Gregg v. Superior Court

[136]

Opinion

MERRILL, J.

Petitioner is a janitorial services franchisee seeking a superior court’s preliminary injunction against certain activities by his franchisor. In this court he challenges a superior court order staying his action until the conclusion of proceedings in the United States District Court. Petitioner is not a plaintiff in the federal court action, but his attorney represents some 50 plaintiffs involved in 11 federal lawsuits against the franchisor. We conclude that the court abused its discretion in staying petitioner’s state court action.

Petitioner’s lawsuit against Jani-King of California and several individual defendants asserts fraud, unfair business practices, and operation of an illegal collection agency. In addition to damages and rescission of all contracts, it seeks an injunction preventing defendants from performing any of the unfair business practices described in the complaint. At a hearing on an order to show cause for a preliminary injunction, Jani-King moved to stay the matter until related federal proceedings were terminated. The court granted the motion and did not rule on the preliminary injunction, finding that the stay rendered it moot. This petition followed.

Petitioner seeks both relief from the stay and a ruling that he is entitled to a preliminary injunction against Jani-King’s illegal collection activities. We consider only the propriety of the stay. Although the court indicated that it was not satisfied the defendant was operating a collection agency, it did not rule on the request for a preliminary injunction. Petitioner’s attack upon the court’s comments is premature.

Two distinct legal principles govern stays of actions pending resolution of related lawsuits. Where the related lawsuit is a prior action in state court of the same state, the later action may be subject to a plea in abatement that “[tjhere is another action pending between the same parties on the same cause of action.” (Code Civ. Proc., § 430.10, subd. (c).) But such a plea in abatement “does not lie where the two actions are in courts of different states” (5 Witkin, Cal. Procedure (3d ed. 1985) Pleading, § 1063, p. 477) or where one is in state court and the other in federal court. There, the principle of comity may call for a discretionary refusal of the court to entertain the second suit pending determination of the first-filed action. (See 2 Witkin, Cal. Procedure (3d ed. 1985) Jurisdiction, §§ 341, 348, pp. 761, 769;