United States District Court, W.D. Virginia, Roanoke Division
VOLVO GROUP NORTH AMERICA, LLC d/b/a VOLVO TRUCKS NORTH AMERICA, a Delaware limited liability company Plaintiff, and KENWORTH TRUCK COMPANY, a Division of PACCAR INC., a Washington corporation, Plaintiff-in-Intervention,
TRUCK ENTERPRISES, INC., a Virginia corporation; JAMES E. HARTMAN; TRUCK ENTERPRISES ROANOKE, INC., a Virginia corporation; TRUCK ENTERPRISES LYNCHBURG, INC., a Virginia corporation; and TRUCK ENTERPRISES HAGERSTOWN, INC., a Virginia corporation, Defendants.
ORDER STAYING CASE
Elizabeth K. Dillon United States District Judge
parties to this suit are identical to the parties that were
before the court in a similar action, Volvo Group North
America, LLC v. Truck Enterprises, Inc., No. 7:16-cv-25
(Volvo I). In Volvo I, Volvo Trucks North
America, LLC (Volvo) sought declaratory and injunctive relief
regarding the scope of its contractual and statutory rights
of first refusal as it related to a 2015 business deal. As
structured, that deal involved a buyer who had agreed to
purchase the entirety of defendant Truck Enterprises, Inc.
(TEI) through a stock sale for a single purchase price. The
deal included the sale of several TEI subsidiaries that owned
dealerships for three different truck manufacturers: Volvo,
Kenworth, and Isuzu.
summary judgment stage, the court ruled in Volvo's favor,
issuing declaratory relief concerning Volvo's contractual
and statutory rights of first refusal over any sale of TEI.
The parties later resolved between themselves the claims of
the plaintiff-in-intervention Kenworth Truck Company.
(Volvo I, No. 7:16-cv-25, Dkt. No. 111, 115-16.)
Thereafter, the court entered final judgment in favor of
Volvo (id., Dkt. No. 117), relying on the grounds
set forth in its March 31, 2017 memorandum opinion and order
and the parties' agreement that nothing was left for the
court to resolve.
filed a notice of appeal, and the appeal is currently pending
before the United States Court of Appeal for the Fourth
Circuit. Oral argument in the case is scheduled for May 9,
2018. See Volvo Grp. N. Am., LLC v. Truck Enters.,
No. 17-1638 (4th Cir.) (March 22, 2018 order calendaring case
for oral argument).
case, Volvo has again filed suit against the same parties and
attempts to enjoin a new deal between TEI and the same
purchaser. Volvo has filed a motion for preliminary
injunction asking that the court stay all deadlines related
to its rights of first refusal until resolution of Volvo
I and pending the court's eventual order in this new
case. Alternatively, it asks this court to stay proceedings
in this case, through the court's inherent power, pending
the decision in Volvo I. At the hearing, Volvo noted
that the parties stipulated to, and the court has entered, an
order in this case staying deadlines related to Volvo's
rights of first refusal until a decision on the preliminary
injunction. (Dkt. No. 28.) Staying the entire case would
obviously prevent a decision on the preliminary injunction
and thus accomplish, in part, the same result as a
preliminary injunction, as it relates to the deadlines.
point out that the new deal is structured differently than
the deal at issue in Volvo I. They further contend
that they have made every effort to comply with the
court's prior order (which, of course, is still on
appeal) by separately valuing the Volvo assets. Thus, they
contend that Volvo has the choice here of exercising its
right of first refusal over the entire deal (which would
include the Kenworth and Isuzu dealerships), purchasing just
the Volvo assets, or declining to exercise its right of first
refusal at all. Volvo counters that it should not be required
to select among choices that may be invalidated by the Fourth
Circuit's reasoning and decision in Volvo I.
federal court's “power to stay proceedings is
incidental to the power inherent in every court to control
the disposition of the causes on its docket with economy of
time and effort for itself, for counsel, and for
litigants.” Landis v. N. Am. Co., 299 U.S.
248, 254 (1936). Where there is a fair possibility that a
stay “will work damage” to the party opposing it,
the party seeking a stay must make out “a clear case or
hardship or inequity in being required to go forward.”
See Id. at 255.
those standards here, the court first notes that there is a
fair possibility that defendants will be damaged by a stay. A
stay would require the defendants to postpone their deal for
at least a short period of time awaiting the Fourth
Circuit's decision. It also would affect Mr.
Hartman's ability to sell his business now to a willing
buyer and his ability to retire at this time, which his
counsel has explained is the reason for penning a new deal.
Nonetheless, the court finds that Volvo has satisfied its
burden to make out a clear case of hardship or inequity in
going forward. Furthermore, the court believes that the
efficient administration of justice is best served by a stay.
sure, there are some differences between the prior deal and
this one. But the court concludes that the Fourth
Circuit's decision in Volvo I may well affect
the legality of Volvo's choices under the new deal. And
if Volvo were to choose a course of action that the Fourth
Circuit later concludes is impermissible, either under the
parties' contract or by statute, then the status of any
sale based on that choice would either be left in limbo or
subject to subsequent litigation touching on the same issues
that the Fourth Circuit already has before it in Volvo
I. By contrast, waiting to resolve the issues in this
case until after the Fourth Circuit has the opportunity to
present guidance and speak on some of the issues-raised there
between these very same parties-is an efficient course of
action. This is particularly true since the appeal is fully
briefed and will be argued today.
of these reasons, the court concludes that a stay is
appropriate in this case. See Hickey v. Baxter, 833
F.2d 1005, 1987 WL 39020, at *1 (4th Cir. 1987) (unpublished
table decision) (affirming district court's stay of
proceedings “while awaiting guidance from the Supreme
Court in a case that could decide relevant issues”);
Harris v. Rainey, No. 5:13-cv-77, 2014 WL 1292803,
at *2 (W.D. Va. Mar. 31, 2014) (staying proceeding pending
the resolution of a Fourth Circuit case where the parties
before it “have a voice in the debate pending at the
court of appeals”); Collins v. S.C. Pub. Serv.
Auth., No. 2:05-cv-2494, 2006 WL 1851305, at *2 (D.S.C.
June 30, 2006) (staying case to allow court of appeals to
rule on related issues in related cases).
the court hereby STAYS this case pending the issuance of the