QUALITY ASSOCIATES, INC. v. THE PROCTER & GAMBLE DISTRIBUTING LLC; YANNIS SKOUFALOS; PATRICK PAOLINO; ELIZABETH RADKE; MICHELLE EGGERS - Articles

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QUALITY ASSOCIATES, INC. v. THE PROCTER & GAMBLE DISTRIBUTING LLC; YANNIS SKOUFALOS; PATRICK PAOLINO; ELIZABETH RADKE; MICHELLE EGGERS

Posted by: Tanja Trezise on Feb 11, 2020

Head Comment: GRIFFIN delivered a separate dissenting opinion.

Court: 6th Circuit Court (Published Opinions)

Attorneys 1: ARGUED: William B. Fecher, STATMAN, HARRIS & EYRICH, LLC, Cincinnati, Ohio, for Appellant. Eric K. Combs, DINSMORE & SHOHL, LLP, Cincinnati, Ohio, for Appellees.

Attorneys 2: ON BRIEF: William B. Fecher, STATMAN, HARRIS & EYRICH, LLC, Cincinnati, Ohio, for Appellant. Eric K. Combs, DINSMORE & SHOHL, LLP, Cincinnati, Ohio, for Appellees.

Judge(s): MOORE, McKEAGUE, and GRIFFIN, Circuit Judges

Court Appealed: Appeal from the United States District Court for the Southern District of Ohio at Cincinnati

KAREN NELSON MOORE, Circuit Judge. In February 2018, Quality Associates, Inc. (“QAI”) sued Procter & Gamble Distributing LLC (“P&G”) in Ohio federal court for breaking a contract with it in a racially discriminatory manner. See 42 U.S.C. § 1981. But the problem was, P&G had already sued QAI in Ohio state court over the same contractual dispute underlying QAI’s § 1981 claim, and that litigation was still ongoing. So P&G moved to dismiss QAI’s federal suit, arguing that its § 1981 claim was a compulsory counterclaim to the state litigation, see Ohio Civ. R. 13(A), and thus needed to be brought in that proceeding. The district court agreed and accordingly dismissed QAI’s suit. We conclude, however, that a federal court cannot enforce a state compulsory-counterclaim rule against a federal litigant while the relevant state litigation is still pending. For this reason, we REVERSE the district court’s judgment and REMAND for further proceedings consistent with this opinion.

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