Court Opinion

ID: 158591
Source: CourtListenerOpinion
Date Created: 2010-08-14 05:25:07+00
Date Added: 2024-06-11T09:42:21.950944
License: Public Domain

UNITED STATES COURT OF APPEALS
                                      Tenth Circuit
                           Byron White United States Courthouse
                                    1823 Stout Street
                                 Denver, Colorado 80294
                                     (303) 844-3157
Patrick J. Fisher, Jr.                                                          Elisabeth A. Shumaker
       Clerk                                                                      Chief Deputy Clerk

                                         September 10, 1999

       TO: ALL RECIPIENTS OF THE ORDER AND JUDGMENT

       RE: 98-4098, Buzas Baseball v. Board of Regents
           Filed on September 2, 1999

             The order and judgment filed in this matter contains two clerical errors on
       page 5, the sentence which begins on line 5. The corrected sentence should read as
       follows:

               Plaintiff further asserts it had notified defendant in November 1997 that
               it needed a decision before the team owner went to the winter meeting
               in December, but it did not receive the proposal until February 1998.

       A copy of the corrected order and judgment is attached.

                                                      Sincerely,

                                                      Patrick Fisher, Clerk of Court

                                                      By:    Keith Nelson
                                                             Deputy Clerk

       encl.
                                                                          F I L E D
                                                                   United States Court of Appeals
                                                                           Tenth Circuit
                     UNITED STATES COURT OF APPEALS
                                                                            SEP 2 1999
                            FOR THE TENTH CIRCUIT
                                                                      PATRICK FISHER
                                                                               Clerk

    BUZAS BASEBALL, INC., a Utah
    corporation,

                Plaintiff-Appellant,
                                                         No. 98-4098
    v.                                               (D.C. No. 98-CV-181)
                                                           (D. Utah)
    THE BOARD OF REGENTS OF
    THE UNIVERSITY SYSTEM OF
    GEORGIA,

                Defendant-Appellee.

                            ORDER AND JUDGMENT            *

Before BALDOCK , BARRETT , and McKAY , Circuit Judges.

         After examining the briefs and appellate record, this panel has determined

unanimously that oral argument would not materially assist the determination of

*
      This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is

therefore ordered submitted without oral argument.

      Plaintiff Buzas Baseball, Inc., a Utah corporation, appeals from an order of

the district court dismissing this declaratory judgment action without prejudice.

We affirm.

      Buzas Baseball operates the Salt Lake Buzz, a minor league Triple A

baseball team which has a bee as its logo. The team was organized in 1993 and

began using the name and logos at that time for both merchandising and

promotional purposes.

      Defendant, doing business as the Georgia Institute of Technology, uses a

Yellow Jacket named “Buzz” as its mascot. Defendant obtained a trademark for

the Yellow Jacket design in 1987 and registered the mark “Buzz” in 1988.

Defendant uses its marks for merchandising and promotional purposes.

      Defendant learned plaintiff was using the Buzz logo in 1997 at an annual

sports merchandising show held in Atlanta where plaintiff’s merchandise was

displayed. Defendant later discovered that a retailer in Atlanta also sold

plaintiff’s merchandise and that the retailer believed consumers confused

plaintiff’s logo with defendant’s mark. Defendant notified the governing body for

minor league baseball teams that it objected to plaintiff’s use of the Buzz logo.

                                         -2-
      The assistant general manager for the Buzz and defendant’s counsel entered

into discussions and, at one point, agreed that plaintiff would discontinue using

Buzz as its name and logo after September 4, 1998, the end of the 1998 season.

Various Salt Lake City media reports also indicated that plaintiff would

discontinue using the logo and that the team owner was leaning towards renaming

the team the “Beezz.”

      In February 1998, defendant sent plaintiff a written settlement agreement.

Thereafter, defendant became aware that the Salt Lake City media was reporting

that plaintiff would not discontinue use of the “Buzz.” Plaintiff never directly

informed defendant of that fact. Eleven days after receiving the written

settlement proposal, plaintiff commenced this action. Approximately three weeks

later, defendant filed a trademark infringement action in Georgia federal district

court. The Utah district court granted defendant’s motion to dismiss.

      On appeal, plaintiff argues that the district court erred in determining that

plaintiff was not entitled to application of the first-to-file rule and an order

staying the Georgia action. Plaintiff also contends the district court erred in

declining to exercise jurisdiction over this action solely because of an extant,

later-filed lawsuit which addressed the same issue of trademark infringement.

                                           -3-
       We review a district court’s decision whether to grant a defendant’s motion

to dismiss a declaratory judgment action for abuse of discretion.   See Wilton v.

Seven Falls Co. , 515 U.S. 277, 289-90 (1995).

       In deciding whether to dismiss a declaratory judgment action, we have

noted that the district court should consider

       [1] whether a declaratory action would settle the controversy;
       [2] whether it would serve a useful purpose in clarifying the legal
       relations at issue; [3] whether the declaratory remedy is being used
       merely for the purpose of “procedural fencing” or “to provide an
       arena for a race to res judicata ”; [4] whether use of a declaratory
       action would increase friction between our federal and state courts
       and improperly encroach upon state jurisdiction; and [5] whether
       there is an alternative remedy which is better or more effective.

State Farm Fire & Cas. Co. v. Mhoon     , 31 F.3d 979, 983 (10th Cir. 1994)

(quotation omitted).

       On appeal we do not engage in a de novo review of these factors, but

rather we ask only whether the district court’s assessment of them “was so

unsatisfactory as to amount to an abuse of discretion.”     Id.

       The district court found that the parties were evenly matched as to all the

factors except number three. The court determined that plaintiff had filed this

action in anticipation of the Georgia lawsuit. The court noted that the parties had

been involved in settlement negotiations “[a]lmost from the beginning of the

controversy” and plaintiff had received a proposed settlement agreement only

                                            -4-
eleven days before it commenced this action. District court order at 3. Further,

plaintiff never informed defendant that the proposal was unacceptable.

       Plaintiff contends it was forced to file the action because no settlement had

been agreed to and, as the new baseball season was about to start, it needed to

determine whether it could continue to use its logo. Plaintiff further asserts it had

notified defendant in November 1997 that it needed a decision before the team

owner went to the winter meeting in December, but it did not receive the proposal

until February 1998. The court found that plaintiff had not informed defendant

that any delay would be unacceptable. We further note that under the terms of the

proposed settlement, defendant agreed that plaintiff could use the logo throughout

the 1998 season. Thus, any need to avoid delay would not have been obvious to

defendant.

       Plaintiff asserts it had reason to believe defendant would soon be filing suit

thus forcing it to forfeit its 1998 season. “[A] federal declaratory judgment is not

a prize to the winner of the race to a courthouse” but rather obviates the need for

a race to the courthouse.   Perez v. Ledesma , 401 U.S. 82, 119 n.12 (1971)

(Brennan, J., concurring in part and dissenting in part)   . In addition, plaintiff’s

assertion is belied by defendant’s submission of a proposed settlement.

       Plaintiff maintains that the first-to-file rule mandates that the district court

retain this case.   Federal courts have recognized that, as courts of coordinate

                                             -5-
jurisdiction and equal rank, they must be careful to avoid interfering with each

other’s affairs in order “to avoid the waste of duplication, to avoid rulings which

may trench upon the authority of sister courts, and to avoid piecemeal resolution

of issues that call for a uniform result.”     Sutter Corp. v. P&P Indus., Inc.    ,

125 F.3d 914, 917 (5th Cir. 1997) (quotation omitted). To aid in achieving this

goal, the “first-to-file” rule permits a district court to decline jurisdiction where

a complaint raising the same issues against the same parties has previously been

filed in another district court.     Alltrade, Inc. v. Uniweld Prods., Inc.    , 946 F.2d

622, 625 (9th Cir. 1991). However, “simply because a court is the first to obtain

jurisdiction does not necessarily mean that it should decide the           merits of the

case.” Hospah Coal Co. v. Chaco Energy Co.           , 673 F.2d 1161, 1164      (10th Cir.

19 82). We review the district court’s decision whether to rely on the first-to-file

rule only for abuse of discretion.      Alltrade , 946 F.2d at 625.

       A district court may decline to follow the first-to-file rule and dismiss a

declaratory judgment action if that action was filed for the purpose of anticipating

a trial of the same issues in a court of coordinate jurisdiction.         See Tempco Elec.

Heater Corp. v. Omega Eng’g, Inc.        , 819 F.2d 746, 749 (7th      Cir. 1987) (where

declaratory judgment action is filed in anticipation of trademark infringement

action, “infringement action should proceed, even if filed” after the declaratory

judgment action); Amerada Petroleum Corp. v. Marshall               , 381 F.2d 661, 663

                                               -6-
(5th Cir. 1967). Here, plaintiff has admitted that one consideration in filing this

action was its concern that defendant would file suit.     See Appellant’s Br. at 5-6;

Reply Br. at 1. This consideration, combined with defendant’s prior agreement

that plaintiff could continue to use its logo throughout the 1998 season, supports

our determination that the district court’s assessment did not amount to an abuse

of discretion.

       Upon review of the record, we cannot say that the district court abused its

discretion in assessing the relevant factors or in concluding that plaintiff filed this

declaratory judgment action in anticipation of a filing in Georgia. The judgment

of the United States District Court for the District of Utah is AFFIRMED.

       The decision of the Georgia court regarding whether to certify its decision

that it has personal jurisdiction over plaintiff is immaterial to our determination

of the propriety of the Utah district court’s exercise of discretion. Therefore,

defendant’s motion to supplement the record is DENIED.

                                                         Entered for the Court

                                                         Monroe G. McKay
                                                         Circuit Judge

                                            -7-