On November 1, 1996, the Wisconsin court entered its Judgment Against Defendant R&B Group, Inc., specifically entering judgment in favor of BCI and against R&B as to Counts I through III of BCI's Wisconsin complaint, and declaring, ordering and adjudging "that plaintiff BCI Burke Company, Inc. has no obligation to pay any part of the sums demanded by defendant R&B Group, Inc. in connection with BCI Burke Company, Inc.'s 1996 product catalog." (Ex. 4 to Certificate of Authenticity). R&B filed a notice of appeal with the Wisconsin Court of Appeals from the November 1, 1996 judgment order. This appeal remains unresolved.
D. Three Motions Pending Before This Court.
There are three pending motions. First, BCI has filed a renewed motion to stay proceedings predicated on the Colorado River doctrine. Second, BCI has filed a motion for summary judgment on the theory that the November 1, 1996 judgment entered in the Wisconsin Litigation is res judicata. Third, R&B has filed a motion for summary judgment on the underlying merits of the litigation contending that it is entitled to judgment as a matter of law against BCI on its breach of contract, account stated and unjust enrichment claims. The Court will address each motion separately.
II. COLORADO RIVER ABSTENTION APPLIES
Federal courts possess a "virtually unflagging obligation" to exercise their jurisdiction. Colorado River Water Conservation District v. United States, 424 U.S. 800, 817, 96 S. Ct. 1236, 1246, 47 L. Ed. 2d 483 (1976); Caminiti and Iatarola, Ltd v. Behnke Warehousing, Inc., 962 F.2d 698 (7th Cir. 1992). A federal court may stay or dismiss a suit in exceptional circumstances when there is a concurrent state proceeding and the stay or dismissal would promote wise judicial administration. Caminiti, 962 F.2d at 700.
The initial step in determining whether the Colorado River doctrine is applicable is to inquire whether the concurrent state and federal proceedings are parallel. Id A suit is "parallel" when substantially the same parties are contemporaneously litigating substantially the same issues in another forum. Calvert Fire Ins. Co. v. American Mutual Reinsurance Co., 600 F.2d 1228, 1229 n.1 (7th Cir. 1979). The parties agree that the Wisconsin Litigation and the Federal Litigation are parallel.
The court must next determine whether exceptional circumstances exist that justify deference to the state court proceeding. There are at least ten factors that a court may consider in deciding whether exceptional circumstances are present: (1) whether the state has assumed jurisdiction over property; (2) the inconvenience of the federal forum; (3) the desirability of avoiding piecemeal litigation; (4) the order in which jurisdiction was obtained by the concurrent forums; (5) the source of governing law; (6) the adequacy of the state court action to protect the federal plaintiff's rights; (7) the relative progress of state and federal proceedings; (8) the presence or absence of concurrent jurisdiction; (9) the availability of removal; and (10) the vexatious or contrived nature of the federal claim. LaDuke v. Burlington Northern R.R., 879 F.2d 1556, 1559 (7th Cir. 1989). No single factor is necessarily determinative. Caminiti, 962 F.2d at 701. Instead, the decision to stay or dismiss a federal action because of parallel state court litigation "does not rest on a mechanical checklist, but on a careful balancing of the important factors as they apply in a given case, with the balance heavily weighted in favor of the exercise of jurisdiction." Moses H. Cone Memorial Hospital v. Mercury Construction Corp., 460 U.S. 1, 16, 103 S. Ct. 927, 937, 74 L. Ed. 2d 765 (1983).
Applying these factors leads to the inescapable conclusion that exceptional circumstances exist which require that this action be stayed pending the final outcome of the Wisconsin Litigation. The Court believes the conservation of judicial resources and the parties resources requires a stay. The Wisconsin Litigation has resulted in a default judgment which is currently on appeal. A stay avoids piecemeal litigation and prevents the risk of inconsistent results. If the present action is not stayed, the parties will simultaneously litigate identical claims in two different forums, which may be both "unseemly" and a "grand waste" of the efforts of the parties and the courts. LaDuke v. Burlington Northern R.R. Co., 879 F.2d 1556, 1560 (7th Cir. 1989). The reasons for a stay found by the Seventh Circuit in Lumen Construction, Inc. v. Brant Construction Company, Inc., 780 F.2d 691, 696-698 (7th Cir. 1986) and Interstate Material Corporation v. City of Chicago, 847 F.2d 1285, 1289-90 (7th Cir. 1988) are equally applicable here:
1. The claims in the federal suit could be mooted by the prior pending Wisconsin Litigation;