United States District Court, D. Colorado
ORDER ON MOTION TO STAY
Y. WANG, MAGISTRATE JUDGE
matter comes before the court on Defendants' Outlook
Acquisition Corp., Outlook FBA Corp., Avi Sakkal, Eli Sakkal,
and the John Does' (collectively,
“Defendants”) Motion to Stay Discovery Pending
Resolution of its Motion to Dismiss Plaintiffs' Amended
Complaint and Memorandum in Support (“the Motion”
or “the Motion to Stay”) [#45, filed March 6,
2019]. The Motion was referred to the undersigned Magistrate
Judge by the Order Referring Case dated December 13, 2018
[#5] and the Memorandum dated March 7, 2019 [#47]. Pursuant
to D.C.COLO.LCivR 7.1(d), the undersigned Magistrate Judge
ordered an abbreviated response deadline, and Plaintiffs
Otter Products LLC and Treefrog Developments Inc.,
(collectively, “Plaintiffs”) filed a timely
Response on March 15, 2019. Defendants then sought leave of
court to file a Reply, which the undersigned granted, and
Defendants filed their Reply on March 22, 2019, and thus the
matter is now fully briefed and ready for decision. For the
reasons stated in this Order, the Motion to Stay is
filed this case on December 13, 2018, bringing seven claims
for trademark infringement, false advertising, unfair
competition, trademark dilution, unfair and deceptive
business practices in violation of the Colorado Consumer
Protection Act (“CCPA”), and tortious
interference with business relations. [#1]. Defendants moved
to dismiss the Complaint on January 24, 2019 (“the
First Motion to Dismiss”) [#21] before the Scheduling
Conference held February 13, 2019 [#28]. The First Motion to
Dismiss argued that the court lacked personal jurisdiction
over the Defendants [#21 at 6] and that the Complaint failed
to state a claim [id. at 11]. The First Motion to
Dismiss remained pending and unaddressed by Plaintiffs at the
Scheduling Conference, the court set substantive deadlines
for discovery and motions practice in this matter. [#28;
#29]. At the Conference, the court discussed the personal
jurisdiction argument and whether Plaintiffs sought
jurisdictional discovery following the contemplated filing of
an Amended Complaint. [#28 at 2]. The court instructed the
Parties that “[i]f parties need jurisdictional
discovery after the amended complaint is filed, parties can
contact chambers to set an informal Discovery
Conference.” [Id.]. Plaintiffs filed the
Amended Complaint the next day. [#27]. Defendants filed a
renewed Motion to Dismiss (“the Renewed Motion to
Dismiss”) on February 28, 2019. [#44]. Defendants filed
the instant Motion to Stay shortly thereafter [#45], and full
briefing is now complete. [#49; #54]. Plaintiffs have not
moved for jurisdictional discovery and neither Party has
contacted chambers seeking a Discovery Conference. Instead,
Plaintiffs have filed an Opposition to the Motion to Dismiss
that is currently pending before the court. [#52].
Federal Rules of Civil Procedure do not expressly provide for
a stay of proceedings; however, the power to stay “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, 254-55 (1936) (citing Kansas City S. Ry. Co. v.
United States, 282 U.S. 760, 763 (1931)). Whether to
stay discovery is a matter left to the sound discretion of
the trial court. Wang v. Hsu, 919 F.2d 130, 130
(10th Cir. 1990). In determining whether a stay is
appropriate, the court weighs interests such as whether
defendants are likely to prevail in the civil action, whether
defendants will suffer irreparable harm, whether the stay
will cause substantial harm to other parties to the
proceeding, and the public interests at stake. United
Steelworkers of Am. v. Oregon Steel Mills, Inc., 322
F.3d 1222, 1227 (10th Cir. 2003). The factors to be applied
by the court in determining the propriety of a stay are: (1)
Plaintiffs' interests in proceeding expeditiously with
the action and the potential prejudice to Plaintiffs
resulting from a delay; (2) the burden on the Defendants; (3)
the convenience to the Court; (4) the interests of persons
not parties to the litigation; and (5) the public interest.
String Cheese Incident, LLC v. Stylus Shows, Inc.,
No. 1:02-CV-01934-LTB-PAC, 2006 WL 894955, at *2 (D. Colo.
Mar. 30, 2006).
in this District generally disfavor the stay of all
discovery. See Wason Ranch Corporation v. Hecla Mining
Co., No. 07-cv-00267-EWN-MEH, 2007 WL 1655362, at *1 (D.
Colo. 2007); see also Church Mut. Ins. Co. v. Coutu,
No. 17-CV-00209-RM-NYW, 2017 WL 3283090, at *2 (D. Colo. Aug.
2, 2017) (“Stays of the normal proceedings of a court
matter should be the exception rather than the rule, and
stays in this District are generally disfavored.”
(citations and quotations omitted) (formatting altered)).
“This is particularly true in cases requesting
indefinite stays, which could substantially delay the
ultimate resolution of the case, with adverse consequences
such as a decrease in evidentiary quality and witness
availability.” Weatherspoon v. Miller, No.
11-CV-00312-REB-MEH, 2011 WL 1485935, at *2 (D. Colo. Apr.
19, 2011). District courts in this Circuit have declined
requests to stay discovery based solely upon the disposition
of dispositive motions. Basin Acquisition Corp. v. Mazda
Motor of Am., Inc., No. 11-CV-179 JEC/ACT, 2011 WL
13289673, at *2 (D.N.M. Aug. 1, 2011).
court now turns to considering each of the String
Interests in Proceeding Expeditiously with the Action and the
Potential Prejudice to Plaintiffs Resulting from a
claim that Plaintiffs “have no particular need for
urgency in this action” and thus this factor does not
weigh in favor of a stay. [#45 at 7]. Plaintiffs vigorously
dispute this point, arguing that the alleged misconduct is
ongoing as Defendants continue to engage in the at-issue
business practices which Plaintiffs allege to constitute an
ongoing harm. [#49 at 9-10]. In Reply, Defendants point to
Plaintiffs' delay in bringing suit as evidence that
Plaintiffs do not have a true interest in moving
expeditiously. [#54 at 4-7].
Plaintiffs have not moved to enjoin any of Defendants'
business practices, the court finds that this factor weighs
against a stay because, as Plaintiffs point out, the alleged
harm is ongoing. Nothing in the record suggests that
Defendants have agreed to cease and desist from selling the
accused products or at least abstain from such sales pending
the adjudication of the Renewed Motion to Dismiss or this
action. In addition, though Plaintiffs filed an Opposition to
the Motion to Dismiss, no Reply has been filed. And there is
no indication as to how long it may be before the court can
fully adjudicate the Renewed Motion to Dismiss. Given the
lack of clarity as to how long a stay would be, this factor
weighs against a stay.
Burden on ...