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Agcs Marine Insurance Company v. American Truck & Trailer Body Company

January 8, 2013



Defendant American Truck and Trailer Body Company (ATTB) has filed a motion to dismiss or stay this action; plaintiff AGCS Marine Insurance Company (AGCS) has opposed and plaintiff has filed a reply. The court ordered the motion submitted without argument and now DENIES the motion.


On October 28, 2011 plaintiff AGCS filed a complaint in the Fresno division of this court, invoking the court's diversity jurisdiction and alleging that defendant ATTB entered into an agreement to modify a 2011 Freightliner; that it stored the Freightliner too close to the adjoining property, in violation of municipal codes governing the storage of combustible material; that the adjoining property stored large quantities of boxes and other combustible materials, also in violation of municipal code; that the Freightliner was destroyed by fire; and that AGCS insured the owner of the Freightliner. The complaint contains five causes of action:

(1) non-return of personal property; (2) negligence/willful misconduct; (3) breach of implied contract; (4) breach of bailment; and (5) breach of warranty.

At the scheduling conference held on February 28, 2012, the Fresno Magistrate Judge assigned at the time directed the parties to meet and confer about "having the matter (and related state matters) litigated in the San Joaquin County State Court or, if no agreement can be reached, having the matter transferred to the Sacramento Division . . . which is the proper venue if the matter is to remain in district court." (ECF Nos. 14, 15.) In a status report filed April 12, 2012, the parties noted their continued disagreement about transfer or dismissal. (ECF No. 17.) The Magistrate Judge then transferred the case to the Sacramento division on April 20, 2012. (ECF No. 18.)

Defendant filed the instant motion on November 9, 2012, arguing that the instant case should be stayed or dismissed in light of a case filed in San Joaquin County Superior Court American Truck v. Taylor Farms, Case No. 39-2011-00270180 CU-PO-STK; this case was filed in September 2011, stemming from the fire that started on the Taylor Farms property adjacent to ATTB's property. It asks the court to take judicial notice of a complaint from the San Joaquin County Superior Court action.

A court may take judicial notice "'of proceedings in other courts, both within and without the federal judicial system, if those proceedings have a direct relation to the matters at issue.'" United States v. Black, 482 F.3d 1035, 1041 (9th Cir. 2007) (quoting United States ex. rel. Robinson Rancheria Citizens Council v. Borneo, Inc., 971 F.2d 244, 248 (9th Cir. 1992)). Because the state court records here are essential to the resolution of the pending motion, the court will take judicial notice of them. They show that on September 28, 2011, ATTB filed suit against Taylor Farms Pacific, Inc. in San Joaquin County Superior Court, alleging that ATTB's property is adjacent to that of Taylor Farms; that Taylor Farms stored plastic bins and boxes in a parking lot that adjoined ATTB's premises; that Taylor Farms did not have a permit for storing the bins and did not store them in compliance with state and municipal fire codes; that Taylor Farms failed to maintain clear space around the bins or enclose them in a suitable fence; that Taylor Farms stored the bins within ten feet of the property line; that on September 10, 2010, a fire started on Taylor Farms' property and spread to ATTB's premises, where it damaged property stored there, including truck chassis. (ECF No. 27-2 at 13-27.) The complaint includes five causes of action: (1) negligence; (2) liability under California Health & Safety Code §§ 13007 & 13008; (3) negligence per se; (4) trespass; and (5) nuisance.

In response, plaintiff's counsel avers that he filed an action in Alameda County because its insured, Golden State, is based in Alameda County and had a contract with ATTB, but he eventually dismissed rather than litigate over the proper venue for the breach of an electronically signed contract. (Declaration of Dennis A. Cammarano ¶ 4, ECF No. 28-1.) He then filed the instant complaint in federal court. Id. He has also asked the court to take judicial notice of the docket of ATTB's action in San Joaquin County Superior Court; the court grants this request as well.


The first to file rule is not one of the enumerated bases for dismissal in Rule 12 of the Federal Rules of Civil Procedure. Some courts have considered a motion based on primacy of filing to be a motion to dismiss for lack of subject matter jurisdiction under Rule 12(b)(1) or for improper venue under Rule 12(b)(3). Ervin v. Kelly, No. C10--5145 BHS, 2010 WL 2985675 (W.D. Wash. Jul. 23, 2010); E-Z-Em, Inc. v. Mallinckrodt, Civil Action No. 2--09--cv--124, 2010 WL 1378820 (E.D. Tex. Feb. 26, 2010). Other courts have found such a motion to be outside the ambit of Rule 12(b) motions. Fujitsu Ltd. v. Nanya Techn. Corp., No. C 06-6613 CW, 2007 WL 484789 at *5 (N.D. Cal. Feb. 9, 2007). The Ninth Circuit has said that a motion to abstain pending resolution of a state court action does not "seek relief provided under Rule 12(b)." Aetna Life Ins. Co. v. Alla Med. Servs., Inc., 855 F.2d 1470, 1475 (9th Cir. 1988); Manna v. Greenburgh No. 11 Sch. Dist., 2 F. Supp. 2d 461, 463 n.1 (S.D.N.Y. 1998) (declining to treat abstention motion as one brought under Rule 12(b)). Because the motion is not one to dismiss under Rule 12(b)(6), the court may consider material outside the record. See FED.R.CIV.P. 12(d).


Defendant argues that under the "first-to-file" rule, this action should be dismissed or stayed in light of the earlier filed state court action. Plaintiff counters that the doctrine applies only when the earlier and later cases have both been filed in district court. It then argues that a stay is not appropriate by virtue of Colorado River*fn1 abstention. In reply defendant contends that a stay is appropriate even if the court applies the test for Colorado River abstention.

The court agrees with plaintiff that the first-to-file rule is not applicable here. Under that doctrine, as a matter of comity, a court has the discretion to dismiss, stay or transfer a case when a complaint involving the same or similar issues and parties has already been filed in another district. Alltrade, Inc. v. Uniweld Prods., Inc., 946 F.2d 622, 625 (9th Cir. 1991); Adoma v. University of Phoenix, 711 F. Supp. 2d 1142, 1146 (E.D. Cal. 2010). "Because 'the first to file priority presumption has evolved from and is applied in cases involving intra-federal conflicts between federal district courts of concurrent jurisdiction' in order to promote efficiency and to avoid duplicative litigation, it 'is not necessarily the guidepost for the setting here, where parallel litigation is pending in federal and state courts.'" Just Film, Inc. v. Merchant Servs, Inc., No. C 10--1993 CW, 2012 WL 10555, at *4 (N.D. Cal. Jan. 3, 2012) (quoting Newmont USA Ltd. v. Am. Home Assurance Co., No. CV--09--33--JLQ, 2009 WL 1764517, at *3 (E.D. Wash. June 21, 2009)).

Nevertheless, the existence of the state court action may provide a basis for a stay in some circumstances. In Colorado River, the Court recognized that while federal courts have a "virtually unflagging obligation [] to exercise the jurisdiction given them," abstention may be appropriate in exceptional circumstances. Colorado River, 424 U.S. at 813, 817. "Generally, as between state and federal courts, the rule is that 'the pendency of an action in the state court is no bar to proceedings concerning the same matter in the Federal court having jurisdiction . . . .'" Id. at 817 (quoting McClellan v. Carland, 217 U.S. 268, 282 (1910)). In deciding whether a stay is appropriate in the face of a parallel proceeding, courts must consider "'[wise] judicial administration, giving regard to conservation of judicial resources and comprehensive disposition of litigation.'" Id. at 817 (quoting Kerotest Mfg. Co. v. C-O-Two Fire Equip. Co., 342 U.S. 180, 183 (1952)). However, "the ...

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