United States District Court, S.D. Ohio, Western Division
Konecranes, Inc. and Terex Utilities, Inc., d/b/a Terex Services Plaintiffs,
Hoist & Crane Service Group, Inc. and David E. Backhaus and Michael Anderson and Nicolas Shafer. Defendants.
ENTRY AND ORDER GRANTING DEFENDANTS' MOTION FOR A
PARTIAL STAY OF PROCEEDINGS, DOC. 4, AND, RETAINING
JURISDICTION PENDING RESOLUTION OF PERTINENT ISSUES OF STATE
LAW, AND ORDERING PLAINTIFF TO FILE QUARTERLY STATUS
M. ROSE UNITED STATES DISTRICT JUDGE
before the Court is a Motion for a Partial Stay of
Proceedings from Defendants: Hoist & Crane Service Group,
Inc. (“Hoist & Crane”), David E. Backhaus,
Michael Anderson, and Nicolas Shafer (Doc. 4). Therein,
Defendants request that the federal claims against Hoist
& Crane and Backhaus be stayed pending the resolution of
a state action out of Wood County, Ohio. Because there are
parallel claims in State and Federal court, Defendants'
motion for abstention is GRANTED.
matter arose out of contractual disputes between Plaintiffs
Konecrane, Inc. and Terex Utilities, Inc.
(“Plaintiffs”) and Defendants David Backhaus,
Michael Anderson, and Nicolas Shafer, former employees of
Konecrane. As a precondition to employment, Plaintiffs
mandate that certain potential employees sign a
confidentiality, non-competition, non-solicitation, and
non-recruiting agreement (Doc. 1, p. 77-80) in order to keep
confidential and proprietary information private in the event
that there ever is a separation. Backhaus, Anderson, and
Shafer all signed the agreements. Over the course of several
months in the summer of 2016, Backhaus, Anderson and Shafer
all ended their employment relationships with Plaintiffs and
began working for Hoist & Crane.
then filed a series of lawsuits against Hoist & Crane and
former employees alleging breach of contract, violation of
Ohio Uniform Trade Secrets Act, tortious interference with
contract, tortious interference with business relationships,
unfair competition, and civil conspiracy. The first suit was
filed in September 2016 in common pleas court in Wood County,
Ohio. The next, which is the genesis of this case before the
Court now, was first filed on December 22, 2016 in Monroe
County, Michigan. It was subsequently removed to the
Montgomery County, Ohio, common pleas court on February 10,
2017, and then removed to the Southern District of Ohio on
February 23, 2017.
& Crane, and one of the employee defendants, Backhaus,
now ask this Court for an order staying the federal
proceedings against them until the conclusion of the Wood
County state court action.
Motion To Stay
decision to stay a proceeding is entirely within a district
court's discretion. Ohio Envtl. Council v. United
States Dist. Court, S. Dist. of Ohio, E. Div., 565 F.2d
393, 396 (6th Cir. 1977). “[T]he power to stay
proceedings is incidental to the power inherent in every
court to control the disposition of the cause on its docket
with the economy of time and effort for itself, for counsel,
and for litigants. How this can best be done calls for the
exercise of judgment, which must weigh competing interests
and maintain an even balance.” Landis v. N. Amer.
Co., 299 U.S. 248, 254-55 (1936).
Colorado River Water Conservation Dist. v. United
States, the Supreme Court explained that considerations
of judicial economy and federal-state comity may justify
abstention in situations involving the contemporaneous
exercise of jurisdiction by state and federal courts.
Romine v. Compuserve Corp., 160 F.3d 337, 339 (6th
Cir. 1998). The Supreme Court explained that the principles
of the doctrine “rest on considerations of ‘wise
judicial administration, giving regard to conservation of
judicial resources and comprehensive disposition of
litigation.'” Colorado River Water Conservation
Dist. v. United States, 424 U.S. 800, 817 (1976)
(quoting Kerotest Mfg. Co. v. C-O Two Fire Equip.
Co., 342 U.S. 180, 183 (1952)).
the Colorado River doctrine can be applied, however,
this Court must determine if the concurrent federal and state
actions are indeed parallel. Suits are parallel when the
federal and state actions are inextricably woven and involve
substantially the same parties litigating substantially the
same issues. Romine, 160 F.3d 337 at 340.
Additionally, there is “no requirement that the parties
in the state court proceedings be identical to those in the
federal case.” Bates v. Van Buren Twp., 122
Fed. App'x 803, 806 (6th Cir. 2004). The Sixth Circuit
has never held that only a perfect, or even near-perfect,
symmetry of parties and causes of action would satisfy
parallel requirement. Romine, 160 F.3d 337 at 340.
the suits, while not identical, are parallel. Both the Wood
County action and this federal action contain substantially
the same parties. Konecrane/Terex are plaintiffs, and Hoist
& Crane and Backhaus are defendants in both suits. The
difference in the parties is that Anderson and Shafer are
added to the federal action and several individuals named in
the state suit are left off of the federal claim.
Nevertheless, if a party is named in a federal action but is
not named in a state action, the inquiry regarding the
parallelism of parties blends into the inquiry regarding the
parallelism of issues. P&G v. Alberto-Culver
Co., 1999 U.S. Dist. LEXIS 23140, at *9 (N.D. Ill. April
27, 1999). In this case, the major players remain the same.
(Doc. 4, p. 5).
addition to the similar parties, the cases are parallel in
that they are both about essentially the same issues: former
Konecrane employees leaving the company to work for Hoist
& Crane, a competitor. Both suits allege breach of
contract, misappropriation of trade secrets, tortious
interference with contracts and business relationships, civil
conspiracy, and unfair competition. The only difference is
that the Wood County case alleges unjust enrichment and the
federal case does not. Here, because the parties and claims
are substantially similar and flow from similar fact
patterns, the Court considers the cases parallel for purposes
of the Colorado River doctrine.