Court Opinion

ID: 2961462
Source: CourtListenerOpinion
Date Created: 2015-09-21 20:43:38.477155+00
Date Added: 2024-06-11T15:00:34.536527
License: Public Domain

USCA1 Opinion

	

          August 7, 1992                                [NOT FOR PUBLICATION]                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ____________________        No. 92-1083                           GREAT AMERICAN INSURANCE COMPANY                    AND AMERICAN NATIONAL FIRE INSURANCE COMPANY,                               Plaintiffs, Appellants,                                          v.                            PRECISION PRODUCTS CORPORATION                              AND NORTHROP CORPORATION,                                Defendants, Appellees.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF MASSACHUSETTS                     [Hon. Robert E. Keeton, U.S. District Judge]                                             ___________________                                 ____________________                                        Before                                 Selya, Circuit Judge,                                        _____________                             Lay,* Senior Circuit Judge,                                   ____________________                            and Pieras,** District Judge.                                          ______________                                 ____________________            Seymour Kagan with whom Herzfeld &  Rubin, Thomas E. Peisch,  Mary            _____________           _________________  ________________   ____        Elizabeth Van Dyck  and Conn,  Kavanaugh, Rosenthal &  Peisch were  on        __________________      _____________________________________        brief for appellants.            Kirk A. Pasich with whom Mary K. Barnes,  Wendy I. Kirchick, Hill,            ______________           ______________   _________________  _____        Wynne,  Troop &  Meisinger, James  Dillon,  Susan Insoft  and Goodwin,        __________________________  _____________   ____________      ________        Procter & Hoar were on brief for appellee, Northrop Corporation.        ______________                                 ____________________                                 ____________________        _____________________        *  Of the Eighth Circuit, sitting by designation.        ** Of the District of Puerto Rico, sitting by designation.                    Per  Curiam:     Great American  Insurance Company  and                    ___________             American National Fire Insurance Company appeal from the  order             of the district  court1 dismissing  their action in that  court             under  Colorado  River  Water Conservation  District  v. United                    ________________________________________________________             States,  424  U.S.  800  (1976),  based  on  the  existence  of             ______             parallel proceedings in a California court.   We affirm on  the             basis  of  the  district  court's  thorough  and  well-reasoned             opinion.                    Northrop   Corporation   (Northrop)   filed   suit   in             California in  January of  1989  claiming that  several of  its             insurers failed  to  acknowledge coverage  of property  damages             sought  in  certain environmental  litigation  brought  against             Northrop.  In July  of 1991, Great  American Insurance  Company             and  American National  Fire Insurance  Company, who  were  not             originally   named   as  parties   in   Northrop's   California             litigation,  filed this action in the federal district court in             Massachusetts  seeking  a declaratory  judgment that  they were             not  obligated   to  defend  or   indemnify  Northrop  in   the             environmental  claims  against  it;  in  addition  they  sought             damages    for   fraudulent    misrepresentation,    fraudulent             concealment, and negligent misrepresentation.2                                              ____________________             1The Honorable Robert  E. Keeton, United States District  Judge             for the District of Massachusetts.             2Plaintiffs urge  that the Colorado  River doctrine should  not                                        _______________             be  applied because  of the  joinder  of the  dissimilar  fraud             claims filed  in the federal court.   Cf.  McLaughlin v. United                                                   ___  ____________________             Virginia Bank,  955 F.2d  930 (4th  Cir. 1992).   We note  that             _____________             these claims arose  out of the California litigation  involving             acts,  witnesses and lawyers all located in  California.  Judge                                          -2-                       In August of 1991, Northrop amended its complaint  in             the California action to add Great American, American  National             and twelve  other insurance carriers  as defendants.   Northrop             also filed a motion seeking dismissal  of the pending action in             Massachusetts under the  Colorado River doctrine, asserting the                                      ______________             need  for deference to  parallel state  proceedings.   After an             analysis of  the relevant  factors as  established in  Colorado                                                                    ________             River   and  subsequent   Supreme  Court   and  First   Circuit             _____             precedents, the  district court  declined federal  jurisdiction             and  granted Northrop's motion.   On  appeal, the two insurance             companies challenge  the district court's  order dismissing its             action as an abuse  of discretion.  We affirm the order of  the             district court.                                              ____________________             Keeton  acknowledged  the  fact  that there  were  non-coverage             claims but observed:                    This brings me to one final difficulty regarding  the               ultimate disposition  of the  claims  made by  plaintiffs.               Although  this question  has  not been  addressed  in  the               precedents,  I  conclude  that  since  it  is  within   my               discretion to  dismiss  plaintiffs' coverage  claim it  is               within my discretion to dismiss the  entire action.  In so               deciding,  however, I  recognize  that a  different answer               might have  been reached  if plaintiffs'  tort claims  had               been brought  independently.   Plaintiffs  did not  choose               that course,  however, and it  would be inappropriate  for               me to retain jurisdiction over the  tort claims only on an               assumption, unsupported by  the record, that a choice  for               that version of piecemeal litigation has been  or would be               manifested.   I  conclude  that dismissal  of  the  entire               claim  is appropriate.    If plaintiffs  wish  to  contend               otherwise, they  may  file  an  appropriate  post-judgment               motion within the time allowed by law.             We  find no  abuse of  discretion in Judge  Keeton's dismissal.             The  overall claims  relate  to the  basic dispute  relating to             coverage  which  is  the  basis  of  the  declaratory  judgment             action.                                          -3-                    The district court addressed each of the Colorado River                                                             ______________             factors,  as  well  as  those  established  in  Moses  H.  Cone                                                             _______________             Memorial Hospital  v. Mercury  Construction Corp.,  460 U.S.  1             _________________________________________________             (1983), and Villa Marina  Yacht Sales v.  Hatteras Yachts,  947                         _____________________________________________             F.2d  529  (1st  Cir.  1991),  cert. denied,  112  S. Ct.  1674                                            ____________             (1992).   Under  the Colorado  River doctrine,  federal  courts                                  _______________             must consider: (1)  whether either  court assumed  jurisdiction             over  a res; (2)  the inconvenience  of the  federal forum; (3)                     ___             the  desirability of  avoiding  piecemeal litigation;  (4)  the             order in  which the forums  obtained jurisdiction; (5)  whether             state or  federal law controls; (6)  the adequacy  of the state             forum to protect the parties' rights;  and (7) the vexatious or             reactive nature of the federal lawsuit.                    The district  court noted the irrelevancy  of the first             factor and  determined that  with the  exception  of the  third             factor, application  of the remaining  factors tilted  slightly             in  Northrop's  favor  but  not   so  strongly  as  to  mandate             dismissal.    See Moses  H.  Cone,  460  U.S.  at 16  (relevant                           ___ _______________             factors  to be  heavily weighed  in  favor  of the  exercise of             jurisdiction); Villa  Marina, 947  F.2d at 532.   The  district                            _____________             court's decision to  dismiss, however, was based on its concern             about the third factor, the desirability of avoiding  piecemeal             litigation.                      The district  court determined  the present case  to be             "on all fours" with the facts  of Liberty Mutual Insurance  Co.                                               _____________________________             v. Foremost-McKesson, Inc., 751 F.2d 475  (1st Cir. 1985).   In             __________________________                                          -4-             McKesson,  a DES manufacturer  brought suit  against all of its             ________             insurers in  California state court while  one of its  insurers             brought   suit   in   Massachusetts   federal   court   seeking             declaratory judgment  as to  its rights  and obligations  under             its insurance  policies.  We affirmed the district court's stay             of the federal proceedings, stating that                [h]ere,  as in Colorado River,  piecemeal litigation could                              ______________               severely prejudice the rights of one  of the parties.   If               the   federal   and  state   actions   were   to   proceed               concurrently, there is  the real possibility that the  two               courts might interpret  the same standard policy  language               differently,  with the  result  that  McKesson would  find               itself  without  sufficient liability  insurance  coverage               from the insurers . . . .                    The California action, which was commenced first,  is               the  more comprehensive of  the two.   It  involves all of               McKesson's  insurers and  all of  the products  for  which               McKesson faces potential liability.   California therefore               is  the  logical  forum  for  the  determination  of   the               respective rights  and  obligations  of  the  parties  and               serves to further the interest of judicial economy.             Id. at 477 (citations omitted).   Moreover, as in McKesson, the             ___                                               ________             action here raises  no federal issues  and "no federal interest             would be served by retaining jurisdiction  over the case."  Id.                                                                         ___                    We concur  with the district court's  analysis and find             no abuse of discretion.                      Judgment affirmed.                    __________________                                          -5-