{
  "id": 4161768,
  "name": "SIGNALIFE, INC., Plaintiff v. RUBBERMAID, INC., NEWELL RUBBERMAID, INC., GARY SCOTT, and DAVID HICKS, Defendants",
  "name_abbreviation": "Signalife, Inc. v. Rubbermaid, Inc.",
  "decision_date": "2008-10-21",
  "docket_number": "No. COA08-496",
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          "page": "594"
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          "parenthetical": "\"[A] minority of courts maintain that where the prior pending action is in a federal court sitting in the same state as the subsequent state action, the second action is abated. We conclude that the minority rule is the better reasoned authority.\" (Internal citations omitted)"
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      "year": 1990,
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  "last_updated": "2023-07-14T16:30:29.332614+00:00",
  "provenance": {
    "date_added": "2019-08-29",
    "source": "Harvard",
    "batch": "2018"
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  "casebody": {
    "judges": [
      "Judges McCULLOUGH and CALABRIA concur."
    ],
    "parties": [
      "SIGNALIFE, INC., Plaintiff v. RUBBERMAID, INC., NEWELL RUBBERMAID, INC., GARY SCOTT, and DAVID HICKS, Defendants"
    ],
    "opinions": [
      {
        "text": "TYSON, Judge.\nSignalife, Inc. (\u201cplaintiff\u201d) appeals order entered granting Rubbermaid, Inc., Newell Rubbermaid, Inc., Gary Scott, and David Hicks\u2019s (collectively, \u201cdefendants\u201d) motion to dismiss plaintiff\u2019s amended complaint filed in Mecklenburg County Superior Court based upon a \u201cprior action pending\u201d in the United States District Court for the Western District of North Carolina. We affirm.\nI. Background\nPlaintiff is a medical device company which developed a FDA approved electrocardiograph monitoring device called the \u201cFidelity 100.\u201d In 2004, Newell Rubbermaid, Inc. entered into negotiations with plaintiff to acquire the exclusive distribution rights to plaintiff\u2019s various technologies. A definitive agreement was not reached at that time. On 26 March 2006, plaintiff, Newell Rubbermaid, Inc., and Rubbermaid, Inc., a subsidary of Newell Rubbermaid, Inc., entered into and signed the 2006 Sales and Marketing Service Agreement (\u201cthe agreement\u201d).\nSubsequently, a dispute arose between the parties regarding their respective obligations under the agreement. The background facts underlying the contention between the parties are disputed and irrelevant for purposes of this appeal. Plaintiff and defendants attempted to negotiate a settlement before resorting to litigation and agreed not to file suit before 24 January 2007.\nAt approximately 12:25 a.m. on 24 January 2007, defendants electronically filed a complaint against plaintiff in the United States District Court for the Western District of North Carolina. Defendants alleged the following causes of action: (1) negligent misrepresentation; (2) breach of representation and warranty; and (3) breach of contract. At approximately 9:01 a.m. on 24 January 2007, plaintiff filed a complaint against defendants in the Office of the Clerk of Superior Court for Mecklenburg County. After an extensive series of motions and rulings, plaintiff filed an amended complaint in superior court alleging seven separate claims for relief. On 20 December 2007, defendants filed a motion to dismiss plaintiffs amended complaint based upon a \u201c \u2018prior action pending\u2019 involving substantially similar subject matter and parties in a North Carolina federal court.\u201d On 1 February 2008, plaintiff filed its answer and counterclaims in federal district court and alleged the identical claims pending before the superior court. Trials were set for September 2008 in federal court and February 2009 in state court. On or after 8 February 2008, a special superior court judge granted defendants\u2019 motion to dismiss plaintiff\u2019s amended complaint without prejudice to plaintiff\u2019s right to pursue its claims for relief in federal court. The superior court based its ruling upon the \u201cprior action pending\u201d doctrine and stated that \u201call parties can obtain complete relief in the Federal Court Action, making the State Court Action \u2018wholly unnecessary.\u2019 \u201d Plaintiff appeals.\nII. Issue\nPlaintiff argues the superior court erred by granting defendants\u2019 motion to dismiss its amended complaint it filed therein.\nIII. Prior Action Pending Doctrine\nPlaintiff argues the superior court erred in granting defendants\u2019 motion to dismiss \u201con the grounds that the \u2018prior action pending\u2019 doctrine is not applicable to substantially similar actions filed simultaneously in the North Carolina Federal and State Courts,\u201d We disagree.\nThe leading case in North Carolina addressing the \u201cprior action pending\u201d doctrine in this context is Eways v. Governor\u2019s Island, 326 N.C. 552, 554, 391 S.E.2d 182, 183 (1990). After acknowledging that a conflict among jurisdictions existed regarding the question of whether a prior pending federal action would abate a subsequent state action, our Supreme Court adopted the minority position that answered this question in the affirmative. See id., at 560, 391 S.E.2d at 187 (\u201c[A] minority of courts maintain that where the prior pending action is in a federal court sitting in the same state as the subsequent state action, the second action is abated. We conclude that the minority rule is the better reasoned authority.\u201d (Internal citations omitted)). Our Supreme Court further enunciated the \u201cprior action pending\u201d doctrine as applied in North Carolina:\nWhere a prior action is pending in a federal court within the boundaries of North Carolina which raises substantially the same issues between substantially the same parties as a subsequent action within the state court system having concurrent jurisdiction, the subsequent action is wholly unnecessary and, in the interests of judicial economy, should be subject to a plea in abatement.\nId. at 560-61, 391 S.E.2d at 187 (emphasis supplied).\nOur appellate courts have not previously addressed cases where actions are filed in both federal courts and North Carolina state courts on the same day. However, in Nationwide Mut. Ins. Co. v. Douglas, this Court considered the effects of filing separate actions in two North Carolina state courts within hours of each other. 148 N.C. App. 195, 197, 557 S.E.2d 592, 593 (2001). In Nationwide, the defendant filed a declaratory judgment action in Carteret County Superior Court. 148 N.C. App. at 197, 557 S.E.2d at 593. Approximately three and one half hours later, the plaintiff filed a declaratory judgment action in Wake County Superior Court. Id. Although it had notice of the pendency of the action in Carteret County, the Wake County Superior Court entered an order: (1) denying defendant\u2019s motion to dismiss based on the pending action in Carteret County; (2) denying defendant\u2019s alternative motion for change of venue to Carteret County; and (3) granting plaintiff\u2019s Rule 12(c) motion for judgment on the pleadings. Id.\nThis Court affirmed the Wake County Superior Court\u2019s order, but stated:\nwe conclude that the trial court\u2019s failure to abate the action in Wake County in favor of the prior filed action in Carteret County, although it ran contrary to the general rule of abatement, nonetheless served the hoary notions of judicial economy upon which the abatement doctrine is founded by effectively avoiding a multiplicity of actions, excess delay and duplicitous costs.\nId. at 198-99, 557 S.E.2d at 594 (citation omitted) (emphasis supplied). The holding in Nationwide appears to require the first to file test to be applied in cases where the \u201cprior action pending\u201d doctrine is implicated. Id. This principle is applicable to the case at bar.\nIt is undisputed that the actions filed in the United States District Court for the Western District of North Carolina and the Mecklenburg County Superior Court involve \u201csubstantially the same issues between substantially the same parties[.]\u201d Eways, 326 N.C. at 560, 391 S.E.2d at 187. Defendants herein electronically filed an action in the United State District Court in North Carolina approximately nine hours prior to the time plaintiff filed its action in state court. We hold that defendants\u2019 federal action was \u201cpending\u201d at the time plaintiff filed its action in Mecklenburg County Superior Court. Based on our Supreme Court\u2019s holding in Eways and this Court\u2019s reasoning in Nationwide, plaintiff\u2019s subsequent state action is \u201cwholly unnecessary\u201d and is subject to a plea in abatement. Eways, 326 N.C. at 560-61, 391 S.E.2d at 187; Nationwide, 148 N.C. App. at 198-99, 557 S.E.2d at 594. The superior court properly dismissed plaintiff\u2019s amended complaint filed therein based upon the \u201cprior action pending\u201d doctrine.\nJudicial economy also compel us to reach the same result. According to the superior court\u2019s order, the federal action was scheduled to commence sometime in September 2008. Defendants\u2019 brief now asserts the trial date is set for December 2008. By the time this opinion is filed, the parties will have completed a substantial amount of preparation for trial in the United States District Court for the Western District of North Carolina, as well as most of the discovery requested by each party. To reverse the superior court\u2019s order would be contrary to the interests of judicial economy. This assignment of error is overruled.\nIV. Conclusion\nDefendants\u2019 action was \u201cpending\u201d in the United States District Court for the Western District of North Carolina prior to the time plaintiff filed its action in Mecklenburg County Superior Court. Plaintiff\u2019s subsequent state action is abated in accordance with the \u201cprior action pending\u201d doctrine applicable in this State. The superior court properly dismissed plaintiff\u2019s amended complaint. The superior court\u2019s order is affirmed.\nAffirmed.\nJudges McCULLOUGH and CALABRIA concur.",
        "type": "majority",
        "author": "TYSON, Judge."
      }
    ],
    "attorneys": [
      "Hamilton Moon Stephens Steele & Martin, P.L.L.C., by Jackson N. Steele and Mark R. Kutny, for plaintiff-appellant.",
      "McGuireWoods, L.L.P., by Robert A. Muckenfuss, for defendantappellees."
    ],
    "corrections": "",
    "head_matter": "SIGNALIFE, INC., Plaintiff v. RUBBERMAID, INC., NEWELL RUBBERMAID, INC., GARY SCOTT, and DAVID HICKS, Defendants\nNo. COA08-496\n(Filed 21 October 2008)\nAbatement\u2014 electronic filing in federal court \u2014 filing next morning in superior court\nThe trial court properly dismissed plaintiff\u2019s amended complaint where a complaint was filed electronically by defendants at 12:25 a.m. in federal court and by plaintiff at 9:01 on the same day in superior court clerk\u2019s office. It is undisputed that the actions involve substantially the same issues between substantially the same parties; plaintiff\u2019s state action is wholly unnecessary and is subject to abatement. Moreover, judicial economy compels the same result.\nAppeal by plaintiff from order entered on or after 8 February 2008 by Judge Albert Diaz in Mecklenburg County Superior Court. Heard in the Court of Appeals 25 September 2008.\nHamilton Moon Stephens Steele & Martin, P.L.L.C., by Jackson N. Steele and Mark R. Kutny, for plaintiff-appellant.\nMcGuireWoods, L.L.P., by Robert A. Muckenfuss, for defendantappellees."
  },
  "file_name": "0442-01",
  "first_page_order": 474,
  "last_page_order": 478
}