Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_08-cv-01424/USCOURTS-azd-2_08-cv-01424-2/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Breach of Contract

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Plaintiffs have requested oral argument. That request is denied because the parties

have thoroughly discussed the law and the evidence, and oral argument will not aid the

Court’s decision. See Lake at Las Vegas Investors Group, Inc. v. Pac. Malibu Dev., 933 F.2d

724, 729 (9th Cir. 1991).

WO

NOT FOR PUBLICATION

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

EVA SPERBER-PORTER; MARK D.

SVEJDA, 

Plaintiffs, 

vs.

EDELTRAUD KELL, 

Defendant. 

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No. CV-08-01424-PHX-GMS

ORDER

Pending before the Court is the Motion to Dissolve Stay of Plaintiffs Eva SperberPorter and Mark D. Svejda. (Dkt. # 28.)1

 The parties are familiar with the factual and

procedural background of this case, and the Court will not discuss it at length. In short, the

Court granted a stay of this action pursuant to Colorado River Water Conservation District

v. United States, 424 U.S. 800 (1976), in favor of substantially similar state court

proceedings. (Dkt. # 20.) The Court denied Plaintiffs’ Motion for Reconsideration because

it did not address the Court’s multi-factor analysis or otherwise establish error. (Dkt. # 26.)

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Plaintiffs now bring a Motion to Dissolve Stay, arguing that the state court action has

changed because of the filing of a new complaint. (Dkt. # 28.) If circumstances giving rise

to an abstention-based stay have sufficiently changed, the district court has discretion to

dissolve the stay. See Cruz v. Melecio, 204 F.3d 14, 25 (1st Cir. 2000). However, the Court

declines to do so here. In determining that the federal case should be stayed pursuant to

Colorado River, the Court determined that none of the nine factors it was required to

consider, see Intel Corp. v. Advanced Micro Devices, Inc., 12 F.3d 908, 912-13 (9th Cir.

1993); Nakash v. Marciano, 882 F.2d 1411, 1415-17 (9th Cir. 1989), weighed against a stay

and that many of the factors, including the desirability of avoiding piecemeal litigation, the

substantial similarity of the cases, and the impropriety of forum-shopping, weighed in favor

of granting a stay. (Dkt. # 20 at 6-12.) Plaintiffs’ motion to dissolve, like its motion to

reconsider, fails to address the Court’s multifactor balancing analysis. This is inconsistent

with the rule that the relevant factors in a Colorado River analysis “are to be applied in a

pragmatic and flexible way, as part of a balancing process rather than as a ‘mechanical

checklist.’” Am. Int’l Underwriters, (Philippines), Inc. v. Cont’l Ins. Co., 843 F.2d 1253,

1257 (9th Cir. 1988) (quoting Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460

U.S. 1, 16 (1983)); see also Holder v. Holder, 305 F.3d 854, 870-71 (9th Cir. 2002) (“The

factors relevant to a given case are subjected to a flexible balancing text, in which one factor

may be accorded substantially more weight than another depending on the circumstances of

the case . . . .”).

Plaintiffs seem to rest their motion entirely on the notion that the state and federal

cases are not identical given the breach claim made by Defendant in the state court. (See

Dkt. # 28 at 3-4.) However, as the Court has explained, exact parallelism between the

actions is not required under Colorado River. See Nakash, 882 F.2d at 1416 (“We agree that

exact parallelism does not exist, but it is not required.”). Rather, the question is merely the

substantial similarity of the claims, which is informed by the parties and issues presented in

each case. See id. (“[P]arallel actions are those involving the same parties and issues.”)

(citing RepublicBank Dallas Nat’l Ass’n v. McIntosh, 828 F.2d 1120, 1121 (5th Cir. 1987));

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Silvaco Data Sys., Inc. v. Tech. Modeling Assocs., Inc., 896 F. Supp. 973, 976 (N.D. Cal.

1995) (pointing out that “[t]he mere fact that the claims in state and federal court are not

based on exactly the same laws does not preclude a finding of substantial similarity” and

holding that “[a]lthough the state and federal actions are not identical, they include extremely

similar claims that all arise out of the long-standing competitive feud between [the parties]”).

Here, as explained in the Court’s previous Orders, the parties are the same and the

issues in the federal case (whether Plaintiffs were required to securitize the promissory note

as Defendant requested, whether Defendant’s rejection of the promissory note discharged

Plaintiffs’ obligation to pay, and whether Defendant breached the settlement agreement by

demanding that Plaintiffs securitize the promissory note in a way with which Plaintiffs

disagreed) are also the subject of the ongoing litigation in state court. The focus of litigation

in both the state and federal actions is the nature of the settlement agreement between the

parties and the effect of the parties’ behavior thereon. The Ninth Circuit has held that such

unity of issues establishes substantial similarity. See Nakash, 882 F.2d at 1416 (“After

reviewing the pleadings in these cases, we conclude that the two actions are substantially

similar. All of these disputes concern how the respective parties have conducted themselves

since Nakash purchased a portion of Guess.”) (emphasis added). Thus, the Court will

maintain the stay until the related state court proceedings have concluded.

IT IS THEREFORE ORDERED that Plaintiffs’ Motion to Dissolve Stay (Dkt. #

28) is DENIED.

DATED this 4th day of September, 2009.

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