Schering Corp. v. Griffo, 2012 U.S. Dist. LEXIS 14207

Schering Corp. and Old Republic filed a federal declaratory judgment action seeking a duty to defend Griffo and Gonzales in a related New Mexico state case.
Gina Delfino moved to dismiss or stay the federal action, arguing abstention and federal non-jurisdiction due to a parallel state proceeding.
New Mexico Supreme Court reversed a social-host dismissal, remanding for further state proceedings on liquor-liability issues.
The parallel state case involves numerous defendants and claims arising from an alcohol-related car collision, with Schering and others alleged to have hosted or contributed to the intoxication.
The Court held a hearing on November 16, 2011, and ultimately stayed the federal action while the state case proceeds, denying dismissal.
Key parties include Schering Corp. (now Merck & Co.), Old Republic Insurance, Delfino, Griffo, and Gonzales.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether to abstain/decline jurisdiction under Brillhart and Mhoon	Delfino argues abstention preferred; state case better addresses factual issues and avoids duplicative litigation.	Schering and Old Republic contend the action is not parallel and should adjudicate duty to defend promptly.	The court declined jurisdiction and stayed the case.
Whether the federal action should be stayed pending the state proceeding	A stay preserves federal forum and avoids piecemeal litigation if state resolution is forthcoming.	Immediate resolution of course-and-scope issues in federal court would be efficient and avoid delays.	A stay was granted pending resolution of the state court case.
Whether the state proceeding is parallel to the federal action	State and federal proceedings are aligned on core factual issues and parties; parallelism exists.	State court is not parallel because Old Republic is not a party and some issues differ.	The proceedings were found to be parallel for purposes of discretionary abstention.

Brillhart v. Excess Insurance Co. of America, 316 U.S. 491 (Supreme Court, 1942) (federal court discretionary abstention under Declaratory Judgment Act)
State Farm Fire & Cas. Co. v. Mhoon, 31 F.3d 979 (10th Cir. 1994) (five-factor test for abstention; weighs against federal jurisdiction when state proceeding appears adequate)
St. Paul Fire and Marine Ins. Co. v. Runyon, 53 F.3d 1169 (10th Cir. 1995) (live issues in state court and procedural fencing influence abstention)
AmSouth Bank v. Dale, 386 F.3d 763 (6th Cir. 2004) (declaratory actions resolving only damages claims may be improper use of the Act)
United States v. City of Las Cruces, 289 F.3d 1170 (10th Cir. 2002) (parallelism and completeness of remedy inform jurisdictional decisions)