ENTERED DEC n 4 201 4
STATE OF MAINE SUPERIOR COURT CUMBERLAND, ss CIVIL ACTION DOCKET NO. RE-14-157 /_ NM-OttYr)- r"- V;A- IY. TRIPPING GNOME FARM, LLC, RYEN MUNROE, and URSULA MUNROE
Plaintiffs
v.
LOU FERRARA, MELISSA FERRARA, and NEW ENGLAND ALPACAS,
Defendants
Before the court is defendants' motion to stay. There is pending litigation
m the Connecticut Superior Court involving the same parties and issues.
Defendants move the court to stay the proceedings in Maine in favor of the
Connecticut litigation. Defendants argue they cannot obtain complete relief in
Maine. Plaintiffs oppose the motion and argue that because the Maine suit was
filed first, the litigation should take place in Maine. For the following reasons, the
motion to stay is granted.
BACKGROUND
This suit arises out of an agreement between plaintiffs and the defendants
regarding the sale of Tripping Gnome Farm, LLC' s (TGF) alpacas to a third-party
buyer. Plaintiffs do not dispute that TGF agreed to pay and did pay defendants a
commission for alpaca sales in 2011 for brokering a deal between plaintiff and an alpaca buyer. The parties' dispute concerns whether plaintiffs also agreed to pay
"tail commissions" to the defendants, which are fees for future sales of alpacas
between TGF and the third-party buyer. According to defendants, plaintiffs agreed to the terms of a written contract sent to plaintiffs, even though that
contract is unsigned. The contract includes provisions regarding "tail
commissions," selects Connecticut as the forum for litigation, and provides for
attorney's fees to the prevailing party.
Plaintiff TGF filed its complaint for declaratory judgment on April2, 2014,
and an amended complaint was filed on June 12, 2014, which included Ryen
Munroe and Ursula Munroe as plaintiffs. In the amended complaint, plaintiffs
seek the following: in count I, a declaratory judgment that plaintiffs never
agreed to pay defendants the tail commissions; in count II, a declaratory
judgment that plaintiffs did not agree to pay defendants' attorney's fees; in count
III, a declaratory judgment that the parties did not agree to litigate in
Connecticut; and in count IV, a declaratory judgment that plaintiffs Ryen
Munroe and Ursula Munroe cannot be held personally liable in connection with
the dispute between TGF and defendants. In their counterclaim, defendants
allege the following: in count I: breach of contract; and in count II: unjust
enrichment.
Defendants filed a motion to dismiss on June 9, 2014 and argued improper
venue because of the contract's forum selection clause. The court denied the
motion to dismiss on July 3, 2014. Defendants filed the motion to stay on October
17, 2014. The court held a telephone conference with counsel on November 19,
2014 to discuss the motion to stay. A second telephone conference was held on
November 26, 2014 after the Connecticut court .granted the Munroes' motion to
dismiss them as parties in the Connecticut suit.
2 DISCUSSION
A trial court has broad discretion in considering whether to stay a
proceeding when there is litigation pending in another jurisdiction. Fitch v.
Whaples, 220 A.2d 170, 172 (Me. 1966). Although the first-filed action generally
has priority over a subsequent suit filed in another jurisdiction, "[t]he
circumstances of the litigation may be such as to make it desirable to stay the first
action, and to permit the subsequent action to proceed to conclusion." lsi; see
also Tones v. York, 444 A.2d 382, 384 (Me. 1982). In Fitch, the Law Court listed
several factors to guide the trial court in deciding whether to grant a stay:
Multiple considerations may serve the trial court in a judicial exercise of its discretion in granting or denying a stay, such as whether the subsequent action was designed solely to harass the adverse party; the nature of the respective actions, especially with a view as to which appears to provide complete justice; also, where did the cause of action arise and which law will be applicable; will there be great and unnecessary expense and inconvenience; the availability of witnesses; the stage at which the proceedings in the other court have already progressed; the delay in obtaining trial. Each case must perforce present its own variety of circumstances which may necessitate different results.
Fitch, 222 A.2d at 172-73.
In Jones v. York, defendants filed a declaratory judgment action in the
Superior Court shortly before plaintiffs filed a forcible entry and detainer action
in the District Court. 444 A.2d at 384. Nevertheless, the Law Court decided that
although the Superior Court action was filed first, the District Court had
properly taken jurisdiction of the matter. Id. at 385. The court balanced the rights
of the parties and concluded that the summary nature of the District Court
proceedings would give the parties "the just, speedy and inexpensive
determination of their dispute .... " Id.
3 Other jurisdictions "give priority to 'coercive' actions over declaratory
judgment actions or anticipatory suits, regardless of the order of filing." Bluetarp
Fin., Inc. v. Matrix Const. Co., Inc., CUMSC-CV-2012-100, at 5 (Me. Super. Ct.,
Cum. Cnty., Sept. 13, 2012). As one federal court explained, an exception to the
first-filed suit rule "exists where the first-filed suit constitutes an 'improper
anticipatory filing,' or one made under the apparent threat of a presumed
adversary filing the mirror image of that suit in a different [court]." Ontel Prods.,
Inc. v. Project Strategies Corp., 899 F. Supp. 1144, 1150 (S.D.N.Y. 1995). An
anticipatory filing is improper if "it attempts to exploit the first-filed rule by
securing a venue that differs from the one that the filer's adversary would be
expected to choose." Id. "Where a party is prepared to pursue a lawsuit, but first
desires to attempt settlement discussions, that party should not be deprived of
the first-filed rule's benefit simply because its adversary used the resulting delay
in filing to proceed with the mirror image of the anticipated suit." Id.
Based on the correspondence of counsel attached to defendants' reply
memorandum in support of the motion to stay, it appears that defendants waited
to file suit because the parties were engaging in settlement discussions. (Defs.'
Reply Mem. Exhs. A & B.) Before these discussions concluded, plaintiff filed this
suit in Maine. Defendants represent that the Connecticut suit was filed on April
24, 2014, before they were served on May 2 with the summons and complaint for 1 the Maine suit. Based on this timeline, plaintiffs' suit is an anticipatory filing
that should not reap the benefit of the "first-filed" rule.
1 During the telephone conference, plaintiffs' counsel did not dispute defendants' history in the first paragraph of page four of defendants' reply memorandum but offered further explanation and context.
4 Other factors weigh in support of granting a stay. First, if defendants are
correct and the written contract is binding on the parties, the forum selection
clause would apply to the case and the parties would be required to litigate in 2 Connecticut.
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ENTERED DEC n 4 201 4
STATE OF MAINE SUPERIOR COURT CUMBERLAND, ss CIVIL ACTION DOCKET NO. RE-14-157 /_ NM-OttYr)- r"- V;A- IY. TRIPPING GNOME FARM, LLC, RYEN MUNROE, and URSULA MUNROE
Plaintiffs
v.
LOU FERRARA, MELISSA FERRARA, and NEW ENGLAND ALPACAS,
Defendants
Before the court is defendants' motion to stay. There is pending litigation
m the Connecticut Superior Court involving the same parties and issues.
Defendants move the court to stay the proceedings in Maine in favor of the
Connecticut litigation. Defendants argue they cannot obtain complete relief in
Maine. Plaintiffs oppose the motion and argue that because the Maine suit was
filed first, the litigation should take place in Maine. For the following reasons, the
motion to stay is granted.
BACKGROUND
This suit arises out of an agreement between plaintiffs and the defendants
regarding the sale of Tripping Gnome Farm, LLC' s (TGF) alpacas to a third-party
buyer. Plaintiffs do not dispute that TGF agreed to pay and did pay defendants a
commission for alpaca sales in 2011 for brokering a deal between plaintiff and an alpaca buyer. The parties' dispute concerns whether plaintiffs also agreed to pay
"tail commissions" to the defendants, which are fees for future sales of alpacas
between TGF and the third-party buyer. According to defendants, plaintiffs agreed to the terms of a written contract sent to plaintiffs, even though that
contract is unsigned. The contract includes provisions regarding "tail
commissions," selects Connecticut as the forum for litigation, and provides for
attorney's fees to the prevailing party.
Plaintiff TGF filed its complaint for declaratory judgment on April2, 2014,
and an amended complaint was filed on June 12, 2014, which included Ryen
Munroe and Ursula Munroe as plaintiffs. In the amended complaint, plaintiffs
seek the following: in count I, a declaratory judgment that plaintiffs never
agreed to pay defendants the tail commissions; in count II, a declaratory
judgment that plaintiffs did not agree to pay defendants' attorney's fees; in count
III, a declaratory judgment that the parties did not agree to litigate in
Connecticut; and in count IV, a declaratory judgment that plaintiffs Ryen
Munroe and Ursula Munroe cannot be held personally liable in connection with
the dispute between TGF and defendants. In their counterclaim, defendants
allege the following: in count I: breach of contract; and in count II: unjust
enrichment.
Defendants filed a motion to dismiss on June 9, 2014 and argued improper
venue because of the contract's forum selection clause. The court denied the
motion to dismiss on July 3, 2014. Defendants filed the motion to stay on October
17, 2014. The court held a telephone conference with counsel on November 19,
2014 to discuss the motion to stay. A second telephone conference was held on
November 26, 2014 after the Connecticut court .granted the Munroes' motion to
dismiss them as parties in the Connecticut suit.
2 DISCUSSION
A trial court has broad discretion in considering whether to stay a
proceeding when there is litigation pending in another jurisdiction. Fitch v.
Whaples, 220 A.2d 170, 172 (Me. 1966). Although the first-filed action generally
has priority over a subsequent suit filed in another jurisdiction, "[t]he
circumstances of the litigation may be such as to make it desirable to stay the first
action, and to permit the subsequent action to proceed to conclusion." lsi; see
also Tones v. York, 444 A.2d 382, 384 (Me. 1982). In Fitch, the Law Court listed
several factors to guide the trial court in deciding whether to grant a stay:
Multiple considerations may serve the trial court in a judicial exercise of its discretion in granting or denying a stay, such as whether the subsequent action was designed solely to harass the adverse party; the nature of the respective actions, especially with a view as to which appears to provide complete justice; also, where did the cause of action arise and which law will be applicable; will there be great and unnecessary expense and inconvenience; the availability of witnesses; the stage at which the proceedings in the other court have already progressed; the delay in obtaining trial. Each case must perforce present its own variety of circumstances which may necessitate different results.
Fitch, 222 A.2d at 172-73.
In Jones v. York, defendants filed a declaratory judgment action in the
Superior Court shortly before plaintiffs filed a forcible entry and detainer action
in the District Court. 444 A.2d at 384. Nevertheless, the Law Court decided that
although the Superior Court action was filed first, the District Court had
properly taken jurisdiction of the matter. Id. at 385. The court balanced the rights
of the parties and concluded that the summary nature of the District Court
proceedings would give the parties "the just, speedy and inexpensive
determination of their dispute .... " Id.
3 Other jurisdictions "give priority to 'coercive' actions over declaratory
judgment actions or anticipatory suits, regardless of the order of filing." Bluetarp
Fin., Inc. v. Matrix Const. Co., Inc., CUMSC-CV-2012-100, at 5 (Me. Super. Ct.,
Cum. Cnty., Sept. 13, 2012). As one federal court explained, an exception to the
first-filed suit rule "exists where the first-filed suit constitutes an 'improper
anticipatory filing,' or one made under the apparent threat of a presumed
adversary filing the mirror image of that suit in a different [court]." Ontel Prods.,
Inc. v. Project Strategies Corp., 899 F. Supp. 1144, 1150 (S.D.N.Y. 1995). An
anticipatory filing is improper if "it attempts to exploit the first-filed rule by
securing a venue that differs from the one that the filer's adversary would be
expected to choose." Id. "Where a party is prepared to pursue a lawsuit, but first
desires to attempt settlement discussions, that party should not be deprived of
the first-filed rule's benefit simply because its adversary used the resulting delay
in filing to proceed with the mirror image of the anticipated suit." Id.
Based on the correspondence of counsel attached to defendants' reply
memorandum in support of the motion to stay, it appears that defendants waited
to file suit because the parties were engaging in settlement discussions. (Defs.'
Reply Mem. Exhs. A & B.) Before these discussions concluded, plaintiff filed this
suit in Maine. Defendants represent that the Connecticut suit was filed on April
24, 2014, before they were served on May 2 with the summons and complaint for 1 the Maine suit. Based on this timeline, plaintiffs' suit is an anticipatory filing
that should not reap the benefit of the "first-filed" rule.
1 During the telephone conference, plaintiffs' counsel did not dispute defendants' history in the first paragraph of page four of defendants' reply memorandum but offered further explanation and context.
4 Other factors weigh in support of granting a stay. First, if defendants are
correct and the written contract is binding on the parties, the forum selection
clause would apply to the case and the parties would be required to litigate in 2 Connecticut. As defendants argue, the only way the Maine court can resolve all
issues is to find against defendants. Plaintiffs do not face similar prejudice in
Connecticut.
Second, defendants could be prejudiced by litigating in Maine if they are
unable to assert an unfair trade practices claim that may be available in
Connecticut. Compare 42 C.G.S.A. § 42-llOg(a) (West 2014) (providing cause of
action to "[a]ny person who suffers any ascertainable loss of money or property .
. .")with 5 M.R.S. § 213(1) (2013) (limiting private cause of action to "[a]ny person
who purchases or leases goods, services or property ... ").
In the objection to the motion to stay, plaintiffs did not identify any
specific benefit to plaintiffs from litigating in Maine as opposed to Connecticut
and relied primarily on the "first-filed" rule. Before the second telephone
conference, the Connecticut court dismissed the Munroes as parties in the
Connecticut suit. Defendants represent they will file a motion to dismiss Ursula
Munroe as a counterclaim defendant in the Maine suit and will file a motion for
reconsideration in the Connecticut suit of the order dismissing Ryen Munroe
based, apparently, on additional information.
The court does not have sufficient information to address all of the Fitch
considerations. It appears, however, that both suits are similar in nature because
2 If the court determines the parties entered a contract, as defendants argue, the <;ourt likely will view the contract as a whole and avoid rendering any provision meaningless. See McCarthy v. U.S.!. Corp., 678 A.2d 48, 52 (Me. 1996).
5 in the Maine suit, plaintiffs seek a declaratory judgment that no contract existed
between the parties and in the Connecticut suit, plaintiffs allege breach of that
alleged contract, unjust enrichment, and, notably absent in the Maine suit, a
violation of Connecticut's Unfair Trade Practices Act. In the Maine suit,
defendants allege in their counterclaim breach of contract and unjust enrichment.
Both suits are in the early stages of the proceedings. The expense and
inconvenience to the parties if required to litigate in the forum they did not
choose are similar. One necessary witness resides in Connecticut.
In addition to the above considerations, because of the apparent
heightened adversarial nature of these lawsuits, including various discovery
disputes the parties cannot resolve themselves, the potential for conflicting
rulings from the Maine and Connecticut courts on discovery and evidentiary
issues is real. See Fitch, 220 A.2d at 173 ("Each case must perforce present its own
variety of circumstances which may necessitate different results.").
The entry is
Defendants' motion to stay is GRANTED. This case is stayed pending resolution of the parties' suit in Connecticut.
If the Connecticut Superior Court grants the pending motion to dismiss or grants the pending motion to stay, counsel will request a conference with the court.
Date: ___.~-=-~--If!::__;?_-f~t- N cy Mills Justice, Superior Co
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