Superior Site Work, Inc. et al v. Nasdi, LLC et al
Filing
161
MEMORANDUM OF DECISION AND ORDER re 143 motion to dismiss. Presently before the Court is a motion by NASDI to dismiss the Complaint pursuant to Federal Rule of Civil Procedure ("Rule") 12(b)(1). For the reasons explained below, the Court denies NASDI's motion in its entirety. So Ordered by Judge Arthur D. Spatt on 4/5/2019. (Coleman, Laurie)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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SUPERIOR SITE WORK, INC., DIVERSIFIED
CONSTRUCTION CORP., HARRISON
AVENUE PROPERTIES LLC,
Plaintiffs,
FILED
CLERK
10:41 am, Apr 05, 2019
U.S. DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
LONG ISLAND OFFICE
MEMORANDUM OF
DECISION & ORDER
2:14-cv-01061 (ADS)(SIL)
-againstNASDI, LLC,
Defendant.
---------------------------------------------------------X
NASDI, LLC,
Third-Party Plaintiff,
-againstCASE FOUNDATION COMPANY, and THE
CITY OF NEW YORK,
Third-Party Defendant.
---------------------------------------------------------X
APPEARANCES:
Zabell & Associates, P.C.
Attorneys for the Plaintiffs
1 Corporate Drive Suite 103
Bohemia, NY 11716
By:
Saul D. Zabell, Esq., Of Counsel
The Law Office of John E. Osborn, P.C.
Attorneys for the Defendant and Third-Party Plaintiff
93–02 Sutphin Boulevard
Jamaica, NY 11435
By:
Daniel H. Crow, Esq., Of Counsel
De Luca & Forster
Attorneys for the Defendant and Third-Party Plaintiff
11 Commerce Drive
Cranford, NJ 07016
By:
Thomas G. De Luca, Esq., Of Counsel.
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Peckar & Abramson
Attorneys for the Third Party Defendant Case Foundation Company
41 Madison Avenue 20th Floor
New York, NY 10010
By:
Alan H. Winkler, Esq., Of Counsel
New York City Law Department, Office of Corporation Counsel
Corporation Counsel for Third Party Defendant the City of New York
100 Church Street Room 3-124
New York, NY 10007
By:
Amanda M. Papandrea, Assistant Corporation Counsel
SPATT, District Judge:
This action arises out of a contract dispute between the parties. The contract concerned
work related to the Ocean Breeze Indoor Athletic Facility in Staten Island, New York (the “Ocean
Breeze Project”). The City of New York (the “City) and the New York City Department of Parks
and Recreation (the “Parks Department”) contracted with NASDI, LLC (“NASDI”) to build the
Ocean Breeze Project. NASDI allegedly subcontracted with Superior Site Work, Inc. (“Superior”),
Diversified Construction Corp. (“Diversified”), and Case Foundation Company (“Case”). NASDI
allegedly leased office space from Harrison Avenue Properties LLC (“Harrison”) during the
project.
On January 23, 2017, the Court granted a motion by Case, which also granted in part a
motion by the City to hold the third party action in abeyance pending the outcome of certain New
York State Supreme Court cases. ECF 102 (the “Stay Order”). For a complete statement of the
relevant facts, the Court refers the parties to the Stay Order. See id. at 3–5.
Presently before the Court is a motion by NASDI to dismiss the Complaint pursuant to
Federal Rule of Civil Procedure (“Rule”) 12(b)(1). For the reasons explained below, the Court
denies NASDI’s motion in its entirety.
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I. DISCUSSION
According to NASDI, the Court should abstain from adjudicating the Main Action in
deference to the supposedly parallel NYS Lien Action. In Colorado River Water Conservation
District v. United States, 424 U.S. 800, 96 S. Ct. 1236, 1244, 47 L. Ed. 2d 483 (1976), the Supreme
Court explained that a federal district court may abstain from exercising jurisdiction over a
controversy properly before it when parallel state court litigation could result in the
“comprehensive disposition of litigation” and abstention would conserve judicial resources. Id. at
424 U.S. 817–18. In the Court’s view, the Court finds abstention inappropriate in the
circumstances of this case.
Before a court evaluates the appropriateness of abstention under Colorado River, it must
make a threshold determination that the federal and state court cases are “parallel.” Dittmer v.
County of Suffolk, 146 F.3d 113, 118 (2d Cir.1998) (“[A] finding that the concurrent proceedings
are ‘parallel’ is a necessary prerequisite to abstention under Colorado River.”). “‘Federal and state
proceedings are ‘concurrent’ or ‘parallel’ for purposes of abstention when the two proceedings are
essentially the same; that is, there is an identity of parties, and the issues and relief sought are the
same.’” Abercrombie v. College, 438 F.Supp.2d 243, 258 (S.D.N.Y.2006) (quoting Nat'l Union
Fire Ins. Co. of Pittsburgh v. Karp, 108 F.3d 17, 22 (2d Cir.1997)). “Perfect symmetry of parties
and issues is not required. Rather, parallelism is achieved where there is a substantial likelihood
that the state litigation will dispose of all claims presented in the federal case.” In re Comverse
Tech., Inc., No. 06-cv-1849, 2006 WL 3193709, at *2 (E.D.N.Y. Nov. 2, 2006) (citing Clark v.
Lacy, 376 F.3d 682, 686 (7th Cir.2004)) (internal citation omitted).
“Any doubt regarding the parallel nature of a federal and state action should be resolved in
favor of the exercise of federal jurisdiction.” In re Comverse Tech., Inc., 2006 WL 3193709, at *2
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(citing AAR Int'l, Inc. v. Nimelias Enters. S.A., 250 F.3d 510, 520 (7th Cir.2001)). If a court finds
that the federal and state cases are not parallel, “Colorado River abstention does not apply, whether
or not issues of state law must be decided by the federal court.” In re Comverse Tech., Inc., 2006
WL 3193709, at *4.
If the state and federal suits are parallel, federal courts must consider the following six
factors:
(1) whether the controversy involves a res over which one of the courts has assumed
jurisdiction; (2) whether the federal forum is less inconvenient than the other for
the parties; (3) whether staying or dismissing the federal action will avoid
piecemeal litigation; (4) the order in which the actions were filed, and whether
proceedings have advanced more in one forum than in the other; (5) whether federal
law provides the rule of decision; and (6) whether the state procedures are adequate
to protect the plaintiff’s federal rights.
Woodford v. Cmty. Action Agency of Greene Cty., Inc., 239 F.3d 517, 522 (2d Cir. 2001) (citing
Moses H. Cone Memorial Hospital v. Mercury Construction Corp., 460 U.S. 1, 22, 103 S.Ct. 927,
74 L.Ed.2d 765 (1983)).
Here, neither the parties nor the claims overlap sufficiently for the Main Action to be
considered parallel to the NYS Lien Action. The Court already considered NASDI’s exact
argument and rejected it in the Stay Order. See ECF 102 at 8 (“Diversified and Harrison are not
parties to the state cases, and therefore Harrison’s claims would not be remedied by the state cases.
Therefore, the Court will not stay the federal action brought by Superior, Diversified and Harrison
against NASDI[.]”). Just like its failed motion to vacate the stay, NASDI presents nothing new
warranting a departure from the Court’s previous decision.
Indeed, much of NASDI’s argument is identical to its argument in favor of vacating the
stay. Compare 133-7 at 6 (“If the stay remains in effect, NASDI will be forced to try the same delayrelated issues again in a separate trial against Case and the City. This would be wasteful and would
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pose major issue preclusion problems to NASDI, Case and the City.”), with ECF 143-15 at 6 (“If
Superior’s Delay Claim is tried in the absence of Case and the City, NASDI will be forced to try
the same issues again in the subsequent trials of the Third-Party Action and the NYS Lien Action.
Abstaining from adjudicating the Main Action here would avoid this prejudice.”). This is NASDI’s
now fourth time making the exact same argument. The Court finds it no more persuasive than the
first three times it considered the argument.
Moreover, the Main Action involves a number of causes of action absent from the NYS
Lien Action, namely, Superior’s claim for failure to provide payment for open concrete PSI
upgrade change orders; Superior's claim for final payment under the contract; and NASDI’s
counterclaim that Superior's work was defective and/or incomplete. As a result, it is apparent that
deference to the NYS Lien Action would not result in the comprehensive disposition of this
litigation, because it would only resolve one of the four claims between the parties. See Maropakis
v. Bank of New York Mellon Tr. Co., N.A., No. 13-cv-4744, 2015 WL 13742419, at *11–12
(E.D.N.Y. May 4, 2015) (finding federal and state court actions relating to the same transaction
were not parallel because they “concern[ed] a number of different issues”); Frydman v.
Verschleiser, 172 F. Supp. 3d 653, 664 (S.D.N.Y. 2016) (finding federal and state court actions
were not parallel because “[t]he federal action contain[ed] numerous claims that are not included
in the state court action”); Kirby McInerney LLP v. Lee Med., Inc., No. 17-cv-4760, 2017 WL
4685101, at *3 (S.D.N.Y. Oct. 16, 2017) (explaining that litigation is not parallel to a federal case
“ simply because some of the parties are the same and the claims arise out of the same set of facts”);
Am. First Fed., Inc. v. Gordon, No. 16-cv-3958, 2016 WL 7477564, at *5 (S.D.N.Y. Dec. 29,
2016) (holding federal action alleging that defendants fraudulently placed assets out of reach of
creditors bringing claims in state action was not parallel to that state action).
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NASDI’s contention that Superior and NASDI could interpose their claims and
counterclaims in the NYS Lien Action as means of disposing of all claims among the parties holds
no water, because the Court may only apply Colorado River abstention when the cases are
“currently parallel.” State Farm Mut. Auto. Ins. Co. v. Schepp, 616 F. Supp. 2d 340, 347–48
(E.D.N.Y. 2008); Dalzell Mgmt. Co. v. Bardonia Plaza, LLC, 923 F. Supp. 2d 590, 597–99
(S.D.N.Y. 2013).
Therefore, NASDI failed to clear the initial threshold of establishing that the Main Action
parallels the NYS Lien Action, such that the Court need not balance the six Moses H. Cone factors.
II. CONCLUSION
For the foregoing reasons, the Court denies NASDI’s motion to dismiss in its entirety.
SO ORDERED.
Dated: Central Islip, New York
April 5, 2019
___/s/ Arthur D. Spatt_______
ARTHUR D. SPATT
United States District Judge
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