RR Street & Co. Inc. v. Transport Ins. Co.

This dispute emerges from a web of state and federal litigation over liability for damages and defense costs in certain environmental tort suits. The appeal before us concerns two cases that mirror each other: (1) an action for damages that the Appellants brought in federal court and (2) a declaratory judgment action that the Appellee brought in state court, which Appellants later removed to federal court. The district court declined to entertain these actions, by dismissing the former and remanding the latter, in light of a related third action that had been pending for several years in state court. We must examine the propriety of this decision.

Considering the particular circumstances of this case, we conclude that the district court had discretion under Wilton v. Seven Falls Co., 515 U.S. 277, 289-90 , 115 S.Ct. 2137 , 132 L.Ed.2d 214 (1995), and Brillhart v. Excess Ins. Co. of Am., 316 U.S. 491 , 62 S.Ct. 1173 , 86 L.Ed. 1620 (1942), to remand the declaratory judgment action, and that the action for damages fell within the scope of Colorado River Water Conservation Dist. v. United States, 424 U.S. 800 , 96 S.Ct. 1236 , 47 L.Ed.2d 483 (1976). We therefore…