Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_14-cv-02371/USCOURTS-caed-2_14-cv-02371-0/pdf.json

Parties Involved:
ABP Corporation
Defendant
Healthy Choice SM, LLC
Plaintiff

Document Text:

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

----oo0oo----

HEALTHY CHOICE SGH, LLC,

Plaintiff,

v.

ABP CORPORATION,

Defendant.

HEALTHY CHOICE SM, LLC,

Plaintiff,

v.

ABP CORPORATION,

Defendant.

MEMORANDUM AND ORDER RE: MOTION 

TO STAY

CIV. NO. 2:14-2370 WBS DAD

CIV. NO. 2:14-2371 WBS DAD

----oo0oo----

In lieu of filing an Answer, defendant in each of these 

actions has filed motion to stay proceedings. (Docket No. 8) 

Defendant represents that both plaintiffs in this matter are 

Case 2:14-cv-02371-WBS-DAD Document 13 Filed 02/25/15 Page 1 of 4
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owned and operated by Sajid Sohail, a non-party to this lawsuit 

who, through various corporate entities, operates Au Bon Pain 

franchises in New York and California. (Docket No. 8-1) 

Defendant and Sohail are reportedly arbitrating franchise 

disputes relating to several New York franchises before the 

American Arbitration Association (“AAA”) in Boston, 

Massachusetts. 

On May 2, 2014, defendant filed a lawsuit in the 

District of Massachusetts against Sohail and ten related entities 

to enforce the termination of Sohail’s franchises for nonpayment 

of royalties. (Docket No. 8-2)1 Defendant states that, at that 

time, it believed an entity called “Healthy Choice Sacramento 

LLC” operated the California franchises at issue here, and it 

therefore named that entity as a defendant in its Massachusetts 

action. (See id.) Defendant states that, on September 8, 2014,

it voluntarily dismissed its action in Massachusetts to pursue 

arbitration before the AAA. A month later, plaintiffs brought 

their actions in this district.

On December 15, 2014, defendant filed a petition to 

compel plaintiffs to arbitrate their claims in the District of 

Massachusetts. (See Cloar Decl. Ex. B.) The same day, defendant 

moved to stay proceedings in this court pursuant to § 3 of the 

FAA or, alternatively, under principles of comity and judicial 

efficiency while the District of Massachusetts decides whether 

 

1 “A federal court may ‘take notice of proceedings in 

other courts, both within and without the federal judicial 

system, if those proceedings have a direct relation to matters at 

issue.’” Schulze v. F.B.I., Civ. No. 1:05-0180 AWI GSA, 2010 WL 

2902518, at *1 (E.D. Cal. July 22, 2010) (U.S. v. Black, 482 F.3d 

1035, 1041 (9 Cir. 2007)). 

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the issues here are referable to arbitration. (See Def.’s Mot. 

to Stay Proceedings (Docket No. 8).) 

Defendant represents that the District of Massachusetts

court has scheduled a hearing on its petition to compel 

arbitration for March 5, 2015, at 2 p.m. (Def.’s Req. for 

Judicial Notice Ex. E (Docket No. 13).) The court anticipates a 

prompt decision regarding that petition. 

Resolution of defendant’s petition in the District of 

Massachusetts may or may not have a dispositive impact on issues 

raised in this district. The court is persuaded, however, that a 

decision from that court on defendant’s petition will facilitate 

the proceedings in these actions in this district. See Kerotest 

Mfg. Co. v. C-O-Two Fire Equip. Co., 342 U.S. 180, 184 (1952).2

IT IS THEREFORE ORDERED that:

(1) Defendant’s motion to stay be, and the same hereby 

is, GRANTED pending the District Court for the 

District of Massachusetts’s decision regarding 

 

2 Plaintiffs argue that the “First-to-File” rule requires 

this district to decide the issue of arbitrability, and that the 

District of Massachusetts should stay its proceedings. (Pls.’ 

Opp’n at 2.) The court disagrees. Federal district courts have 

long exercised the power to temporarily stay proceedings in order 

to promote comity between courts and efficiently allocate 

judicial resources. See Kerotest, 342 U.S. at 184. Moreover, 

several federal courts have effectively employed temporary stays 

in similar situations to the one here. See, e.g., Ansari v. 

Qwest Commc'ns Corp., 414 F.3d 1214 (10th Cir. 2005) (affirming a 

district court’s stay of proceedings pending a determination by a 

district court in the District of Columbia regarding whether 

arbitration of the plaintiff’s claims should be compelled); Roe 

v. Gray, 165 F. Supp. 2d 1164 (D. Colo. 2001) (staying 

proceedings pending the Eastern District of North Carolina’s 

decision on arbitrability). 

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defendant’s petition to compel arbitration;

(2) Defendant shall file a Status Report with this 

court addressing arbitrability of issues raised in 

plaintiffs’ Complaints and the status of any

pending arbitration no later than ten days after 

the District of Massachusetts’s decision.

Dated: February 24, 2015

Case 2:14-cv-02371-WBS-DAD Document 13 Filed 02/25/15 Page 4 of 4