United States District Court, D. Oregon
Michael J. McShane United States District Judge.
Judge Mark D. Clarke filed a Report and Recommendation
(R&R, ECF No. 51), and the matter is now before this
court. See 28 U.S.C. § 636(b)(1)(B),
Fed.R.Civ.P. 72(b). Defendants filed objections (ECF No. 55)
to the Report and Recommendation. Accordingly, I have
reviewed the file of this case de novo. See
28 U.S.C. § 636(b)(1)(c); McDonnell Douglas Corp. v.
Commodore Bus. Mach., Inc., 656 F.2d 1309, 1313
(9th Cir. 1981). I conclude the report is correct.
Motion to Stay
considering a motion to stay, a court is to weigh three
competing interests: (1) the possible damage which may result
from the granting of a stay, (2) the hardship or inequity
which a party may suffer if required to go forward, and (3)
does the stay simplify or complicate the issues, proof, and
questions of law which could be expected to result from a
stay. CMAX, Inc. v. Hall, 300 F.2d 265, 268 (9th
Cir. 1962) citing Landis v. North American Co., 299
U.S. 248, 254-255 (1936). In reaching its decision on the
motion, a district court is exercising its inherent power to
control the cases on its docket in a manner which will
“promote economy of time and effort for itself, for
counsel, and for litigants.” Id.
object the denial of the stay and argue that “hardships
and equities” weigh in favor of a stay of this action.
I agree with Judge Clarke's analysis who, in denying
defendant's request, found that they have not shown that
they will suffer any hardship or inequity in the
absence of a stay. He further found that to stay the case
would not serve the interests of justice because it was
unclear how long before the state court matter would be fully
resolved. R&R 16, ECF No. 51. As a general matter, having
to litigate itself is not hardship warranting the stay of a
case. Dependable Hwy. v. Navig., 498 F.3d 1059,
1066-70 (9th Cir. 2007). Submitting to discovery
(particularly discovery that is “substantially
similar” (Pl.'s Mot. 14-15, ECF No. 25) to what has
already been submitted in the state court action) also does
not constitute hardship.
also unwilling to stay a case to simply delay the pains of
litigation based on the speculative future outcome of a state
court proceedings. It is unclear the mechanism by which the
state court case will resolve; whether by jury verdict,
summary judgment motion, or settlement. It is equally unclear
if or how the resolution of the state court proceeding may
simplify or complicate the issues in the federal case.
Because the orderly course of justice weighs against a stay
in the federal litigation, the request to stay is DENIED.
Clarke made a third point that, before the filing of this
federal suit, there was an attempt to join Defendants here
with the defendants of the state court proceedings, but that
attempt was opposed and ultimately denied by the state court.
There is an irony to the defendant's position, but this
observation is not a determinative factor in reaching a
decision on the motion to stay.
Necessary and Indispensable Parties
object to the Recommendation that the state court defendants
are not necessary parties. Def.'s Obj. 8-9, ECF No. 55.
Defendants argue that the Recommendation failed to consider
all three prongs in the first step of the Rule 19 two-step
analysis. Id. In the first step, the district court
must determine whether the absent party is a
“necessary” party. Makah Indian Tribe v.
Verity, 910 F.2d 555, 558 (9th Cir. 1990). If the absent
party is necessary and cannot be joined, then the court must
determine whether the party is “indispensable.”
Id. If the absent party is not necessary, then the
analysis stops. The moving party bears the burden of
persuasion in arguing for dismissal under Rule 19.
order to determine whether the state court defendants are
necessary parties under Rule 19(a), the Court must consider:
(1) whether complete relief is available among the existing
parties; (2) whether the state court defendants have a
legally protected interest in the suit such that a decision
in its absence will impair or impede its ability to protect
that interest; and (3) whether Defendants would be subjected
to a substantial risk of multiple or inconsistent
obligations. Fed.R.Civ.P. 19(a)(1); Ward v. Apple
Inc., 791 F.3d 1041, 1048-49 (9th Cir. 2015). If any one
of the three prongs is met, then the state court defendants
are to be found necessary. I find that Judge Clarke
thoroughly discussed all three prongs at step one. His
analysis at step two for each of the asserted claims
correctly concluded that the state court defendants are not
necessary and not indispensable parties to the federal suit.
R&R 4-15, ECF No. 51. Defendants' objections are
Personal Jurisdiction over Steven Scott and HLH-East
that Plaintiffs have met their burden for showing the
existence of personal jurisdiction over Steven Scott and
HLH-East Bay, and that there is not a compelling case that
the exercise of jurisdiction would be unreasonable.
the Report and Recommendation (ECF No. 51) in full.
Defendants' motion (ECF No. 25) is DENIED. Motion for