Court Opinion

ID: 4196342
Source: CourtListenerOpinion
Date Created: 2017-08-16 17:01:27.844213+00
Date Added: 2024-06-11T07:46:45.208919
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

MONTANORE MINERALS                       Nos. 15-35707
CORPORATION,                                  15-35753
             Plaintiff-Appellee,
                                            D.C. No.
                  v.                     9:13-cv-00133-
                                              DLC
ARNOLD BAKIE; OPTIMA, INC.;
FRANK DUVAL,
          Defendants-Appellants,            OPINION

                 and

EASEMENTS AND RIGHTS OF WAY
UNDER, THROUGH AND ACROSS
THOSE CERTAIN UNPATENTED LODE
MINING CLAIMS LOCATED IN THE
NE 1/4 OF SECTION 15, TOWNSHIP
27 NORTH, RANGE 31 WEST,
LINCOLN COUNTY, MONTANA AND
IDENTIFIED AS POPS 12, POPS 13,
POPS 14 AND POPS 15; UNKNOWN
OWNERS, and all other persons,
unknown, claiming or who might
claim any right, title, estate, or
interest in or lien or encumbrance
the unpatented lode mining claims
described above or any cloud upon
title thereto, whether such claim or
possible claim be present,
                           Defendants.
2              MONTANORE MINERALS V. BAKIE

        Appeal from the United States District Court
                for the District of Montana
        Dana L. Christensen, Chief Judge, Presiding

             Argued and Submitted June 13, 2017
                    Seattle, Washington

                     Filed August 16, 2017

    Before: DOROTHY W. NELSON, MILAN D. SMITH,
       JR., and MORGAN CHRISTEN, Circuit Judges.

             Opinion by Judge Milan D. Smith, Jr.

                          SUMMARY *

                    Colorado River Doctrine

    The panel held that the district court abused its discretion
by not staying this federal case in deference to pending state
court proceedings under Colo. River Water Conservation
Dist. v. United States, 424 U.S. 800, 817-19 (1976); reversed
the district court’s order condemning for Montanore
Minerals Corp.’s public use easements and rights of way
through four unpatented mining claims; remanded for the
district court to stay the proceedings; and on cross-appeal,
affirmed the district court’s denial of Montanore’s motion to
determine the validity of the mining claims.

    *
      This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
             MONTANORE MINERALS V. BAKIE                     3

    The panel held that application of the Colorado River
factors, along with the unusual circumstances of this case,
compelled a finding that this was an exceptional case in
which the district court’s decision not to enter a stay
constituted an abuse of discretion.

     The panel held that on balance the Colorado River
factors strongly counseled in favor of a stay: the state court
first assumed jurisdiction over the subject claims;
proceeding with the federal case presented a risk of
piecemeal litigation; the state court had jurisdiction over the
case for several years, and had made substantial progress, by
the time the federal proceeding was filed; state law provided
the rule of decision on the merits, and the case presented
complex state law questions better addressed by the state
court; the state court could adequately protect the federal
rights at issue; Montanore’s actions strongly suggested that
it was forum shopping by filing in federal court; and the suits
were sufficiently parallel for Colorado River to apply.

                         COUNSEL

Stephen Ross Brown (argued), Garlington Lohn & Robinson
PLLP,      Missoula,    Montana,      for    Defendants-
Appellants/Cross-Appellees.

Mark Stermitz (argued), Matthew A. Baldassin, and
Christopher C. Stoneback, Crowley Fleck PLLP, Missoula,
Montana, for Plaintiff-Appellee/Cross-Appellant.
4                MONTANORE MINERALS V. BAKIE

                              OPINION

M. SMITH, Circuit Judge:

     The causa belli in this case is the legal status of POPS
claims 12–15 (the Subject Claims), which are four
unpatented mining claims owned by defendant Arnold Bakie
and his predecessors in interest since 1984, and then
conveyed to defendant Optima, Inc., in October 2013. 1
Plaintiff Montanore Minerals Corp. (Montanore) seeks to
resume construction of a tunnel near Libby, Montana (the
Libby Tunnel), which Defendants contend would interfere
with their rights in the Subject Claims. To accomplish its
goal without objection from Defendants, Montanore first
initiated an action in Montana state court in 2007, in which
it sought a declaration that the Subject Claims were invalid.
After the state court ruled in 2013 that the Subject Claims
were valid, Montanore brought an action in federal district
court, seeking to condemn for public use easements and
rights of way through the Subject Claims. The district court
ordered the easements and rights of way condemned for
Montanore’s public use, and determined that Defendants
were not entitled to any compensation as a result of the
taking.

    We conclude that the district court abused its discretion
by not staying the federal case in deference to the pending
state court proceedings.        See Colo. River Water
Conservation Dist. v. United States, 424 U.S. 800, 817–19
(1976). Accordingly, we reverse the district court’s
condemnation order, and remand for the district court to stay
the proceedings. On cross-appeal, we affirm the district

    1
        We refer to the Subject Claim owners collectively as Defendants.
             MONTANORE MINERALS V. BAKIE                    5

court’s decision to deny Montanore’s motion to determine
the validity of the Subject Claims.

         FACTS AND PRIOR PROCEEDINGS

     In 1989, Noranda Minerals Corp. (Noranda) began
construction of the Libby Tunnel in order to gain
underground access to valuable silver and copper deposits
located within its patented mining claims, HR 133 and HR
134. To facilitate construction of the Libby Tunnel, in 1989
Noranda entered into a mining lease with certain entities and
persons that claimed to own unpatented mining claims
located within the Libby Tunnel, including Bakie and his
predecessors in interest. After building approximately
14,000 feet of the Libby Tunnel, Noranda ceased
construction before it reached HR 133 and HR 134. In 2002,
it ceased its development efforts entirely, and disclaimed any
interests in the easements it held for tunnel construction
pursuant to the 1989 mining lease.

    In 2006, Noranda changed its name to Montanore and
sought to recommence construction of the Libby Tunnel.
Rather than following its previous strategy of obtaining
easements from unpatented mining claim holders, it sought
to have those mining claims declared invalid, or,
alternatively, have easements running through them
condemned for public use.

I. State court action.

    In 2007, Montanore filed a state court action seeking,
inter alia, a declaratory judgment that the Subject Claims
were invalid under state and federal law. After years of
discovery and cross-motions for summary judgment, the
state court issued an interlocutory order in March 2013
holding that the Subject Claims were valid. The order also
6               MONTANORE MINERALS V. BAKIE

enjoined Montanore from crossing the unpatented claims
owned by Walter Lindsey, who is not a party to this case.
The injunction did not concern the Subject Claims or
Defendants.

    The injunction was immediately appealable under
Montana law, and Montanore appealed to the Montana
Supreme Court. In an unpublished order, the Montana
Supreme Court vacated the injunction on procedural grounds
and remanded for further consideration. 2 On remand to the
state district court, Montanore sought to remove the judge
who had presided over the state court action, pursuant to
Montana Code Annotated (MCA) § 3-1-804(12), but was
unsuccessful in its quest. Mines Mgmt., Inc. v. Fus, 334 P.3d
929, 931–32 (Mont. 2014). Montanore appealed, and the
Montana Supreme Court affirmed the decision of the trial
court. Id. at 932.

    Montanore has not yet appealed the state court’s ruling
concerning the validity of the Subject Claims, because it was
not an appealable final order. In the meantime, the state

    2
       In its order, the Montana Supreme Court noted that the state district
“court’s reliance upon the 1989 mining lease as dispositive of
Linds[e]y’s interests in the non-patented mining claims at issue [was]
confusing and appear[ed] from a review of the provisions of the lease to
be misplaced.” Montanore argues that the state district court’s reliance
on the 1989 mining lease as dispositive of the validity of the Subject
Claims was similarly misplaced. While this conclusion may logically
apply, the Montana Supreme Court has not considered the validity of the
Subject Claims. Additionally, the court’s comment on the validity of the
Lindsey claims was not a holding on claim validity; the order merely set
aside the Lindsey injunction on “procedural grounds and instructed the
[state d]istrict [c]ourt to consider the issue further.” Mines Mgmt., Inc.
v. Fus, 334 P.3d 929, 932 (Mont. 2014).
             MONTANORE MINERALS V. BAKIE                   7

district court has deferred further state court proceedings
pending the outcome of this appeal.

II. Federal court action.

    On June 28, 2013, Montanore filed a condemnation
action in federal court pursuant to Federal Rule of Civil
Procedure (Rule) 71.1, seeking to condemn easements and
rights of way through the Subject Claims so that it could
complete the Libby Tunnel in order to reach HR 133 and HR
134, and begin mining silver and copper. Montanore also
moved for the district court to determine the validity of the
Subject Claims.

    Defendants moved for the district court to stay the
federal proceedings in deference to the pending, parallel
state court proceedings, pursuant to the Colorado River
doctrine. The district court agreed with Defendants
regarding Montanore’s motion to determine claim validity,
and thus denied Montanore’s motion. However, the district
court declined to stay the condemnation action because it
determined that the state court proceedings were not
sufficiently parallel to the federal proceedings for the
Colorado River doctrine to apply.

    The condemnation action proceeded and the district
court held that Montanore met Montana law’s requirements
to condemn private property for public use, and, on April 29,
2014, it issued a preliminary condemnation order in favor of
Montanore. See MCA § 70-30-111(1). The district court
next appointed three experts (the Commissioners) to
determine what compensation was due to the condemnees.
The Commissioners held a compensation hearing, and then
issued a report recommending that $0 was just compensation
for the condemned interests. The district court adopted the
Commissioners’ report in its entirety, and granted judgment
8            MONTANORE MINERALS V. BAKIE

as a matter of law for Montanore on August 7, 2015. The
district court issued a final condemnation order on
September 8, 2015. Defendants timely appealed, and
Montanore timely cross-appealed.

               STANDARD OF REVIEW

    “Whether the facts of a particular case conform to the
requirements for a Colorado River stay or dismissal is a
question of law which we review de novo.” Seneca Ins. Co.,
Inc. v. Strange Land, Inc., 862 F.3d 835, 840 (9th Cir. 2017)
(quoting Smith v. Cent. Ariz. Water Conservation Dist., 418
F.3d 1028, 1032 (9th Cir. 2005)). “If we conclude that the
Colorado River requirements have been met, we then
review” the district court’s decision for abuse of discretion.
Id. The district court’s “discretion must be exercised within
the narrow and specific limits prescribed by the [Colorado
River] doctrine.” R.R. St. & Co. Inc. v. Transp. Ins. Co.,
656 F.3d 966, 973 (9th Cir. 2011) (quoting Holder v. Holder,
305 F.3d 854, 863 (9th Cir. 2002)).

                        ANALYSIS

    In exceptional circumstances, a federal court may
decline to exercise its “virtually unflagging obligation” to
exercise federal jurisdiction, in deference to pending,
parallel state proceedings. Colo. River, 424 U.S. at 817.
Such a decision “rest[s] on considerations of wise judicial
administration, giving regard to conservation of judicial
resources and comprehensive disposition of litigation.” Id.
(internal quotation marks and alteration omitted). The
decision “does not rest on a mechanical checklist, but on a
careful balancing of the important factors as they apply in a
given case, with the balance heavily weighted in favor of the
exercise of jurisdiction.” Moses H. Cone Mem’l Hosp. v.
Mercury Constr. Corp., 460 U.S. 1, 16 (1983).
             MONTANORE MINERALS V. BAKIE                   9

    We have recognized eight factors to be considered when
reviewing a district court’s decision regarding a Colorado
River stay or dismissal. R.R. St., 656 F.3d at 978. They are:

       (1) which court first assumed jurisdiction
       over any property at stake; (2) the
       inconvenience of the federal forum; (3) the
       desire to avoid piecemeal litigation; (4) the
       order in which the forums obtained
       jurisdiction; (5) whether federal law or state
       law provides the rule of decision on the
       merits; (6) whether the state court
       proceedings can adequately protect the rights
       of the federal litigants; (7) the desire to avoid
       forum shopping; and (8) whether the state
       court proceedings will resolve all issues
       before the federal court.

Id. at 978–79. Some factors may not apply in some cases,
and “[a]ny doubt as to whether a factor exists should be
resolved against a stay” or dismissal. Seneca Ins. Co.,
862 F.3d at 842 (quoting Travelers Indem. Co. v. Madonna,
914 F.2d 1364, 1369 (9th Cir. 1990)).

    When it is appropriate for a court to decline to exercise
jurisdiction pursuant to the Colorado River doctrine, we
generally require a stay rather than a dismissal. Attwood v.
Mendocino Coast Dist. Hosp., 886 F.2d 241, 243 (9th Cir.
1989). A stay “ensures that the federal forum will remain
open if for some unexpected reason the state forum . . . .
turn[s] out to be inadequate.” Id. (internal quotation marks
omitted).
10            MONTANORE MINERALS V. BAKIE

I. The district court abused its discretion by declining
   to stay the federal condemnation action.

    As a threshold matter, the Colorado River doctrine
applies in this case because there are “pending state court
proceedings involving the same property.” Sexton v. NDEX
W., LLC, 713 F.3d 533, 538 (9th Cir. 2013) (internal
quotation marks omitted). We acknowledge that it is
exceedingly rare for an appellate court to hold that a district
court abused its discretion by declining to stay federal
proceedings pursuant to Colorado River.            However,
application of the Colorado River factors, along with the
unusual circumstances of this case, compel a finding that this
is the exceptional case in which a district court’s decision
not to enter a stay constituted an abuse of discretion. We
address each factor in turn.

        A. Which court first assumed jurisdiction over
           the property at stake.

    This factor applies when both forums exercise
jurisdiction over the same property, and addresses the
concern “that the parallel proceedings will result in
inconsistent dispositions of [such property].” Seneca Ins.
Co., 862 F.3d at 842. The Supreme Court has held “that the
court first assuming jurisdiction over property may exercise
that jurisdiction to the exclusion of other courts.” Colo.
River, 424 U.S. at 818.

    We held that this Colorado River factor was
“dispositive” in 40235 Washington St. Corp. v. Lusardi,
976 F.2d 587, 589 (9th Cir. 1992) (per curiam). There, the
appellee first filed a quiet title action in state court regarding
disputed property, and the appellant then filed a quiet title
action concerning the same property in federal court, along
with a claim for declaratory relief. Id. at 588. We affirmed
              MONTANORE MINERALS V. BAKIE                     11

the district court’s decision to stay the federal proceedings
because “[a] quiet title action is a proceeding in rem,” and
“[i]n proceedings in rem or quasi in rem, the forum first
assuming custody of the property at issue has exclusive
jurisdiction to proceed.” Id. at 589. Thus, “under Colorado
River, the district court was required to stay the federal quiet
title action.” Id. (emphasis added); see also Sexton, 713 F.3d
at 538 (“[W]here there are ‘pending state court proceedings’
involving a single property, the first Colorado River factor
bars us from exercising jurisdiction over that property
. . . .”). Further, the district court was “required” to stay the
appellant’s declaratory relief claim, even though it was not
in rem or quasi in rem, because it “involve[d] the same
question” as the in rem claim, and could be resolved in state
court. Lusardi, 976 F.2d at 589.

    In this case, the first factor does not require a stay, as it
did in Lusardi, because Montanore did not bring an in rem
or quasi in rem action in state court; it sought a declaration
that the Subject Claims were invalid under state and federal
law. Cf. id. However, while we decline to apply a
categorical rule requiring a stay under the first factor in this
case, we still hold that this factor favors a stay. The state
court first obtained jurisdiction over the Subject Claims, and
the parallel proceedings presented the risk of inconsistent
dispositions of the Subject Claims. While the state court
determined that the Subject Claims were valid, in the federal
action doubts concerning claim validity permeated the
decision to award no compensation for the taking, strongly
suggesting inconsistent views of the validity of the property
in the two actions. See Part I.C infra.

        B. The inconvenience of the federal forum.

    In Colorado River, the Court noted the inconvenience of
the 300-mile distance between the state and federal court as
12            MONTANORE MINERALS V. BAKIE

a factor favoring dismissal. 424 U.S. at 820. Montanore
filed the state court action in Libby, Montana, and the federal
district court action about 200 miles away, in Missoula,
Montana. On appeal, Defendants argue that this factor
favors a stay, but in their district court brief they
acknowledged that “neither forum has a significant
advantage as to convenience.” Accordingly, we treat this
factor as neutral in our analysis. Accord Madonna, 914 F.2d
at 1368 (“Although 200 miles is a fair distance, it is not
sufficiently great that this factor points toward abstention.
The district court did not err in finding this factor
‘unhelpful.’”).

       C. The desire to avoid piecemeal litigation.

    “Piecemeal litigation occurs when different tribunals
consider the same issue, thereby duplicating efforts and
possibly reaching different results.” Am. Int’l Underwriters
(Philippines), Inc. v. Cont’l Ins. Co., 843 F.2d 1253, 1258
(9th Cir. 1988). For this factor to favor a stay, “the case must
raise a special concern about piecemeal litigation, which can
be remedied by staying or dismissing the federal
proceeding,” and which “the court could [not] have avoided
by other means.” R.R. St., 656 F.3d at 979 (internal
quotation marks and citation omitted).

     The state and federal courts in this case did not consider
precisely the same issue; the state court considered the
validity of the Subject Claims, while the federal court
considered condemnation of property interests in the Subject
Claims. However, Montanore’s decision to file two separate
actions in two different courts resulted in piecemeal
litigation of its singular goal (that is, extinguishing
Defendants’ claimed rights in the Subject Claims). It did not
promote “conservation of judicial resources and
comprehensive disposition of litigation,” Colorado River,
             MONTANORE MINERALS V. BAKIE                    13

424 U.S. at 817, to have a federal court “adjudicate rights
that [were] implicated in a vastly more comprehensive state
action.” R.R. St., 656 F.3d at 979 (internal quotation marks
omitted).

    Moreover, the validity of the Subject Claims was
considered by the Commissioners in their compensation
recommendation, resulting in duplication of efforts.
Although the district court instructed the Commissioners
that “[f]inal determination of the validity of Defendants’
unpatented mining claims [was] not before [the federal]
court,” and would “be determined in a separate, state court
action,” the district court also instructed the Commissioners
to consider any evidence regarding the validity of the
Subject Claims “for its bearing on the issue of the amount of
just compensation owed to Defendants.” The district court
also acknowledged in an order issued on April 29, 2014, that
the validity of the Defendants’ claimed interests was relevant
to the question of just compensation.

    In their report, which was adopted by the district court in
its entirety, the Commissioners listed as two of the five
reasons supporting the determination that no compensation
was owed (1) that “questions exist as to the validity and even
the location of the Subject Claims,” and (2) “the validity of
the Subject Claims is subject to a state district court
proceeding.” Although this case does not involve different
tribunals ruling on precisely the same issue, the validity of
the claims was crucial in both proceedings, and both courts
considered the issue and reached arguably conflicting
results. Thus, this factor favors a stay.
14            MONTANORE MINERALS V. BAKIE

       D. The order in which the forums obtained
          jurisdiction.

    “We next consider the order in which the forums gained
jurisdiction.” R.R. St., 656 F.3d at 980. We do not apply
this factor mechanically, but instead consider “the realities
of the case at hand” “in a pragmatic, flexible manner.”
Moses H. Cone, 460 U.S. at 21. We consider not only the
order, but also the relative progress of the state and federal
proceedings. Am. Int’l Underwriters, 843 F.2d at 1257.

     This factor strongly favors a stay. When Montanore filed
its action in federal court in June 2013, it had already been
litigating the state case for six years. The parties had
conducted extensive discovery, filed cross-motions for
summary judgment, and the state court had issued an order
deciding several issues in the case in March 2013. Since
then, the Montana Supreme Court has decided two
interlocutory appeals taken in the state case. Thus, not only
did the state court obtain jurisdiction long before the federal
court, but the state court proceedings had progressed
significantly. Montanore “should . . . . be bound by its initial
choice of the state forum, given the substantial progress that
has occurred in the state court litigation.” Id. at 1259.

       E. Whether federal law or state law provides the
          rule of decision on the merits.

    The fact that state law provides the rule of decision on
the merits in a case may favor a stay, but “only when the
state law questions are themselves complex and difficult
issues better resolved by a state court; it is not enough that a
state law case is complex because it involves numerous
parties or claims.” Seneca Ins. Co., 862 F.3d at 844.
              MONTANORE MINERALS V. BAKIE                     15

    Montana eminent domain law provided the rule of
decision on the merits in the federal action. The case
presents “rare circumstances” where “the presence of state-
law issues . . . . weigh[s] in favor of [a stay]” because the
legal issues involved go beyond what we have identified as
routine state law issues (e.g., breach of contract,
indemnification and subrogation, misrepresentation, and
breach of fiduciary duty). R.R. St., 656 F.3d at 980 (internal
quotation marks omitted); see also Madonna, 914 F.2d at
1370. The condemnation action raises difficult questions
regarding Defendants’ statutory right to appeal a
compensation determination to a jury pursuant to MCA
§ 70-30-304(1), the elements of a taking for public use under
MCA § 70-30-111(1), and the proper method to determine
just compensation for interests in unpatented mining claims.
The state court is in a better position to address these issues
than is the federal court. See Seneca Ins. Co., 862 F.3d at
844.

        F. Whether the state court proceedings can
           adequately protect the rights of the federal
           litigants.

   This factor concerns “whether the state court might be
unable to enforce federal rights.” Id. at 845. If the state court
“cannot adequately protect the rights of the federal litigants,”
a Colorado River stay is inappropriate. R.R. St., 656 F.3d at
981. When it is clear “that the state court has authority to
address the rights and remedies at issue” this factor may
weigh in favor of a stay. Id. “[H]owever, this factor is more
important when it weighs [against a stay].” Id. (internal
quotation marks omitted).

    There is no doubt that Montana state courts have the
authority to hear condemnation actions brought under
Montana law. See, e.g., Park Cty. ex rel. Paradise & Shields
16           MONTANORE MINERALS V. BAKIE

Valley TV Dists. v. Adams, 100 P.3d 640 (Mont. 2004).
Moreover, Montanore does not claim that the state court
would lack jurisdiction over a condemnation action, or lack
the power to enter any orders to protect its rights. Cf. Moses
H. Cone, 460 U.S. at 26; Holder, 305 F.3d at 869 n.5.
Montanore instead argues that the state court cannot
adequately protect its rights because the state court refused
to consider an alleged “Federal Land Policy Management
Act defect” (federal defect) when considering the validity of
the Subject Claims. However, there is no reason to believe
that Montanore could not have properly raised this argument
in state court. The state court refused to consider the
argument because although it was based on Defendants’
alleged failure to make a filing and pay a fee in 2005,
Montanore did not raise the argument in state court until
2016, nine years after Montanore initiated suit on claim
validity, and three years after the state court held that the
Subject Claims were valid.

    Before the state court declined to consider the claimed
federal defect in 2016, the district court also refused to
consider the claim, and we affirm the district court’s
decision. See Part II, infra. Thus, we cannot agree that the
state court could not adequately protect Montanore’s federal
rights because it refused to consider a late-raised argument
that was properly denied in federal court. This factor favors
a stay.

       G. The desire to avoid forum shopping.

    We next ask whether Montanore attempted to forum
shop by filing in federal court. Nakash v. Marciano,
882 F.2d 1411, 1417 (9th Cir. 1989). If Montanore “pursued
suit in a new forum after facing setbacks in the original
proceeding,” this factor may weigh in favor of a stay. Seneca
Ins. Co., 862 F.3d at 846. In Nakash, for example, this factor
              MONTANORE MINERALS V. BAKIE                    17

strongly weighed in favor of a stay when, after litigating for
three and a half years in state court, the plaintiffs
“[a]pparently . . . . [became] dissatisfied with the state court
and [sought] a new forum for their claims” by filing in
federal court. 882 F.2d at 1417.

     This case goes further than Nakash. After six years of
litigation, Montanore filed in federal court a few months
after it received an unfavorable decision in state court.
Although it did not bring the exact same claim in federal
court, the federal proceeding was aimed at the same goal.
We can reasonably infer that Montanore was seeking to
avoid the state court judge whose rulings it repeatedly
characterized as wrong in its appellate briefing, and whom it
unsuccessfully sought to have removed from the case under
Montana law. This factor therefore favors a stay.

       H. Whether the state court proceedings will
          resolve all issues before the federal court.

    Finally, we consider “whether the state court proceeding
sufficiently parallels the federal proceeding” in order “to
ensure ‘comprehensive disposition of litigation.’” R.R. St.,
656 F.3d at 982 (quoting Colo. River, 424 U.S. at 817).
“[T]he existence of a substantial doubt as to whether the state
proceedings will resolve the federal action precludes the
granting of a stay.” Intel Corp. v. Advanced Micro Devices,
Inc., 12 F.3d 908, 913 (9th Cir. 1993).

     We do not require “exact parallelism” under this factor;
it is sufficient if the proceedings are “substantially similar.”
Nakash, 882 F.2d at 1416. In Nakash, for example, the suits
were sufficiently parallel because they concerned the same
relevant conduct and named the same pertinent parties. Id.
at 1416‒17. The parallelism requirement was met even
though additional parties were named in the state suit, the
18           MONTANORE MINERALS V. BAKIE

federal suit included additional claims, and the suits
arguably focused on different aspects of the dispute. Id.

     The district court in this case made its Colorado River
determination on this factor alone. It held that parallelism
did not exist because “there [was] no parallel state court
proceeding adjudicating the merits of a condemnation order
with respect to the easements and rights of way at issue.”
We do not require such “exact parallelism.” Nakash,
882 F.2d at 1416. Moreover, we are “particularly reluctant
to find that the actions are not parallel when the federal
action is but a ‘spin-off’ of more comprehensive state
litigation.” Id. at 1417. The state and federal proceedings
are substantially similar because they both concern rights to
the Subject Claims, name the same pertinent parties, and
attempt to accomplish the same goal (namely, extinguishing
the Defendants’ rights to the Subject Claims). The state
court could have resolved all issues before the federal court,
and judicial resources would have been saved and
duplicative litigation prevented, if Montanore had continued
with its initial choice of the state forum.

    We are confident that the state court, which has had
jurisdiction over this dispute since 2007, will resolve all of
the claims properly raised in that court. However, we direct
the district court to enter a stay, rather than a dismissal, so
“that the federal forum will remain open if for some
unexpected reason the state forum . . . . turn[s] out to be
inadequate.” Attwood, 886 F.2d at 243 (internal quotation
marks omitted).

       I. The balancing of the Colorado River factors.

    On balance, the Colorado River factors strongly counsel
in favor of a stay. The state court first assumed jurisdiction
over the Subject Claims; proceeding with the federal case
                MONTANORE MINERALS V. BAKIE                             19

presented a risk of piecemeal litigation; the state court had
jurisdiction over the case for several years, and had made
substantial progress, by the time the federal proceeding was
filed; state law provides the rule of decision on the merits,
and the case presents complex state law questions better
addressed by the state court; the state court can adequately
protect the federal rights at issue; Montanore’s actions
strongly suggest that it was forum shopping by filing in
federal court; and the suits are sufficiently parallel for
Colorado River to apply. 3

    Under the unusual circumstances of this case, we not
only hold that Colorado River clearly applies, but also that
the district court abused its discretion when it declined to
stay the case. As we explained in Lusardi, when the
Colorado River doctrine may apply to a case, we avoid
engaging in different analyses for related claims in a single
action, because such an approach “would increase, not
decrease, the likelihood of piecemeal adjudication or
duplicative litigation,” undermining the Colorado River
doctrine. 976 F.2d at 589.

    As part of the condemnation action, Montanore moved
for the federal court to determine the validity of the Subject
Claims. The district court applied Colorado River to that
motion only, noting that the pending state court proceeding
concerned the exact same issue. However, claim validity
could not so easily be separated from the condemnation
action, as evidenced by the reasons the Commissioners gave
for their recommendation of no compensation, and the
district court’s instruction that claim validity was relevant to
the compensation question. It was an abuse of discretion to

     3
       The only factor that is neutral in our analysis is the “inconvenience
of the federal forum” factor.
20              MONTANORE MINERALS V. BAKIE

decline jurisdiction over one aspect of the case, rather than
the entire case, when that aspect was relevant to the case as
a whole.

II. The district court did not abuse its discretion by
    dismissing Montanore’s motion to determine the
    validity of the Subject Claims.

    Montanore cross-appeals the district court’s decision,
pursuant to Colorado River, to decline to consider
Montanore’s motion to determine the validity of the Subject
Claims. The motion was filed as part of the condemnation
action, and, for the reasons already discussed, we conclude
that the district court should have declined to exercise
jurisdiction over the entire condemnation action. Thus, the
district court did not abuse its discretion by dismissing the
motion. 4

                          CONCLUSION

    We REVERSE the district court’s condemnation order
and REMAND for the district court to stay the federal
proceedings. On cross-appeal, we AFFIRM the district
court’s dismissal of Montanore’s motion to determine claim
validity.

     4
      While “[w]e generally require a stay rather than a dismissal” under
Colorado River, “we do not consider this issue because [Montanore] did
not raise it on appeal.” R.R. Street, 656 F.3d at 978 n.8.