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Granite State Insurance Co. v. Songer Steel Services Inc.

United States District Court, E.D. Michigan, Southern Division

November 7, 2016




         On September 23, 2016 Plaintiff Granite State Insurance Co. filed a “Request to Lift Stay and Motion to Remand to State Court Pursuant to the Colorado River Abstention Doctrine.” (Dkt. # 8.) Plaintiff's motion requests remand or, in the alternative, that the court continue the stay and grant Plaintiff leave to file a motion to intervene in the related state court action. The matter has been fully briefed and a hearing is unnecessary. See E.D. Mich. LR 7.1(e)(2). For the reasons set forth below, the court will deny Plaintiff's motion.

         I. BACKGROUND

         The following facts are undisputed unless otherwise noted. Plaintiff brings this action as subrogee of its insured, Connelly Crane Rental Co. Connelly rented a crawler crane to U.S. Steel Corp. For use at U.S. Steel's Ecorse, Michigan facility in or around early April, 2014. (Dkt. # 9, Pg. ID 68.) U.S. Steel hired Defendant Songer Steel Services, Inc. to assist with the crane's operation to remove collapsed ductwork at the U.S. Steel facility. In the early morning of April 4, 2014, the crane tipped over, killing the operator. (Dkt. # 1-2, Pg. ID 11-12.)

         On May 29, 2015 the decedent crane operator's estate filed a wrongful death action in Wayne County Circuit Court against, among other parties, Defendant Songer and U.S. Steel. (Dkt. # 8, Pg. ID 55.) That state court proceeding has grown to include issues surrounding the collapsed ductwork and several defendants unrelated to the tip over. (Id.) On October 27, 2015 Plaintiff filed the present action related to the damage to the crane in Wayne County Circuit Court, (Dkt. # 1-1) and Defendant removed the action to this court on the basis of diversity jurisdiction on November 24, 2015. (Dkt. # 1.)

         An agreement reached by the parties to this case and the parties in the related state court proceeding allowed Plaintiff reasonable, but limited, participation in discovery and a potential global settlement. This court in turn stayed and administratively closed the present action in its Order entered March 18, 2016. (Dkt. # 7.) Since that time, the parties to the state court proceeding, with some participation from Plaintiff, have conducted dozens of depositions and have nearly completed a mediation process that Plaintiff anticipates will be unsuccessful. (Dkt. # 8, Pg. ID 59-60.) The state court proceeding was scheduled for a status conference on October 31, 2016. (Dkt. # 9.)

         Plaintiff has stated its intent to file a motion to intervene at the October 31 status conference pursuant to a stipulated order in the state court proceeding. (Dkt. # 10, Pg. ID 88.) Rekated to this intent, the parties assert here that Plaintiff “may not seek the state court's permission to intervene when it currently has the exact same cause of action pending” in this court. (Dkt. # 9, Pg. ID 71.) Accordingly, Plaintiff filed the instant motion, asking this court to lift the stay and remand the proceeding based on Colorado River Water Conservation Dist. V. U.S., 424 U.S. 800 (1976) or, in the alternative, continue the stay “with authority to file an intervention pleading in state court.” (Dkt. # 8, Pg. ID 54.) The court has no interest in interfering with Plaintiff's intended state court filings, but is not persuaded as to the predicates of the motion as presently stated.


         In Colorado River, the Supreme Court held that federal courts may abstain from hearing a case solely because similar pending state court litigation exists. Colorado River, 424 U.S. at 817; Romine v. Compuserve Inc., 160 F.3d 337, 339 (6th Cir. 1998). “[D]espite the ‘virtually unflagging obligation of the federal courts to exercise the jurisdiction given them, ' . . . considerations of judicial economy and federal-state comity may justify abstention in situations involving the contemporaneous exercise of jurisdiction by state and federal courts.” Romine, 160 F.3d at 339 (quoting Colorado River, 424 U.S. at 817).

         At the outset, the court notes that it lacks the ability to remand this action based on abstention doctrine. See Quackenbush v. Allstate Ins. Co. 517 U.S. 706, 719-20 (1996) (holding that federal courts do not have the power to remand cases based on abstention principles in common-law actions for damages). The Fifth Circuit has succinctly addressed this issue:

It is clear, though, that remand is not an option. In addition to being unsupported by any authority in the removal statute or elsewhere, it is simply illogical. Where a court has already determined under the Colorado River analysis that an existing state court case “will be an adequate vehicle for the complete and prompt resolution of the issues between the parties, ” [Moses H. Cone Memorial Hosp. V. Mercury Constr. Corp., 460 U.S. 1, 28 (1983)] no purpose is served by sending the federal case back to state court to litigate the same issues.

Saucier v. Aviva Life & Annuity Co., 701 F.3d 458, 465-66 (5th Cir. 2012). The parties agree, but do not explain how application of Colorado River abstention would authorize the court to remand the case as Plaintiff requests; the widely recognized alternative is simply to continue the stay. See Bates v. Van Buren Twp., 122 F. App'x. 803, 809 (6th Cir. 2004) (“We therefore join other circuits in requiring a stay of proceedings rather than a dismissal in Colorado River abstention cases.”) Plaintiff's request for remand must be denied.

         Further, an analysis of Colorado River abstention principles demonstrates that it would be inappropriate here. In deciding whether abstention under Colorado River would be appropriate, courts must first determine whether the proceedings are “parallel.” Romine, 160 F.3d at 339. If the proceedings are parallel, the court then considers the following factors: (1) whether the state court has assumed over any res or property; (2) whether the federal forum is less convenient to the parties; (3) avoidance of piecemeal litigation; (4) the order in which jurisdiction was obtained; (5) whether the source of governing law is state or federal; (6) the adequacy of the state court action to protect the federal plaintiff's rights; (7) the relative progress of the state and federal proceedings; and (8) the presence or absence of concurrent jurisdiction. Id. at 340-41. These factors “do not comprise a mechanical checklist. Rather, they require ‘a careful balancing of the important factors as they apply in a give[n] case' depending on the particular facts at hand. Id. at 341 (quoting Moses H. Cone, 460 U.S. at 15-16).

         To be “parallel, ” the proceedings must be “substantially similar.” Id. at 340. Other circuits consider whether there is an identity of parties and whether the issues and relief sought are the same in both proceedings. Nat'l Union Fire Ins. Co. of Pittsburgh v. Karp, 108 F.3d 17, 22 (2nd Cir. 1997). Here, the state court proceeding is vastly more complex, involves an accident entirely different from the crane tip over, and does not raise the issue of property damage to the crane. (Dkt. # 9, Pg. ID 78-79.) These issues are not ...

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