New Wellington v. Flagship Resort , 416 F.3d 290 ( 2005 )


Menu:
  •                           PUBLISHED
    UNITED STATES COURT OF APPEALS
    FOR THE FOURTH CIRCUIT
    NEW WELLINGTON FINANCIAL              
    CORPORATION,
    Plaintiff-Appellant,
    v.
    FLAGSHIP RESORT DEVELOPMENT
    CORPORATION; FIRST FLAGSHIP
    FINANCIAL SERVICES CORPORATION,                 No. 04-2216
    Defendants-Appellees,
    and
    ATLANTIC PALACE DEVELOPMENT,
    L.L.C.,
    Defendant.
    
    Appeal from the United States District Court
    for the Western District of Virginia, at Charlottesville.
    Norman K. Moon, District Judge.
    (CA-03-74)
    Argued: May 25, 2005
    Decided: July 21, 2005
    Before MOTZ and GREGORY, Circuit Judges,
    and HAMILTON, Senior Circuit Judge.
    Affirmed by published opinion. Judge Gregory wrote the opinion, in
    which Senior Judge Hamilton joined. Judge Motz concurred in the
    judgment.
    2          NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT
    COUNSEL
    ARGUED: Thomas E. Albro, TREMBLAY & SMITH, Charlottes-
    ville, Virginia, for Appellant. Dennis Alan Richard, RICHARD &
    RICHARD, P.A., Miami, Florida, for Appellees. ON BRIEF: Joseph
    D. Pope, Nicole Tuman, COHEN POPE, P.L.L.C., New York, New
    York; M. E. Gibson, Jr., Patricia D. McGraw, TREMBLAY &
    SMITH, L.L.P., Charlottesville, Virginia, for Appellant. Patrick C.
    Asplin, KEELER OBENSHAIN, P.C., Harrisonburg, Virginia, for
    Appellees.
    OPINION
    GREGORY, Circuit Judge:
    This appeal requires us to determine whether personal jurisdiction
    exists over an out-of-state defendant and, if so, whether the district
    court could decline to exercise jurisdiction. Because the district court
    was entitled to exercise its discretion to decline to hear a declaratory
    judgment action in light of a parallel state-court case, we affirm.
    I.
    Flagship Resort Development Corp., First Flagship Financial Ser-
    vices Corp. (together, "Flagship"), and Atlantic Palace Development,
    L.L.C. ("Atlantic Palace") operate timeshare resorts in New Jersey.
    According to New Wellington Financial Corp. ("Wellington"), Flag-
    ship and Atlantic Palace mailed consumer credit applications, credit
    reports, and collateral from outside Virginia to Wellington’s Virginia
    headquarters every week from 1993 to 2003. Wellington reviewed
    and processed these credit documents on behalf of lenders including
    Liberty Bank ("Liberty") and Finova Capital Corp. ("Finova"), among
    others (collectively, "the lenders"). With Wellington’s aid, Flagship
    and Atlantic Palace secured financing from the lenders for their
    resorts.
    In June 2003 a sharp disagreement arose between the parties. Flag-
    ship and Atlantic Palace confronted Wellington with allegations that
    NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT                 3
    Wellington violated its duty as their agent by taking undisclosed pay-
    ments from the lenders. On June 13, 2003, Flagship and Atlantic Pal-
    ace sent a letter from New Jersey to Finova’s headquarters in Arizona.
    The letter sought Finova’s cooperation with Flagship and Atlantic
    Palace’s investigation of the allegedly undisclosed payments and
    requested that, in the interim, Finova cease payments to Wellington
    relating to their loans. Five days later Flagship and Atlantic Palace
    also wrote to Liberty, in Connecticut. The letter told Liberty that
    Flagship and Atlantic Palace would no longer be working with Wel-
    lington. That same day Flagship informed Wellington by letter that
    they would terminate their relationship with Wellington, requested a
    list of the dates, amounts and form of all payments received from the
    lenders, and stated that they would seek return of all fees paid by the
    lenders on their loans. Wellington insists that it has never acted as
    Flagship’s or Atlantic Palace’s agent or broker or taken improper pay-
    ments from lenders.
    Wellington filed its initial complaint on August 13, 2003. It sought
    a declaratory judgment that no agency relationship existed between
    the parties and that it owed Flagship and Atlantic Palace no money
    that it had received from the lenders. A month later Wellington
    amended its complaint by adding a claim against Flagship for tortious
    interference with Wellington’s agreement with Liberty and by drop-
    ping Atlantic Palace to preserve complete diversity, which was the
    sole basis for subject-matter jurisdiction.1 Both complaints asserted
    personal jurisdiction because the action arose "from the transaction of
    business in this state and from the commission of torts outside this
    state causing injury in this state." J.A. 12, 32.
    Between the filing of Wellington’s initial and amended complaints,
    Flagship and Atlantic Palace sued Wellington, Finova, and two of
    Wellington’s officers in New Jersey state court. Flagship and Atlantic
    Palace alleged, among other things, fraud, commercial bribery, viola-
    tion of New Jersey racketeering law, breach of contract, breach of the
    implied covenant of good faith and fair dealing, and breach of fidu-
    1
    Flagship is incorporated in both New Jersey and Florida. Atlantic Pal-
    ace is a limited liability company whose citizenship is ultimately uncer-
    tain from the record because of its abbreviated presence in this suit.
    4               NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT
    ciary duty. The parties agree that the conduct underlying the two
    cases is identical.
    On April 30, 2004, Flagship filed motions to dismiss the Virginia
    case because of the parallel New Jersey suit and for lack of personal
    jurisdiction. In its brief opposing Flagship’s motion to dismiss for
    lack of personal jurisdiction, Wellington argued that personal jurisdic-
    tion existed only under 
    Va. Code Ann. § 8.01-328.1
    (A)(4)
    ("subsection 4"),2 not § 8.01-328.1(A)(1) ("subsection 1").3 At the oral
    argument, however, Wellington changed course and argued both sub-
    sections 1 and 4 of Virginia’s long-arm statute. Only on August 18,
    2004 — over three months after filing its opposition brief and the
    court’s deadline for reply briefs, after oral argument, and the day
    before the court issued its opinion — did Wellington put the subsec-
    tion 1 argument to paper, in a "supplemental memorandum of law"
    that Wellington admits to us was untimely and unauthorized.
    Wellington acknowledged in both its May 14, 2004 brief opposing
    the motion to dismiss and at the August 13, 2004 oral argument on
    the motion before the district court that it had released the claim for
    tortious interference with Liberty’s contract because of settlement. At
    the oral argument on the motions to dismiss Wellington also claimed
    it would amend its complaint again to allege tortious interference with
    Wellington’s contract with Finova. Despite its claim, and despite the
    fact that it must have been aware of any alleged tortious interference
    at least three months before the oral argument, when it submitted a
    declaration of its president containing the information Wellington
    2
    This subsection provides jurisdiction over a person as to:
    a cause of action arising from the person’s . . . [c]ausing tortious
    injury in this Commonwealth by an act or omission outside the
    Commonwealth if he regularly does or solicits business, or
    engages in any other persistent course of conduct, or derives sub-
    stantial revenue from goods used or consumed or services ren-
    dered, in this Commonwealth[.]
    
    Va. Code Ann. § 8.01-328.1
    (A)(4).
    3
    This subsection confers jurisdiction over a person as to "a cause of
    action arising from the person’s . . . [t]ransacting any business in this
    Commonwealth." 
    Va. Code Ann. § 8.01-328.1
    (A)(1).
    NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT                 5
    4
    claims states a claim of tortious interference, Wellington never sub-
    mitted a motion for leave to amend.
    On August 19, 2004, the district court dismissed the case. The
    court held that because Wellington withdrew the claim that Flagship
    tortiously interfered with Wellington’s contract with Liberty and
    because Wellington never filed any motion seeking to amend the
    complaint to add the Finova contract claim, the only claim remaining
    was the request for a declaration of the nature of the parties’ relation-
    ship. The court found that because Wellington only argued jurisdic-
    tion under subsection 4 of Virginia’s long-arm statute, which requires
    an allegation that the defendant caused an actual tortious injury, and
    because no claim of tortious injury remained, personal jurisdiction did
    not exist. The court then explained that even if jurisdiction were
    proper, it would exercise its discretion not to hear the declaratory
    judgment action in light of the New Jersey state-court suit. This
    appeal followed.
    II.
    We first address whether personal jurisdiction existed over Flag-
    ship. We review this legal question de novo, but review any underly-
    ing factual conclusions for clear error. See ePlus Tech., Inc. v. Aboud,
    
    313 F.3d 166
    , 176 (4th Cir. 2002) (citing ALS Scan, Inc. v. Digital
    Serv. Consultants, Inc., 
    293 F.3d 707
    , 710 (4th Cir. 2002)).
    A.
    When a defendant moves to dismiss for lack of personal jurisdic-
    tion, the plaintiff ultimately bears the burden of proving to the district
    court judge the existence of jurisdiction over the defendant by a pre-
    ponderance of the evidence. Combs v. Bakker, 
    886 F.2d 673
    , 676 (4th
    Cir. 1989). "But when, as here, the court addresses the question on the
    basis only of motion papers, supporting legal memoranda and the rel-
    4
    Specifically, the declaration stated in relevant part that, "FINOVA has
    renegotiated its loan agreements with Defendants and with Atlantic Pal-
    ace. The renegotiated loan agreements enabled Defendants and with [sic]
    Atlantic Palace to prepay their respective loans, which has resulted in
    reduced fees to Wellington from FINOVA." J.A. 162 (emphasis added).
    6              NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT
    evant allegations of a complaint, the burden on the plaintiff is simply
    to make a prima facie showing of a sufficient jurisdictional basis to
    survive the jurisdictional challenge." Id.; see also In re Celotex Corp.,
    
    124 F.3d 619
    , 628 (4th Cir. 1997). Under such circumstances, courts
    "must construe all relevant pleading allegations in the light most
    favorable to the plaintiff, assume credibility, and draw the most favor-
    able inferences for the existence of jurisdiction." Combs, 
    886 F.2d at 676
    ; see also Mitrano v. Hawes, 
    377 F.3d 402
    , 406 (4th Cir. 2004).5
    Because federal courts exercise personal jurisdiction in the manner
    provided by state law, we first decide whether Virginia state law
    authorizes jurisdiction over the defendant; if so, we then must deter-
    mine whether exercise of such jurisdiction is consistent with the Due
    Process Clause of the Fourteenth Amendment. ESAB Group, Inc. v.
    Centricut, Inc., 
    126 F.3d 617
    , 622 (4th Cir. 1997); see also Mitrano,
    
    377 F.3d at 406
    . Virginia law provides in relevant part that:
    A court may exercise personal jurisdiction over a person,
    who acts directly or by an agent, as to a cause of action aris-
    ing from the person’s:
    1. Transacting any business in this Commonwealth;
    ....
    4. Causing tortious injury in this Commonwealth by an act
    or omission outside this Commonwealth if he regularly does
    or solicits business, or engages in any other persistent course
    of conduct, or derives substantial revenue from goods used
    or consumed or services rendered, in this Commonwealth
    ....
    5
    However, "[a] threshold prima facie finding that personal jurisdiction
    is proper does not finally settle the issue; plaintiff must eventually prove
    the existence of personal jurisdiction by a preponderance of the evidence,
    either at trial or at a pretrial evidentiary hearing." Production Group Int’l
    v. Goldman, 
    337 F. Supp. 2d 788
    , 793 n.2 (E.D. Va. 2004) (citation omit-
    ted).
    NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT                  7
    Va. Code. Ann. § 8.01-328.1(A) (emphasis added). Virginia, like
    other states, expands its specific grants of personal jurisdiction as far
    as the Due Process Clause allows. See Peninsula Cruise, Inc. v. New
    River Yacht Sales, Inc., 
    257 Va. 315
    , 319 (1999).6
    Wellington only alleges specific, not general, jurisdiction. We have
    synthesized the requirements of the Due Process Clause for asserting
    specific jurisdiction into a three-part test. Specifically, we consider:
    "‘(1) the extent to which the defendant purposefully availed itself of
    the privilege of conducting activities in the State; (2) whether the
    plaintiffs’ claims arise out of those activities directed at the State; and
    (3) whether the exercise of personal jurisdiction would be constitu-
    tionally reasonable.’" Mitrano, 
    377 F.3d at 407
     (quoting ALS Scan,
    Inc., 
    293 F.3d at 712
    ).
    B.
    Wellington now attempts to argue that specific personal jurisdic-
    tion exists under both subsections 1 and 4 of Virginia’s long-arm stat-
    ute. But the subsection 1 argument was never properly presented.
    Here, some three months after briefing on the motion, Wellington
    decided to adopt a different theory of personal jurisdiction at oral
    argument from the only one argued in its brief. Then, after oral argu-
    ment and the day before the court issued its decision, Wellington sub-
    mitted the subsection 1 argument in an unauthorized and untimely
    "supplemental memorandum." The court was fully within its rights to
    prevent this ambush.7 District courts have the inherent authority —
    6
    It is nonetheless still possible "‘for the contacts of a non-resident
    defendant to satisfy due process but not meet the specific grasp of a Vir-
    ginia long-arm statute provision.’" Bochan v. LaFontaine, 
    68 F. Supp. 2d 692
    , 698 (E.D. Va. 1999) (quoting Telco Communications v. An Apple
    A Day, 
    977 F. Supp. 404
    , 405 (E.D. Va. 1997)); see also Blue Ridge
    Bank v. Veribanc, Inc., 
    755 F.2d 371
    , 373 (4th Cir. 1985). Virginia’s spe-
    cific grants of jurisdiction are not meaningless. Moreover, plaintiffs who
    assert jurisdiction under only one provision of the long-arm statute can-
    not obtain jurisdiction under an unclaimed provision.
    7
    See, e.g., Skipper v. Giant Food, Inc., 
    68 Fed.Appx. 393
    , 396 n.3 (4th
    Cir. 2003) ("After all papers were filed in the district court and the par-
    ties had conducted oral argument, plaintiffs’ counsel filed a supplemental
    8           NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT
    and in fact the duty — to manage cases by setting time limits for the
    filing of motions. An inseparable corollary is that the court can ignore
    arguments forfeited because they are not presented consistent with the
    court’s time limits. So it is clear that Wellington can only contend
    personal jurisdiction exists under subsection 4.
    As the district court also recognized rightly, Wellington plainly
    released the only tortious interference with contract claim made in its
    amended complaint because of settlement in both its brief opposing
    the motion and at oral argument on the motion. Wellington contends
    that the district court should have read the complaint and the May 13,
    2004 declaration by Wellington’s president in a manner that somehow
    constructed a new and separate claim for tortious interference with
    Wellington’s contract with Finova. We disagree. Over three months
    of time passed after Wellington filed the declaration of its president
    which, it claims, contained a sufficient basis for belief that a new tor-
    tious interference claim existed. Yet throughout this time Wellington
    never moved for leave to amend its complaint so as to add a new tor-
    tious interference claim.8 Given this inexplicable failure to amend
    during this extensive opportunity, it was perfectly reasonable for the
    district court to find that Wellington had not and either could not or
    would not allege a new claim of tortious interference.9
    memorandum. . . . Finding that the memorandum had not been filed in
    a timely manner, the district court declined to address. . . [it] and we
    decline to do so as well."); OV Foy v. Norfolk & Western R. Co., 
    377 F.2d 243
    , 246 (4th Cir. 1967) (where plaintiff offered no timely response
    to motion for summary judgment and no explanation for that failure, dis-
    trict court did not abuse its discretion in granting summary judgment for
    defendant; district court’s decision to deny late motion was not an abuse
    of discretion).
    8
    At oral argument Wellington stated that "[a]nd now we’re seeking, we
    will be seeking, Judge, to amend it to encompass the claim of tortious
    interference with a different bank that they’ve interfered with." J.A. 257.
    Yet as the district court held, Wellington never filed this promised
    motion to amend "and given the absence of such a motion the Court can-
    not find that [ ] Wellington’s hypothetical proposed amendment is proper
    or that such an amendment would create jurisdiction." J.A. 284.
    9
    Wellington argues to us that "mere lateness or delay in seeking leave
    to amend are not, by themselves, reasons to deny amendment," Appel-
    NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT                  9
    Wellington’s remaining argument is that under subsection 4 its
    declaratory judgment action arises from a tortious injury. Wellington
    submits that, even without the tortious interference with contract
    claim, it alleged a tortious injury in the amended complaint with the
    truncated claim that Flagship’s correspondence with Finova "dispar-
    ages Wellington in its trade and business." J.A. 34. While this asser-
    tion is rather cursory, when we construe the complaint in the light
    most favorable to the plaintiff, see Combs, 
    886 F.2d at 676
    , and rec-
    ognize the minimal requirements of the notice-pleading regime, see
    Fed. R. Civ. P. 8(a), (e)(1), and (f), as we must, it is fair to say that
    this allegation could be shaped into an allegation of the tort of defama-
    tion.10 We will thus assume that the declaratory judgment claim can
    satisfy subsection 4 by "arising from" this tort, thus satisfying Vir-
    ginia law. Because, as explained below, we resolve this appeal by
    lant’s Br. at 25. True enough, but this is insufficient to carry the day
    where, as here, counsel never properly moved for amendment. That Wel-
    lington managed to hide an alternative request to amend the complaint
    in what it admits to us is an untimely and unauthorized "supplemental
    memorandum of law" opposing the motion to dismiss is of no moment.
    Filing a motion for leave to amend is not difficult — Wellington already
    did it once in this case, and could have done so again easily. Improperly
    filed briefs are a nullity and counsel should expect courts to ignore sug-
    gestions tucked inside such papers.
    10
    In contrast with other arguments in this case, Wellington preserved
    the defamation argument. The argument was made in Wellington’s
    response to the motion to dismiss, see J.A. 308-310, and to the district
    court at oral argument. At oral argument before the district court Wel-
    lington stated that "letters were sent that were demeaning, derogatory,
    and defaming of Wellington, and those letters were sent by Flagship
    from New Jersey to other places. That’s a tort. There’s a tort of business
    defamation and there was a tort of interference with business relations."
    J.A. 246. Subsequently, Wellington stated that "[w]e have, in our original
    and amended claim, we alleged business defamation. We didn’t set it out
    as a separate count, but it is alleged." J.A. 247. We note that in Virginia
    false, publicized statements that "prejudice a person in his or her profes-
    sion or trade" are defamatory per se, and "a defamatory charge need not
    be made in direct terms; rather, it may be made ‘by inference, implica-
    tion[,] or insinuation.’" Perk v. Vector Resources Group, Ltd., 
    253 Va. 310
    , 316 (1997) (citing Carwile v. Richmond Newspapers, 
    196 Va. 1
    , 7
    (1954)).
    10         NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT
    holding that the district court did not abuse its discretion by refusing
    to entertain the declaratory judgment action in light of the New Jersey
    suit, we will also assume without analysis that jurisdiction would sat-
    isfy the familiar due process requirements.
    III.
    But this does not end things. "In the declaratory judgment context,
    the normal principle that federal courts should adjudicate claims
    within their jurisdiction yields to considerations of practicality and
    wise judicial administration." Wilton v. Seven Falls Co., 
    515 U.S. 277
    , 287 (1995); see also Brillhart v. Excess Ins. Co., 
    316 U.S. 491
    ,
    494-95 (1942) (district courts are "under no compulsion" to exercise
    jurisdiction over declaratory judgment action). "This circuit has long
    recognized the discretion afforded to district courts in determining
    whether to render declaratory relief," Aetna Cas. & Sur. Co. v. Ind-
    Com Elec. Co., 
    139 F.3d 419
    , 421-22 (4th Cir. 1998). Accordingly,
    we review a district court’s decision to decline to exercise such juris-
    diction for an abuse of that discretion. 
    Id.
     at 421 (citing Wilton, 
    515 U.S. at 290
    ).
    This discretion, while not unbounded, is especially crucial when,
    as here, a parallel or related proceeding is pending in state court. See
    Brillhart, 
    316 U.S. at 495
     (district court considering hearing a declar-
    atory judgment action "should ascertain whether the questions in con-
    troversy between the parties to the federal suit . . . can better be
    settled in the proceeding pending in the state court."). In such situa-
    tions federal courts must weigh "‘considerations of federalism, effi-
    ciency, and comity.’" United Capitol Ins. Co. v. Kapiloff 
    155 F.3d 488
    , 493 (4th Cir. 1998) (quoting Nautilus Ins. Co. v. Winchester
    Homes, Inc., 
    15 F.3d 371
    , 376 (4th Cir. 1994)); see also Penn-
    America Ins. Co. v. Coffey, 
    368 F.3d 409
    , 412 (4th Cir. 2004). As the
    Supreme Court explained:
    Ordinarily it would be uneconomical as well as vexatious
    for a federal court to proceed in a declaratory judgment suit
    where another suit is pending in a state court presenting the
    same issues, not governed by federal law, between the same
    parties. Gratuitous interference with the orderly and compre-
    NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT                11
    hensive disposition of a state court litigation should be
    avoided.
    Brillhart, 
    316 U.S. at 495
    . These considerations led us to require the
    consideration of four factors when deciding whether to hear a declara-
    tory judgment action when a related state-court proceeding exists:
    (1) whether the state has a strong interest in having the
    issues decided in its courts; (2) whether the state courts
    could resolve the issues more efficiently than the federal
    courts; (3) whether the presence of "overlapping issues of
    fact or law" might create unnecessary "entanglement"
    between the state and federal courts; and (4) whether the
    federal action is mere "procedural fencing," in the sense that
    the action is merely the product of forum-shopping.
    Kapiloff, 
    155 F.3d at 493
     (quoting Nautilus Ins., 15 F.3d at 377); see
    also Penn-America Ins. Co., 
    368 F.3d at 412
    .
    Applying these guidelines to this case, we do not believe the dis-
    trict court abused its discretion when it held that it would have
    declined to exercise jurisdiction.
    First, we agree with the district court that New Jersey has a strong
    interest in having the dispute resolved in its courts. The conduct at
    issue in these two suits involves and concerns New Jersey companies,
    writing letters from New Jersey, regarding loans for New Jersey prop-
    erty. In addition to the parties, actions, and property implicated, Flag-
    ship and Atlantic Palace’s complaints in the New Jersey suit
    exclusively involve claims based in New Jersey state law, several of
    which can fairly be called complex, including those for "commercial
    bribery," New Jersey RICO, and conspiracy to violate New Jersey
    RICO.11 As we explained in Mitcheson v. Harris, 
    955 F.2d 235
     (4th
    Cir. 1992), "[t]here exists an interest in having the most authoritative
    voice speak on the meaning of applicable law, and that voice belongs
    to the state courts when state law controls the resolution of the case."
    11
    We pause to make clear that insofar as Wellington seeks to assert in
    this action that it has a good defense to Flagship’s New Jersey action, it
    is entirely proper to look to Flagship’s New Jersey claims.
    12          NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT
    
    Id. at 237
    . Likewise, Wellington asserts no claims under federal law.
    As we said in Mitcheson, "[a]bsent a strong countervailing federal
    interest, the federal court here should not elbow its way into this con-
    troversy to render what may be an ‘uncertain and ephemeral’ interpre-
    tation of state law." 
    Id. at 238
     (citation omitted).
    Second, the New Jersey state court can resolve the matter more
    efficiently. Other parties present there apparently could not be joined
    in this case without destroying subject-matter jurisdiction. In the New
    Jersey case, Finova and two of Wellington’s principals are named as
    defendants. Wellington first removed the New Jersey case to New
    Jersey federal district court but then filed a suggestion of remand,
    because it believed one of the individual defendants was not diverse
    from all of the members of Atlantic Palace. Remand was granted.
    Moreover, Wellington first joined Atlantic Palace as a defendant to
    this case, which evidences Wellington’s belief that Atlantic Palace is
    a proper party, if not a necessary one. But Wellington’s counsel has
    represented to the court that Atlantic Palace’s presence in this case
    would destroy complete diversity of the parties.12 Besides the parties
    present in New Jersey and absent here, it is easy to believe that the
    New Jersey state court could resolve the New Jersey state law issues
    alleged by Flagship and Atlantic Palace more efficiently than could
    a federal court sitting in Virginia. We have previously found that the
    presence of other parties and issues in the state action not present in
    the federal declaratory judgment action is "particularly salient," and
    we also find that to be the case here. See Centennial Life Ins. Co. v.
    Posten, 
    88 F.3d 255
    , 257 (4th Cir. 1996). Indeed, if the district court
    heard the case without the other parties and without addressing Flag-
    ship’s state-law claims as counter-claims, then this could indeed cause
    "excessive entanglement" by resolving the dispute in a piecemeal and
    inefficient fashion.13
    12
    Now Wellington’s counsel claims that it erred in representing that
    Atlantic Palace would destroy diversity in this case, and that Atlantic
    Palace is indeed diverse and could be re-joined to this suit. Litigation
    cannot proceed in this fashion; at some point an attorney’s representation
    must have consequences.
    13
    Like the district court, we do not suggest that the filing of this action
    was "mere procedural fencing."
    NEW WELLINGTON FINANCIAL v. FLAGSHIP RESORT               13
    IV.
    Given all this, we cannot conclude that the district court abused its
    discretion in deciding to decline to hear this declaratory judgment
    action if personal jurisdiction existed. Clear as day, considerations of
    "federalism, comity, and efficiency," Penn-America Ins. Co., 
    368 F.3d at 412
    , counsel against running this action simultaneously with
    the New Jersey lawsuit. Accordingly, after careful consideration we
    conclude that the district court’s decision to dismiss is
    AFFIRMED.
    

Document Info

Docket Number: 04-2216

Citation Numbers: 416 F.3d 290

Filed Date: 7/21/2005

Precedential Status: Precedential

Modified Date: 1/12/2023

Authorities (21)

David T. Combs Sarah E. Combs v. James O. Bakker Tammy Faye ... , 886 F.2d 673 ( 1989 )

esab-group-incorporated-v-centricut-incorporated-thomas-aley-and-john , 126 F.3d 617 ( 1997 )

Blue Ridge Bank v. Veribanc, Inc. , 755 F.2d 371 ( 1985 )

united-capitol-insurance-company-v-bernard-kapiloff-lynn-kapiloff-v , 155 F.3d 488 ( 1998 )

penn-america-insurance-company-v-gregory-coffey-steven-simons-ajz , 368 F.3d 409 ( 2004 )

Peter Paul Mitrano v. Christopher J. Hawes, D/B/A Cjh Color ... , 377 F.3d 402 ( 2004 )

Wilton v. Seven Falls Co. , 115 S. Ct. 2137 ( 1995 )

Eplus Technology, Incorporated v. Patricia Aboud, A/K/A ... , 313 F.3d 166 ( 2002 )

george-anthony-mitcheson-acting-for-and-on-behalf-of-certain-other , 955 F.2d 235 ( 1992 )

In Re the Celotex Corporation, Debtor. Owens-Illinois, ... , 124 F.3d 619 ( 1997 )

The Centennial Life Insurance Company v. Barbara Poston ... , 88 F.3d 255 ( 1996 )

Aetna Casualty & Surety Company v. Ind-Com Electric Company , 139 F.3d 419 ( 1998 )

o-v-foy-v-norfolk-and-western-railway-company-a-corporation , 377 F.2d 243 ( 1967 )

als-scan-incorporated-v-digital-service-consultants-incorporated-and , 293 F.3d 707 ( 2002 )

Perk v. Vector Resources Group, Ltd. , 253 Va. 310 ( 1997 )

Carwile v. Richmond Newspapers , 196 Va. 1 ( 1954 )

Peninsula Cruise, Inc. v. New River Yacht Sales, Inc. , 257 Va. 315 ( 1999 )

Brillhart v. Excess Insurance Co. of America , 62 S. Ct. 1173 ( 1942 )

Bochan v. La Fontaine , 68 F. Supp. 2d 692 ( 1999 )

Telco Communications v. an Apple a Day , 977 F. Supp. 404 ( 1997 )

View All Authorities »