Opinion ID: 1194678
Heading Depth: 4
Heading Rank: 5

Heading: Comity Considerations

Text: Although we have found that the four preliminary injunction factors favor issuing Plaintiff's requested injunction in this case, the district court relied upon the discretionary first-to-file doctrine, see Certified, 2007 WL 1343682, at  n. 2, to conclude that comity considerations weigh in favor of not granting the preliminary injunction while [Plaintiff's] Motion to Dismiss in the Ohio Action is still pending. Id. at . We find this reliance on the first-to-file doctrine to be misplaced and agree with Plaintiff that the district court's consideration of the Ohio action was an abuse of discretion. The first-to-file rule, while not frequently discussed by this Court, is a well-established doctrine that encourages comity among federal courts of equal rank. AmSouth Bank v. Dale, 386 F.3d 763, 791 n. 8 (6th Cir.2004) (quoting Zide Sport Shop of Ohio v. Ed Tobergte Assoc., Inc., 16 Fed.Appx. 433, 437 (6th Cir.2001) (unpublished)) (emphasis altered). The rule provides that when actions involving nearly identical parties and issues have been filed in two different district courts, `the court in which the first suit was filed should generally proceed to judgment.' Zide Sport Shop, 16 Fed.Appx. at 437 (quoting In re Burley, 738 F.2d 981, 988 (9th Cir.1984)) (emphasis added). However, the first-filed rule is not a strict rule and much more often than not gives way in the context of a coercive action filed subsequent to a declaratory judgment. AmSouth Bank, 386 F.3d at 791 n. 8. As we have previously explained: District courts have the discretion to dispense with the first-to-file rule where equity so demands. A plaintiff, even one who files first, does not have a right to bring a declaratory judgment action in the forum of his choosing. Factors that weigh against enforcement of the first-to-file rule include extraordinary circumstances, inequitable conduct, bad faith, anticipatory suits, and forum shopping. Zide Sport Shop, 16 Fed.Appx. at 437 (internal citations omitted) (emphasis added). Cases construing the interplay between declaratory judgment actions and suits based on the merits of underlying substantive claims create, in practical effect, a presumption that a first filed declaratory judgment action should be dismissed or stayed in favor of the substantive suit. AmSouth Bank, 386 F.3d at 791 n. 8 (quoting UAW v. Dana Corp., No. 3:99CV7603, 1999 WL 33237054, at  (N.D.Ohio Dec.6, 1999)). In this case, a proper application of the first-to-file rule would have led the district court to the conclusion that comity did not counsel against issuing a preliminary injunction. The Ohio action filed by Defendants was the very kind of anticipatory suit which should not have been given deference under the first-to-file rule. As the Ohio district judge recognized when it dismissed the action, the forum selection clause in the franchise agreement clearly mandated that the parties' dispute be resolved in a Michigan, rather than an Ohio, forum. See Tenke Corp., 2007 WL 2114659, at -2. By filing in Ohio courts, Defendants were attempting to forum shop as well as preempt resolution of the parties' dispute by the proper forum. Thus, the Ohio action was not entitled to any deference under the first-to-file rule. Because the Ohio declaratory judgment action was not entitled to deference under the first-to-file rule, comity did not require that any injunctive relief sought by Plaintiff in its properly-filed coercive action be denied. The district court committed a clear error of judgment in denying Plaintiff's request for preliminary injunction on such a basis.