defendant’s motion to stay or
dismiss proceedings (Docket No. 73) is DENIED.

So ordered.
/s/ Nathaniel M. Gorton____
Nathaniel M. Gorton
United States District Judge
Dated November 30, 2017

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