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Brizendine v. Randall

United States District Court, D. Kansas

April 5, 2017

DANNY BRIZENDINE, Plaintiff,
v.
JENNIFER RANDALL, Defendant.

          MEMORANDUM AND ORDER

          GWYNNE E. BIRZER United States Magistrate Judge.

         This matter is before the Court on Defendant's Motion to Stay this case (ECF No. 11). On March 27, 2017, the Court conducted an in-person hearing to discuss the motion. Plaintiff Danny Brizendine appeared in person and through counsel, Myndee M. Lee. Defendant Jennifer Randall appeared through counsel, Patrick A. Turner. After review of the parties' briefing and considering the arguments of counsel, the Motion to Stay is GRANTED in part as explained below.

         Background[1]

         This is the third-filed lawsuit filed between an estranged husband and wife. The parties lived together in the state of California for approximately five years prior to their relocation to Hutchinson, Kansas in 2006. Although there are multiple disputed facts, it appears, at least from the record in the case, the following background facts are not in dispute:

         During their time in Kansas, the parties purchased a commercial property (“Property”) located at 201 S. Main Street in Hutchinson, Kansas, and eventually married in 2009. Then, in the summer of 2010, the couple moved back to California. Despite residing in California, the couple continued to manage the Property in Hutchinson. At some point after its purchase, ownership of the Property was transferred to a Kansas Limited Liability Company (LLC). Jennifer Randall was the managing member, and Danny Brizendine was designated as resident agent.

         Kansas Divorce Action

         The parties encountered marital difficulties and separated in November 2014. Brizendine was the first to file a divorce action on September 14, 2015, in Reno County, Kansas.[2] The Reno County case was dismissed for lack of jurisdiction and that dismissal was recently upheld by the Kansas Court of Appeals.[3] The district and appellate courts found Kansas lacked jurisdiction over the matter because Brizendine was not a resident of Kansas for the requisite time frame prior to his filing of the divorce.[4]

         California Divorce Action

         Before being served with the Kansas petition, and only four days after the Kansas filing, Randall filed a divorce action in the Superior Court, San Luis Obispo County, California on September 18, 2015.[5] On September 22, 2015, the California court issued an ex parte temporary order, giving Randall temporary exclusive management and control of the Hutchinson Property. The California divorce proceeding remains active, and according to the parties' reports at the March 27, 2017 hearing, is scheduled for trial on April 14, 2017.[6]

         Federal Claims

         On November 27, 2016, Brizendine filed his federal Complaint against Randall, alleging federal claims of quantum meruit and fraud related to the Hutchinson Property. Brizendine claims the parties bought the Property together in 2006, and from 2006 through 2015, he spent thousands of hours both physically remodeling it and acting as Property manager. He alleges Randall falsely misrepresented to him that he was investing his labor in exchange for an equal ownership interest in the Property. He also asserts Randall fraudulently induced him to transfer title to the Property from their joint ownership to the LLC, of which she is the sole member, in order to exclude him from any financial benefit in the Property.

         Randall filed a motion to dismiss the fraud claim (ECF No. 6), arguing Brizendine failed to plead fraud with particularity under Fed.R.Civ.P. 9(b), and that motion is currently being considered by the District Judge. During a February 16, 2017 scheduling conference, the parties initiated a contested conversation regarding a stay of this case pending resolution of the divorce action. The undersigned Magistrate Judge then stayed discovery and entered a briefing schedule, leading to the present motion (ECF No. 14).

         Defendant Randall's Motion to Stay (ECF No. 11)

         Randall seeks to stay this case, pending final property division by the California domestic court. She contends the Property at the core of Brizendine's federal claims will be equitably distributed through the divorce. Once the domestic court determines the value and ultimate award of the Property (which will include any time and/or money both parties have contributed to it during their marriage), Randall argues the federal claims will become moot. Randall asserts the filing of this action, while Brizendine was fully aware the Property is subject to distribution in the divorce, amounts to forum shopping and harassment. She contends a stay of this case would avoid piecemeal litigation and duplicative costs to both parties, and impose no prejudice on Brizendine.

         In opposition, Brizendine claims the California court is unable to hear either his fraud or quantum meruit claims. Most importantly, domestic law prohibits a fraud claim to be plead in, or joined with, a divorce action. Additionally, he distinguishes the value of his services-pursued in the quantum meruit claim-as separate from the value of the Property itself. Because they are distinct claims, he argues the cases are not parallel, and the Court must resolve any doubt in favor of exercising federal jurisdiction.

         Legal Standard

         Whether to stay litigation is within the Court's inherent power to control its docket and rests in its sound discretion.[7] Applying the abstention doctrine of Colorado River Water Conservation Dist. v. United States, [8] a federal court analyzes multiple factors to determine whether to stay a federal case pending the outcome of parallel state court proceedings.[9] Abstention is the exception rather than the rule, and the “pendency of an action in state court is no bar to proceedings concerning the same matter in a federal court with jurisdiction.”[10] However, the doctrine's core principle is “the avoidance of duplicative litigation, ” and its goal is to “preserve judicial resources” by focusing on efficiency and economy.[11] Although the federal court is under a “virtually unflagging”[12]obligation to hear a case under its jurisdiction, the obligation “is not absolute, and it is well-established that federal courts have the power to refrain from hearing, among other things, cases which are duplicative of a pending state proceeding.”[13]

         Before analyzing the relevant Colorado River factors, the court must first find the state court proceeding is parallel to the federal case. In this context, the definition of parallel does not require the exact parties and issues to be present in both cases. Rather, “the state and federal proceedings are considered parallel if ‘substantially the same parties litigate substantially the same issues'” in different forums.[14] “Just as the parallel nature of the actions cannot be destroyed by simply tacking on a few more defendants, neither can it be dispelled by repackaging the same issue under different causes of action.”[15] The actions need not be identical to be parallel.[16]

         Once the federal court determines the federal and state actions are parallel, it applies the Colorado River factors to analyze whether abstention is appropriate. Those factors include: (1) assumption of jurisdiction over property by either court; (2) relative inconvenience of the federal forum; (3) avoidance of piecemeal litigation; (4) the order in which jurisdiction was obtained by the state and federal forums and progress of both cases; (5) the extent to which federal law controls the issues; and (6) the adequacy of the state proceedings in protecting the rights of the party invoking federal jurisdiction;[17] and (7) the “vexatious or reactive nature of either the federal or the state litigation.”[18] The court must carefully balance these factors, but the “weight to be given to any one factor may vary greatly from case to case.”[19]

         Analysis

         Prior to the application of the Colorado River factors, the Court first analyzes whether the current case and the California divorce action are parallel. Clearly, the parties to each case are identical. Therefore, the Court must evaluate the issues presented in each action and the underlying facts supporting each. Brizendine argues his fraud and quantum meruit claims are simply unable to be joined in the underlying domestic action, [20] and the Court recognizes the distinction between the legal causes of action and the remedies available in the two cases.

         However, during the motion hearing, Brizendine reluctantly conceded two questions which this Court cannot ignore. First, although certainly not the sole determinants of the divorce case, the facts underlying the purchase, improvements, and ownership of the Property will be examined in both forums. Second, Brizendine also acknowledged that, though he disagrees discovery will be “substantially similar” (as argued by Randall), due to the shared factual issues, the discovery in the two cases will overlap. His contributions to the Property-which form the basis of his quantum meruit claim-will be one element the domestic court may consider when determining how to award the Property. Likewise, Randall's alleged representations-the subject of the fraud claim-will be another issue examined by the divorce court to determine the Property's ultimate ...


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