701 F.3d 458
5th Cir.2012Background
- RSL appeals district court abstention under Colorado River and remand order; Saucier opposes, seeking state court resolution.
- Saucier originally received a Mississippi structured settlement annuity (due 2010 $150,000; 2015 $200,000) held by Aviva Life and Annuity Company.
- Saucier sold future payments to RSL under agreements containing arbitration clauses; MSSPA requires court findings on best interests and gives notice to interested parties.
- State court had initially approved the transfer but later set aside approval noncompliance with MSSPA; RSL’s reconsideration motion denied.
- RSL sued Saucier March 12, 2010 for breach of contract; state court injunctions and a contemporaneous federal interpleader action followed, with Aviva joining and depositing $150,000 into federal registry.
- District court later abstained under Colorado River, stayed, and remanded to state court; RSL appealed; state court issued a permanent injunction prohibiting arbitration.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Colorado River abstention applies | Saucier argues not parallel; abstention inappropriate | RSL contends exceptional circumstances justify abstention | Abstention reversed; not justified; retain jurisdiction |
| Whether district court’s stay was proper absent abstention | Saucier contends stay inappropriate where no abstention | RSL seeks timely resolution and arbitration | Stay improper; remand not appropriate as option; reversed |
| Whether district court should decide arbitration enforceability under 9 U.S.C. § 3 | RSL seeks arbitration; federal question on enforceability | State court already addressed MSSPA validity; preclusion not decided | Remand for determination of arbitration enforceability on remand; arbitration not relitigated |
| Whether Aviva’s interpleader and RSL’s joining affected jurisdiction | Aviva’s role complicated parallelism | Joinder does not cure federal jurisdiction | Federally retained jurisdiction; not a basis to abstain |
| Whether the district court erred in remanding after abstention found improper | Remand not permitted under Moses H. Cone; stay preferable | Remand not appropriate after abstention ruling | District court erred; remand vacated; case to be treated under retained jurisdiction |
Key Cases Cited
- Colorado River Water Conservation Dist. v. United States, 424 U.S. 800 (1976) (aboriginal parallelism; exceptional circumstances for abstention discussed)
- Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983) (application of six-factor test; dismissal vs stay considerations)
- Kelly Inv., Inc. v. Continental Common Corp., 315 F.3d 494 (5th Cir. 2002) (six-factor Colorado River test; balance weighed towards jurisdiction)
- Stewart v. Western Heritage Ins. Co., 438 F.3d 488 (5th Cir. 2006) (location of fora; same geographic location weighs against abstention)
- Evanston Ins. Co. v. Jimco, Inc., 844 F.3d 1185 (5th Cir. 1988) (piecemeal litigation not favored; duplication not a factor)
- Miller Brewing Co. v. Fort Worth Distrib. Co., 781 F.2d 494 (5th Cir. 1986) (arbitration context and res judicata considerations)
- Rapid Settlements, Ltd. v. Symetra Life Ins Co., 567 F.3d 754 (5th Cir. 2009) (sham arbitration; MSSPA-related implications)