United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
W. DARRAH United States District Court Judge.
River Docks, Inc. filed an admiralty Complaint, alleging
negligence by Roy Strom Excavating and Grading Co. related to
the sinking of a barge. Plaintiff has now filed a Motion to
Enjoin Roy Strom from Asserting Compulsory Counterclaims in
Other Fora . For the reasons discussed more fully below,
Plaintiff's Motion  is denied.
February 17, 2015, Service Welding and Shipbuilding, LLC
filed a complaint in state court against Defendant:
Service Welding and Shipbuilding, LLC v. Roy Strom
Excavating and Grading Co., No. 2015 L 001627. Plaintiff
filed the current federal action against Defendant; and
summons was returned executed on August 18, 2015. On August
21, 2015, Defendant filed a “third-party complaint,
” asserting two third-party claims against Plaintiff in
the state-court action. On September 24, 2015, Plaintiff
moved to dismiss Defendant's third-party claims in state
court. On January 13, 2016, Defendant's federal Motion to
Dismiss certain claims and to stay or abstain from hearing
the remaining claims pursuant to the abstention doctrine was
denied because the subject of the state action and the
federal action are different. On May 12, 2015, the state
court dismissed the third-party claims against Plaintiff for
failure to state a claim and due to the federal admiralty
action. The state court also informed Defendant that the
third-party claims were mandatory counterclaims in the
the state court granted Defendant leave to re-plead its
third-party claims in state court, over Plaintiff's
objection. Defendant was granted multiple extensions of time
to re-plead; and, on August 1, 2016, Defendant filed its
Amended Third-Party Complaint in state court. In the Amended
Third-Party Complaint, Defendant alleges that Plaintiff
negligently caused barge AGS 441B to sink because the barge
was not fit for its purpose and that Plaintiff would be
unjustly enriched in the event that Defendant is found to
have breached its contracts in the state action.
the Anti-Injunction Act, a federal court may not enjoin
“proceedings in a State court except as expressly
authorized by Act of Congress, or where necessary in aid of
its jurisdiction, or to protect or effectuate its
judgments.” 28 U.S.C. § 2283. “Any doubts
about the Act's three specifically defined exceptions
ought to be resolved in favor of permitting the state courts
to proceed.” Trustees of Carpenters' Health
& Welfare Trust Fund of St. Louis v. Darr, 694 F.3d
803, 805 (7th Cir. 2012) (internal citations and quotations
argues that the Motion to Enjoin should be denied because
this Court does not have authority to enjoin Defendant from
asserting third-party claims in the state-court action under
the Anti-Injunction Act. Plaintiff argues that when the
original third-party complaint was dismissed without
prejudice, that ended the state action between Plaintiff and
Defendant and that there was no proceeding in a state court.
See United States v. California, 507 U.S. 746, 756
(1993) (“A dismissal without prejudice terminates the
action and concludes the rights of the parties in that
particular action.”); Johnson v. Du Page Airport
Auth., 644 N.E.2d 802, 808 (1994) (“The effect of
a dismissal without prejudice is to render the proceedings a
nullity and leave the parties in the same position as if the
case had never been filed.”). The motion for injunctive
relief was filed between the Third-Party Complaint being
dismissed without prejudice and the start of another action
by filing the Amended Third-Party Complaint. 735 Ill. Comp.
Stat. 5/2-201 (actions in Illinois are “commenced by
the filing of a complaint”). The Anti-Injunction Act
“does not apply to state actions commenced after a
motion for injunctive relief is filed in the federal
court.” Barancik v. Inv'rs Funding Corp. of New
York, 489 F.2d 933, 938 (7th Cir. 1973).
an injunction is not prohibited by the Anti-Injunction Act, a
district court must respect the courts of a sovereign state
and determine whether an injunction is an appropriate
exercise of authority. Zurich Am. Ins. Co. v. Superior
Court for State of California, 326 F.3d 816, 824 (7th
Cir. 2003). The principles of equity, comity, and federalism
must be considered when a federal court is asked to enjoin a
state-court proceeding. Mitchum v. Foster, 407 U.S.
225, 243 (1972). Enjoining a state-court proceeding must also
be supported by “traditional equitable requirements
such as irreparable harm for which there is no adequate
remedy at law.” Zurich, 326 F.3d at 825. In
this case, Plaintiff has not demonstrated an irreparable harm
for which there is no adequate remedy at law. If
Defendant's third-party complaint is frivolous, Plaintiff
can move for monetary sanctions in state court pursuant to
Illinois Supreme Court Rule 137. See Ill. Comp.
Stat. S.Ct. Rule 137; Amadeo v. Gaynor, 701 N.E.2d
1139, 1144-46 (Ill.App.Ct. 1998) (upholding sanctions for
filing frivolous third-party complaint).
also argues that the Federal Rules regarding compulsory
counterclaims weigh on the side of enjoining Defendant.
Federal Rule of Civil Procedure 13(a) lays out the
requirements for compulsory counterclaims: “A pleading
must state as a counterclaim any claim that at the time of
its service the pleader has against an opposing party if the
claim: (A) arises out of the transaction or occurrence that
is the subject matter of the opposing party's claim; and
(B) does not require adding another party over whom the court
cannot acquire jurisdiction.” Fed.R.Civ.P. 13(a)(1). A
counterclaim is not compulsory if “when the action was
commenced, the claim was the subject of another pending
action.” Fed.R.Civ.P. 13(a)(2)(A).
previously discussed, the admiralty action was commenced
before Plaintiff was brought into the state-court action.
Therefore, any counterclaims would not be the subject of
another pending action when the federal action commenced.
Moreover, enjoining the state court proceedings would not
comport with traditional equitable requirements.
‘s Motion to Enjoin Roy Strom from Asserting Compulsory