Michael Ford v. [24]7.ai, Inc.

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS JUL 16 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
MICHAEL FORD; et al., No. 19-15462
Plaintiffs-Appellants, D.C. No. 5:18-cv-02770-BLF
v.
MEMORANDUM*
[24]7.AI, INC.,
Defendant-Appellee.
Appeal from the United States District Court
for the Northern District of California
Beth Labson Freeman, District Judge, Presiding
Argued and Submitted July 9, 2020
Pasadena, California
Before: PAEZ and BADE, Circuit Judges, and ZOUHARY,** District Judge.
This putative class action arises out of a 2017 data breach, in which
Plaintiffs-Appellants allege their payment card data and other personally
identifiable information were compromised due to Defendant-Appellee’s
data-security system. The district court determined that another action arising out
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The Honorable Jack Zouhary, United States District Judge for the
Northern District of Ohio, sitting by designation.
of the same data breach, Pica v. Delta Air Lines, Inc., No. 19-55300 (9th Cir.)
(“Pica”), was commenced prior to this action (“Ford”), and dismissed Ford with
prejudice on first-to-file grounds.
We have jurisdiction under 28 U.S.C. § 1291. “We review a court’s
decision to accept or decline jurisdiction based on the first-to-file rule for abuse of
discretion.” Alltrade, Inc. v. Uniweld Prods., Inc., 946 F.2d 622, 625 (9th Cir.
1991) (citation omitted). We vacate the district court dismissal and remand with
instructions to stay the proceedings pending resolution of Pica.
The first-to-file rule is “a generally recognized doctrine of federal comity
which permits a district court to decline jurisdiction over an action when a
complaint involving the same parties and issues has already been filed in another
district.” Pacesetter Sys., Inc. v. Medtronic, Inc., 678 F.2d 93, 94–95 (9th Cir.
1982) (citations omitted). A district court applying the rule may transfer, stay, or
dismiss the second-filed case. See Cedars-Sinai Med. Ctr. v. Shalala, 125 F.3d
765, 769 (9th Cir. 1997).
Plaintiffs-Appellants contend that the first-to-file rule should not apply to
this action at all. We do not decide that issue; regardless of whether Pica or Ford
should be deemed “first-filed,” the district court abused its discretion in dismissing
Ford. Under our case law, “where the first-filed action presents a likelihood of
dismissal, the second-filed suit should be stayed, rather than dismissed.” Alltrade,
2
Inc., 946 F.2d at 629 (citation omitted). The Pica action plainly presented a
likelihood of dismissal: When the district court dismissed the Ford action, the
district court in Pica had already issued a tentative order dismissing that case with
prejudice. Accordingly, we conclude the district court abused its discretion in
dismissing Ford. We vacate the district court order and remand with instructions
to stay the proceedings pending resolution of Pica.
Plaintiffs-Appellants shall recover their costs on appeal.
VACATED AND REMANDED.
3