Burns v. Watler

• Decision Date: 09 January 1991
• Docket Number: No. 90-1927,90-1927
• Citation: 931 F.2d 140
• Parties: William A. BURNS, et al., Plaintiffs, Appellants, v. Jamie N. WATLER, etc. Defendant, Appellee. . Heard
• Court: U.S. Court of Appeals — First Circuit

Page 140

931 F.2d 140

William A. BURNS, et al., Plaintiffs, Appellants, v. Jamie N. WATLER, etc. Defendant, Appellee.

No. 90-1927.

United States Court of Appeals First Circuit.

Heard Jan. 9, 1991.

Decided April 26, 1991.

Bennett Block, Philadelphia, Pa., for plaintiffs, appellants.

John W. McCarthy, with whom Edith A. Richardson and Rudman & Winchell, were on brief, Bangor, Me., for defendant, appellee.

Before BREYER, Chief Judge, ALDRICH and TORRUELLA, Circuit Judges.

TORRUELLA, Circuit Judge.

Injuries sustained as a result of an automobile collision prompted appellants William A. Burns and Dolores E. Burns to file a complaint against Jamie N. Watler and her parents, Karl and Nancy Watler, in the United States District Court for the District of Maine on August 8, 1989. Jurisdiction was based on the parties' diverse citizenships, as plaintiffs were citizens of the State of Pennsylvania and defendants were citizens of the State of Maine. A day later, the same plaintiffs and Mrs. Rachel Bagley, a citizen of the State of Maine, filed a virtually identical suit against the same defendants in the Maine Superior Court in Piscataquis County. Pursuant to stipulations, in February of 1990 defendants Karl and Nancy Watler were dismissed from both the federal and the state suits. On June 5, 1990, Jamie Watler moved for a stay of the proceedings in the federal court due to the pendency of the more comprehensive action in the Maine Superior Court. The United States Magistrate issued a report on August 1, 1990, in which he recommended that an order granting the stay be entered. On August 28, 1990, and over plaintiffs' objections, the district court adopted the magistrate's report. The order, in its entirety, read as follows:

[P]roceedings in this action are stayed pending further order of court, and the parties will diligently attempt to bring the pending state court action to trial as soon as possible. Counsel shall file with the clerk, not later than November 1, 1990, a written statement with respect to the then current status of the proceedings in Piscataquis County, together with an estimate of when the matter may be reached for trial. Counsel shall file a like statement with the clerk of this court at 60-day intervals thereafter. Counsel may at any time after November 1, 1990, file a motion seeking reconsideration of this order by this court.

Plaintiffs appeal from this adverse ruling. For reasons that follow, we vacate the district court's grant of a stay and remand for continuation of the proceedings.

I

At the threshold, we must dissipate any existing doubts regarding this court's jurisdiction to entertain this appeal. Appellee argues that two characteristics of the district court's order--the fact that it requires counsel to regularly file written statements pertaining to the status of the proceedings in the state court and the fact that it additionally and expressly suggests that a motion for reconsideration may be filed--denote that the federal court has contemplated such further and ongoing involvement in the proceedings as to render the order not final, and hence unappealable, under 28 U.S.C. Sec. 1291. ¹ Additionally, appellee submits that the order is not appealable under the collateral order exception to the final judgment rule recognized in Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 69 S.Ct. 1221, 93 L.Ed. 1528 (1949), because it does not "conclusively determine the disputed question." See also Coopers & Lybrand v. Livesay, 437 U.S. 463, 468, 98 S.Ct. 2454, 2458, 57 L.Ed.2d 351 (1978). This court disagrees.

We recently delineated the contours of our appellate jurisdiction over orders granting stays in the federal courts pending resolution of parallel actions in the state courts. See Rojas-Hernandez v. Puerto Rico Electric Power Authority, 925 F.2d 492, 494 (1st Cir.1991). Simply stated, such orders are immediately appealable when the res judicata effect of the state court judgment would preclude further litigation in the federal forum. Id. at 494; see also Moses H. Cone Hospital v. Mercury Construction Corp., 460 U.S. 1, 10, 103 S.Ct. 927, 933, 74 L.Ed.2d 765 (1983). We must, of course, turn to state law for the rules of decision regarding the preclusive effect to be given to a state judgment in the federal court. Migra v. Warren City School Dist. Board of Educ., 465 U.S. 75, 81, 104 S.Ct. 892, 896, 79 L.Ed.2d 56 (1984). And, under Maine law, a prior judgment bars a subsequent litigation only if: (1) the same parties or their privies were involved in both actions; (2) a valid final judgment was entered in the prior action; and (3) the matters presented for decision now were, or could have been, litigated in the prior action. See Currier v. Cyr, 570 A.2d 1205, 1208 (Me.1990); Kradoska v. Kipp, 397 A.2d 562, 565 (Me.1979).

All three of these elements are clearly met in the case at bar. We initially note that both plaintiffs in the federal action, and the same defendant, are parties to the state litigation. Consideration of whether "a valid judgment was entered in the prior action" begs the question, since the reasonable certainty that such will actually be the case is precisely what has moved the federal plaintiffs to object to the district court's granting of the stay. Finally, since the complaint filed in the state court action is virtually identical to the federal complaint and both cases present a straightforward application of state law issues, we must presume that all matters that will be litigated in the one would, in fact, be litigated in the other. Hence, this appeal is properly before our court.

The cases cited by appellee do not warrant a different result. Contrary to her contention, the fact that the order requires periodical reports on the progress of the proceedings in the state court and invites reconsideration does not make it "inherently tentative" so as to fall within the purview of Gulfstream Aerospace Corp. v. Mayacamas Corp., 485 U.S. 271, 108 S.Ct. 1133, 99 L.Ed.2d 296 (1988). There, the Supreme Court held that an order denying, rather than granting, a stay was "inherently tentative," and hence unappealable, because it is generally "not made with the expectation that it would be the last word on the subject addressed." Id. at 278, 108 S.Ct. at 1138. Moreover, an order denying a stay clearly merits different treatment because it does not affect the course of the proceedings, nor does it deprive a plaintiff of the federal forum he or she seeks. Similarly, reliance on National R.R. Passenger Corp. v. Providence & W.R.R. Co., 798 F.2d 8 (1st Cir.1986), is misplaced, since that case was an action for declaratory relief concerning an issue already pending in a parallel state action, and the panel decided it on the basis of the rule which provides that in the declaratory judgment context "avoidance of piecemeal litigation is entitled to great weight." Id. at 11. Finally, Bridge Const. Corp. v. City of Berlin, 705 F.2d 582 (1st Cir.1983), is also inapposite. In that case, the district court did not stay the federal proceedings pending resolution of the state action, but only to await state court resolution of some unsettled state law issues, a decision it clearly had authority to make. See Commerce Oil Refining Corp. v. Miner, 303 F.2d 125, 128-29 (1st Cir.1962). Additionally, the underlying premise of that decision was that, prior to the taking of the appeal and because the parties had not been given the opportunity to brief or argue the matter to the district court before the stay issued, the district court had indicated its intent to hold a hearing to discuss the propriety of the stay it had already granted. Bridge, 705 F.2d at 584-85. These circumstances are clearly inapplicable here.

Appellee's allegation that the stay order in this case fails to meet the requirements of the Cohen exception to the final judgment rule is equally unavailing. In Moses H. Cone, 460 U.S. at 11-12, 103 S.Ct. at 934-35, the Supreme Court enumerated the Cohen factors as follows:

To come within the small class of decisions excepted from the final judgment rule by Cohen, the order must conclusively determine the disputed question, resolve an important issue separate from the merits of the action, and be effectively unreviewable on appeal from a final judgment.

Appellee concedes that the order granting the stay is essentially unrelated to the merits of the main claim and involves a right incapable of vindication on appeal from a final judgment. She vehemently argues, however, that the order does not "conclusively determine the disputed question."

Appellee's contention must fail for the following reason. While it is true that the district court requested periodic reports on the progress of the case at the state level and even commented that appellant could seek reconsideration of its order, there is no indication in the record that it intended to take any further action with regard to the case until the state court had given full consideration to the same, at which point the plaintiffs in all probability would be precluded from seeking any further remedy in the federal court. ² In fact, the only discernible scenario under which the district court would exercise its judicial power over the instant case would be in the event that the case was not brought to trial in the state court within a reasonable period of time. The reasonable probability that this would not be so suffices to bring the same within the category of orders which would "conclusively determine the disputed question[s]," in this case by decisively leaving them for resolution to the state court. Finally, the passing reference to the possibility of reconsideration, without more, is merely an expression of the court's inherent power to reconsider its orders in light of changed circumstances, which power would have existed even had the statement not been made. It thus renders the order inconclusive "only in the technical...