United States Court of Appeals

for the Fifth Circuit

No. 21-20093

Koch Project Solutions, L.L.C., 

Plaintiff—Appellant,

versus

Alliance Process Partners, L.L.C., doing business as

International Alliance Group; Triten Corporation, 

Defendants—Appellees.

Appeal from the United States District Court

for the Southern District of Texas

USDC No. 4:20-cv-3479

Before Richman, Chief Judge, and Clement and Duncan, Circuit 

Judges.

Per Curiam:*

Koch Product Solutions, L.L.C. (KPS) appeals a stay order in its 

federal declaratory judgment action. The district court granted the stay 

* Pursuant to 5th Circuit Rule 47.5, the court has determined that this 

opinion should not be published and is not precedent except under the limited 

circumstances set forth in 5th Circuit Rule 47.5.4.

United States Court of Appeals

Fifth Circuit

FILED

November 11, 2022

Lyle W. Cayce

Clerk

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largely because of a related pending state court action. Because the district 

court did not abuse its discretion, we affirm.

I

KPS seeks a declaratory judgment that it has not unlawfully drawn 

employees or business away from Triten Corporation and its subsidiary 

International Alliance Group (together, Triten). KPS and Triten both 

provide project management services to clients in the energy sector. KPS 

leadership includes at least five former Triten employees, including KPS 

President, Paul Switzer. While working at Triten, each of the employees 

entered a contract that included noncompete provisions. The provisions 

prohibited inducing or attempting to induce employees to leave Triten and 

work for a competitor, and they prohibited soliciting or accepting similar 

business from Triten clients for set periods. Between 2018 and 2019, all five 

employees left their positions at Triten.

In June 2020, Switzer filed a lawsuit in Texas state court against 

Triten for breach of contract and various state law torts. These claims arose 

out of Triten’s alleged failure to pay Switzer compensation and benefits. 

Triten responded with counterclaims against Switzer and third-party claims 

against two of KPS’s parent companies, Koch Industries and Koch 

Engineered Solutions, and against Koch officer David Dotson (collectively, 

the Koch affiliates). Among other claims, Triten alleged civil conspiracy and 

tortious interference with the noncompete provisions. Triten charged that 

Switzer and the Koch affiliates sought to draw business away from Triten by 

establishing KPS and recruiting the former Triten employees. Triten 

referred to KPS in its claims, but it did not name KPS as a third-party 

defendant. The state district court dismissed the Koch affiliates from the 

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lawsuit for lack of personal jurisdiction, but that decision was reversed on 

appeal.

In October 2020, KPS filed this federal declaratory judgment action 

against Triten. KPS brought the lawsuit pursuant to the Declaratory 

Judgment Act1 “to remove the cloud over its name” cast by Triten’s 

allegations in state court. The federal action consists of two counts of 

tortious interference. First, KPS seeks a declaration that it did not interfere 

with its employees’ contract obligations not to solicit or accept business from 

Triten clients. Second, KPS seeks a declaration that it did not interfere with 

its employees’ contract obligations not to induce or attempt to induce Triten 

employees to leave Triten and work at a competitor.

Triten sought to dismiss or stay the suit under the Supreme Court’s 

Brillhart2 doctrine, whereby federal courts may exercise their discretion to

abstain from hearing declaratory judgment actions.

3

 In January 2021, the

district court denied the motion to dismiss but granted a stay until final 

judgment in the state court action. The district court reasoned that, although 

the state court action involved additional claims and parties, “all of the 

material questions necessary to decide the issues raised in this declaratory 

judgment action are governed by state law and can be resolved in the state 

court action,” since the lawsuit arose out of the same facts and involved the 

same contractual issues. The district court ordered the parties to submit a 

joint status report every 60 days until the stay is lifted. KPS timely appealed

the stay order.

1 28 U.S.C. § 2201-02.

2 Brillhart v. Excess Ins. Co. of Am., 316 U.S. 491 (1942).

3 Id. at 495.

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II

We must first determine our jurisdiction over this appeal.4 KPS seeks 

appellate review pursuant to 28 U.S.C. § 1291. Under § 1291, “federal 

courts of appeals are empowered to review only ‘final decisions of the district 

courts.’”5

 “[A] decision is ordinarily considered final and appealable under 

§ 1291 only if it ‘ends the litigation on the merits and leaves nothing for the 

court to do but execute the judgment.’”6 Most stay orders are not 

considered final because they do not end litigation; they postpone it.

7

In abstention and related contexts, however, the Supreme Court has 

recognized an exception to this general rule.8 The Court first identified this 

exception in Idlewild Bon Voyage Liquor Corp. v. Epstein.

9 In Idlewild, a liquor 

distributor brought a federal suit challenging the constitutionality of a state

statute.10 The district court stayed the lawsuit under the Pullman11 doctrine, 

whereby federal courts abstain from deciding constitutional disputes when a 

state court’s clarification of its law would render a constitutional ruling 

unnecessary.12 The Supreme Court held that the stay order was a final 

4 United States v. Shkambi, 993 F.3d 388, 389 (5th Cir. 2021) (“We start, as always, 

with jurisdiction.”).

5 Microsoft Corp. v. Baker, 137 S. Ct. 1702, 1707 (2017) (quoting 28 U.S.C. § 1291)).

6 Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 712 (1996) (quoting Catlin v. United 

States, 324 U.S. 229, 233 (1945)).

7 Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 10 n.11 (1983); 

Kershaw v. Shalala, 9 F.3d 11, 14 (5th Cir. 1993).

8 Moses H. Cone, 460 U.S. at 10 n.11.

9 370 U.S. 713 (1962).

10 Id. at 714.

11 R.R. Comm’n of Tex. v. Pullman Co., 312 U.S. 496 (1941).

12 Id. at 501-02.

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decision appealable under § 1291 but gave limited reasoning.

13 It said only 

that “[t]he Court of Appeals properly rejected the argument that the order 

of the District Court ‘was not final and hence unappealable under 28 U.S.C. 

§§ 1291, 1292,’ pointing out that ‘[a]ppellant was effectively out of court.’”14

Two decades later, in Moses H. Cone Memorial Hospital v. Mercury 

Construction Corp.,15 the Court relied on Idlewild’s “effectively out of court” 

exception and held once again that a stay order was appealable under § 1291.

16 

Moses H. Cone involved a stay entered under the Colorado River17 doctrine, 

whereby federal courts may in certain exceptional circumstances abstain 

from exercising jurisdiction when there are concurrent state court 

proceedings.

18 Idlewild secured appellate jurisdiction over the stay order.19

In Idlewild, the “district court stay pursuant to Pullman abstention is entered 

with the expectation that the federal litigation will resume in the event that 

the plaintiff does not obtain relief in state court on state-law grounds.”20 By 

contrast, in Moses H. Cone, “a stay . . . meant that there would be no further 

litigation in the federal forum; the state court’s judgment on the issue would 

13 Idlewild, 370 U.S. at 715 n.2.

14 Id.(quoting Idlewild Bon Voyage Liquor Corp. v. Rohan, 289 F.2d 426, 428 (2d Cir. 

1961)).

15 460 U.S. 1 (1983).

16 Id. at 10.

17 Colo. River Water Conservation Dist. v. United States, 424 U.S. 800 (1976).

18 Id. at 817-19.

19 Moses H. Cone, 460 U.S. at 10.

20 Id.

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be res judicata.”21 As a result, “the argument for finality of the District 

Court’s order [was] even clearer.”22

Moses H. Cone emphasized that the “effectively out of court” 

exception was narrow. “Of course,” the Court explained, “Idlewild does not 

disturb the usual rule that a stay is not ordinarily a final decision for purposes 

of § 1291, since most stays do not put the plaintiff ‘effectively out of 

court.’”23 The exception was “limited to cases where (under Colorado River, 

abstention, or a closely similar doctrine) the object of the stay is to require all 

or an essential part of the federal suit to be litigated in a state forum.”24

The Court ascertained the stay’s object based on its legal 

consequences. It was not enough that a stay “have the practical effect of 

allowing a state court to be the first to rule on a common issue.”25 Rather, 

the Court “h[e]ld only that a stay order is final when the sole purpose and 

effect of the stay is precisely to surrender jurisdiction of a federal suit to a 

state court.”26

Since Moses H. Cone, the Court has continued to apply this 

exception.

27 In Quackenbush v. Allstate Insurance Co.,28 the Court deemed an 

abstention-based remand order appealable under § 1291 because of its 

21 Id.

22 Id.

23 Id. at 10 n.11.

24 Id.

25 Id.

26 Id.

27 See Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 712 (1996); Wilton v. Seven 

Falls Co., 515 U.S. 277, 280-81 (1995).

28 517 U.S. 706 (1996).

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decisions in Moses H. Cone and Idlewild.29 Based on those precedents, the 

order was appealable as a final decision under § 1291 because it “put[] the 

litigants in this case effectively out of court, and its effect [was] precisely to 

surrender jurisdiction of a federal suit to a state court.”30 The Court 

acknowledged that “these standards do not reflect our oft-repeated 

definition of finality.”31 Nevertheless, the Court concluded that § 1291 

appealability was “compelled by precedent.”32

Precedent also compels § 1291 appealability in this case. Like stay 

orders governed by Pullman and Colorado River, the stay order governed by

Brillhart here concerns the interplay of federal and state proceedings.

33 The 

stay suspends the former in favor of the latter; its object is “precisely to 

surrender jurisdiction of a federal suit to a state court.”34 Litigation of the 

federal suit will not resume, if at all, until final judgment in the state court 

action. The district court’s stay puts the litigants in this case “effectively out 

of court.”35 Under these circumstances, the stay is a § 1291 final decision.

Generally, when this court has deemed Brillhart stay orders

appealable under § 1291, the stays have suspended federal proceedings until 

the resolution of a state court lawsuit with res judicata effect.36 In those cases, 

29 Id. at 712.

30 Id. (citing Moses H. Cone, 460 U.S. at 10 n.11) (internal citations omitted).

31 Id. at 713.

32 Id.

33 See Brillhart v. Excess Ins. Co. of Am., 316 U.S. 491, 495 (1942).

34 Moses H. Cone, 460 U.S. at 10 n.11.

35 Id.

36 Granite State Ins. Co. v. Tandy Corp., 986 F.2d 94, 95 (5th Cir. 1992); see also Am. 

Guarantee & Liab. Ins. Co. v. Anco Insulations, Inc., 408 F.3d 248, 250 (5th Cir. 2005); Ford 

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the stays guaranteed that there would be no further litigation in the federal 

forum. In this case, the potential for future litigation is less clear. State law 

determines the preclusive effect of a state court judgment.37 Under Texas 

law, res judicata requires: “(1) a prior final judgment on the merits by a court 

of competent jurisdiction; (2) identity of parties or those in privity with them; 

and (3) a second action based on the same claims as were raised or could have 

been raised in the first action.”38 When this court has deemed Brillhart stays

appealable under § 1291, it has not engaged in a detailed res judicata analysis. 

That is because res judicata has been self-evident: the parties have been 

identical, and the claims in the state and federal court actions have 

overlapped.39

Not so here. A final judgment by the state court on the merits of the 

tortious interference claims may well satisfy elements one and three, but the 

parties are not identical, and privity is uncertain. This distinction is crucial 

to the preclusion analysis. Given the fact-specific nature of privity,40 which 

Motor Credit Co. v. Lewis, 233 F.3d 575, 2000 WL 1468831, at *4 (5th Cir. 2000) (per 

curiam) (unpublished).

37 In re 3 Star Properties, L.L.C., 6 F.4th 595, 604-05 (5th Cir. 2021).

38 Cox v. Nueces Cnty., 839 F.3d 418, 421 (5th Cir. 2016) (quoting Amstadt v. U.S. 

Brass Corp., 919 S.W.2d 644, 652 (Tex. 1996)).

39 See Am. Guarantee, 408 F.3d at 250 (holding that a stay order was appealable 

under § 1291 when the parties were the same and the state proceeding encompassed 

common issues); Granite State, 986 F.2d at 95 (holding that a stay order was appealable 

under § 1291 when the parties were the same and the issues would “undoubtedly be 

litigated in the state court action”); Ford Motor, 2000 WL 1468831, at *4 (“Since the state 

court proceeding will resolve the declaratory judgment action’s only issue, the order 

granting the stay of proceeding is considered a final judgment for purposes of 28 U.S.C. 

§ 1291.”).

40 EEOC v. Jefferson Dental Clinics, PA, 478 F.3d 690, 694 (5th Cir. 2007) (citing 

and then quoting Getty Oil Co. v. Ins. Co. of N. Am., 845 S.W.2d 794, 800 (Tex. 1992)) 

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the parties have not briefed, we decline to rule on privity or to predict the res 

judicata effect of an unresolved state court proceeding.41

In any case, the possibility of future litigation does not preclude our 

jurisdiction. Our circuit precedents also hold that a stay order that causes a 

“protracted and indefinite” delay in federal court proceedings suffices to put 

plaintiffs “effectively out of court.”42 This logic derives from Idlewild, in 

which, as noted, the Supreme Court asserted § 1291 jurisdiction over a stay 

that was “entered with the expectation that the federal litigation will resume 

in the event the plaintiff does not obtain relief in state court.”43 In this case, 

the stay order has already delayed proceedings for over eighteen months, and 

there is no indication that delay will end. Even if federal litigation does 

ultimately continue, our jurisdiction is secure.

Triten contends that the district court’s order is not final because the 

order requires the parties to submit periodic status reports. This argument 

lacks merit. Section 1291 finality “is to be given a practical rather than a 

technical construction.”44 An order is final when “there is no indication that 

(“Texas courts have been clear that there is no categorical rule for privity; instead the 

courts look to ‘the circumstances of each case.’”).

41 Cooper v. Harris, 137 S. Ct. 1455, 1470 n.4 (2017) (determining that there was “no 

occasion to address” a fact-intensive issue “the parties have not briefed or argued”).

42 Hines v. D’Artois, 531 F.2d 726, 731 (5th Cir. 1976) (holding that a stay order that 

would delay proceedings for at least eighteen months was a final decision under § 1291); see 

also Occidental Chem. Corp. v. La. Pub. Serv. Comm’n, 810 F.3d 299, 306-08 (5th Cir. 2016) 

(affirming that Hines remains good law and holding that a stay order that had already 

delayed proceedings for nearly two years was a final decision under § 1291).

43 Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 10 (1983); see 

also Occidental, 810 F.2d at 306-07; Hines, 531 F.2d at 730-31.

44 Microsoft Corp. v. Baker, 137 S. Ct. 1702, 1712 (2017) (quoting Eisen v. Carlisle & 

Jacquelin, 417 U.S. 156, 171 (1974)).

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the district court intends to revisit its decision to stay the case.”45 Here, 

there is no such indication. The district court ordered that “this action 

should be stayed pending final adjudication in the state court action.” A 

mere request for updates on the parties’ progress does not evince any interest 

in lifting the stay before the state court action concludes.

III

We now turn to the merits of the stay order. Under the Declaratory 

Judgment Act, federal courts “may declare the rights and other legal 

relations of any interested party seeking such declaration.”46 They are not 

compelled to do so, however. In declaratory judgment actions, “the normal 

principle that federal courts should adjudicate claims within their jurisdiction 

yields to considerations of practicality and wise judicial administration.”47 

The statute has long “been understood to confer on federal courts unique 

and substantial discretion in deciding whether to declare the rights of 

litigants.”48

The Brillhart doctrine governs the district court’s discretion to stay a 

declaratory judgment action.49 Under Brillhart, a district court “should 

ascertain whether the questions in controversy between the parties to the 

45 Am. Guarantee & Liab. Ins. Co. v. Anco Insulations, Inc., 408 F.3d 248, 250 (5th 

Cir. 2005) (citing Moses H. Cone, 460 U.S. at 12-13).

46 28 U.S.C. § 2201(a).

47 Wilton v. Seven Falls Co., 515 U.S. 277, 288 (1995).

48 Id. at 286.

49 Sherwin-Williams Co. v. Holmes Cnty., 343 F.3d 383, 389 (5th Cir. 2003). 

Although commonly referred to as Brillhart “abstention,” the term is “not entirely 

accurate.” Med. Assur. Co., Inc. v. Hellman, 610 F.3d 371, 378 (7th Cir. 2010). 

“Abstention” normally refers to “judicially-created doctrines,” whereas the discretion to 

stay or dismiss an action under the Declaratory Judgment Act comesfrom the statute itself. 

Id.

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federal suit . . . can better be settled in the proceeding pending in the state 

court.”50

We review the district court’s decision to stay federal court 

proceedings pending the outcome of a state court action for abuse of 

discretion.

51 Although discretion “is broad, it is not unfettered.”52 A district 

court abuses its discretion “unless [it] addresses and balances the purposes 

of the Declaratory Judgment Act and the factors relevant” to the Brillhart

doctrine.53 In St. Paul Insurance Co. v. Trejo,54 we identified seven 

nonexclusive factors to guide a district court’s exercise of discretion in a 

Brillhart stay:

(1) whether there is a pending state action in which all of the 

matters in controversy may be fully litigated;

(2) whether the plaintiff filed suit in anticipation of a lawsuit 

filed by the defendant;

(3) whether the plaintiff engaged in forum shopping in bringing 

the suit;

(4) whether possible inequities in allowing the declaratory 

plaintiff to gain precedence in time or to change forums exist;

(5) whether the federal court is a convenient forum for the 

parties and witnesses;

50 Brillhart v. Excess Ins. Co. of Am., 316 U.S. 491, 495 (1942).

51 Am. Guarantee & Liab. Ins. Co. v. Anco Insulations, Inc., 408 F.3d 248, 250 (5th 

Cir. 2005).

52 St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 590 (5th Cir. 1994) (quoting Travelers Ins. 

Co. v. La. Farm Bureau Fed’n, Inc., 996 F.2d 775, 778 (5th Cir. 1993)).

53 Vulcan Materials Co. v. City of Tehuacana, 238 F.3d 382, 390 (5th Cir. 2001) 

(quoting Trejo, 39 F.3d at 590).

54 39 F.3d 585 (5th Cir. 1994).

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(6) whether retaining the lawsuit would serve the purposes of 

judicial economy; and

(7) whether the federal court is being called on to construe a 

state judicial decree involving the same parties and entered by 

the court before whom the parallel state suit between the same 

parties is pending.55

Every circuit has a similar test.56 Across circuits, the Brillhart inquiry 

is grounded in three fundamental concerns: federalism, fairness, and 

efficiency.57

A

The first Trejo factor considers “whether there is a pending state court 

action in which all of the matters in controversy may be fully litigated.”58 A 

parallel state court proceeding raises Brillhart concerns about federalism and 

efficiency.59 Duplicative litigation in federal court, especially over matters of 

state law, should be avoided.60

The existence of a pending parallel state court proceeding is not 

dispositive, but it is an “important factor” in the analysis.61 When a related

state court proceeding “is not ‘parallel’ because it does not involve all the 

same parties or issues,” the district court must consider “the extent of 

55 Id. at 590-91.

56 Sherwin-Williams Co. v. Holmes Cnty., 343 F.3d 383, 390 (5th Cir. 2003)

(collecting cases).

57 Id. at 390-91.

58 Trejo, 39 F.3d at 590.

59 Sherwin-Williams, 343 F.3d at 394.

60 See id. at 391-92.

61 Id. at 394.

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similarity between the pending state court and federal court cases.”62 The 

greater the overlap, the more likely that a stay will promote federalism and 

efficiency.63

The district court ruled that the first factor favored a stay. The court 

reasoned that the factual and legal issues coincided because “the state court 

action arises out of the same facts and circumstances, and involves the same 

contractual issues as this declaratory judgment action.” The court 

recognized that KPS was not a party to the state court proceeding but did not 

deem this distinction significant because KPS had the same interests as

Switzer and the Koch affiliates.

The district court correctly determined that the federal and state court 

proceedings are connected. Both involve claims of tortious interference 

based on the same set of noncompete provisions in the same set of contracts. 

The related state court proceeding governing state law issues raises concerns 

about federalism and efficiency that favor a stay.

B

The next three Trejo factors consider whether the declaratory 

judgment plaintiff filed suit in anticipation of a lawsuit filed by the defendant, 

engaged in forum shopping in bringing the action, and would create potential 

62 Id. at 394 n.5.

63 See id. at 390, 394.

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inequities by gaining precedence in time or changing forums.64 These factors 

raise Brillhart concerns about fairness.65

The district court ruled that, on the whole, these fairness factors 

favored a stay. As to the second factor, the court correctly recognized that 

the federal proceeding was “not filed in anticipation of, but in response to” 

the state proceeding. Nevertheless, the court concluded that this response 

was unfair. Because “KPS’s interests in this declaratory action are the same 

as the interests of [its] president, Switzer, and [its] parent companies in the 

state court action,” the declaratory action was “in fact, an effort by KPS not 

only to forum shop, but also to gain precedence by having this court instead 

of the state court decide the issues raised by the tortious interference claims 

asserted in both actions.”

The district court did not abuse its discretion in concluding that KPS 

sought to forum shop and to gain unfair precedence. It is true that a mere 

preference for a federal forum “does not necessarily demonstrate 

impermissible forum selection.”66 An out-of-state plaintiff may properly 

invoke federal jurisdiction to avoid the potential bias of a state forum.67 

Protecting out-of-state defendants like KPS is “the traditional justification 

for diversity jurisdiction.”68 In this case, however, the record adequately 

supports the district court’s determination that the declaratory action was 

not a mere effort to avoid state court bias. The overlap between the state and 

federal proceedings suggests that KPS intends to reassign adjudication of 

64 St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 590-91 (5th Cir. 1994).

65 Sherwin-Williams, 343 F.3d at 391.

66 Id. at 399.

67 Id.

68 Id.

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shared legal and factual issues to the federal court. KPS says as much in its 

federal complaint. In KPS’s words, “[t]his declaratory judgment action 

arises from Defendants’ public and erroneous allegations that KPS is 

unlawfully competing with Defendants.” KPS seeks declarations of noninterference “so that it may fairly compete in the marketplace without the 

distraction and harm associated with Defendants’ meritless contentions.” 

The purpose of its lawsuit is to have the federal court declare Triten’s state 

court allegations wrong.

This court has previously drawn a connection between the degree of 

overlap in state court proceedings and procedural inequity.

69 When federal 

and state court actions are related, the federal action risks “changing forums 

or subverting the real plaintiff’s advantage in state court.”70 These risks 

dissipate when the federal action pertains to separate claims. In this case, the 

relationship between the state and federal proceedings threatens 

impermissible meddling with Triten’s lawsuit. This threat supports the 

district court’s conclusion that, in sum, the fairness factors favor a stay.

69 See Sherwin-Williams, 343 F.3d at 399 (rejecting unfairness when there was no 

“race to res judicata”); Ironshore Specialty Ins. Co. v. Tractor Supply Co., 624 F. App’x 159, 

167-68 (5th Cir. 2015) (per curiam) (unpublished) (denying procedural inequity when “the 

state court action did not involve the same parties or the same legal issues,” thereby 

negating the risk of preclusion).

70 Sherwin-Williams, 343 F.3d at 399 (quoting Travelers Ins. Co. v. La. Farm Bureau 

Fed’n, Inc., 996 F.2d 775, 777 (5th Cir. 1993)).

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C

The fifth Trejo factor considers “whether the federal court is a 

convenient forum for the parties and witnesses.”71 This factor “primarily 

address[es] efficiency considerations.”72

The district court ruled that the federal and state courts were equally 

convenient, so this factor was neutral. KPS does not dispute the convenience 

of the federal court, but it argues that this convenience militates in its favor. 

We are not rigid in prescribing the role that convenience must play in the 

district court’s analysis.73 The district court did not abuse its discretion in 

ruling this factor neutral.

D

The sixth Trejo factor considers “whether retaining the lawsuit would 

serve the purposes of judicial economy.”74 Federal courts “should avoid 

duplicative or piecemeal litigation where possible.”75 Judicial economy 

corresponds primarily to Brillhart’s concern about efficiency.76 Judicial 

economy may also implicate concerns about federalism and comity, 

71 St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 591 (5th Cir. 1994).

72 Sherwin-Williams, 343 F.3d at 391.

73 See, e.g., Ironshore Specialty Ins. Co. v. Tractor Supply Co., 624 F. App’x 159, 168 

(5th Cir. 2015) (per curiam) (unpublished) (holding that this factor “weighs against 

dismissal” when there was no indication that the federal court was inconvenient); RLI Ins. 

Co. v. Wainoco Oil & Gas Co., 131 F. App’x 970, 973 (5th Cir. 2005) (per curiam) 

(unpublished) (finding no abuse of discretion when the federal and state forums were both 

of “relative convenience” and the district court ruled this factor “neutral”).

74 Trejo, 39 F.3d at 591.

75 Sherwin-Williams, 343 F.3d at 391.

76 Id.

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especially when duplicative litigation could produce conflicting judgments on 

matters of state law.77

The district court held that this factor favored a stay. The court 

reasoned that the declaratory judgment action would produce inefficient 

piecemeal litigation because the state lawsuit involves claims besides tortious

interference that the federal lawsuit would not resolve. By contrast, “all 

issues raised by the claims asserted in this declaratory judgment action can 

be resolved in the state court proceeding.”

The district court correctly concluded that a stay would serve judicial 

economy. The resolution of the state lawsuit may or may not resolve the 

claims in the federal lawsuit. As the district court noted, however, there is 

no question that the federal lawsuit will not resolve the claims in the state 

lawsuit. For example, the federal lawsuit will not resolve claims by Switzer 

against Triten for compensation that Triten allegedly failed to pay him. 

When state court proceedings involve claims or parties beyond those in the 

federal declaratory judgment action, this court has held that efficiency 

concerns counsel against asserting jurisdiction.78 A stay may not avoid 

piecemeal or duplicative litigation, but proceeding with the federal action 

ensures it.

The federal action also raises concerns about federalism. Duplicative 

litigation in the federal court about state law matters—tortious interference 

77 Id.

78 See id. (“A federal court should be less inclined to hear a case if necessary parties 

are missing from the federal forum, because that leads to piecemeal litigation and 

duplication of effort in state and federal courts.”); Am. Emps.’ Ins. Co. v. Eagle Inc., 122 F. 

App’x 700, 703-04 (5th Cir. 2004) (per curiam) (unpublished) (affirming a stay order when 

“a federal court cannot rule conclusively” on all the issues raised in the state court 

proceedings so “it would not be more efficient for a federal court to initially hear the 

claims”).

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with Triten’s contracts—creates “the potential for inconsistent state and 

federal court judgments.”79 A stay reduces this risk. For reasons of 

efficiency as well as federalism, this factor favors a stay.

E

The seventh Trejofactor considers “whether the federal court is being 

called on to construe a state judicial decree involving the same parties and 

entered by the court before whom the parallel state suit between the same 

parties is pending.”80 This factor addresses Brillhart’s concern about 

federalism.81

Because this case does not involve the construction of a state judicial 

decree, the district court deemed this factor “not relevant.” KPS contends 

that the absence of a state decree is not irrelevant but rather disfavors a stay. 

This court has not dictated the weight that district courts must place on the 

absence of a state decree. One decision held that it “weighs strongly” in 

favor of the declaratory judgment plaintiff,82 while another approved of the 

district court’s determination that this factor was “not implicated.”83 KPS 

does not give any reason why the absence of a state judicial decree warrants 

special significance in this case. In fact, KPS concedes that there is “no 

meaningful dispute” on this point. Given the variation in acceptable 

79 Sherwin-Williams, 343 F.3d at 391.

80 St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 591 (5th Cir. 1994).

81 Sherwin-Williams, 343 F.3d at 392.

82 AXA Re Prop. & Cas. Ins. Co. v. Day, 162 F. App’x 316, 321 (5th Cir. 2006) (per 

curiam) (unpublished).

83 RLI Ins. Co. v. Wainoco Oil & Gas Co., 131 F. App’x 970, 973 (5th Cir. 2005) (per 

curiam) (unpublished).

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interpretations, the district court did not abuse its discretion in rejecting the 

relevance of this factor.

F

The seven Trejo factors are “nonexclusive.”84 KPS asserts additional 

concerns about unfairness that would result if the state court action were to 

preclude the federal court action. As explained above, however, the

preclusive effect of the state court’s ruling is unknown. This unsubstantiated 

fear does not bear on the analysis.

In addition to considering the Trejo factors, a district court must also 

“address[] and balance[] the purposes of the Declaratory Judgment Act.”85 

KPS argues that the stay order defies the purposes of the statute by 

obstructing KPS’s attempt to clarify its rights. It is true that “[a] proper 

purpose of section 2201(a) is to allow potential defendants to resolve a 

dispute without waiting to be sued.”86 However, the district court 

reasonably concluded that a stay was consistent with that purpose. Triten 

had already sought to resolve the dispute in some measure by asserting 

related claims in state court.

In sum, we conclude that the district court did not abuse its discretion 

in granting the stay. The presence of a related pending action in state court 

implicates Brillhart’s concerns about federalism, fairness, and efficiency that 

support the district court’s stay decision.

84 Sherwin-Williams, 343 F.3d at 388.

85 Vulcan Materials Co. v. City of Tehuacana, 238 F.3d 382, 390 (5th Cir. 2001) 

(quoting St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 590 (5th Cir. 1994)).

86 Sherwin-Williams, 343 F.3d at 397.

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IV

Finally, we turn to the parties’ motions for judicial notice. Both 

concern documents from the related state court proceedings.

Under Federal Rule of Evidence 201, a court “may judicially notice a 

fact that is not subject to reasonable dispute.”87 Such facts include those that 

“can be accurately and readily determined from sources whose accuracy 

cannot reasonably be questioned.”88 An appellate court may take judicial 

notice of facts, “even if such facts were not noticed by the trial court.”89 On 

several occasions, this court has taken judicial notice of court proceedings 

relevant to the case being decided.90

We grant both motions. The state court proceedings are relevant to 

this action because they elucidate the nature of the claims the parties have 

made and the defenses they have raised, and they show the status of those 

proceedings. Of course, our notice of these documents does not mean that 

we accept the assertions in the state court pleadings as true. Rule 201 permits 

judicial notice only of facts that are “not subject to reasonable dispute.”91 

The test for indisputability is stringent. Assertions in pleadings that are not 

otherwise obvious cannot clear Rule 201’s “‘indisputability’ hurdle.”92

87 Fed. R. Evid. 201(b).

88 Id. 201(b)(2).

89 United States v. Herrera-Ochoa, 245 F.3d 495, 501 (5th Cir. 2001); see also Fed. 

R. Evid. 201(d) (“The court may take judicial notice at any stage of the proceeding.”).

90 See, e.g., Alexander v. Verizon Wireless Servs., L.L.C., 875 F.3d 243, 248 n.8 (5th 

Cir. 2017); United States v. Verlinsky, 459 F.2d 1085, 1089 (5th Cir. 1972); Paul v. Dade 

Cnty., 419 F.2d 10, 12 (5th Cir. 1969).

91 Fed. R. Evid. 201(b).

92 Taylor v. Charter Med. Corp., 162 F.3d 827, 830 (5th Cir. 1998).

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* * *

For the reasons stated, we AFFIRM the district court’s stay order 

and GRANT the parties’ motions for judicial notice.

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