United States District Court, D. Maryland
MEMORANDUM OPINION
DEBORAH K. CHASANOW UNITED STATES DISTRICT JUDGE
Defendant/Counter-Plaintiff
Allan Myers, L.P. (“Myers”) filed a motion to
stay, or in the alternative, motion to dismiss in this breach
of contract case on February 15, 2019. (ECF No. 13). Myers
filed a motion for more definite statement of the first
affirmative defense in Plaintiff/Counter-Defendant Metromont
Corporation's (“Metromont”) answer on March
21, 2019. (ECF No. 22). The issues are briefed and the court
now rules, no hearing being deemed necessary. Local Rule
105.6. For the following reasons, Myers' motions will be
denied.
I.
Background
Metromont's
claim stems from a contract (“prime contract”)
the City of Baltimore's Department of Public Works
(“the City”) awarded to Myers in
2009.[1] (ECF No. 1 ¶¶ 2, 10). According
to the contract, Myers agreed to “build an enclosed
concrete reservoir for Montebello Plant 2, a water filtration
plant” (“the project”). (Id.).
Myers formed a subcontract with Metromont on July 28, 2010
wherein Metromont agreed to supply “precast concrete
double tee beams, inverted girders, and connections[,
]” to construct the reservoir roof. (ECF Nos. 1 ¶
11 & 1-1, at 2). The standard purchase order for the
materials indicated that they were to “strictly comply
with the requirements of the [prime] [c]ontract['s] . . .
plans and specifications[][, ]” (ECF No. 1-1, at 2), as
put forward by the Project's “registered design
professional” (ECF No. 1 ¶ 15). Metromont supplied
the requested materials and Myers used the materials to
construct the reservoir roof.[2] (See ECF No. 1
¶¶ 13, 17-18).
The
parties agree that “[t]he reservoir's large roof
system experienced problems with cracking concrete at various
connection points in July 2011[.]”[3] (ECF Nos. 1
¶ 17 & 9 ¶ 14). To resolve the issue, Myers and
the City agreed to replace the “rigid welded
connections” with
“slip-joints[.]”[4] (ECF Nos. 1 ¶ 18 & 9
¶ 17). “On or about August 20, 2012, Myers
submitted a change order request to the city, seeking an
equitable adjustment of $1, 993, 382.56 for the additional
work involved in implementing the slip joint connection fix,
which Myers later revised on or about March 13, 2015 to a
total sum of $4, 699, 735.91.” (ECF No. 9 ¶ 19).
The City questioned Myers's change order request,
“triggering the dispute resolution terms of the [p]rime
[c]ontract.” (ECF No. 9 ¶ 20). From September 10,
2012 through November 19, 2018, Myers was involved in six
years of administrative proceedings regarding its claim for a
contractual equitable adjustment. (ECF No. 9 ¶¶
20-23, 25-27). The City's Deputy Director of Public Works
issued a final administrative decision denying Myers's
change order on November 19, 2018, concluding that Myers
failed to meet its burden for adequately calculating the
thermal loads in its design of the roof structure
members.[5] (ECF No. 9-5, at 13-17). Myers filed a
still-pending appeal of the administrative decision in the
Circuit Court for Baltimore City (“State Claim”)
on November 27, 2018.[6](ECF No. 9 ¶ 28). Metromont did not
join the appeal either voluntarily (ECF No. 9 ¶ 29) or
via compulsory joinder (ECF No. 26-1, at 2).
Metromont
commenced this action on December 19, 2018, alleging one
count of breach of contract based on Myers's refusal to
pay Metromont. (ECF No. 1). Metromont seeks damages in the
amount of $1, 015, 000.00 plus pre- and post-judgment
interest. (Id.). Myers filed an answer and
counterclaim against Metromont on February 1, 2019, alleging
four counts: (1) breach of contract; (2) breach of warranty;
(3) negligent design; and (4) indemnification. (ECF No. 9).
Myers's counterclaim seeks damages in the amount of $4,
699, 735.91, attorneys' fees, pre- and post-judgment
interest, and “such additional direct, indirect,
consequential, general and special damages as may be proven
at trial[.]” (Id., at 23). Myers also filed a
motion to stay, or in the alternative, motion to dismiss on
February 15, 2019. (ECF No. 13). Metromont filed a response
in opposition to Myers's motion to stay (ECF No. 17) and
an answer to Myers's counterclaim on March I, 2019 (ECF
No. 16). Myers filed a motion for a more definite statement
on March 21, 2019 (ECF No. 22) and Metromont opposed the
motion on April 4, 2019 (ECF No. 25).
II.
Motion to Stay or Dismiss
A.
Colorado River
Myers
argues that this action should be stayed or dismissed
pursuant to the doctrine established by the Supreme Court of
the United States in Colorado River Water Conservation
District v. United States, 424 U.S. 800 (1976), because
“a determination as to liability in the [pending state
court] [a]ppeal will prove dispositive of Metromont's
claims in this case.”[7] (ECF No. 13, at 2).
In
response, Metromont argues that the Colorado River
abstention doctrine is not applicable here and abstention is
not appropriate because “[f]ederal courts with
jurisdiction over a case can abstain from hearing it in
deference to state-court proceedings only in truly
‘extraordinary circumstances'-not as a matter of
convenience or efficiency.” (ECF No. 17, at 2).
Generally,
“our dual system of federal and state governments
allows parallel actions to proceed to judgment until one
becomes preclusive of the other.” Chase Brexton
Health Servs., Inc. v. Maryland, 411 F.3d 457, 462
(4th Cir. 2005). Thus, the mere fact that an
action is pending in a state court “is no bar to
proceedings concerning the same matter in the [f]ederal court
having jurisdiction.” McLaughlin v. United Va.
Bank, 955 F.2d 930, 934 (4th Cir. 1992)
(internal quotation marks omitted). Indeed, “federal
courts are bound by a ‘virtually unflagging obligation
. . . to exercise the jurisdiction given them.'”
Chase Brexton, 411 F.3d at 462 (quoting
McClellan v. Carland, 217 U.S. 268, 282 (1910)). It
is well established, however, that “federal courts may
decline to exercise their jurisdiction, in otherwise
‘exceptional circumstances,' where denying a
federal forum would clearly serve an important countervailing
interest[.]” Quackenbush v. Allstate Ins. Co.,
517 U.S. 706, 716 (1996) (quoting Colorado River,
424 U.S. at 813) (internal quotation marks omitted). The
“exceptional circumstances” in which abstention
is appropriate “inevitably relate to a policy of
avoiding unnecessary constitutional decisions of
accommodating federal-state relations.” Chase
Brexton, 411 F.3d at 462. “Abstention from the
exercise of federal jurisdiction is the exception, not the
rule.” Colorado River, 424 U.S. at 813.
The
“threshold question in deciding whether Colorado
River abstention is appropriate is whether there are
parallel federal and state suits.” Chase
Brexton, 411 F.3d at 463. If the suits are parallel, the
court must balance a number of factors in considering whether
“exceptional circumstances” are presented,
thereby warranting its abstention. See Gannett Co. v.
Clark Constr. Group, Inc., 286 F.3d 737, 741
(4th Cir. 2002).
“Simultaneous
federal and state suits are deemed parallel if
‘substantially the same parties litigate substantially
the same issues.'” Extra Storage Space,
527 F.Supp.2d 462, 466 (D.Md. 2007) (quoting New Beckley
Mining Corp. v. Int'l Union, United Mine Workers of
Am., 946 F.2d 1072, 1073 (4th Cir. 1991)).
The similarity of the suits is generally assessed in terms of
the identity of the parties, the legal issues, and the
remedies sought in the respective cases. See Great Am.
Ins. Co. v. Gross, 468 F.3d 199, 207-08 (4th
Cir. 2006). “Although the parties in the concurrent
suits need not be identical, the [United States Court of
Appeals for the] Fourth Circuit has strictly construed the
requirement that the parties be substantially the
same.” Extra Storage Space, 527 F.Supp.2d at
466.
The
parties in the two suits are not substantially the same. The
state administrative action “involves a contractual
dispute between [] Myers [] . . . and the Baltimore City
Department of Public Works[.]” (ECF No. 17-1, at 4).
Although Metromont received a copy of the administrative
decision, it is not listed as a party to the administrative
proceedings and, accordingly, would not be a party in
Myers's administrative appeal. (Id., at 22).
Because Metromont is not a party to the pending state court
litigation, the parties are not “substantially the
same” and staying this litigation “would deprive
[Plaintiff] of the opportunity to litigate its claims.”
Great Am. Ins., 468 F.3d at 208; see also Chase
Brexton, 411 F.3d at 464 (“[F]ive of the federal
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