Tobias Chavez v. Dole Food Company Inc

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
__________
No. 13-4144
__________
TOBIAS BERMUDEZ CHAVEZ, et al.,
v.
DOLE FOOD COMPANY, INC., et al.
(D. Del. No. 1-12-cv-00697)
____
JULIO ABREGO ABREGO, et al.,
v.
DOLE FOOD COMPANY, INC., et al.
(D. Del. No. 1-12-cv-00698)
_____
ALVARADO ALFARO MIGUEL FRANCISCO, et al.,
v.
DOLE FOOD COMPANY, INC., et al.
(D. Del. No. 1-12-cv-00699)
_____
JORGE LUIS AGUILAR MORA, et al.,
v.
DOLE FOOD COMPANY, INC., et al.
(D. Del. No. 1-12-cv-00700)
_____
EDWIN AGUERO JIMENEZ, et al.,
v.
DOLE FOOD COMPANY, INC., et al.
(D. Del. No. 1-12-cv-00701)
_____
GONZALEZ ARAYA FRANKLIN, et al.,
v.
DOLE FOOD COMPANY, INC., et al.
(D. Del. No. 1-12-cv-00702)
TOBIAS BERMUDEZ CHAVEZ, et al.,
Appellants
__________
On Appeal from the United States District Court
for the District of Delaware
(D.C. Nos. 1-12-cv-00697, 1-12-cv-00698, 1-12-cv-00699,
1-12-cv-00700, 1-12-cv-00701, and 1-12-cv-00702)
District Judge: Honorable Richard G. Andrews
ARGUED JUNE 24, 2014
BEFORE: FUENTES, GREENAWAY, JR., and
NYGAARD, Circuit Judges
2
(Opinion Filed: August 11, 2015)
Scott M. Hendler, Esq.
HendlerLaw
1301 West 25th Street, Suite 400
Austin, TX 78705
Jonathan S. Massey, Esq. [Argued]
Massey & Gail
1325 G Street, N.W., Suite 500
Washington, DC 20005
Michael L. Sensor, Esq.
Perry & Sensor
P.O. Box 1568
704 North King Street
One Customs House, Suite 560
Wilmington, DE 19899
Counsel for Appellants
Caitlin J. Halligan, Esq. [Argued]
Gibson Dunn
200 Park Avenue, 47th Floor
New York, NY 10166
Andrea E. Neuman, Esq.
Gibson Dunn
3161 Michelson Drive, 12th Floor
Irvine, CA 92714
3
Somers S. Price, Jr., Esq.
Potter, Anderson & Corroon
1313 North Market Street
6th Floor, P.O. Box 951
Wilmington, DE 19801
William E. Thomson, III, Esq.
Gibson Dunn
333 South Grand Avenue
Los Angeles, CA 90071
Counsel for Appellees Dole Food Company, Inc., Dole
Fresh Fruit, Standard Fruit Company, Standard Fruit
and Steamship Company
Michael L. Brem, Esq.
Schirrmeister Diaz-Arrastia Brem
700 Milam Street, 10th Floor
Houston, TX 77002
Donald E. Reid, Esq.
Morris, Nichols, Arsht & Tunnell
1201 North Market Street
P.O. Box 1347
Wilmington, DE 19899
Counsel for Appellee Dow Chemical Co.
Timothy J. Houseal, Esq.
Jennifer M. Kinkus, Esq.
Young, Conaway, Stargatt & Taylor
1000 North King Street
4
Rodney Square
Wilmington, DE 19801
D. Ferguson McNiel, III, Esq.
Vinson & Elkins
1001 Fannin Street
2300 First City Tower
Houston, TX 77002
Counsel for Appellee Occidental Chemical Corp.
John C. Phillips, Jr., Esq.
Phillips, Goldman & Spence
1200 North Broom Street
Bank of Delaware Building
Wilmington, DE 19806
Counsel for Appellee AMVAC Chemical Corporation
Kelly E. Farnan, Esq.
Richards, Layton & Finger
920 North King Street
One Rodney Square
Wilmington, DE 19801
Counsel for Appellee Shell Oil Co.
Steven L. Caponi, Esq. [Argued]
Blank Rome
1201 Market Street, Suite 800
Wilmington, DE 19801
R. Jack Reynolds, Esq.
5
Samuel E. Stubbs, Esq.
Pillsbury, Winthrop, Shaw & Pittman
909 Fannin
Suite 2000, Two Houston Center
Houston, TX 77010
Counsel for Appellees Chiquita Brands International
Inc., Chiquita Brands, LLC, Chiquita Fresh North
America, LLC
Boaz S. Morag, Esq.
Cleary, Gottlieb, Steen & Hamilton
One Liberty Plaza
New York, NY 10006
James W. Semple, Esq.
Morris James
500 Delaware Avenue, Suite 1500
Wilmington, DE 19081
Counsel for Del Monte Fresh Produce NA, INC
__________
OPINION OF THE COURT
__________
NYGAARD, Circuit Judge.
I.
The “first-filed rule” is a well-established policy of the
federal courts that “[i]n all cases of concurrent jurisdiction,
6
the court which first has possession of the subject must decide
it.” Smith v. McIver, 22 U.S. (9 Wheat) 532, 535 (1824).
This rule permits the district courts, in their discretion, to
stay, transfer or dismiss cases that are duplicates of those
brought previously in other federal fora. See, e.g., Cedars-
Sinai Med. Ctr., et al., v. Shalala, 125 F.3d 765, 769 (9th Cir.
1997). Today, we are asked to review the contours of this
rule and the discretion of the district courts under it.
II.
This appeal is but a facet of procedurally intricate
litigation concerning the alleged misuse of the pesticide
dibromochloropropane (DBCP) on banana farms throughout
Central America. Litigation has been ongoing in various
federal and state courts for decades. Appellants—more than
two hundred foreign agricultural workers—allege they were
exposed to DBCP beginning in the 1960’s and ending
sometime in the 1980’s. They maintain that improper
exposure to this pesticide is to blame for the numerous health
problems they have endured. Litigation began in 1993 with
the filing of a putative class against the Dole Food Company,
Inc., and other related companies in Texas state court. To our
knowledge, no court—federal or state—has ever reviewed the
actual merits of Appellants’ claims. Instead, these matters
have continued in various courts around the country on purely
procedural questions. Not surprisingly, the procedural history
associated with these cases is labyrinthine. Here, however,
we confine our discussion to the procedural history of DBCP
litigation that was recently undertaken in two states:
Louisiana and Delaware.
A. The Louisiana Action: Chaverri et al. v. Dole Food Co.,
Inc., et al.
7
Numerous suits were filed in June of 2011 in the
United States District Court for the Eastern District of
Louisiana against Dole and others.1 Among other things, this
lawsuit alleged claims sounding in negligence, strict liability,
and breach of implied warranty. The suits were consolidated
and Dole moved for summary judgment.
On summary judgment, Dole argued that the
Appellants’ claims were time-barred under Louisiana’s one-
year statute of limitations. See La. Civ. Code Ann. art. 3492
(West, Westlaw through 2014 Regular Session). The District
Court agreed and on September 17, 2012, granted Dole’s
motion for summary judgment. The matter was appealed to
the United States Court of Appeals for the Fifth Circuit on
October 5, 2012. The appeal was actively prosecuted, with
oral argument taking place on September 4, 2013. On
September 19, 2013, the Court of Appeals for the Fifth
Circuit affirmed the Louisiana District Court in an
unpublished, per curiam opinion. See Chaverri v. Dole Food
Co., 546 Fed. App’x 409 (5th Cir. 2014).
1
Named as defendants in the Louisiana action were Dole
Food Company, Inc.; Dole Fresh Fruit Company; Standard
Fruit Company; Standard Fruit and Steamship Company, Del
Monte Fresh Produce N.A., Inc., Chiquita Brands
International, Chiquita Brands, Inc., Maritrop Trading
Corporation, Dow Chemical Company, Occidental Chemical
Company, Amvaco Chemical Company and Shell Oil
Company. All of these entities joined in a motion to for
summary judgment based on statute of limitations grounds.
For simplicity, we will refer to this group of defendants as
“Dole.”
8
B. Delaware Federal Litigation: the Subject of This
Dispute.
Meanwhile, on June 1, 2012, while Dole’s motion for
summary judgment was pending in Louisiana District Court,
the Appellants filed several actions in the United States
District Court for the District of Delaware. These Delaware
actions were brought against the same defendants listed in the
Louisiana litigation and contained the same causes of action.2
Importantly, Appellants admit that the actions filed in
Delaware were “materially identical lawsuits” to those filed a
year earlier in Louisiana. Appellants’ Br. 12.
Dole Food Company filed a motion to dismiss the
Delaware lawsuits on June 21, 2012, arguing for the
application of the first-filed rule. This motion was joined by
Dole Fresh Fruit Company, Standard Fruit Company,
Standard Fruit & Steamship Company, and AMVAC
Chemical Corporation (hereinafter “Dole Appellees”). The
District Court agreed with the Dole Appellees and held that
the first-filed rule applied to the Delaware cases. It then was
faced with the discretionary decision whether to stay or
dismiss the proceedings. The Delaware District Court
dismissed the actions on August 21, 2012, reasoning that
2
The set of defendants in this litigation are Dole Food
Company, Inc.; Dole Fresh Fruit Company; Standard Fruit
Company; Standard Fruit & Steamship Company; AMVAC
Chemical Corp.; Del Monte Fresh Produce N.A., Inc.;
Chiquita Brands International, Inc.; Chiquita Brands, LLC;
The Dow Chemical Company; Occidental Chemical Corp.;
and Shell Oil Company.
9
Appellants “filed in Delaware notwithstanding their choice to
file first in Louisiana. Decisions have consequences; one fair
bite at the apple is sufficient.” App. 19-20.
The day after the Delaware District Court dismissed
Dole, Appellees Occidental Petroleum, Del Monte Produce
N.A., Inc., Dow Chemical Co., and Shell Oil (hereinafter
“Occidental Appellees”) likewise moved for dismissal based
on the first-filed rule. On March 29, 2013, the District Court
granted the Occidental Appellees motion as well. Although
final judgment had been entered in the District Court for
Louisiana, the District Court reasoned that the first-filed rule
still applied because the case was on appeal to the Court of
Appeals for the Fifth Circuit.
While Appellants’ appeal was pending in the Court of
Appeals for the Fifth Circuit, Appellee Chiquita Brands
International, Inc., moved to dismiss, arguing a lack of
personal jurisdiction. Chiquita Brands LLC and Chiquita
Fresh N.A. LLC moved for a dismissal pursuant to Fed. R.
Civ. P. 12(b)(6) and to dismiss based on res judicata and
statute of limitations grounds.3 The Delaware District Court
dismissed the claims against Chiquita Brands International on
May 30, 2013, finding a lack of personal jurisdiction. Later,
on September 19, 2013, the Delaware District Court
dismissed the remaining two Chiquita defendants (Chiquita
Brands, LLC and Chiquita Fresh N.A. LLC) based on the
first-filed rule and closed the case.
3
Chiquita Brands International, Inc., joined in these motions,
but only in the alternative in the event the District Court
denied its motion to dismiss based on personal jurisdiction.
10
III.
We review the District Court’s decision to apply the
first-filed rule for an abuse of discretion. E.E.O.C. v. Univ. of
Pa., 850 F.2d 969, 972 (3d Cir. 1988).4 This means we
cannot disturb the District Court’s decision “unless there is a
definite and firm conviction that the [District Court]
committed a clear error of judgment in the conclusion it
reached.” Hanover Potato Prods., Inc. v. Shalala, 989 F.2d
123, 127 (3d Cir. 1993) (internal citations and quotation
marks omitted). We see no clear error of judgment here and
will affirm the District Court.
A. The First-Filed Rule
The first-filed rule counsels deference to the suit that
was filed first, when two lawsuits involving the same issues
and parties are pending in separate federal district courts.
Univ. of Pa., 850 F.2d at 971. We have been clear: where
there is federal concurrent jurisdiction over a matter, “the
court which first ha[d] possession of the subject must decide
it.” Id. (quoting Crosley Corp. v. Hazeltine Corp., 122 F.2d
925, 929 (3d Cir. 1941) (internal citations and quotations
marks omitted)). Appellants concede that they filed
duplicative actions in the Delaware District Court, stating that
the Delaware cases were “materially identical” to those they
previously filed in Louisiana. Appellants’ Br. 12. Therefore,
the pivotal question becomes whether concurrent jurisdiction
4
The District Court exercised jurisdiction under 28 U.S.C. §
1332(a). We exercise jurisdiction over this appeal pursuant to
28 U.S.C. § 1291.
11
existed at the time the Delaware actions were filed. We hold
that it did.
Claims against the Appellees were filed in Louisiana
District Court on June 1, 2011, and those same claims were
filed against the same Appellees on June 1, 2012 in Delaware
District Court. Therefore, concurrent jurisdiction existed on
June 1, 2012 when the duplicative actions were filed.
The Appellants place great emphasis on the fact that
the Louisiana cases were on appeal when the Delaware
District Court dismissed the claims against the Occidental
Appellees and two of the Chiquita Appellees. They argue
that by the time the Delaware District Court dismissed the
actions, concurrent jurisdiction no longer existed. But, as we
see it, the procedural posture of the first-filed case on the date
the second-filed actions were dismissed, is irrelevant to the
analysis. The relevant point-in-time is the filing date of the
duplicative action. If concurrent jurisdiction exists at that
time, and the actions are truly duplicative, the first-filed rule
can be invoked. This is what we meant when we held that
“the court which first has possession of the subject must
decide it.” Crosley Corp. v. Hazeltine Corp., 122 F.2d 925,
929 (3d Cir. 1041) (quoting Smith, 22 U.S. at 535); Univ. of
Pa., 850 F.2d at 971.
A court obtains possession of a case through the filing
of a complaint and the date of that filing, therefore, is the
relevant inquiry under the first-filed rule. See, e.g.,
Collegiate Licensing Co. v. American Cas. Co. of Reading,
Pa., 713 F.3d 71, 78 (11th Cir. 2013) (“The first-filed rule
provides that when parties have instituted competing or
parallel litigation in separate courts, the court initially seized
12
of the controversy should hear the case.” (internal citation
omitted)); Alltrade, Inc. v. Uniweld Products, Inc., 946 F.2d
622, 623 (9th Cir. 1991) (“[T]he well-established ‘first-to-file
rule,’ which allows a district court to transfer, stay, or dismiss
an action when a similar complaint has already been filed in
another federal court . . .”) (emphasis added). Analyzing a
case under the first-filed rule requires a district court, in a
sense, to take a snap-shot of the cases at a particular moment
in time: the date of the filing of the second complaint. If, on
the date of the filing of the second-filed complaint, the
matters are duplicative, that is, materially on all fours, then a
district court has the discretion to stay, transfer, or dismiss the
second-filed matter. Here, materially identical cases against
these same Appellees were pending in Louisiana District
Court on June 1, 2012, the date the Appellants filed
duplicative lawsuits in the Delaware District Court.
Therefore, concurrent jurisdiction existed in June of 2012.
B. The District Court’s Discretion and the Dismissal of
the Delaware Actions
The Appellants next argue that, even if the first-filed
rule was applicable, the Delaware District Court should have
stayed or transferred the Delaware cases, and that dismissing
them with prejudice instead was an abuse of discretion. Our
dissenting colleague agrees with this argument. We,
however, do not because such a position is in tension with the
purposes of the rule and would result in a wrongful limitation
on the scope of a district court’s discretion to fashion an
appropriate response to a second-filed action. The scope of
the District Court’s discretion is very broad in these
circumstances. As we said earlier, we will not find an abuse
of discretion under the first-filed rule “unless there is a
13
definite and firm conviction that the [District Court]
committed a clear error of judgment in the conclusion it
reached.” Hanover Potato Prods., 989 F.2d at 127 (internal
citation and quotation marks omitted).
The rationale underlying the first-filed rule is “to
encourage[] sound judicial administration and to promote[]
comity among the courts in the federal system.” Univ. of Pa.,
850 F.3d at 971. The import of the first-filed rule is
commonsensical: “[i]t is of obvious importance to all the
litigants to have a single determination of their controversy,
rather than several decisions which if they conflict may
require separate appeals to different circuit courts of appeals.”
Crosley, 122 F.2d at 930. The Delaware District Court’s
actions in this case are in line with the purposes of the rule.
By dismissing these cases, the Delaware District Court
“avoid[ed] burdening the federal judiciary and . . .
prevent[ed] the judicial embarrassment of conflicting
judgments.” Univ. of Pa., 850 F.2d at 977 (citations omitted).
Nor did the Delaware District Court act woodenly, inflexibly,
or mechanically in its application of the rule. Id. at 972, 976.
Instead, by dismissing these duplicative cases, the District
Court avoided “the waste of judicial time and energy.”
Crosley, 122 F.3d at 930.
Also, dismissal with prejudice is an appropriate
response to the Appellants’ own litigation strategy. Three
days after filing the Delaware lawsuits, the Appellants’
counsel informed the Louisiana District Court that the
decision to file the duplicative law suits in Delaware District
Court was strategic and that counsel recognized that: “the
general rule is that duplicate cases in different federal judicial
districts should not both proceed.” App. at 388 (citations
14
omitted). Counsel then asked for the Louisiana District
Court’s “indulgence over the next several months,” and did
not move to stay or dismiss the actions pending in Louisiana
federal court. Id. The Appellants felt it was “imperative” to
preserve and protect their claims in Louisiana by filing
duplicate cases in Delaware, admitting to the Louisiana
District Court that they had also filed suit in Delaware
because:
The Louisiana Supreme Court is
expected to conclusively
determine the [opt out] issue later
this year and before the Delaware
Supreme Court is likely to have
the opportunity to squarely
address the matter. If the
[Louisiana] Supreme Court rules
that the Plaintiffs cases are not
Prescribed, the Plaintiffs would
elect to proceed in Louisiana
because the prescription issue
would have been conclusively
determined. But if this Court and
the Louisiana Supreme Court
determine that the cases are in fact
prescribed, then Plaintiffs can
continue to pursue the merits of
their claims in Delaware.
App. at 387. By their own acknowledgement then,
Appellants were forum shopping. They wanted to keep the
same litigation going in two different federal fora
simultaneously to see in which one they would fare better. If
15
the Louisiana Supreme Court ruled in their favor, then the
Appellants would elect to proceed in Louisiana because that
issue would have been settled. However, if the Louisiana
District Court and the Supreme Court of Louisiana ruled
against them on the statute of limitations issue, they would
then continue their litigation in Delaware. The Appellants
could have asked the Delaware District Court to stay their
claims, but they did not. Just as we have held that forum
shopping is a basis for departing from the first-filed rule, see
Univ. of Pa., 850 F.2d at 976, it can also be a basis for
enforcing the rule. Here, the Appellants not only filed first,
but filed second as well. This duplication of litigation was of
their own making and it was not an abuse of discretion for the
Delaware District Court to dismiss their second-filed
complaint with prejudice, instead of staying the matter.
We are also concerned that finding error in the
Delaware District Court’s dismissal here could create a “no
dismissal” rule for these type of cases. That is, when faced
with a second-filed action, a district court would only have
discretion to stay or transfer while the first-filed action is
pending. Such a rule, we believe, is inconsistent with our
current jurisprudence, which clearly states that application of
the first-filed rule be guided by principles of “fundamental
fairness . . . [and] dictates the need for fashioning a flexible
response to the issue of concurrent jurisdiction.” Univ. of
Pa., 850 F.2d at 977 (internal citation and quotation marks
omitted). Dismissing a matter—with or without prejudice—
is part of a flexible response. Therefore, because the first-
filed rule is flexible in nature, it does not proscribe the
remedy of dismissal, nor does it mandate the remedy of a stay
or transfer. In fact, our jurisprudence far from imposes such
bright-line rules. We have instructed that a district court is
16
merely “bound to acknowledge these [equitable] principles”
but the “term ‘discretion’ denotes the absence of a hard and
fast rule.” Id. (internal citations and quotation marks
omitted).
Here, the District Court acknowledged the relevant
considerations of the first-filed rule, and was persuaded to
dismiss the second-filed actions. The District Court weighed
heavily that the Appellants were blatantly forum shopping
and were attempting to get a second bite at the proverbial
apple. We can say then, that the Delaware District Court’s
calculation of “fundamental fairness” was guided by “what is
right and equitable under the circumstances and the law,”
especially in light of the fact that the Appellants’ attempt to
evade Louisiana law “violates the equitable basis for the
rule.” Id. at 977-78.
Further, it is well within a district court’s discretion to
dismiss a second-filed action because a district court has an
inherent power to control its docket and dismiss a duplicative
action. See In re Fine Paper Antitrust Litig., 685 F.2d 810,
817 (3d Cir. 1982) (“We will not interfere with a trial court’s
control of its docket except upon the clearest showing that the
procedures have resulted in actual and substantial prejudice to
the complaining litigant.” (quotation marks omitted)); Curtis
v. Citibank, N.A., 226 F.3d 133, 138 (2d Cir. 2000) (stating
that a district court, “[a]s part of its general power to
administer its docket . . . may stay or dismiss a suit that is
duplicative of another federal court suit.”). And, finding that
the District Court abused its discretion here would require us
to determine that it made a clear error in judgment, i.e., that it
acted outside the scope of its discretion. Hanover Potato
Prods., 989 F.2d at 127. To do so, we believe, would require
17
us to retroactively limit the scope of a district court’s
discretion when faced with a second-filed action.
While the first-filed rule does admit some exceptions,
there are none present in this case that warrant a departure
from the rule. See Univ. of Pa., 850 F.2d at 976-977(surveying the “proper bases for departing from the rule” and
noting that the “letter and spirit of the ... rule ... are grounded
on equitable principles”). Appellants bring several arguments
as to why their Delaware actions should be exempt from the
first-filed rule, but they are all unavailing. First, Appellants
argue that they should be exempted from the rule because
invoking it would frustrate their choice of forum. This
argument is nonsensical. Appellants chose to file in
Louisiana first. Indeed, the Delaware District Court honored
the Appellant’s choice of forum: Louisiana. The Appellants
also argue that the first-filed rule does not apply because they
filed both the Louisiana and Delaware themselves. It is true
that most first-filed rule issues arise where a plaintiff files in
one district and then the defendant counter-sues in another
(or, for example, seeks a declaratory judgment in the second
district). There is no authority, however, which holds that the
first-filed rule only applies in cases where the filings are
initiated by different parties. For the rule to apply, all that is
necessary is for the later filed action to involve the same
parties and issues that are already before another federal
court. Univ. of Pa., 850 F.2d at 971–72 (citing Triangle
Conduit & Cable Co. v. Nat'l Elec. Products Corp., 125 F.2d
1008, 1009 (3d Cir. 1941). It does not matter that the cases
were commenced by the same party, in this case, the
Appellants. Further, the principal reason for the first-filed
rule is the avoidance of duplicative litigation, so it cannot
18
matter whether the same party brought both suits—what
matters is whether the second suit is duplicative of the first.
Next, Appellants maintain that the first-filed rule
should not apply here because litigating this matter in
Delaware makes “eminent sense.” Appellants’ Br. at 31.
Perhaps there is some sense in litigating this matter in
Delaware, but the Appellants chose not to do so, instead filing
their complaint in Louisiana. As we have already determined,
the Appellants filed a second, duplicative case in Delaware to
hedge their bets against an unfavorable outcome in Louisiana.
This is forum shopping, which never makes “eminent sense.”
Id.Finally, Appellants argue that their duplicative
Delaware filing is a “reasonable response” to the Appellees’
history of delaying tactics. A review of the record could
reasonably leave one with the impression that the Appellees
took full advantage of any opportunity to procedurally stall
and/or delay these lawsuits over the decades. However, that
is not a reason to abandon the first-filed rule. When
reviewing the first-filed rule, we concern ourselves only with
the two cases at issue – not any other procedural issues or
history of related, but irrelevant litigation.
C. Appellee Chiquita Brands International and Personal
Jurisdiction
In a separate order, the Delaware District Court held
that it lacked personal jurisdiction over Appellee Chiquita
Brands International, and granted its motion to dismiss. We
review de novo the District Court’s dismissal for lack of
personal jurisdiction, Eurofins Pharma U.S. Holdings v.
19
BioAlliance Pharma S.A., 623 F.3d 147, 155 (3d Cir. 2010),
and we review the District Court’s decision denying the
Appellants’ request to conduct jurisdictional discovery for an
abuse of discretion. Id. at 157. We hold that the District
Court did not err by dismissing Appellee Chiquita for lack of
personal jurisdiction and denying the Appellants
jurisdictional discovery.
Two types of personal jurisdiction exist: general and
specific. Helicopteros Nacionales de Colombia S.A. v. Hall,
466 U.S. 408, 414 (1984). General jurisdiction is present
when a plaintiff’s claim arises out of the defendant's
“continuous and systematic” contacts with the forum state.
General jurisdiction can exist even if the cause of action is
unrelated to the defendant’s activities in the forum state.
Specific jurisdiction exists when the plaintiff’s claim arises
out of the defendant’s activities within the forum such that the
defendant could reasonably anticipate being hauled into the
state’s courts. Vetrotex Certainteed Corp. v. Consl. Fiber
Glass Prods. Co., 75 F.3d 147, 151 (3d Cir. 1995).
Appellants make no argument that the District Court had
specific personal jurisdiction over Chiquita Brands.
Recently, the United States Supreme Court reviewed
the requirements to establish general jurisdiction in Daimler
AG v. Bauman, ––– U.S. ––––, 134 S.Ct. 746, 760-61 (2014).
There, the Supreme Court noted that when determining
general jurisdiction, the appropriate consideration is whether
a defendant’s “‘affiliations with the State are so continuous
and systematic as to render [it] essentially at home in the
forum State.’” Id. at 761 (quoting Goodyear Dunlop Tires
Operations, S.A. v. Brown, 564 U.S. ––––, 131 S.Ct. 2846,
2851 (2011)) (alteration in original). The Supreme Court
20
pointed out that for a corporation, “the place of incorporation
and principal place of business” are where it is “at home” and
are, therefore, the paradig[m] bases for jurisdiction. Id. at
760 (internal citations and quotation marks omitted).
Goodyear, therefore, makes it “incredibly difficult to
establish general jurisdiction in a forum other than the place
of incorporation or principal place of business.” Monkton Ins.
Services, Ltd. v. Ritter, 768 F.3d 429, 432 (5th Cir. 2014)
(citations omitted). Chiquita Brands International argues that
it was never ‘at home’ in Delaware, and we agree. The
company is not incorporated in Delaware and does not
maintain an office there. Nor, we note, does the company
supervise its business from that state. Indeed, as the
Delaware District Court found, Chiquita is a national
company and its products are found across the country. In
Goodyear, the Supreme Court seems to reject the idea that
national corporations are subject to general jurisdiction
throughout the country. Goodyear, 131 S.Ct. at 2855-56.5
Nothing on the record suggests that Chiquita Brands
International is any more active in Delaware than it is in other
states. Nor do any of its activities in moving and selling its
products lead to a finding that its principal place of business
5
Nor, as the Appellants suggest, does maintaining an
interactive website subject a national corporation to general
jurisdiction in a particular state. We have specifically held
that “the mere operation of a commercially interactive web
site should not subject the operator to jurisdiction anywhere
in the world.” Toys “R” Us, Inc., v. Step Two S.A., 318 F.3d
446, 454 (3d Cir. 2003).
21
is Delaware. The District Court, therefore, correctly
dismissed this Appellee for a lack of personal jurisdiction.6
IV.
In the end, we simply cannot say that the District Court
abused its discretion in dismissing this case with prejudice. A
district court’s discretion is necessarily broad so as to handle
the concerns associated with forum shopping and the first-
filed rule. This discretion must include the ability to dismiss
a case with prejudice, especially in a case such as this one
where a party’s forum shopping is so clearly on display.
Therefore, and in light of the foregoing, we conclude that the
Delaware District Court did not abuse its discretion in
dismissing the Appellants’ actions in favor of the first-filed
litigation in Louisiana. We also find no error in the Delaware
District Court’s dismissal of Appellee Chiquita Brands
International for a lack of jurisdiction. Therefore, for the
foregoing reasons, we will affirm the Delaware District
Court’s orders.
6
We also reject the Appellants’ contention that the District
Court abused its discretion in denying discovery for purposes
of establishing jurisdiction.
22
Fuentes, Circuit Judge, dissenting:
More than two hundred plantation workers brought
this suit alleging their employers and certain chemical
companies knowingly exposed them to toxic pesticides over a
period of many years. As a result, they say, they have injured
kidneys, are infertile, and are at heightened risk of cancer.
Twenty years after first bringing suit, no court has heard the
merits of their claims. Because the Louisiana court dismissed
on procedural grounds, the Delaware District Court’s
dismissal of the plaintiffs’ claims—with prejudice—
effectively ends the plaintiffs’ lawsuit. The majority’s
affirmance of that decision, i.e., the dismissal with prejudice
of a duplicate claim filed in a second court, is not supported
by our caselaw and is contrary to the decisions of the only
other Courts of Appeals to have addressed the issue.1
1
As discussed below, three other Courts of Appeals have
addressed the appropriate disposition of second-filed suits in
the context of the first-filed rule. None has approved
dismissal with prejudice of the second-filed action on the
basis of the rule. See Cent. States, Se. & Sw. Areas Pension
Fund v. Paramount Liquor Co., 203 F.3d 442, 444 (7th Cir.
2000) (holding that second-filed court’s dismissal without
prejudice was error because “dismissal created an
unwarranted risk of legal prejudice”); Asset Allocation &
Mgmt. Co. v. W. Employers Ins. Co., 892 F.2d 566, 571 (7th
Cir. 1989) (“[W]hy take chances? It is simpler just to stay the
second suit.”); Alltrade, Inc. v. Uniweld Products, Inc., 946
F.2d 622, 629 (9th Cir. 1991) (“[W]here the first-filed action
presents a likelihood of dismissal, the second-filed suit should
be stayed, rather than dismissed.”); Burger v. Am. Mar.
I agree with the majority opinion that the first-filed
rule applied to the plaintiffs’ successive filing in Delaware,
and, as such, that the District Court should have given the
Louisiana suit priority. But I do not agree that the first-filed
rule is a basis to terminate a claim that otherwise may be
prosecuted. That is not something we have ever held before; it
is contrary to our positions on successive litigation and
concurrent litigation in other contexts; and it is inappropriate
in light of the Supreme Court’s command that we must
adjudicate properly presented cases not heard elsewhere on
the merits. As our sister circuits have done in like cases, I
would vacate and remand for further proceedings.2
I
In Crosley v. Hazeltine we adopted the first-filed rule:
a comity-based policy that, when two federal courts possess
the same case at the same time, the action filed first has
priority. 3 In E.E.O.C. v. University of Pennsylvania, we
Officers Union, 170 F.3d 184, 1999 WL 46962, at *2 (5th
Cir. 1999) (“When the jurisdiction of the first-filed court to
hear the dispute is uncertain, it is an abuse of discretion to
dismiss the claims in the second-filed court with prejudice, as
it creates the risk that the merits of the claims could never be
addressed.”).
2
I agree with the majority opinion’s determination that the
District Court lacked personal jurisdiction over defendant
Chiquita Brands. Hence, I dissent in part.
3
See Crosley Corp. v. Hazeltine Corp., 122 F.2d 925, 929-30
(3d Cir. 1941) (adopting “Chief Justice Marshall[’s] salutary
rule that, ‘In all cases of concurrent jurisdiction, the court
which first has possession of the subject must decide it.’”)
2
elaborated on Crosley and discussed various scenarios where,
for equitable reasons, that presumption should not apply. 4
These decisions have a clear, but limited, applicability to this
appeal. They mean that the District Court correctly concluded
that the Louisiana suit should have priority.
The difficult question here, however, is not whether
the first-filed rule applies. Once we determine the rule
applies, we must still decide whether it is permissible—solely
on the basis of the policy—to dismiss the plaintiffs’ claims
with prejudice rather than stay the action or dismiss it without
prejudice.5 As the majority opinion acknowledges, the claims
(quoting Smith v. McIver, 22 U.S. (9 Wheat.) 532, 535
(1824)); see also First City Nat'l Bank & Trust v. Simmons,
878 F.2d 76, 79 (2d Cir. 1989) (“[W]here there are two
competing lawsuits, the first suit should have priority, absent
the showing of balance of convenience or special
circumstances giving priority to the second.”); Orthmann v.
Apple River Campground, Inc., 765 F.2d 119, 121 (8th Cir.
1985) (“[C]ourts follow a ‘first to file’ rule that where two
courts have concurrent jurisdiction, the first court in which
jurisdiction attaches has priority to consider the case.”).
4
E.E.O.C. v. Univ. of Pa., 850 F.2d 969, 971-72, 976-77 (3d
Cir. 1988) (discussing equitable limitations to the “policy of
comity”).
5
“The primary meaning of ‘dismissal without prejudice’ . . .
is dismissal without barring the plaintiff from returning later,
to the same court, with the same underlying claim.” Semtek
Int’l Inc. v. Lockheed Martin Corp., 531 U.S. 497, 505-06
(2001) (citing Black’s Law Dictionary (7th ed. 1999)).
3
were not heard on the merits in Louisiana 6 and, under
ordinary preclusion principles, are otherwise free to proceed
in Delaware. 7 Nor, likely, were the plaintiffs’ claims in
Delaware time-barred under Delaware’s statute of
limitations.8
Having concluded that the first-filed rule applied, the
District Court believed the possible options available to it
were “transfer to the Eastern District of Louisiana, stay, or
6
Maj. Op. at 6 (“To our knowledge, no court—federal or
state—has ever reviewed the actual merits of Appellants’
claims”).
7
“Res judicata bars a claim litigated between the same parties
. . . in earlier litigation where the claim arises from the same
set of facts as a claim adjudicated on the merits in the earlier
litigation.” Blunt v. Lower Merion Sch. Dist., 767 F.3d 247,
277 (3d Cir. 2014). “The traditional rule is that expiration of
the applicable statute of limitations merely bars the remedy
and does not extinguish the substantive right, so that
dismissal on that ground does not have claim-preclusive
effect in other jurisdictions with longer, unexpired limitations
periods.” Semtek, 531 U.S. at 504.
8
Dow Chem. Corp. v. Blanco, 67 A.3d 392, 399 (Del. 2013)
(in case arising from the same facts as the instant one,
concluding that Delaware recognizes cross-jurisdictional
tolling).
4
dismissal.” 9 The majority opinion agrees, including as to
dismissal with prejudice. On the majority opinion’s view, the
first-filed rule “permits the district courts, in their discretion,
to stay, transfer, or dismiss cases that are duplicates of those
brought previously in other federal fora.” 10 The majority
opinion cites to no decision of our court for this position.11
Meanwhile, neither Crosley nor University of Pennsylvania12
contain anything supportive of dismissal with prejudice, let
alone endorse district court discretion to dispose of a second-
9
Chavez v. Dole Food Co. Inc., No. 12-697-RGA, 2012 WL
3600307, at *2 (D. Del. Aug. 21, 2012). The District Court
did not cite to any decision of our court for this proposition.
10
Maj. Op. at 5.
11
Rather, the majority opinion cites to a Ninth Circuit case,
Cedars-Sinai Med. Ctr., et al v. Shalala, 125 F.3d 765, 769
(9th Cir. 1997). Neither Shalala nor any other Ninth Circuit
case has approved of dismissal with prejudice under the first-
filed rule, nor even dismissal without prejudice where the
first-filed suit may not be adjudicated on the merits. Much to
the contrary, the position of the Ninth Circuit is that “where
the first-filed action presents a likelihood of dismissal, the
second-filed suit should be stayed, rather than dismissed.” See
Alltrade, 946 F.2d at 629.
12
Nor our other first-filed rule cases: Triangle Conduit &
Cable Co. v. Nat’l Elec. Products Corp., 125 F.2d 1008 (3d
Cir. 1942) (en banc) and Kerotest Mfg. Co. v. C-O-Two Fire
Equip. Co., 189 F.2d 31 (3d Cir. 1951) (en banc) aff’d, 342
U.S. 180 (1952).
5
filed case in any manner it chooses. 13 Indeed, the proper
disposition of a second-filed case did not come up in Crosley
or University of Pennsylvania.
Crosley involved an interlocutory appeal from a first-
filed court’s denial of a motion to enjoin second-filed,
duplicative proceedings in another district court. Under our
newly-adopted first-filed rule, we “conclude[d] that the
District Court . . . having the power to issue the preliminary
injunction prayed for, abused its discretion in refusing to
exercise that power.”14 We had no occasion to say anything
about what may be done by second-filed courts, and we did
not do so in dicta. Meanwhile, to the extent we can glean
something here from Crosley’s instruction to first-filed
courts, it is that when a first-filed court enjoins prosecution of
13
The majority opinion separately suggests we have limited
review over a decision to dismiss with prejudice because it is
part of the district court’s docket management authority. Maj.
Op. at 15. I do not see how a dismissal with prejudice, which
enters final judgment on a complaint, falls within the rubric of
docket management. Indeed, In re Fine Paper Antitrust
Litigation, which the majority opinion cites, addressed a
challenge to the district court’s calendaring of proceedings.
See 685 F.2d 810, 818 (3d Cir. 1982) (“We find no abuse of
discretion by the district judge in his scheduling of discovery
or of the trial.”). Curtis v. Citibank, N.A. is not contrary to the
dissent, either. In Curtis, the Second Circuit reversed the
District Court’s dismissal of a purportedly duplicate case on
the basis that the cases were not actually duplicates. See 226
F.3d 133, 136 (2d Cir. 2000).
14
Crosley, 122 F.2d at 930.
6
later-filed proceedings, the effect is that of staying—not
dismissing—those other cases.15
University of Pennsylvania did involve a second-filed
court. But the second-filed court in that case determined that,
for equitable reasons, the first-filed rule did not apply. 16
University of Pennsylvania is a landmark first-filed rule case
because of its comprehensive discussion of the considerations
that bear upon whether or not the first-filed suit is entitled to
priority. 17 But because we upheld the District Court’s
determination that the first-filed suit was not, in that case,
entitled to priority, we had no occasion to say anything about
what a second-filed court is to do when the rule does apply.18
15
Cf. Asset Allocation, 892 F.2d at 571 (affirming portion of
first-filed court’s order enjoining party from proceeding in
second-filed forum, but reversing portion of order requiring
party to dismiss the parallel action).
16
Univ. of Pa., 850 F.2d at 972.
17
See id. at 971-72, 976-77.
18
If anything, University of Pennsylvania is supportive of the
dissent. In a footnote, we stated we were “puzzled” that the
EEOC did not move to transfer or stay the University’s
abusive and anticipatory first-filed suit in the District for the
District of Columbia. See id. at 976 n.4. In doing so, we cited
to a statement of the Fifth Circuit that “In addition to outright
dismissal, it sometimes may be appropriate to transfer the
action or to stay it.” Id. (citing W. Gulf Mar. Ass’n v. ILA
Deep Sea Local 24, 751 F.2d 721, 729 n. 1 (5th Cir. 1985)).
As to dismissal, that Fifth Circuit decision stated that “a
district court may dismiss an action where the issues
7
In short, the propriety of dismissal with prejudice
under the first-filed rule is a question of first impression in
our circuit.19 We should address it with reference to the view
of our sister circuits and leading treatises, considerations of
comity and equity, and the rules and principles we apply in
parallel contexts.
II
Unlike our Court, the Seventh, Ninth, and Fifth
Circuits have addressed whether and when a second-filed
court may dismiss a case on the basis of the first-filed rule.
presented can be resolved in an earlier-filed action pending in
another district court.” W. Gulf Mar. Ass’n, 751 F.2d at 729. I
agree wholeheartedly. As discussed below, presented with a
situation where a second court dismissed with prejudice
despite a likelihood that the first court would not resolve the
issues presented, the Fifth Circuit vacated the dismissal. See
Burger v. Am. Mar. Officers Union, 170 F.3d 184, 1999 WL
46962 (5th Cir. 1999).
19
That we have never previously reviewed a district court’s
dismissal with prejudice under the first-filed rule underscores
the unusualness of the dismissal with prejudice in this case.
Of course, we would not ordinarily have jurisdiction to
review a stay, transfer, or non-final dismissal. See Michelson
v. Citicorp Nat. Servs., Inc., 138 F.3d 508, 516 (3d Cir. 1998)
(emphasizing “the limited extent to which stays are
appealable”); Semerenko v. Cendant Corp., 223 F.3d 165, 172
(3d Cir. 2000) (“[A] dismissal without prejudice is not a final
and appealable order under § 1291, unless the plaintiff can no
longer amend the complaint or unless the plaintiff declares an
intention to stand on the complaint as dismissed.”).
8
These cases show that dismissal with prejudice under the
first-filed rule should be limited to cases where some other
legal basis—res judicata, jurisdiction, mootness, or the like—
shows the plaintiffs are clearly unable to prosecute their
claims before the abstaining court. Applying this basic rule,
these Courts of Appeals have each reversed a second-filed
court’s dismissal where, as here, there was an apparent
possibility that the claims at issue would not or could not be
heard in the first-filed forum.
Beginning with the Seventh Circuit, two cases there
are on point. First is Asset Allocation v. Western Employers.20
Though the procedural posture differs from the instant case,
the effect was the same: a first-filed court ordered the
defendant to dismiss a reciprocal action it had filed involving
the same issues in a second court. 21 While affirming the
portion of the first court’s order enjoining the parties from
proceeding in the second forum, 22 the Seventh Circuit
reversed the dismissal order. The court explained that if the
first suit was dismissed before litigation was “well-
advanced,” there would be no reason to forbid pursuing the
claim in the second-filed forum. Warning that statute of
limitations problems could cause claims to needlessly go
20
Asset Allocation & Mgmt. Co. v. W. Emp’rs Ins. Co., 892
F.2d 566 (7th Cir. 1989).
21
Id. at 571.
22
Cf. Crosley, 122 F.2d at 929 (holding district court abused
its discretion by failing to enjoin second-filed duplicative
proceedings).
9
unheard, the court asked, “[W]hy take chances? It is simpler
just to stay the second suit.”23
The Seventh Circuit again focused on the cost of
dismissing unheard claims in Central States v. Paramount
Liquor, which held that a second-filed court’s dismissal
without prejudice was error because, compared to a stay,
“dismissal created an unwarranted risk of legal prejudice.”24
23
Asset Allocation, 892 F.2d at 571. The court noted, “for
completeness, . . . that if the second suit is harassing—
vexatious—an abuse of process, the proper disposition is
neither a stay nor a dismissal without prejudice; it is dismissal
with prejudice, so that the plaintiff cannot refile suit.” Id. I do
not disagree that there is an “equitable doctrine that bars
vexatious litigation.” See id. at 572. This is “independent”
from the first-filed rule, however, which applies to any
“second, nonharassing lawsuit (albeit one identical to the
first).” Id. Here, there is no dispute that the plaintiffs filed suit
in Delaware to obtain relief from the defendants rather than to
harass them.
24
Cent. States, Se. & Sw. Areas Pension Fund v. Paramount
Liquor Co., 203 F.3d 442, 445 (7th Cir. 2000) (“Central
States”). The Seventh Circuit in Central States observed that
dismissal is more likely to be appropriate when the same
party brings duplicate suits than when opposing parties bring
dueling suits. As an example, it cited to Serlin v. Arthur
Andersen & Co., 3 F.3d 221 (1993), which upheld the
dismissal with prejudice of a second-filed action within the
same district court that was procedurally dismissed for failure
to timely serve process. The Serlin court affirmed given the
first-case ended because of “the plaintiff’s own failure to
follow the rules” and unwillingness to dismiss the earlier case
10
The general rule, the court explained, is that “when comity
among tribunals justifies giving priority to a particular suit,
the other action (or actions) should be stayed, rather than
dismissed, unless it is absolutely clear that dismissal cannot
adversely affect any litigant’s interests.”25
In Alltrade, Inc. v. Uniweld Products, Inc., the Ninth
Circuit followed the Seventh Circuit’s lead. 26 Alltrade
determined that a second-filed court’s dismissal without
prejudice was problematic even as it was proper for the
voluntarily—without prejudice—and then refile it with proper
service. See id. at 224.
For our purposes, Serlin was not a first-filed rule case, and the
particular context of a failure to follow procedural rules in the
same district court presents different considerations than
when a different federal court exercising diversity jurisdiction
determines a complaint is time-barred. Cf. Walton v. Eaton
Corp., 563 F.2d 66, 70-71 (3d Cir. 1977) (en banc) (discussed
infra at n.47).
25
Central States, 203 F.3d at 444. Judge Easterbrook
presented this as a rule of general applicability for all
concurrent litigation contexts. Reformulating the principle in
a case where the same plaintiff filed identical suits in the
same district, the court in Gleash v. Yuswak wrote that “even
when prudence calls for putting a redundant suit on hold, it
must be stayed rather than dismissed unless there is no
possibility of prejudice to the plaintiff.” See Gleash v.
Yuswak, 308 F.3d 758, 760 (7th Cir. 2002).
26
Alltrade, Inc. v. Uniweld Prods., Inc., 946 F.2d 622 (9th
Cir. 1991).
11
second court to give priority to the first court. To wit, if the
first-filed case terminated without an adjudication on the
merits, the district court’s dismissal meant the plaintiff
“would have to file a new suit in [the second court] and
would risk encountering statute of limitations problems.”27 A
stay, on the other hand, would have preserved the district
court’s flexibility to secure the rights of plaintiff and
defendant alike. Specifically, “should the [first] court dismiss
the appeal and transfer what remains of the first-filed action,
the stay could be lifted and the actions consolidated. On the
other hand, should the [first] court decide that it has
jurisdiction . . . , the stay could be lifted and the second-filed
action dismissed or transferred.”28 Citing to Asset Allocation,
the Ninth Circuit concluded that, “where the first-filed action
presents a likelihood of dismissal, the second-filed suit should
be stayed, rather than dismissed.”29
Finally, there is Burger v. American Marine Officers
Union, where the Fifth Circuit reversed a second-filed court’s
dismissal with prejudice.30 The decision to reverse drew upon
Alltrade, Asset Allocation, and Fifth Circuit caselaw holding
that, when a plaintiff files duplicative suits in the same federal
district, dismissal with prejudice is appropriate only when res
judicata or collateral estoppel give preclusive effect to the
27
Id. at 629.
28
Id. (citation and internal quotation marks omitted).
29
Id.30
Burger v. Am. Mar. Officers Union, 170 F.3d 184, 1999
WL 46962 (5th Cir. 1999).
12
first proceeding. 31 In light of these authorities, the court
explained that “[w]hen the jurisdiction of the first-filed court
to hear the dispute is uncertain, it is an abuse of discretion to
dismiss the claims in the second-filed court with prejudice, as
it creates the risk that the merits of the claims could never be
addressed.”32 Instead, the Fifth Circuit held, the second-filed
court should have stayed the proceedings or dismissed
without prejudice.33
The leading treatises are in concert with our sister
courts. Speaking of the first-filed rule as a doctrine of
abstention—meaning a judge-made canon by which a court
declines to exercise its jurisdiction—Wright and Miller say
that “it is well settled that if the same issues are presented in
an action pending in another federal court, one of these courts
may stay the action before it or even in some circumstances
enjoin going forward in the other federal court.”34 They say
nothing of dismissal. Moore’s Federal Practice, meanwhile,
takes dismissal on directly, writing that “if the first-filed
31
Id. (citing Dillard v. Merrill Lynch, Pierce, Fenner &
Smith, Inc., 961 F.2d 1148, 1160-61 (5th Cir. 1992)); see also
Cadle Co. v. Whataburger of Alice, Inc., 174 F.3d 599, 604
(5th Cir. 1999) (stating that a second-filed court applying the
first-filed rule “is not binding the litigants before it to a ruling
of the first [court]”).
32
Burger, 1999 WL 46962 at *2.
33
Id. at *3.
34
17A Charles Alan Wright et al., Fed. Prac. & Proc. Juris. §
4247 (3d ed.) (“Avoiding Duplicative Litigation”).
13
action is vulnerable to dismissal on jurisdictional or statute of
limitations grounds, the court in the second-filed action
should stay it or transfer it, rather than outright dismiss it.”35
This circumstance is precisely the one presented in this case.
Then there are our district courts, the vast majority of
which have applied the first-filed rule by staying the second
case, transferring it, or dismissing it without prejudice.36 The
35
17 Moore's Federal Practice ¶ 111.13[1][o][ii][A] (3d ed.).
36
See Premier Payments Online, Inc. v. Payment Sys.
Worldwide, 848 F. Supp. 2d 513, 523 (E.D. Pa. 2012) (“When
the first-filed rule applies, a court has the option of dismissing
the second-filed case without prejudice, staying it for the
duration of the first-filed case, or transferring it to the forum
where the first-filed case was brought.”); e.g. CTI Sys. SA v.
Herr Indus., Inc., 2015 WL 1073667 (E.D. Pa. 2015)
(dismissal without prejudice, with express leave to re-file if
first court was unable to grant a remedy); Englebert v.
McGraw-Hill Global Educ. Holdings LLC, 2014 WL
3109884 (E.D. Pa. 2014) (stay); Plange v. Christ Hosp., 2014
WL 1790169, at *5 (D.N.J. 2014) (stay); Miller v.
Careminders Home Care, Inc., 2014 WL 1779362, at *4
(D.N.J. 2014) (transfer); DePuy Synthes Sales, Inc. v. Gill,
2013 WL 5816328, at *11 (D.N.J. 2013) (transfer); Synthes,
Inc. v. Knapp, 978 F. Supp. 2d 450, 463 (E.D. Pa. 2013)
(transfer); Inter City Tire & Auto Ctr., Inc. v. Michelin N.
Am., Inc., 2013 WL 5567564, at *3 (D.N.J. 2013) (transfer);
Wheaton Indus., Inc. v. Aalto Scientific, Ltd., 2013 WL
4500321, at *5 (D.N.J. 2013) (transfer); D & L Distribution,
LLC v. Agxplore Int'l, LLC, 959 F. Supp. 2d 757, 772 (E.D.
Pa. 2013) (transfer); Mahmoud v. Rite Aid Corp., 2012 WL
14district court here is the only one I am aware of that dismissed
a second case with prejudice despite the open likelihood that
the earlier case would not adjudicate the matter on the
merits.37
Our sister Courts of Appeals, the leading treatises, and
most of our district courts agree: the applicability of the first-
filed rule alone is insufficient to justify dismissal with
prejudice, and dismissal with prejudice is inappropriate under
the rule where, compared to a stay, it could cause properly
presented claims to go unheard.
III
3560645, at *6 (D.N.J. 2012) (stay); Worthington v. Bayer
Healthcare, LLC, 2012 WL 1079716, at *8 (D.N.J. 2012)
(dismissal “with leave to re-file if [first] action is dismissed
on procedural grounds”); Vinik Marine, Inc. v. Ironhead
Marine, Inc., 2012 WL 1067737, at *4 (D.N.J. 2012)
(dismissal “without prejudice since the [first] court did not
address the claims on the merits”).
37
The defendants bring but three examples of first-filed rule
dismissals to our attention. In one case the dismissal was
issued with express leave to re-file if the first forum
dismissed on procedural grounds. See Worthington v. Bayer
Healthcare, LLC, 2012 WL 1079716 (D.N.J. 2012). In the
others there was no apparent possibility that the first court
would not adjudicate the case on the merits. See Time Warner
Cable, Inc. v. GPNE Corp., 497 F. Supp. 2d 584, 586 (D. Del.
2007); Funkhouser v. Chi-Chi's, Inc., No. 02:05CV638, 2005
WL 2545300 (W.D. Pa. 2005).
15
The majority opinion offers a few reasons why we
should depart from the consensus viewpoint and embrace
dismissal with prejudice as squarely within the authority of
the second-filed court. For one thing, the majority opinion
notes, dismissal with prejudice satisfies the primary goals of
the first-filed rule in that it avoids duplicative proceedings,
which serves comity and efficiency and prevents conflicting
judgments.38 For another, the majority opinion sees dismissal
with prejudice as salutary when, as here, the same party filed
both suits out of concern about a procedural dismissal in the
first forum.39 To the extent the plaintiffs “wanted to keep the
same litigation going in two different federal fora
simultaneously to see in which one they would fare better,”
the majority opinion sees dismissal with prejudice as “an
appropriate response to the Appellants’ own litigation
strategy.” 40 From this perspective, our sister Courts of
Appeals’ reversals might be distinguished, as in those cases
the successive suits were filed by different parties.
I find these arguments unpersuasive. A second-filed
court avoids duplicative litigation, conflicting judgments, and
cross-district frictions whether it stays the matter or dismisses
it. A stay also prevents gamesmanship. Regardless of who
files each suit, a stay confines litigants to the first-filed forum
until the conclusion of its proceedings. Res judicata and
collateral estoppel would then prevent the relitigation of any
claims that were, or could have been, previously heard on the
merits. The additional benefit of a stay, as our sister Courts of
38
Maj. Op. at 12.
39
Maj. Op. at 12-13.
40
Maj. Op. at 12-13.
16
Appeals have emphasized, is that it preserves the ability of
litigants to advance claims that the first-filed forum does not
allow to be adjudicated on the merits. This danger of
litigation prejudice is the same whether the two suits were
brought by the same parties or opposing ones. The reasoning
of our sister Courts of Appeals is as operative here as in the
cases before them.
I disagree, moreover, with the assertion that the
plaintiffs sought to maintain two actions to see in which one
they would fare better. The plaintiffs explicitly told the
District Court here, and the one in Louisiana, that they filed
their claim in Delaware as a precaution in case the Louisiana
court determined that it could not hear their claims on the
merits. After all, if the Louisiana court dismissed their claim
without any assessment of the merits, the District Court here
was their court of only resort, and filing sooner rather than
later helped ensure timeliness in Delaware. This is not a
litigation strategy designed to get the plaintiffs multiple bites
at the apple or a more favorable judge or decisional law than
what was offered in Louisiana. Rather, this is a litigation
strategy designed to get the plaintiffs a seat at the table to
present their claims to a single U.S. District Court.
As to the purported inequities of successive litigation
generally, forum shopping is indeed a recognized basis for
overriding the first-filed rule’s presumption that the first court
to receive a case should have priority.41 It does not follow,
however, that concurrent filings—whether by the same or
different parties—is a basis for dismissing a case with
41
See Univ. of Pa., 850 F.2d at 972.
17
prejudice such that the dispute is never heard at all. Indeed,
the majority opinion’s forum shopping concerns are nowhere
to be seen in our cases addressing other successive and/or
concurrent litigation situations. Under our rule of res judicata,
for example, litigants are entitled to bring—and our courts
required to entertain—new filings of previously presented
claims unless those claims were previously adjudicated on the
merits. 42 Far from the majority opinion’s view that a
successive filing of an unheard claim should be barred as
inequitable, res judicata reflects the principle that, when the
first court that a plaintiff petitions is unable to entertain her
claims, she may go to another and another until she finds one
that can. Under ordinary res judicata principles, the plaintiffs
here would not be precluded from proceeding in Delaware.43
Our cases in other successive and/or concurrent
litigation contexts track the same contours as the res judicata
rule. Where a plaintiff has filed successive duplicative suits
within the same district court, we have expressly recognized
only stay, consolidation, and dismissal without prejudice as
42
Blunt, 767 F.3d at 277.
43
The majority opinion illuminates its departure from res
judicata principles with its claim that “the procedural posture
of the first-filed case, on the date the second-filed actions
were dismissed, is irrelevant to the analysis.” Maj. Op. at 9-
11. If the majority opinion fashioned the first-filed rule
consistent with res judicata principles, there would be no need
to fix “a particular moment in time” at which “to take a
snapshot of the cases.” See Maj. Op. at 11.
18
the options available to the court.44 Compared to that context,
the case against dismissal with prejudice is stronger under the
first-filed rule, as parallel cases in different states are more
likely to involve different personal jurisdictions and/or
statutes of limitations. Meanwhile, where abstention
principles counsel deference to a parallel state proceeding,45
we have repeatedly emphasized the importance of staying—
and not dismissing—the federal case where any of the
44
Walton, 563 F.2d at 70-71 (en banc) (Judge Garth observed
that, “When the district court became aware that the two
actions begun by Mrs. Walton were virtually identical, it
could have dismissed her second complaint without prejudice
or it could have stayed proceedings in the second action until
judgment was entered in the first”) (emphasis added).
45
E.g. Younger v. Harris, 401 U.S. 31 (1971) (requiring
abstention where judgment would interfere with ongoing state
enforcement proceeding); Colorado River Water
Conservation Dist. v. United States, 424 U.S. 800 (1976)
(permitting abstention in limited circumstances because of
duplicative state court litigation); Burford v. Sun Oil Co., 319
U.S. 315 (1943) (affirming abstention in deference to
complex state administrative proceedings); see also Colorado
River, 424 U.S. at 817 (“[T]here are principles unrelated to
considerations of proper constitutional adjudication and
regard for federal-state relations which govern in situations
involving the contemporaneous exercise of concurrent
jurisdictions, either by federal courts or by state and federal
courts.”). See generally 17A Charles Alan Wright et al., Fed.
Prac. & Proc. Juris. § 4241 (3d ed.) (“Abstention Generally”).
19
requested relief may be unavailable from the state forum.46 As
we explained in Feige v. Sechrest, a stay “retains the
sensitivity for concerns of federalism and comity implicated
by . . . abstention, while preserving appellants’ right to litigate
their claims in the federal forum should the [state] courts, for
jurisdictional or other reasons, fail to adjudicate them.”47
Our consistent position—that an earlier-filed action
precludes a later one only if the earlier one has been
adjudicated on the merits—reflects the fairness principle that
46
See, e.g., Feige v. Sechrest, 90 F.3d 846, 851 (3d Cir. 1996)
(“The entry of a stay rather than a dismissal prevents those
claims from becoming time-barred should jurisdiction be
somehow lacking in the [state court], and the preclusion
doctrines of res judicata and collateral estoppel will prevent
their re-litigation in the more likely event that court proceeds
to judgment.”); Ingersoll-Rand Fin. Corp. v. Callison, 844
F.2d 133, 138 (3d Cir. 1988) (reversing dismissal under
Colorado River doctrine because “some matters arguably will
remain for resolution after the state proceedings” and
instructing district court to “determine the effect of the
judgment by applying principles of res judicata to determine
what issues of fact or law remain in the case”); Monaghan v.
Deakins, 798 F.2d 632, 635 (3d Cir. 1986) aff’d in part,
vacated in part on other grounds, 484 U.S. 193 (1988) (“It is
settled in this circuit that a district court, when abstaining
from adjudicating a claim for injunctive relief, should stay
and not dismiss accompanying claims for damages and
attorney fees when such relief is not available from the
ongoing state proceedings.”).
47
Feige, 90 F.3d at 851.
20
litigants are entitled to a single day in court. 48 But though
well-grounded in equity, the position is ultimately one of
Article III obligation.
As recently noted by Judge Krause, “the mandate that
federal courts hear cases within their statutory jurisdiction is a
bedrock principle of our judiciary.”49 For, “[a]s the Supreme
Court has instructed on numerous occasions, ‘federal courts
have a strict duty to exercise the jurisdiction that is conferred
upon them by Congress.’”50 “Proceed[ing] from the premise
48
Cf. In re Global Indus. Technologies, Inc., 645 F.3d 201,
204, 204 n.4 (3d Cir. 2011) (en banc) (describing bankruptcy
parties as “entitled to be fully heard and to have their
legitimate objections addressed” and focusing on the
Bankruptcy Court’s “refusal to give [the appellants] their
proper place at the litigation table” as “the whole point of this
appeal”).
49
In re: One2One Communications, LLC, __ F.3d __, 2015
WL 4430302 at *9 (3d Cir. July 21, 2015 (Krause, J.,
concurring).
50
In re Semcrude, L.P., 728 F.3d 314, 326 (3d Cir. 2013)
(quoting Quackenbush v. Allstate Ins. Co., 517 U.S. 706(1996)). See also Willcox v. Consol. Gas Co. of New York,
212 U.S. 19, 40 (1909) (“When a federal court is properly
appealed to in a case over which it has by law jurisdiction, it
is its duty to take such jurisdiction.”); Chicot County v.
Sherwood, 148 U.S. 529, 534 (1893) (“The courts of the
United States are bound to proceed to judgment and to afford
redress to suitors before them in every case to which their
jurisdiction extends.”). “Underlying these assertions is the
21
that ‘[i]n rare circumstances, federal courts can relinquish
their jurisdiction in favor of another forum,’”51 the unanimous
Supreme Court in Quackenbush v. Allstate explained how this
Article III duty constrains the abstention doctrines that are the
state-federal analogue to the first-filed rule. 52 To wit, when
abstention principles militate against a federal court’s
exercise of jurisdiction, the abstaining court’s disposition of
the case depends both on the nature of the claim and, if it is a
damages claim, the ability of the other forum to hear it. 53
Where there is no other available forum to entertain a
damages claim before an abstaining court, the Supreme Court
held that an abstaining court may stay a damages action to
avoid concurrent litigation, but it may not dismiss it. 54 The
basis of this is that, “[u]nlike the outright dismissal or remand
of a federal suit, . . . an order merely staying the action ‘does
undisputed constitutional principle that Congress, and not the
Judiciary, defines the scope of federal jurisdiction within the
constitutionally permissible bounds.” New Orleans Pub.
Serv., Inc. v. Council of City of New Orleans, 491 U.S. 350,
358-59 (1989).
51
One2One Communications, 2015 WL 4430302 at *9
(Krause, J., concurring) (quoting Quackenbush, 517 U.S. at
722).
52
Quackenbush, 517 U.S. at 716-23, 728, 731.
53
Id.54
Id.22
not constitute abnegation of judicial duty . . . [a]s there is only
postponement of decision for its best fruition.’”55
The teaching of Quackenbush is that “where there is
no other forum and no later exercise of jurisdiction . . .
relinquishing jurisdiction is not abstention; it’s abdication.”56
A judge’s primary function is to decide cases within its
jurisdiction. Judge-made canons of comity and equity cannot
supplant that duty, and for this reason, too, a district court
may not properly terminate a claim under the first-filed rule
that has not, and will not, be heard by any other court. In
55
Id. at 721 (quoting La. Power & Light Co. v. City of
Thibodaux, 360 U.S. 25, 29 (1959)). The Quackenbush Court
emphasized that the “distinction between . . . dismissals and
abstention-based decisions merely to stay adjudication of a
federal suit” is crucial in this respect. Id. at 720. Indeed, it
accounts for the divergent results of companion cases decided
on the same day in 1959—Louisiana Power & Light v. City of
Thibodaux and County of Allegheny v. Frank Mashuda—
which each involved district court abstentions from exercising
diversity jurisdiction over an eminent domain action. See id.
at 721 (comparing Thibodaux, 360 U.S. 25 with Cnty. of
Allegheny, 360 U.S. 185). The district court in Thibodaux
stayed the federal action; the district court in County of
Allegheny dismissed the federal action; and “[b]ased in large
measure on this distinction,” the Supreme Court affirmed the
Thibodaux court and reversed the County of Allegheny court.
Id.56
One2One Communications, 2015 WL 4430302 at *9
(Krause, J., concurring).
23
short, “the Judiciary has a responsibility to decide cases
properly before it, even those it ‘would gladly avoid.’”57
In sum, the vast corpus of successive litigation and
concurrent litigation authority holds that a second-filed suit
may not be dismissed with prejudice solely on the basis of
equity or judicial management. This consistent rejection of
dismissal with prejudice except as according to some other
recognized basis—res judicata, jurisdiction, mootness, or the
like—is well-grounded in both fundamental fairness and the
constitutional duties of federal courts. Those considerations
apply as fully here as ever, and they cannot be overcome by
concern for purported forum shopping.
IV
For the above reasons, I would say that a second-filed
action “should be stayed, rather than dismissed, unless it is
absolutely clear that dismissal cannot adversely affect any
litigant’s interests.” 58 The District Court’s dismissals with
57
Zivotofsky ex rel. Zivotofsky v. Clinton, 132 S. Ct. 1421,
1427 (2012) (quoting Cohens v. Virginia, 19 U.S. (6 Wheat.)
264 (1821)).
58
See Central States, 203 F.3d at 444. I emphasize that this is
not a “no dismissal rule.” Maj. Op. at 14. A second-filed court
may always dismiss with an express caveat that the plaintiff
has leave to re-file if the first-filed court finds it is unable to
adjudicate the case on the merits. Worthington v. Bayer
Healthcare, LLC, 2012 WL 1079716, at *8 (D.N.J. 2012),
took such an approach, and it is exemplary of how a court can
dismiss under the first-filed rule without risking prejudice to
24
prejudice were at fundamental odds with this precept,
needlessly foreclosing the plaintiffs’ final chance at a lone
hearing on the merits. The premature judgments caused two
hundred people to be without redress for life-altering injuries,
and I believe they should be vacated and the case remanded
for further proceedings.
I respectfully dissent.
any litigant. Meanwhile, dismissal with prejudice remains
appropriate in the event that the plaintiff is clearly unable to
prosecute her claims in the second-filed court.
25