E & I Holdings, LLC v. Bellmari Trading USA, Inc. et al

Filing 32

MEMORANDUM OPINION AND ORDER granting 22 MOTION for a stay pending resolution of the motion to dismiss; this action is stayed pending the further order of the court; denying as moot 30 MOTION for Protective Order. Signed by Judge John T. Copenhaver, Jr. on 10/30/2018. (cc: counsel of record) (taq)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF WEST VIRGINIA
AT CHARLESTON
E & I HOLDINGS, LLC,
Plaintiff,
v.

Civil Action no. 2:18-cv-00484

BELLMARI TRADING USA, INC., a
Delaware Corporation, and
PECTROLUM, INC., a New York
Corporation,
Defendants.
MEMORANDUM OPINION AND ORDER
Pending is defendants’ motion for a stay pending
resolution of their motion to dismiss, filed September 18, 2018.
The plaintiff filed a response on October 2, 2018, to which the
defendants replied on October 9, 2018.

On October 26, 2018, the

defendants also filed a motion for a protective order to suspend
discovery until resolution of the motion to dismiss.

The

plaintiff has not yet filed a response to that motion.
Plaintiff instituted this civil action on March 26,
2018, asserting claims against the defendants related to a “term
sheet agreement” that “fell into disarray[.]”
at 1).

(Memo. in Support

Under the agreement, “E&I agreed to obtain coal meeting

certain specifications for purchase by Bellmari.”

Id.

On May

18, 2018, defendants moved to dismiss the complaint pursuant to

the doctrine of forum non conveniens, in light of a forum
selection clause in the term sheet agreement which indicates
Orange County, Florida as the location for litigation.

The

motion to dismiss is fully briefed and ripe for decision.
Federal Rule of Civil Procedure 26(c) provides
pertinently as follows:
Upon motion by a party . . . and for good cause shown,
the court . . . may make any order which justice
requires to protect a party or person from . . . undue
burden or expense, including one or more of the
following: (1) that the . . . discovery not be had . .
. [or] (2) that the disclosure or discovery may be had
only on specified terms and conditions . . . .
Fed. R. Civ. P. 26(c).

The Rule vests the court with discretion

to stay discovery in advance of deciding a pending dispositive
motion.

See Thigpen v. United States, 800 F.2d 393, 396-97 (4th

Cir. 1986) (“Nor did the court err by granting the government's
motion under Fed.R.Civ.P. 26(c) to stay discovery pending
disposition of the 12(b)(1) motion. . . . Trial courts . . . are
given wide discretion to control this discovery process . . .
.”).

In exercising its discretion to grant a stay, a court

“must weigh competing interests.”

Landis v. North American Co.,

299 U.S. 248, 255 (1936). Parties seeking a stay generally “must
make out a clear case of hardship or inequity in being required
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to go forward, if there is even a fair possibility that the stay
. . . will work damage to some one else.” Id. at 255; see also
Williford v. Armstrong World Industries, Inc., 715 F.2d 124, 127
(4th Cir. 1983) (“The party seeking a stay must justify it by
clear and convincing circumstances outweighing potential harm to
the party against whom it is operative.”).

This court considers

three factors when determining whether to grant a motion to
stay: “(1) the interests of judicial economy; (2) hardship and
equity to the moving party if the action is not stayed; and (3)
potential prejudice to the non-moving party.”

White v. Ally

Fin. Inc., 969 F. Supp. 2d 451, 462 (S.D.W. Va. 2013) (quoting
Tolley v. Monsanto Co., 591 F.Supp.2d 837, 844 (S.D.W.Va.2008)).
The motion to dismiss raises potentially dispositive
legal issues, the resolution of which may obviate the need for
or limit discovery in this case.

Defendants attest that they

cannot conduct discovery or assert desired counterclaims without
facing the risk of inadvertently waiving their rights under the
forum selection clause, but that refraining from doing so will
result in them waiving their counterclaims or running afoul of
discovery obligations.

Plaintiff objects, claiming that it

“will suffer substantial prejudice if it is unilaterally denied
discovery by the defendant, and as a result is unable to comply

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with the deadlines contained [in] the Court’s Orders.”
in Opp. at 4).

(Memo.

However, the court notes that staying the case

will suspend the existing orders and that a stay in discovery
will not apply unilaterally.
Defendants have demonstrated that they may suffer
significant hardship if forced to proceed through discovery and
assert claims in this forum before the court decides whether it
is the appropriate forum to hear this case.

It does not appear

that the plaintiff will suffer any significant prejudice in
delaying the proceedings until that time.
Having considered the applicable factors, the court
ORDERS that defendant’s motion for a stay pending resolution of
the motion to dismiss be, and it hereby is, granted.

It is

further ORDERED that this action be, and it hereby is, stayed
pending the further order of the court.
In light of this decision, the court ORDERS that the
motion for a protective order be, and it hereby is, denied as
moot.

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The Clerk is directed to forward copies of this
written opinion and order to all counsel of record.
DATED: October 30, 2018

John T. Copenhaver, Jr.
United States District Judge

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