United States District Court, D. Massachusetts
QUALITY ONE WIRELESS, LLC, as assignee of PERSONAL COMMUNICATIONS DEVICES, LLC, Plaintiff,
THE GOLDIE GROUP, LLC, Defendant
For Quality One Wireless, LLC, as assignee of Personal Communications Devices, LLC, Plaintiff: Stephen C. Garabedian, Cohn & Dussi, LLC, Wobourn, MA.
For The Goldie Group, LLC, Defendant: Thomas J. Scannell, Fusaro, Altomare & Ermilio, Worcester, MA.
MEMORANDUM AND ORDER ON MOTION TO DISMISS
F. Dennis Saylor IV, United States District Judge.
This is a contract dispute concerning the sale of cellular telephones, accessories, and parts. Jurisdiction is based on diversity of citizenship. Personal Communications Devices, LLC (" PCD" ), sold the goods to Goldie Group, LLC. On February 20, 2013, PCD filed suit in state court, contending that Goldie Group owed it more than $2 million. Goldie Group asserted a counterclaim, and the case proceeded into discovery. However, on August 19, 2013, PCD filed for bankruptcy and the state court proceeding was stayed. Quality One Wireless, LCC (" Q1W" ), purchased PCD's assets through the bankruptcy court and filed suit against Goldie Group in this Court of the same claim.
Goldie Group has moved to dismiss the complaint, contending that this Court should abstain from exercising jurisdiction under the first-filed doctrine, the prior-pending-action doctrine, or the Colorado River abstention doctrine, and because Q1W failed to join an indispensable party, PCD. Q1W, in turn, requests the motion be struck and seeks costs and fees. For the reasons set forth below, the motion to dismiss will be granted, plaintiff's requests will be denied, and the case will be stayed.
Unless otherwise noted, the facts are presented as stated in the complaint.
Q1W is a Nevada limited liability company. Goldie Group is a Massachusetts limited liability company. PCD is, or was, a New York limited liability company.
From 1996 to 2013, PCD sold and delivered cellular phones, accessories, and parts to Goldie Group. According to the complaint, Goldie Group owes an outstanding balance to PCD of $2,134,384.88.
On February 20, 2013, PCD filed suit against Goldie Group in Massachusetts state court. (Scannell Aff., Ex. B). Goldie Group answered and asserted a counterclaim, contending that PCD had breached agreements to provide price protection by selling similar phones at lower prices, to give Goldie Group a right of first refusal before selling similar phones to others, and to provide product support. ( Id. ). The case proceeded into discovery. (Garabedian Aff., Ex. A).
On August 19, 2013, PCD filed a petition under Chapter 11 of the Bankruptcy Code. On October 17, 2013, the Bankruptcy Court approved a sale of PCD's assets to Q1W pursuant to 11 U.S.C. § 363, and all right, title, and interest in the alleged debt was assigned to Q1W.
On November 20, 2013, PCD filed a motion to substitute Q1W as plaintiff in the state court action under Mass. R. Civ. P. 25(c). The motion was supported by an affidavit of Q1W, which stated that it was the holder of the alleged debt and that it must be substituted in order to proceed with collection. (Scannell Aff., Ex. D). Goldie Group filed a limited opposition; it requested that PCD remain in the action so that it could pursue its counterclaims, contending that its alleged damages are greater than the alleged $2 million debt, and to facilitate discovery. (Scannell Aff., Ex. E). On December 11, 2013, the state court denied the motion to substitute, but stated that Q1W " may be added as a plaintiff." (Scannell Aff., Ex. F). However, according to the state-court docket, Q1W was not added as a party to the action. (Garabedian Aff., Ex. A).
Instead of seeking to join the state court action, Q1W simply decided to file a new action seeking to collect on the same debt. On December 23, 2013, Q1W filed a complaint in this Court. Goldie Group moved
to dismiss the complaint on the grounds that the existence of the pending state-court action requires stay or dismissal and that Q1W failed to join an indispensable party (PCD) under Fed.R.Civ.P. 19. Q1W opposed the motion to dismiss, and moved to ...