United States District Court, W.D. Washington, Seattle
ORDER GRANTING MOTION TO CONSOLIDATE
L. ROBART UNITED STATES DISTRICT JUDGE.
the court is Defendant Hyperion Entertainment C.V.B.A.'s
("Hyperion") motion to consolidate this matter with
Hyperion Entertainment C. V.B.A. v. Itec LLC, No.
C18-0381RSM (W.D. Wash. 2018) (the "381 Action").
(Mot. (Dkt. # 35).) Plaintiff Cloanto Corporation
("Cloanto") opposes the motion. (Resp. (Dkt. #
38).) The court has considered the motion, the parties'
submissions in support of and in opposition to the motion,
the relevant portions of the record, and the applicable law.
Being fully advised,  the court GRANTS the motion.
this action and the 381 Action stem from the 2009 settlement
of two prior actions before Chief Judge Ricardo S. Martinez
relating to a licensing and development agreement.
(See Am. Compl. (Dkt. # 29) ¶¶ 25-37);
Hyperion Entertainment C. V.B.A. v. Itec LLC et al.,
No. 18-0381RSM, (W.D. Wash. 2018) (hereinafter, "381
Action"), Dkt. # 1 (the "381 Compl.")
¶¶ 18-29; see generally Amiga, Inc. v. Hyperion
VOF, No. C07-0631RSM (W.D. Wash. 2007); Hyperion VOF
v. Amino Dev. Corp., No. C07-1761RAK (W.D. Wash. 2007).
Cloanto originally brought this suit on December 14, 2017,
against Hyperion in the Northern District of New York for
breach of the 2009 settlement agreement, copyright
infringement, trademark infringement, and unfair competition.
(See generally Compl. (Dkt. # 1).) Hyperion then
filed suit on March 13, 2018, in the Western District of
Washington, against Cloanto and other entities for breach of
the 2009 settlement agreement and various declaratory
judgments of non-infringement and ownership of the
trademarks. (See generally 381 Compl.) That case,
the 381 Action, is pending before Chief Judge Martinez.
(See 381 Action.)
April 9, 2018, the parties in the New York suit stipulated to
transfer the matter to the Western District of Washington.
(See Stip. (Dkt. # 14).) The parties agreed that
"the Western District of Washington is both a convenient
and appropriate venue in which all claims, issues and
defenses ... can be adjudicated." (Id. at 2.)
Significantly, the parties agreed that the case "should
be transferred to the Western District of Washington and
consolidated with [the 381 Action] for resolution and
adjudication." (Id.) Based on that stipulation,
the Northern District of New York transferred the case to
this District on April 11, 2018. (Transfer Order (Dkt. #
transfer, Hyperion sought to consolidate this case with the
381 Action. (See Mot.) Despite its earlier
stipulation, Cloanto opposes consolidation. (See
Stip. at 2; Resp.) The court now addresses the motion.
Rule of Civil Procedure 42(a) provides:
If actions before the court involve a common question of law
or fact, the court may: (1) join for hearing or trial any or
all matters at issue in the actions; (2) consolidate the
actions; or (3) issue any other orders to avoid unnecessary
cost or delay.
Civ. P. 42(a). The rule affords courts "broad
discretion" to consolidate cases pending in the same
district. In re Adams Apple, Inc., 829 F.2d 1484,
1487 (9th Cir. 1987). In considering whether to consolidate,
the court considers a number of factors, including
"judicial economy, whether consolidation would expedite
resolution of the case, whether separate cases may yield
inconsistent results, and the potential prejudice to a party
opposing consolidation." First Mercury Ins. Co. v.
SQI, Inc., Nos. C13-2110JLR, C13-2109JLR, 2014 WL
496685, at *2 (W.D. Wash. Feb. 6, 2014).
all factors favor consolidation. Both parties agree that the
381 Action and the instant matter present similar issues of
law and fact. (See Mot. at 2; Resp. at 4
(acknowledging that the 381 Action "involve[s] some of
the same issues that arise in the instant action").) The
parties further agree that the two actions center on the
interpretation of the 2009 settlement agreement reached in
the two cases previously heard by Chief Judge Martinez.
(See Mot. at 3; Resp. at 4.) Thus, consolidation
will serve the interest of judicial economy in three ways:
(1) it eliminates the need to file separate motions in each
case on similar issues, (2) it allows the court to address
overlapping issues in a more streamlined fashion, and (3) it
capitalizes on Chief Judge Martinez's knowledge of the
settlement agreement and the prior litigation between
parties. Moreover, maintaining two separate cases may yield
inconsistent results, and neither party has raised any
possible prejudice resulting from consolidation.
(See Mot.; Resp.)
does not so much oppose consolidation but instead maintains
that the two cases should be "consolidated [before the
undersigned judge], as the instant action is the one that was
first-filed." (Resp. at 2 (holding removed); see
also Id. at 4 (stating that "consolidation in this
[c]ourt would be the proper procedural outcome").) The
court disagrees. The first-to-file rule is not absolute or
mechanically-applied. Guthy-Renker Fitness, LLC v. Icon
Health & Fitness, Inc., 179 F.R.D. 264, 269 (CD.
Cal. 1998). Courts decline to apply the rule in certain
equitable circumstances. Id. at 270. Here, Chief
Judge Martinez's experience-not only with the settlement
agreement at issue but also with the pending 381
Action-persuades the court that strictly adhering to the
first-to-file rule is inappropriate. Although Cloanto
attempts to downplay Chief Judge Martinez's involvement
with the settlement agreement (see Resp. at 4-7), it
is undisputed that Chief Judge Martinez presided over the
previous cases for years and resolved numerous motions, all
of which provide him insight into this matter that the
undersigned judge does not have, see generally Amiga,
Inc., No. C07-0631RSM; Hyperion VOF, No.
the court grants Hyperion's motion to consolidate the