Maria Vlachou-Hahn, et al., Plaintiffs,

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2016).

STATE OF MINNESOTA
IN COURT OF APPEALS
A17-1921

Maria Vlachou-Hahn, et al.,
Plaintiffs,

vs.

Michael A. Zimmer,
as Special Administrator for the Estate of Marcus Hahn, deceased, et al.,
Respondents,

Budget Rent A Car System, Inc., et al.,
Appellants,

Nationwide Mutual Insurance Company, et al.,
Respondents,

and

Budget Rent A Car System, Inc., et al.,
Defendants and Third Party Plaintiffs,

PV Holding Corp.,
Defendant and Third Party Plaintiff,

vs.

Diego Velazquez Sanchez, et al.,
Third Party Defendants.

Filed June 18, 2018
Affirmed
Schellhas, Judge

Hennepin County District Court
File No. 27-CV-17-9143

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B. Jon Lilleberg, Peter M. Leiferman, Lilleberg & Hopewell, PLLC, Edina, Minnesota (for
respondents Michael A. Zimmer, et al.)

Sylvia Ivey Zinn, Brendel, Zinn, Sofio & Oskie, PLLC , St. Paul, Minnesota (for
respondents Nationwide Mutual Insurance Company and AMCO Insurance company)

Robert E. Kuderer, Thomas C. Brock, Erickson, Zierke , Kuderer & Madsen, P.A.,
Minneapolis, Minnesota (for appellants)

Considered and decided by Ross, Presid ing Judge; Schellhas, Judge; and Hooten,
Judge.
U N P U B L I S H E D O P I N I O N
SCHELLHAS, Judge
Appellants rental-car company and insurer ar gue that the district court abused its
discretion by staying an action in Minneso ta and denying a request for an anti-suit
injunction regarding an action in another state. We affirm.
FACTS
On August 27, 2015, California residents Marcus Hahn (Hahn) and his wife and
daughter, plaintiffs Maria and Eva Vlachou -Hahn (Vlachou-Hahns), rented a car from
appellant Budget Rent-A-Car (Budget) in Mi nnesota. Two days later, while driving in
Minnesota, Hahn collided with a vehicle driven by third-pa rty defendant Diego Sanchez.
The collision killed Hahn and injured Vlachou-Hahns and the passengers in Sanchez’s car.
On November 3, 2016, Hahn’s insurers, respondents Nationwide Mutual Insurance
Company and AMCO Insurance Company (Nationwide), sought declaratory relief in state
court in California, seeking a determination about their obligation, if any, to indemnify or

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defend Hahn’s estate against liability claims resulting from the accident.1 On December 19,
the Minnesota District Court appointed resp ondent Michael Zimmer to serve as special
administrator of Hahn’s estate. On December 20, Vlachou-Hahns filed their answer in the
California action.
In late December 2016, Vlachou-Hahn s sued Hahn’s estate, Budget, and
defendant/third-party plaintiff PV Holding Corp. (PV), the owner of Hahn’s rental car, in
Minnesota District Court for damages allege dly caused by Hahn’s driving negligence. 2
Vlachou-Hahns also sought a declaratory judgm ent that the family exclusion in Hahn’s
insurance policies did not apply and that the insurance policies of appellants ACE
American (ACE) and AON Risk Services (AON), Budget, an d PV covered the damages
sought.
On or about January 19, 2017, Vlacho u-Hahns amended thei r complaint in the
Minnesota action, adding Nationwide as a party to their declaratory-judgement action and
alleging that ACE, AON, Budget, and PV had denied coverage under their “family
exclusion” provisions. On or about March 20, 2017, Vlachou-Hahns added AMCO as a
defendant in the Minnesota action.
On or about July 7, 2017, Budget cro ss-claimed and counterclaimed in the
Minnesota action for a declaratory judgment that AMCO’s policy has the primary duty to

1 We take judicial notice of the California Superior Court records. See Eagan Econ. Dev.
Auth. v. U-Haul Co. of Minn. , 787 N.W.2d 523, 530 (Minn. 2010) (“[W]e have taken
judicial notice of public records and have said we have the inherent power to look beyond
the record where the orderly administration of justice commends it.” (quotation omitted)).
2 The district court’s October 4, 2017 order misidentifies the date of this complaint as
“November 21, 2016”; the original complaint is dated “12-21-16.”

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defend and indemnify Hahn’s estate and for equitable contribution from Nationwide for all
costs incurred defending Hahn’s estate. Budg et also added “Does 1-6” representing the
then-unidentified Sanchez-car passengers.3 On or about July 19, Nationwide moved both
to stay and to bifurcate the Minnesota action, pending resolution of the California action.
On or about August 4, Vlachou-Hahns move d in the Minnesota action to enjoin
Nationwide from proceeding wi th the California action. Budget, PV, ACE, and AON
joined the Vlachou-Hahns’ motion and moved to temporarily enjoin Nationwide in the
California action. On or about August 10 , Nationwide and AMCO moved for summary
judgment in the California action.
On or about October 4, 2017, the Minneso ta District Court stayed the Minnesota
action, noting the first-filed status of the California action, the “identical issues” present in
both actions, and that the California action had proceeded further than the Minnesota
action. Because the court stayed the Minnes ota action, it did not address the motion to
bifurcate. The court denied Vlachou-Hahns’ and Budget’s motions for injunctive relief.
This appeal follows.
D E C I S I O N
Budget argues that the district court abused its discretion by granting Nationwide’s
motion to stay and by denying Budget’s anti-suit injunction. We disagree.
When parallel litigation is pr oceeding in different states , “the rules of res judicata
will generally be applied with regard to the first suit to be concluded as against the suit still

3 On July 27, 2017, Budget amended its claim to add the Sanchez passengers as parties.

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pending.” St. Paul Surplus Lines Ins. Co. v. Mentor Corp. , 503 N.W.2d 511, 515 (Minn.
App. 1993). But one of the courts, “in its discretion, may stay proceedings before it to allow
the proceedings before the other court to continue.” Id. We review a district court’s decision
to stay an action for an abuse of discretion. Id. A district court abuses its discretion when
it “disregards either the facts or the applicable principles of equity.” First State Ins. Co. v.
Minn. Mining and Mfg. Co., 535 N.W.2d 684, 687 (Minn. App. 1995) (quotation omitted),
review denied (Minn. Oct. 18, 1995). We do not reverse a district court’s decision on a
motion for an anti-suit injunction “absent a clear abuse of discretion.” Medtronic, Inc. v.
Advanced Bionics Corp., 630 N.W.2d 438, 451 (Minn. App. 2001). For reasons explained
below, we conclude that the district c ourt did not abuse its discretion by granting
Nationwide a stay of the Minnesota action or by denying Budget an anti-suit injunction.
“A court may enjoin a party over whom it has in personam jurisdiction from
pursuing similar litigation in another court.” Id. Budget argues that the district court erred
by denying its request for an anti-suit injunction as to th e California action because the
court improperly considered the first-filed ru le because (1) the Minnesota and California
courts lack concurrent jurisdiction, (2) the court incorrectly applied the first-filed rule, and
(3) the court failed to consider relevant public policy concerns. The Minnesota Supreme
Court has described the first-filed rule as follows:
Where two actions between the same parties, on the same
subject, and to test the same ri ghts, are brought in different
courts having concurrent jurisd iction, the court which first
acquires jurisdiction, its power being adequate to the
administration of complete justic e, retains its jurisdiction and
may dispose of the whole cont roversy, and no court of
coordinate power is at liberty to interfere with its action. This

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rule rests upon comity and the necessity of avoiding conflict in
the execution of judgments by i ndependent courts, and is a
necessary one because any other rule would unavoidably lead
to perpetual collision and be productive of the most calamitous
results.

State ex rel. Minn. Nat’l Bank of Duluth v. Dist. Ct. , 195 Minn. 169, 173, 262 N.W. 155,
157 (1935) (quotation omitted). The power to issue an anti-suit injunction “should be used
sparingly.” Mentor, 503 N.W.2d at 516.
The first-filed rule is a not truly a rule at all, but a principle, ‘“a blend of courtesy
and expediency.”’ Gavle v. Little Six, Inc. , 555 N.W.2d 284, 291 (Minn. 1996) (quoting
Medtronic Inc. v. Catalyst Research , 518 F. Supp. 946, 9 55, (D. Minn. 1981), aff’d, 664
F.2d 660 (8th Cir. 1981)). “This rule is not intended to be rigid, mechanical, or inflexible,”
Advanced Bionics Corp., 630 N.W.2d at 449 (quotation omitted), but “should be applied
in a manner serving sound judicial administration,” Gavle, 555 N.W.2d at 291 (quotation
omitted). We review the application of the fi rst-filed rule for an abuse of discretion.
Advanced Bionics , 630 N.W.2d at 449 (noting, in ca se involving litigation in both
California and Minnesota state courts, that courts are required to exercise their discretion
in applying the first-filed rule).
When deciding a motion for an anti-suit injunction, district courts consider “factors
of judicial economy, informal comity between courts, cost and convenience of the litigants,
and the possibility of vexatious conflict and overlap of multiple determinations of the same
dispute.” Minn. Mut. Life Ins. v. Anderson , 410 N.W.2d 80, 82 (Minn. App. 1987).
“Judicial comity is the respect a court of one state or jurisdiction shows to another state or

7
jurisdiction in giving effect to the other’s laws and judicial decisions.” Advanced Bionics,
630 N.W.2d at 449 (quotation omitted).
Here, the district court determined that a consideration of judicial economy weighed
in favor of staying the Minnesota case because of the possibility of multiple litigation and
conflicting results and that th e California action had proceede d further. In its October 4,
2017 order, the court recognized that judici al comity weighed in favor of staying the
Minnesota action because the California court had not withdrawn from the matter and had
proceeded with scheduling. The court concluded that the costs and convenience of the
litigants weighed in favor of the Califor nia action because the parties had been
actively involved in that action, it was file d first, had proceeded further, and the
parties had “demonstrated their ability to litigate” there.
In Anderson, the Ramsey County District Co urt granted an anti-suit injunction
against a first-filed case in Hennepin County involving multiple life-insurance claims. 410
N.W.2d at 80–81. On appeal, we affirmed, analyzing the same factors that the district court
used in this case: judicial economy, comity, and the cost and convenience of the litigants.
Id. at 82–83. We concluded that the Ramsey C ounty court did not abuse its discretion by
granting the injunction because the Ramsey Co unty action included all necessary parties,
had proceeded further, and it had “authority over potentially crucial evidence.” Id. at 83.
Here, similar to Anderson, the California action has proceeded further, includes all
necessary parties for deciding the applicability of the Califor nia insurance contracts, and
the California court has “authority over pote ntially crucial eviden ce,” the applicable

8
insurance contracts executed by Hahn, a California resident. The district court’s
consideration of equitable factors in addition to the first-filed rule is well supported in the
record. See First State Ins. Co. , 535 N.W.2d at 688–89 (concluding that when no
concurrent jurisdiction existed, “district c ourt did not misapply the law by relying on the
first-filed status in addition to anti-suit injunction factors”); see also Anderson, 410 N.W.2d
at 82–83 (weighing equitable factors in addition to first -filed rule when concurrent
jurisdiction did not exist).
Budget first argues that Minnesota and Ca lifornia lack concurrent jurisdiction and
that the district court therefore improperly applied the first-filed rule. Budget correctly
asserts that Minnesota and Californi a lack concurrent jurisdiction. See Black’s Law
Dictionary 980 (10th ed. 2014) (defining “concurrent jurisdiction” as: “Jurisdiction that
might be exercised simultaneously by more th an one court over the same subject matter
and within the same terr itory”). But, as noted above, the fi rst-filed rule is not a rule, but
rather a “blend of courtesy and expediency” and “should be applied in a manner serving
sound judicial administration.” Gavle, 555 N.W.2d at 291 (quotation omitted). Further, this
court has used the first-filed rule in cases that do not involve concurrent jurisdiction. See,
e.g., First State Ins. Co., 535 N.W.2d at 689 (stating that the “district court did not misapply
the law by relying on the first-filed stat us” in granting anti-su it injunction where no
concurrent jurisdiction existed ). The district court therefore did not err by applying the
first-filed rule even though the Minnesota and California courts lack concurrent
jurisdiction.

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Budget next argues that the district cour t erred in applying the first-filed rule
because Nationwide anticipatorily sued in California for declaratory judgment to avoid the
jurisdiction of the Minnesota courts. Budget cites Advanced Bionics as support for its
proposition that a district court cannot apply th e first-filed rule when one party files an
anticipatory declaratory-judgment action. Advanced Bionics involved a dispute over the
enforcement of a noncompete agreement be tween a former employee and his Minnesota
employer, Medtronic. Advanced Bionics, 630 N.W.2d at 445–46. The Minnesota District
Court permanently enjoined the former employee’s new employer, Advanced Bionics,
from pursuing its action in California. Id. at 447. On appeal, this court concluded that the
district court “did not err in exercising its discretion in considering the principles
underlying the so-calle d first-filed ‘rule.’” Id. at 450. We stated that “it is clear that
Advanced Bionics filed suit in California specifically to av oid Minnesota law, which is
more likely to result in enforcement of the contract provision.” Id.
Advanced Bionics is distinguishable from this case . Hahn, a California resident,
executed the insurance policies with an Ohio company (Nationwide) and an Iowa company
(AMCO). In Advanced Bionic , two of the parties resided in Minnesota, and their
employment relationship was formed in Minnesota. 630 N.W.2d at 445–46. But here, the
parties do not reside in Minnesota and their contractual relationship was not formed in
Minnesota.
Budget also argues that the district court erred in applying the first-filed rule because
it did not first analyze a three-pa rt substantial-similarity test. See Mentor, 503 N.W.2d at
515 (“Where two actions between the same par ties, on the same subject, and to test the

10
same rights, are brought in different courts having concurrent jurisdiction, the court which
first acquires jurisdiction . . . retains its jurisdiction and may dispose of the whole
controversy.” (quotation omitted)); First State Ins. Co. , 535 N.W.2d at 535 (applying
substantial-similarity test). Even if the district court did not precisely analyze the three-part
substantial-similarity test, we conclude that the court did not abuse its discretion.
The Minnesota action contains a different party from the California action: the
Sanchez-car passengers are third-party defend ants in the Minnesota action but are not
parties in the California action. See Mentor, 503 N.W.2d at 516 (concluding that different
parties were present between cases in two stat es where one state lacked jurisdiction over
all parties present in other st ate’s action). And the issues in the Minnesota and California
actions are different: the Minnesota action includes a claim for negligence, and the
California action does not. See id. (concluding that actions in two states presented different
issues because one state’s action included an additional claim). The California action does
not intrude upon the jurisdiction of the Mi nnesota action and will therefore not be
dispositive. See id. (concluding that neither action was dispositive of the other because
“[t]here has been no showing that [one] acti on was commenced . . . in hopes of obtaining
an unfair or inequitable advantage”). And neither the record nor the district court’s findings
support Budget’s contention that Nationwide commenced its action in California to obtain
an “unfair or inequitable” advantage. See Doerr v. Warner , 247 Minn. 98, 107–10, 76
N.W.2d 505, 513–14 (1956) (affirming injunction in a trust case where trustee moved the
trust res from Minnesota to Nevada to deprive the Minnesota court of jurisdiction).

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Regarding Minnesota’s public policy, Budget argues that the district court erred by
failing to consider Minnesota’s “strong interest in having its laws . . . apply to accidents
occurring” here.4 We note that at oral arguments befo re the district court, Budget argued
that the court should apply the factors of judicial economy, comity, the cost and
convenience of the litigants, a nd the possibility of multiple determinations in deciding
whether to grant its motion for an anti-suit in junction. Further, this court has previously
used these factors when deciding whether to gran t an anti-suit injunction. See Advanced
Bionics, 630 N.W.2d at 449 (concluding no ab use of discretion in granting anti-suit
injunction where the district court in part c onsidered judicial economy, comity, the cost
and convenience of the litigants, and the possibility of multiple determinations).
We conclude that the district court did not disregard the facts or fail to consider the
proper equitable considerations. Like the courts in Advanced Bionics and First State Ins.
Co., the district court did not abuse its discreti on when it relied on the first-filed status of
the California action in addition to other equitable factors—judicial economy, comity, and
the cost to and the convenience of the litigants. See Mentor, 503 N.W.2d at 515 (affirming
denial of stay and grant of anti-suit inju nction when a Minnesota court had proper
jurisdiction over the parties and issues in first-filed action). We therefore affirm the district
court’s grant of a stay and denial of an anti-suit injunction.
Affirmed.

4 We note that nothing in the district court’s order here prevents the parties from arguing
for the application of Minnesota law to the insurance contracts in the California action.