Sheffield Insurance v. River Products, Inc.
Sheffield Insurance v. River Products, Inc.
Opinion of the Court
ORDER AND REASONS
Before the Court is defendants River Products, Inc., Magnolia Holdings, Inc., and Maintenance Dredging, Inc.’s motion to stay proceedings. For the following reasons, the defendants’ motion to stay proceedings pending the resolution of the state court matter entitled Terry Jude Lalonde v. Maintenance Dredging, Inc. (Docket No. 35105 “C”) is GRANTED.
BACKGROUND
This action for declaratory judgment filed by the plaintiff, Sheffield Insurance Corporation (Sheffield), arises out of an injury allegedly sustained by Terry J. Lalonde on or about January 6, 1995.
On April 8, 1996, Mr. Lalonde filed a lawsuit in the 40th Judicial District Court, State of Louisiana against Maintenance Dredging alleging various claims under the general maritime law of unseaworthiness, for maintenance and cure and Jones Act negligence.
ANALYSIS
The Declaratory Judgment Act is a procedural mechanism designed to provide parties a new remedy in federal court, however, it does not act to confer jurisdiction. Days Inns of America, Inc. v. Reno, 935 F.Supp. 874, 877 (W.D.Tex. 1996). A court need not provide a party with declaratory judgment relief on request “as this is a matter left to the district court’s sound discretion.” Odeco Oil & Gas Co., Drilling Div. v. Bonnette, 4 F.3d 401, 404 (5th Cir.), reh’g denied, 9 F.3d 105 (5th Cir. 1993), cert. denied, 511 U.S. 1004, 114 S.Ct. 1370, 128 L.Ed.2d 47 (1994).
The Declaratory Judgment Act provides that “in a case of actual controversy within its jurisdiction, ... any court of the United States, ..., may declare the rights and other legal relations of any interested party seeking such a declaration____” 28 U.S.C. § 2201(a). Since its inception, the Act “has been understood to confer on federal courts unique and substantial discretion in deciding whether to declare the rights of litigants.” Wilton v. Seven Falls Co., 515 U.S. 2137, -, 115 S.Ct. 2137, 2142, 132 L.Ed.2d 214 (1995). In exercising its discretion, a district court is authorized to stay or to dismiss an action seeking declaratory judgment. Id. When the basis for declining to proceed is the pendency of a state court proceeding, as is the case here, a stay is often the preferable course. Id. at-, n. 2, 115 S.Ct. at 2143, n. 2.
Although the district court’s discretion is broad, it is not unfettered. Courts may not dismiss requests “for declaratory judgment relief on the basis of whim or personal disinclination.’ ” Rowan Cos., Inc. v. Griffin, 876 F.2d 26, 28-29 (5th Cir. 1989) (quoting Hollis v. Itawamba County Loans, 657 F.2d 746, 750 (5th Cir. 1981)). The Fifth Circuit has set out several factors which the district court must consider when deciding whether to hear a declaratory judgment action, which include, but are not limited to, 1) whether there is a pending state action in which all of the matters in controversy may be fully litigated, 2) whether the plaintiff filed suit in anticipation of a lawsuit filed by the defendant, 3) whether the plaintiff engaged in forum shopping in bringing the suit, 4) whether possible inequities in allowing the declaratory plaintiff to gain precedence in time or to change forums exist, 5) whether the federal court is a convenient forum for the parties and witnesses, and 6) whether retaining the lawsuit in federal court would serve the purposes of judicial economy. Travelers Ins. Co. v. Louisiana Farm Bureau Federation, Inc., 996 F.2d 774, 778 (5th Cir. 1993). The Supreme Court has recently simplified ■ the above test by stating that whether the district court should exercise its discretion comes down to considerations of practicality and wise judicial administration. Wilton, 515 U.S. at-, 115 S.Ct. at 2143.
In Wilton v. Seven Falls Company, supra, the Supreme Court affirmed a Fifth Circuit decision upholding a district court’s ruling to stay a declaratory judgment action pending the resolution of a later-filed state court suit. The Wilton court found that the issuance of such a stay was not an abuse of the trial court’s discretion. Additionally, this Court has held previously that the existence of a properly filed Jones Act case in state court, absent bad faith, requires dismissal of a declaratory judgment act which arises out of the same set of facts. Belle Pass Towing Corp. v. Cheramie, 763 F.Supp. 1348, 1355 (E.D.La. 1991); See also Great Lakes Dredge
After a review of the law and facts surrounding the above captioned matter, this Court, in the exercise of its discretion, finds that this declaratory judgment action should be stayed pending the resolution of the state court matter. First, the pending action in state court can fully resolve all of the issues between the parties since Sheffield is now a party to that litigation.
In summary, considerations of practicality and wise judicial administration necessitate staying this matter pending a resolution of the pending state court case.
CONCLUSION
For the foregoing reasons, IT IS HEREBY ORDERED that the defendants’ motion is GRANTED and that this action is STAYED for administrative purposes pending the resolution of the state court matter. It is further ordered that the clerk close this case for statistical purposes.
. Mr. Lalonde is not a party to this litigation.
. Maintenance Drilling, Inc. was the only named defendant in the original petition.
Mr. Lalonde’s state court suit was filed pursuant to the "Savings to Suitors” Clause of 28 U.S.C. § 1333.
. Mr. Lalonde's state court petition was first amended to add Polaris Insurance Company who is not a party to this matter.
. The instant matter was filed on June 28, 1996.
. The fact that Sheffield has yet to answer the state court suit is of no moment. The petition asserting a claim against Sheffield has been filed and acknowledged by Sheffield and is properly considered as a factor by this Court. See also Defendants' Exhibit Affidavit of Mr. Lalonde's Attorney.
Reference
- Full Case Name
- SHEFFIELD INSURANCE CORPORATION v. RIVER PRODUCTS, INC.
- Cited By
- 1 case
- Status
- Published