Kohn Law Grp. v. Auto Parts Mfg., No. 13-55023 (9th Cir. 2015)
Annotate this CaseKohn Law filed suit against APMM, alleging that it was entitled to payments APMM owed to a third party. The district court stayed the proceedings, finding the question presented was already being litigated by the same or related parties in Mississippi. At issue is the first-to-file rule. The parties do not dispute that the Mississippi interpleader action was filed first. Because the Mississippi interpleader action is a previously filed lawsuit involving substantially similar parties and issues, the district court did not abuse its discretion by entering the stay. Finally, the court denied the parties' motions to supplement the record. The court affirmed the judgment.
Court Description: First-To-File Rule. The panel affirmed the district court’s order staying proceedings under the first-to-file rule in an action brought by Kohn Law Group, Inc., under § 9607(a)(3) of the California Commercial Code alleging it was entitled to payments Auto Parts Manufacturing Mississippi, Inc., owed to a third party. The first-to-file rule allows a district court to stay proceedings if a similar case with substantially similar issues and parties was previously filed in another district court. The panel held that a Mississippi interpleader action was a previously filed lawsuit involving substantially similar parties and issues where the Mississippi action was filed first, the present case involved substantially similar issues as the Mississippi action, and the present case involved the issue to be determined in the Mississippi action. The panel concluded that the district court did not abuse its discretion by staying the present action under the first-to-file rule. KOHN LAW GROUP V. AUTO PARTS MFG. MISS. 3
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