United States District Court, M.D. Florida, Tampa Division
ORDER ON DEFENDANT'S RENEWED MOTION TO
IMMEDIATELY STAY DISCOVERY
S. SNEED UNITED STATES MAGISTRATE JUDGE
MATTER is before the Court on Defendant's Renewed Motion
to Immediately Stay Discovery (“Motion”) (Dkt.
24), and Plaintiff's response in opposition (Dkt. 29).
Defendant requests that the Court stay discovery until the
Court rules on Defendant's motion to dismiss (Dkt. 23).
For the reasons that follow, the Motion is denied.
purchased a steel cutting machine from Defendant called the
“Ring of Fire.” (Dkt. 21 ¶¶ 4-6, 9-16.)
Plaintiff alleges that the Ring of Fire did not perform as
Defendant advertised it would. (Id. ¶¶
17-24.) Therefore, Plaintiff withheld the final $100, 000 of
its purchase price from Defendant. (Id. ¶ 18.)
Defendant sued Plaintiff in an Illinois state court in
December 2015 to recover the $100, 000 balance. (Id.
Plaintiff sues Defendant for Defendant's alleged
deceptive misrepresentations of the Ring of Fire's
characteristics and qualities as well as the terms and
conditions of Defendant's sale of the Ring of Fire,
specifically its mandatory arbitration provision.
(Id. ¶¶ 34-41.) Further, Plaintiff seeks
declaratory judgment regarding its right to withhold the
$100, 000 from Defendant. (Id. ¶¶ 42-44.)
Finally, Plaintiff seeks an order of rescission of the Ring
of Fire purchase contract based on Defendant's alleged
misrepresentation and fraud regarding the mandatory
arbitration provision. (Id. ¶¶ 45-53.)
pending motion to dismiss, Defendant argues that
Plaintiff's theory regarding mandatory arbitration was
“comprehensively litigated and adjudicated” by
the Illinois state court. (Dkt. 23 ¶ 13.) Further,
Plaintiff's claim of deceptive and unfair trade practices
“mimics the theory [Plaintiff] raised as a defense in
the Illinois litigation, ” Defendant argues.
(Id. ¶ 14.) Defendant acknowledges that
Plaintiff brings two new causes of action in its amended
complaint, but urges the Court to abstain from exercising
jurisdiction over this case based on the Colorado
River doctrine, which empowers federal courts to abstain
from exercising jurisdiction, under certain circumstances, in
light of duplicative state court actions. (Id.)
(citing Colorado River Water Conservation District v.
United States, 424 U.S. 800 (1976)).
Motion, Defendant seeks a stay of discovery based on its
argument that the Court should abstain from exercising its
jurisdiction over this case pursuant to the Colorado
River doctrine. (Dkt. 24.) In response, Plaintiff argues
that abstention under the Colorado River doctrine is
unwarranted because Plaintiff's claims in this case are
“not pending in any other forum and are not mandatory
counterclaims in the Illinois state court lawsuit.”
(Dkt. 29 at 6.)
maintain great discretion to regulate discovery.
Patterson v. U.S. Postal Serv., 901 F.2d 927, 929
(11th Cir. 1990). In exercising this discretion, Federal Rule
of Civil Procedure 26(c) permits a court to stay discovery if
the movant demonstrates good cause and reasonableness.
McCabe v. Foley, 233 F.R.D. 683, 685 (M.D. Fla.
2006). However, motions to stay discovery are not favored
because delays in discovery “can create case management
problems which impede the Court's responsibility to
expedite discovery and cause unnecessary litigation expenses
and problems.” Feldman v. Flood, 176 F.R.D.
651, 652 (M.D. Fla. 1997) (citation omitted); see
also Middle District Discovery (2015) §I(E)(4)
(stating that motions for stay are rarely granted unless
unusual circumstances justify such a result based on a
“specific showing of prejudice or undue burden”).
of discovery may be warranted when a pending dispositive
motion will dispose of the entire case and thereby eliminate
the need for discovery. Chudasama v. Mazda Motor
Corp., 123 F.3d 1353, 1368 (11th Cir. 1997). Dispositive
motions presenting pure legal questions may appropriately be
resolved before discovery begins, but motions that turn on
findings of fact “may require some limited discovery
before a meaningful ruling can be made.” Id.
at 1367; see In re Winn Dixie Stores, Inc. Erisa
Litig., No. 3:04-CV-194-J-33MCR, 2007 WL 1877887, at *1
(M.D. Fla. June 28, 2007) (explaining that Chudasama
and its progeny “do not establish a broad general rule
that discovery should not proceed while a motion to dismiss
is pending, ” but “stand for the much narrower
proposition that courts should not delay ruling on a likely
meritorious motion to dismiss while undue discovery costs
in deciding whether to stay discovery pending the resolution
of a dispositive motion, the Court must take a
“preliminary peek” at the motion to determine
whether it appears clearly meritorious and case-dispositive.
McCabe, 233 F.R.D. at 685 (citing Feldman,
176 F.R.D. at 652-53). The Court must then balance the harm
produced by a delay in discovery against the possibility that
the motion will be granted and, therefore, eliminate the need
for discovery. Id.
taken a “preliminary peek” at Defendant's
motion to dismiss (Dkt. 23), the Court is not convinced that
there is an immediate and clear possibility that the motion
will be granted. Although the Court recognizes the interest
in avoiding potentially unnecessary and costly discovery,
this case does not present an appropriate opportunity to do
so. While Plaintiff's claim for declaratory judgment
regarding whether it is entitled to withhold the final $100,
000 due to Defendant under the purchase contract for the Ring
of Fire seems intertwined with the resolution of
Defendant's claim for breach of contract in the Illinois
state court, Plaintiff also brings separate causes of action
for deceptive and unfair trade practices and for recession of
the purchase contract based on Defendant's alleged
misrepresentations regarding the Ring of Fire's
characteristics and terms of purchase. Accordingly, Defendant
is unable to meet its burden of showing good cause. Defendant
has also failed to show any specific prejudice or undue
burden that would result from allowing discovery; instead,
Defendant argues that a stay of discovery would not prejudice
Plaintiff. (Dkt. 24-1 ¶ 5.) And, as Plaintiff argues,
discovery is already underway because Defendant has responded
to Plaintiffs discovery requests and produced documents.
(Dkt. 29 at 1, 7.)
it is ORDERED that Defendant's Renewed Motion to