Schneider Nat. Carriers, Inc. v. Carr

• Court: U.S. Court of Appeals — Seventh Circuit
• Writing for the Court: Before CUMMINGS, POSNER and RIPPLE; CUMMINGS; Sharp; Sharp's
• Citation: Schneider Nat. Carriers, Inc. v. Carr, 903 F.2d 1154 (7th Cir. 1990)
• Decision Date: 08 June 1990
• Docket Number: No. 89-1679,89-1679
• Parties: SCHNEIDER NATIONAL CARRIERS, INC., Plaintiff-Appellee, v. David M. CARR, Defendant-Appellant.

Page 1154

903 F.2d 1154

SCHNEIDER NATIONAL CARRIERS, INC., Plaintiff-Appellee, v. David M. CARR, Defendant-Appellant.

No. 89-1679.

United States Court of Appeals Seventh Circuit.

Argued April 5, 1990.

Decided June 8, 1990.

John T. Mulvihill, South Bend, Ind., for plaintiff-appellee.

David T. Stutsman, Elkhart, Ind., for defendant-appellant.

Before CUMMINGS, POSNER and RIPPLE, Circuit Judges.

CUMMINGS, Circuit Judge.

David M. Carr was driving a truck south on Indiana Route 15 in the course of his employment for Troyer's Poultry, Inc., in the early morning hours of April 8, 1987. At the same time, Ronald Gillette was driving a truck west on Indiana Route 6 for Schneider National Carriers. Route 6 and Route 15 intersect in Elkhart County, Indiana; Carr's truck entered that intersection when Gillette's truck was already there. Both trucks were destroyed, and Carr sustained a serious head injury. According to Carr, Gillette ran a red light at the intersection; Gillette says it was Carr who was in the wrong. Schneider National Carriers sued Carr and Troyer's in the district court for the Northern District of Indiana, and Carr counterclaimed against Schneider for his injuries.

The case was assigned to Judge Allen Sharp. A pretrial conference was held and a trial date set for February 27, 1989. On June 30, 1988, one day before the discovery cutoff date and seven months after Schneider's suit was instituted, Carr filed a similar suit in the Indiana state courts. In the state court suit, as in the federal, the principal issue was which of the drivers ran the red light. The only difference between the suits was that Carr had named the State of Indiana and Consolidated Rail Corporation as additional defendants; the state for not properly placing and maintaining the stoplight, and Conrail for having a railroad-crossing warning sign which could interfere with a driver's ability to see the stoplight at the intersection. In light of the new state suit, Carr filed a "Memorandum of Law on Compulsory Counterclaim," which was in effect a request that the federal action be stayed pending the outcome of the state suit. Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 96 S.Ct. 1236, 47 L.Ed.2d 483 (1976). After studying a memorandum in opposition, the district court refused to stay proceedings. Trial was to be held according to schedule on February 27, 1989.

On January 19, 1989, Carr moved for a continuance of the trial date. The reason stated was that Carr intended to enter a medical treatment program operated by New Medico, Inc. in Battle Creek, Michigan, to deal with psychological and behavioral problems which resulted from the injuries suffered in the accident. He stated that he would not be available for trial on February 27, and that until the treatment program was completed he would be unable to prove the extent of his damages. He added that under Indiana's Workers' Compensation Law he was required to accept the treatment. Schneider responded that Carr had not yet been admitted to New Medico, and that there was therefore no impediment to trial. Schneider noted that Carr could easily schedule his admission to New Medico for some time after the trial and suggested that Carr was merely trying to delay the trial. The district judge denied the motion for continuance.

Carr filed a second motion for continuance on February 7, less than three weeks before the scheduled trial date. This motion stated that Carr was shortly being admitted to New Medico, that his doctors recommended entering the program as soon as possible, and that the program was scheduled to begin on February 11. Attached to the motion were letters from Carr's doctors and a copy of New Medico's proposed treatment plan for him. The motion was followed on February 21 by Carr's memorandum of law in support of a continuance. The court denied the motion the same day without comment.

The case did in fact go to trial before a jury on February 27, 1989. Carr did not personally appear, and Carr's attorney did not put Carr's deposition testimony into evidence. The jury heard conflicting testimony about who ran the red light and specifically found that Carr was the person solely responsible for the accident. A judgment of $42,785.65 plus prejudgment interest of $6,518.25 was entered against Carr and Troyer's, and Carr took nothing on his counterclaim. Carr appeals from the adverse judgment. He argues that the federal suit should have been stayed in favor of the state court action, and that it was an abuse of Judge Sharp's discretion to deny the motions for continuance.

STAY UNDER THE COLORADO RIVER DOCTRINE

In a small class of cases, federal courts should stay the exercise of their "virtually unflagging obligation" to decide all cases within their jurisdiction to await the outcome of parallel proceedings in the state courts as a matter of "wise judicial administration." Colorado River, 424 U.S. at 817, 96 S.Ct. at 1246. In determining whether to stay a federal action, the district court should first determine whether the state and federal actions are indeed parallel. Interstate Material Corp. v. City of Chicago, 847 F.2d 1285, 1287 (7th Cir.1988). If they are, the court should carefully balance the advantages and disadvantages of granting a stay, "with the balance heavily weighted in favor of the exercise of jurisdiction." Moses H. Cone Memorial Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 16, 103 S.Ct. 927, 937, 74 L.Ed.2d 765 (1983). We review the district court's decision for abuse of discretion. Will v. Calvert Fire Ins. Co., 437 U.S. 655, 665, 98 S.Ct. 2552, 2558, 57 L.Ed.2d 504 (1978).

Judge Sharp ruled that the federal suit and the state suit were indeed parallel. We agree. As we said in Interstate Material Corp., 847 F.2d at 1288, the issue is not whether the state and the federal suit are identical, but only if they are parallel. Suits are parallel if substantially the same parties are litigating substantially the same issues simultaneously in two fora. The existence of additional parties in one suit does not of itself destroy parallelism. We noted in Interstate Material Corp. that the Colorado River doctrine is sufficiently important that it cannot be avoided simply by the stroke of a pen. Just so, the duty of the federal courts to decide cases within their jurisdiction is too weighty to be avoided by the stroke of a litigant's pen. As between Carr and Schneider National Carriers, there is no difference whatever between the federal suit and the later state court action. The only issue is who ran the red light. The issue raised in the state action regarding defendant Conrail was eventually disposed of by summary judgment in Conrail's favor. ^* The theory that the State of Indiana was at fault for failing to provide a stoplight that Gillette could easily see was so weak that it was only proper for the district court to disregard it. Besides, Carr could get complete relief from Gillette's employer in the federal action if he had won, without respect to the possible liability of the State. See Ind.Code Sec. 34-4-33-3 (amount of judgment is total damages from all sources reduced in proportion to plaintiff's degree of fault so long as plaintiff's fault is 50% or less). The issue of overriding importance in both suits was which of the two drivers ran the red light. The district judge's decision that the suits covered substantially the same issues between substantially the same parties was proper.

It was within the district judge's discretion to rule that the relevant factors did not tip strongly in favor of staying the federal case pending the outcome of the state suit. A decision in the later state suit would have been entitled to res judicata effect in the federal suit, and therefore a stay would ultimately have been tantamount to a dismissal. Moses H. Cone Memorial Hosp., 460 U.S. at 9-10, 103 S.Ct. at 933-34. "Only the clearest of justifications will warrant dismissal." Colorado River, 424 U.S. at 819, 96 S.Ct. at 1247. The Supreme Court and this Court have enumerated several factors that may be relevant in determining whether a stay is appropriate. See, e.g., Lumen Constr. Inc. v. Brant Constr. Co., 780 F.2d 691 (7th Cir.1985). Both Courts have often stated that no one factor is determinative. Colorado River, 424 U.S. at 818, 96 S.Ct. at 1246-47; Medema v. Medema Builders, 854 F.2d 210, 213 (7th Cir.1988). The weight to be given any one factor is determined solely by the circumstances of the particular case--there is no mechanical formula by which to determine when a stay is appropriate. Moses H. Cone Memorial Hosp., 460 U.S. at 16, 103 S.Ct. at 937.

The district judge relied on the fact that the state action was not commenced until the federal suit was well underway. A pretrial conference had already been held and a trial date and discovery cut-off date set. The state action was not filed until seven months after the federal suit was commenced. This was an appropriate factor to consider, and it does weigh heavily against staying the federal suit. The principal purpose of a stay under Colorado River is judicial economy, and judicial...