Opinion
Case No. EDCV 05-578 CAS (RZx).
December 12, 2005
GAIL LISONI, Attorneys Present for Plaintiffs.
RICHARD WILLIAMS, Attorneys Present for Defendants.
Proceedings: DEFENDANT BRIDGESTONE FIRESTONE NORTH AMERICAN TIRE LLC'S MOTION TO STAY PROCEEDINGS (filed November 15, 2005)
I. INTRODUCTION AND BACKGROUND
On June 30, 2005, plaintiffs Martin Frosini, Robert Kofonvec, Chris Keen, William Noordhoek, Gary Symons, Frank Larrango, David Bockholt, and Roger Littell (collectively, the "named plaintiffs"), on behalf of themselves and all others similarly situated (collectively, the "plaintiffs"), filed suit against defendants Bridgestone Firestone North American Tire, LLC ("Bridgestone/Firestone"), Bridgestone Corporation, and Does 1 through 10, inclusive (collectively, "defendants"). Plaintiffs filed a first amended complaint ("FAC") on September 22, 2005, and filed a second amended complaint ("SAC") on October 21, 2005. The named plaintiffs are California residents who own Firestone Steeltex tires manufactured by defendants. SAC ¶ 4.
Plaintiffs allege the following claims for relief: (1) fraudulent concealment; (2) deceptive practices in violation of the California Consumer Legal Remedies Act; (3) unfair business practices in violation of the California Unfair Practices Act; (4) strict liability; and (5) negligence. Id. ¶¶ 37-63. Specifically, plaintiffs allege that the Steeltex R4S, R4SII, and A/T tire brands ("the tires") manufactured by defendants were defective, id. ¶ 12, and that the named plaintiffs therefore suffered tread separation of the tires causing damage to their property, id. ¶ 19. Plaintiffs further allege that defendants concealed the truth from, and made false representations to, the National Highway Traffic and Safety Administration during the course of its investigation of the tires, causing it to close its investigation, id. ¶ 14, and that, as a result, they "had no opportunity to weigh the risks posed" by the tires, id. ¶ 18.
Plaintiffs seek the following forms of monetary and injunctive relief: (1) compensatory damages; (2) imposition of an asset freeze and a constructive trust; (3) actual damages; (4) an order requiring disclosure of the scope of the tire defects; (5) an order requiring recall and replacement of the tires; (6) attorneys' fees; (7) punitive damages; (8) costs; and (9) pre- and post-judgment interest.
On November 15, 2005, defendant Bridgestone/Firestone ("defendant") filed the present motion to stay these proceedings. Plaintiffs filed an opposition on November 28, 2005, and on December 5, 2005, defendant filed a reply. Plaintiffs filed a sur-reply on December 8, 2005. Defendant's motion is presently before the Court.
II. DISCUSSION
Roger Littell, one of the named plaintiffs in the present action, previously filed suit against defendant in state court. Defendant removed the action, and the plaintiffs, represented by the same counsel as in the present action, moved to remand the action back to the state court. The Court granted the plaintiffs' motion for remand. See Littell v. Bridgestone/Firestone, Inc., 259 F.Supp.2d 1016 (C.D. Cal. 2003). Such action remains pending in California Superior Court, Riverside County (the "Superior Court"), Case No. INC 030708 (the "state action"), and the Superior Court's order denying class certification is currently on appeal to the California Court of Appeal. Defendant argues that "[i]n the state court proceedings, the plaintiffs, seeking to represent essentially the same class, assert essentially the same claims and seek essentially the same relief as sought in this action," and that "[s]ound principles of judicial administration and conservation of judicial resources counsel in favor of staying these proceedings until the conclusion of the state court proceedings." Mot. at 3-4. Accordingly, defendant requests that this Court stay all proceedings in the present action pursuant to the Colorado River abstention doctrine until resolution of the state action.Id. at 4 (citing Colorado River Water Conservation Dist. v. United States, 424 U.S. 800 (1975)).
Under very limited "exceptional circumstances," it may be appropriate to dismiss or stay a federal suit because of a concurrent state proceeding "for reasons of wise judicial administration." Colorado River, 424 U.S. at 813. In determining whether to stay or dismiss proceedings underColorado River and its progeny, a court must consider: (1) whether the state and federal suits are substantially similar; (2) whether staying or dismissing would avoid "piecemeal" litigation; (3) whether there exists the risk of conflicting results; (4) whether the state proceeding is adequate to protect the parties' rights; (5) whether state or federal law provides the rule of decision on the merits; (6) the order in which the forums obtained jurisdiction; and (7) whether the federal suit was filed in an attempt to forum shop. See Colorado River, 424 U.S. at 818; Moses H. Cone Mem. Hosp. v. Mercury Const. Corp., 460 U.S. 1 (1983); Nakash v. Marciano, 882 F.2d 1411 (9th Cir. 1989). "No one factor is necessarily determinative; a carefully considered judgment taking into account both the obligation to exercise jurisdiction and the combination of factors counseling against that exercise is required. Only the clearest of justifications will warrant dismissal." Colorado River, 424 U.S. at 818-19 (citations omitted).
Defendant argues that the Colorado River factors weigh in favor of abstention. Mot. at 6. As to the first factor, whether the actions are substantially similar, defendant argues that the state action and the present action cover the same issues and are parallel. Id. at 5. Specifically, defendant contends:
Both the state and federal court lawsuits are based upon the same factual predicate and purpose. And both actions were brought by individuals claiming to have purchased Steeltex tires and who allege they were deceived about the quality and safety of their tires. Both actions advance claims for (1) fraudulent concealment, (2) deceptive practices in violation of the California Consumer Legal Remedies Act, (3) violation of the California Unfair Practices Act, (4) strict liability, and (5) negligence. Both actions seek product recalls and compensation for damages allegedly sustained as a result of ownership of the Steeltex tires. The plaintiff's prayers for relief in the actions are virtually identical. Indeed, jurisdictional questions aside, it is fair to say that no significant question is present in this action that has not also been presented by the complaint in [the state action].Id. Defendant also argues that staying the present action would avoid "piecemeal" litigation and the risk of conflicting results in that "[p]roceeding in both matters would require this Court to oversee similar pre-trial motions and discovery issues and to consider the same issues and evidence as the state court," given the substantial similarity of the two actions. Id. at 8. Defendant contends that the only difference between the two actions is in the identity of certain of the named plaintiffs and that "[e]ven the difference in named plaintiffs is immaterial because the plaintiffs in this action have requested that all the plaintiffs in the state court action be made plaintiffs in the federal action." Id.
As to the issue of whether the state court proceeding is adequate to protect the parties' rights, defendant contends that such factor "involves the state court's adequacy to protect federal rights," and that there are no federal rights involved in the present action because all of plaintiff's claims are based on state law. Id. at 12 (quoting Travelers Indem. Co. v. Madonna, 914 F.2d 1364, 1369 (9th Cir. 1990) (emphasis in original)). Similarly, defendant argues that because the claims of both the state and present actions are based on California law, federal law does not provide the rule of decision on the merits. Id. at 11.
As to the order in which the forums obtained jurisdiction, defendant points out that the state action was filed "almost three full years" before the present action. Id. at 9. Moreover, defendant contends:
In those three years, substantial progress has been made in the state court litigation, including extensive discovery, as well as various substantive motions having been argued and decided. The state court proceedings have been set for trial on January 30, 2006. The parties have made their expert disclosures, and expert witnesses have been deposed. The depositions of the named plaintiffs have been taken and considerable written discovery exchanged. More than 30 depositions have been taken on class certification issues and a record consisting of more than 5,000 pages has been considered by the Superior Court judge. Two decisions denying class certification have been issued by the trial court, decisions which are presently on appeal to the California Court of Appeal.Id. Accordingly, defendant argues, "[t]he priority of the state court proceedings, the length of time those proceedings have been ongoing, and, more importantly, the progress that has been made in the state court proceedings are all facts which support abstention." Id.
Finally, defendant argues that "[t]his is a case of blatant forum shopping both between state and federal forums and within this district." Id. at 10. Defendant contends: "After receiving unfavorable rulings in the state court, plaintiffs — and their counsel — would like to change forums to see if they can obtain rulings more to their liking." Id. Defendant argues that plaintiff should not be permitted "to effectively remove the state court action back to federal court after three years and some adverse rulings." Id. at 11.
Plaintiffs argue that this is the just the type of class action that Congress had in mind when drafting the Class Action Fairness Act ("CAFA"), 28 U.S.C. § 1332(d), that Congress intended for this Court to have subject matter jurisdiction over the present action, and that to stay the proceedings would serve to undermine this congressional intent. Id. at 5-6. Plaintiffs further argue that there are no exceptional circumstances in the present case to warrant a stay of the proceedings pursuant to the Colorado River doctrine. Opp'n at 6.
First, plaintiffs contend that since the Superior Court denied class certification in the state action, "the only state court proceeding being litigated is the underlying individual claims of Roger Littell and Lou Ann Pleasant, not the class members," such that the actions are not substantially similar. Id. Plaintiffs concede that Roger Littell is a named plaintiff in both actions, but contend that he is a named plaintiff in the state action based on the failure of his original factory-equipped Steeltex tires, whereas he is a named plaintiff in the present action based on the failure of his "replacement tires," which were manufactured in a different plant. Id. at 2.
In addition, plaintiffs argue that there is no risk of "piecemeal" litigation in that "the individual state court action of Roger Littell and Lou Ann Pleasant is scheduled for Trial on January 30, 2006, and the issue of improper denial of class certification is pending in the California Court of Appeal and should be resolved in a relatively short period of time." Id. at 10. Plaintiffs contend that "[t]he state court's proceedings are inadequate to protect a federal litigant's rights in prosecuting a nationwide class action involving millions of tires," and that defendant's assertion that plaintiffs are forum shopping is "an unfounded accusation." Id. at 8. Accordingly, plaintiffs argue that the Colorado River factors weigh against the granting of a stay of the current action pending resolution of the state action.
The Court concludes that a weighing of the Colorado River factors, in addition to equitable considerations, support a stay of the present action, insofar as the ongoing proceedings in the state action may have some bearing on these proceedings. Accordingly, the Court, in the exercise of its discretion, orders that the present action be stayed for ninety days.
III. CONCLUSION
In accordance with the foregoing, the present action is STAYED for ninety days. Counsel are directed to appear on March 6, 2005 at 11:00 am for a status conference, and are directed to file a joint report regarding the status of the state action proceedings and of the appeal of the Superior Court's order denying class certification at least two weeks before their appearance. The Scheduling Conference is Vacated.
IT IS SO ORDERED.