VRCompliance LLC v. Homeaway, Inc.
2013 U.S. App. LEXIS 10527
| 4th Cir. | 2013Background
- Appellee HomeAway sued Eye Street, VRCompliance, and CAST in Texas state court for various state-law claims related to scraping and tax issues.
- Eye Street filed a separate federal action seeking declaratory and other relief against HomeAway and affiliates in the Eastern District of Virginia.
- HomeAway moved to stay or dismiss Eye Street’s federal action pending resolution of the Texas suit; Eye Street challenged the stay.
- District court applied Kapiloff factors to determine whether to stay under Brillhart/ Wilton or Colorado River standards.
- Eye Street proceeded in federal court rather than removing HomeAway’s Texas action; HomeAway indicated it would not oppose removal, but Eye Street did not pursue removal.
- District court stayed Eye Street’s federal action, concluding a stay was appropriate to avoid entanglement, promote efficiency, and reflect Eye Street’s procedural choices.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the stay was proper under Brillhart/Wilton or Colorado River | Eye Street argues for broader stay discretion on declaratory actions. | HomeAway contends factors justify stay to avoid duplicative litigation. | Stay affirmed under either standard; discretion supported. |
| Whether removal/ forum-shopping influenced the stay decision | Eye Street sought federal forum on its terms, avoiding removal. | Removal would have provided a single federal forum; Eye Street exercised gamesmanship. | Eye Street’s procedural choice to forego removal did not compel reversal; stay affirmed. |
| Whether district court abused discretion by considering overlapping state/federal actions | Eye Street asserts less risk of entanglement. | Texas action would resolve broader issues efficiently. | No abuse of discretion given overlapping issues and risk of entanglement. |
| Whether the court should have dismissed rather than stayed | Staying preserves forum while state action proceeds. | Dismissal unnecessary where federal claims can proceed if state action falters. | Dismissal not required; stay appropriate. |
Key Cases Cited
- United Capitol Ins. Co. v. Kapiloff, 155 F.3d 488 (4th Cir. 1998) (multifactor test for staying declaratory actions in deference to parallel state proceedings)
- Brillhart v. Excess Insurance Co. of America, 316 U.S. 491 (S. Ct. 1942) (declaratory judgments; avoidance of unnecessary federal proceedings)
- Wilton v. Seven Falls Co., 515 U.S. 277 (S. Ct. 1995) (deference to parallel state proceedings in declaratory actions; discretion to stay)
- Colorado River Water Conservation Dist. v. United States, 424 U.S. 800 (S. Ct. 1976) (exceptional circumstances for staying federal proceedings in favor of state proceedings)
- Nautilus Ins. Co. v. Winchester Homes, Inc., 15 F.3d 371 (4th Cir. 1994) (concerns about preclusion and entanglement in parallel proceedings)
- Great American Insurance Co. v. Gross, 468 F.3d 199 (4th Cir. 2006) (emphasizes considerations under stay/abstention standards)
- Chase Brexton Health Servs., Inc. v. Maryland, 411 F.3d 457 (4th Cir. 2005) (multifactor approach to stays in parallel proceedings)