The opinion
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF LOUISIANA
LAFAYETTE DIVISION
BROWN & BROWN OF LOUISIANA, LLC CASE NO. 6:23-CV-1047
VERSUS JUDGE TERRY A. DOUGHTY
JOHN C. CARO, JR., AND ROBERT COWAN MAGISTRATE JUDGE DAVID J. AYO
MEMORANDUM ORDER
Before this Court is a Motion to Transfer Venue [Doc. No. 13] filed by Defendants John
C. Caro, Jr. (“Caro”) and Robert Cowan (“Cowan”). An Opposition [Doc. No. 18] was filed by
Plaintiff Brown & Brown of Louisiana, LLC (“Brown & Brown”). A Reply [Doc. No. 20] was
filed by Caro and Cowan.
For the reasons set forth herein, the Motion to Transfer Venue is GRANTED.
I. BACKGROUND
The issue in this Motion to Transfer Venue is whether this case should be transferred to the
United States Court for the Middle District of Louisiana. On July 25, 2023, Caro, and Cowan each
filed separate suits1 in the Middle District of Louisiana seeking a declaratory judgment that
restrictive covenants contained in their employment agreements with Brown & Brown were
invalid for failure to comply with La. R.S. 23:921. On August 8, 2023, Brown & Brown filed a
Complaint [Doc. No. 1] in this proceeding which seeks damages from Caro and Cowan for breach
of restrictive covenants they entered into as a result of their employment with Brown & Brown.
Therefore, all three suits involve the legality of the restrictive covenants Caro and Cowan entered
into through their employment with Brown & Brown.
1 Case No. 3:23-cv-00596 and Case No. 3:23-cv-00597
Caro and Cowan maintain the present proceeding should be transferred to the Middle
District of Louisiana based upon the “first to file” rule. Brown & Brown argue that Caro and
Cowan engaged in “forum shopping” and the “first to file” rule should not be applied.
II. LAW AND ANALYSIS
A. First to File Rule
The “first to file” rule is grounded in principles of comity and sound judicial administration.
Federal courts have long recognized that principles of comity require federal district court – courts
of coordinate jurisdiction and equal rank – to exercise care to avoid interference with each other’s
affairs. The concern manifestly is to avoid the waste of duplication, to avoid rulings which may
trench upon the authority of sister courts, and to avoid piecemeal resolution of issues that call for
a uniform result. West Gulf Maritime Ass’n. v. ILA Deep Sea Local 24, 751 F.2d 721, 728-29 (5th
Cir. 1985).
The Fifth Circuit adheres to the general rule that the court in which the action is first filed
is the appropriate court to determine whether subsequently filed cases involving similar issues
should proceed. The rule does not require that cases be identical. The crucial inquiry is one of
“substantial overlap.” If the suits overlap on the substantive issues, the cases would be required to
be consolidated in the jurisdiction where the suit was first filed. Where the overlap between two
suits is less than complete, the determination is made on a case-by-case basis, based on such factors
as the extent of overlap, the likelihood of conflict, the comparative advantage, and the interest of
each forum in resolving the dispute. Save Power Ltd. v. Syntek Finance Corp., 121 F.3d 947, 950-
51 (5th Cir. 1997).
In deciding whether “substantial overlap” exists, the Court has looked at factors such as
whether the core issue is the same, or if much of the proof addressed would likely be identical.
International Fidelity Ins. Co. v. Sweet Little Mexico Corp., 665 F.3d 671, 678 (5th. Cir. 2011).
There is a strong presumption that favors the forum of the first filed suit. Waguespack v.
Medtronic, Ins., 185 F.Supp. 3d. 922 (M.D. La., May 6, 2016). The “first filed” rule does not apply
where compelling circumstances dictate that the first action be dismissed rather than the second
one. “Compelling circumstances” exist when a declaratory action is filed in anticipation of another
lawsuit in order to secure a more favorable forum. Johnson Bros. Corp. v. International
Brotherhood of Painters, 861 F.Supp. 28, 29 (M.D. La., July 27, 1994); Florida Marine
Transporters, Inc. v. Lawson & Lawson Towing Co. Inc., 2001 WL 1018364 at 3 (E.D. La. August
31, 2001); and Mission Ins. Co. v. Puritan Fashions Corp, 706 F.2d 599, 602 (5th Cir. 1983).
Two predicate questions underlie a decision to apply the “first to file” rule: (1) whether the
two pending actions are so duplicative that they involve substantially overlapping issues such that
one court should decide both, and if so, (2) which of the two courts should take the case.
“Substantial overlap” is satisfied if the two actions involve closely related questions or common
subject matter. In the second inquiry, (which of the two courts should take the case), the Fifth
Circuit adheres to the general rule that the court in which the action is first filed is the appropriate
court to determine whether subsequently filed cases, involving substantially similar issues should
proceed. Marks v. Mackey, 2014 WL 3530137 at 3 (W.D. La., July 15, 2014).
B. Analysis
There is no dispute that Caro and Cowan’s lawsuits were both filed in the Middle District
of Louisiana, on July 25, 2023, while Brown & Brown filed its lawsuit in the Western District of
Louisiana on August 8, 2023.
1. Substantial Overlap
The first question is whether the suits “substantially overlap.” The Caro and Cowan
lawsuits are both Petitions for Declaratory Judgment, which ask the Court to decide the restrictive
covenants contained in Plaintiffs’ employment agreement with Brown & Brown invalid and
unenforceable. The suit by Brown & Brown in this Court seeks damages from Caro and Cowan
for breach of their non-solicitation agreements contained in their employment agreement with
Brown & Brown. The core issue involves the validity and enforceability of the Brown & Brown
non-solicitation agreement. Brown & Brown concedes that substantial overlap exists.2 This Court
finds all the actions involve complete substantially overlapping issues that one court should decide.
2. Which Court should hear the Cases?
The Fifth Circuit adheres to the general rule that the court in which the action is first filed
is the appropriate court to determine the issues in the cases unless an exception exist to the “first
to file” rule. Brown & Brown argues that Caro and Cowan improperly sought to gain an advantage
by engaging in forum shopping. One of the exceptions to the “first to file” rule is when the first to
file plaintiff files a suit in anticipation of another lawsuit in order to secure a more favorable forum.
Caro and Cowan ceased working for Brown & Brown on July 24, 2023, and filed their lawsuits
the next day, July 25, 2023.3
Additionally, Brown & Brown alleges Caro and Cowan did not attempt to serve Brown &
Brown until August 9, 2023.4 Since Caro and Cowan filed their suits the day after they left their
employment, the lawsuits were likely filed in anticipation of Brown & Brown filing a lawsuit.
However, the law also requires the anticipatory lawsuit be filed in order to secure a more favorable
2 [Doc. No. 18, p. 9]
3 [Doc. No. 18-1] Declaration of Mark Romero.
4 [Id]
forum. Brown & Brown has not provided any explanation of how Caro and Cowan’s lawsuits filed
in the Middle District of Louisiana would be a more favorable forum than the Western District of
Louisiana. In diversity cases, both courts would be required to follow Louisiana law. The law is
no different in the Middle District than in the Western District.
Because Brown & Brown has failed to show that Caro and Cowan filed their suits in order
to secure a more favorable forum, the “‘first-to-file” rule applies, and the Middle District of
Louisiana (where the first suits were filed) is the most appropriate forum court to determine the
issues.
CONCLUSION
For the reasons set forth herein,
IT IS ORDERED that the Motion to Transfer Venue [Doc. No. 13], filed by Defendants
Caro and Cowan is GRANTED and this proceeding shall be transferred to the Middle District of
Louisiana.
MONROE, LOUISIANA, this 22" day of August 2023. \
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