For the Gusto Motorsports, Inc et al v. Lane

Filing 13

Memorandum Opinion and Order: For the reasons herein stated, the court grants Defendant Richard Lane's Motion to Dismiss Plaintiff's Complaint (Doc. 12 ) and dismisses this lawsuit with prejudice. The court dismisses with prejudice bec ause this action involves three of the same parties that are parties in the North Carolina Action. The issues raised in this action are also raised in the North Carolina Action. As required, a final judgment will issue by separate document pursuant to Federal Rule of Civil Procedure 58. (Ordered by Judge Sam A Lindsay on 3/7/2017) (ndt)

IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
FOR THE GUSTO MOTORSPORTS, INC., §
and BRUCE LEE ADAMS, JR.,
§
§
Plaintiffs,
§
§
v.
§
§
RICHARD LANE,
§
§
Defendant.
§

Civil Action No. 3:16-CV-1074-L

MEMORANDUM OPINION AND ORDER
Before the court is Defendant Richard Lane’s Motion to Dismiss Plaintiff’s Complaint (Doc.
12), filed July 28, 2016. No response was filed. For the reasons that follow, the court grants
Defendant Richard Lane’s Motion to Dismiss Plaintiff’s Complaint.
I.

Background
Defendant Richard Lane (“Lane”) is the owner of SS Autochrome, Inc. (“SSA”), which

designs, manufactures, distributes, and sells high-performance auto parts. See Aff. of Richard Lane
(Ex. 1 to Def.’s Mot.). In 2013, SSA gave Plaintiffs, For the Gusto Motorsports, Inc. and Bruce Lee
Adams, Jr. (the “Adams Parties”) permission to market and sell certain of SSA’s products. Id. In
January of 2016, a dispute arose between Lane and SSA, on the one hand, and the Adams Parties,
on the other hand, relating to ownership and use of certain proprietary information. Id. On March
10, 2016, Lane and SSA filed a lawsuit against the Adams Parties in the Eastern District of North
Carolina, in a case styled Richard Lane d/b/a SS Autochrome, Inc., et al. v. Bruce Lee Adams, Jr.
d/b/a FTG Motorsports, For the Gusto Motorsports, et al., Civil Action No. 5:16-cv-107-D (the

Memorandum Opinion and Order - Page 1

“North Carolina Action”). See Ex. 2 to Def.’s Mot (Original Complaint).
On March 30, 2016, the Adams Parties filed this lawsuit against Lane in the 160th Judicial
District Court of Dallas County, Texas. See Not. of Removal (Doc. 1 at Ex. 3 (Orig. Pet.)). On
April 20, 2016, Lane removed the action to this court alleging subject matter jurisdiction under 28
U.S.C. §§ 1331 and 1332(a). This lawsuit concerns the same parties, claims, and issues as the North
Carolina Action, that was filed first. Lane now moves to dismiss this action based on the “first to
file” rule.
II.

Analysis
The “first to file” rule is a “generally recognized doctrine of federal comity [that] permits a

district court to decline jurisdiction over an action when a complaint involving the same parties and
issues has already been filed in another district.” Texas Instruments Inc. v. Micron Semiconductor,
Inc., 815 F.Supp. 994, 997 (E.D. Tex. 1993). The rule promotes the conservation of judicial
resources and the comprehensive disposition of litigation by avoiding waste of duplication,
interference in another court’s affairs, and piecemeal resolution of issues that call for a uniform
result. See West Gulf Maritime Ass’n v. ILA Deep Sea Local 24, 751 F.2d 721, 729–31 (5th Cir.
1985). In the Fifth Circuit, absent compelling circumstances, the court that initially obtains the
controversy should be the one to decide whether it will try it. Texas Instruments, 815 F. Supp. at 997
(quoting Mann Mfg., Inc. v. Hortex, Inc., 439 F.2d 403, 407 (5th Cir.1971)).
The court concludes that there are no such compelling circumstances in the present case. The
North Carolina Action and the present action have a substantial relationship. They arise in
connection with the same dispute and are essentially mirror images of each other, and the
circumstances surrounding the filing of the instant suit are sufficient to cause this court to defer to

Memorandum Opinion and Order - Page 2

the Eastern District of North Carolina. Further, the Adams Parties have not filed an opposition to
Lane’s Motion to Dismiss and, therefore, have failed to provide this court with any legal basis for
finding that compelling circumstances exist in this case such that it should retain jurisdiction over
this matter in the face of the first-filed North Carolina Action. Accordingly, the court grants Lane’s
Motion to Dismiss this action under the “first to file” rule.*
III.

Conclusion
For the reasons herein stated, the court grants Defendant Richard Lane’s Motion to Dismiss

Plaintiff’s Complaint (Doc. 12) and dismisses this lawsuit with prejudice. The court dismisses with
prejudice because this action involves three of the same parties that are parties in the North Carolina
Action. The issues raised in this action are also raised in the North Carolina Action. As required,
a final judgment will issue by separate document pursuant to Federal Rule of Civil Procedure 58.
It is so ordered this 7th day of March, 2017.

_________________________________
Sam A. Lindsay
United States District Judge

*

In the alternative to his motion to dismiss based on the “first to file” rule, Lane moves to dismiss pursuant to
Federal Rule of Civil Procedure 12(b)(2), arguing that the court lacks personal jurisdiction over him. The court’s ruling
granting Lane’s motion to dismiss based on the “first to file” rule renders moot his alternative motion to dismiss for lack
of personal jurisdiction.
Memorandum Opinion and Order - Page 3