AUI Partners LLC v. State Energy Partners LLC

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

___________________________________

)

AUI PARTNERS LLC, )

)

Plaintiff, )

)

v. ) CIVIL ACTION

) NO. 23-12292-WGY

STATE ENERGY PARTNERS LLC, )

FK CONSTRUCTION FUNDING, LLC, )

)

Defendants. )

___________________________________)

)

FK CONSTRUCTION FUNDING, LLC, )

)

Counter Claimant, )

v. )

)

AUI PARTNERS LLC, )

)

Counter Defendant.)

___________________________________)

YOUNG, D.J. July 11, 2024

MEMORANDUM OF DECISION

I. INTRODUCTION

The Plaintiff AUI Partners LLC (“AUI”), a general

contractor, here sues the Defendants State Energy Partners LLC

(“SEP”), a subcontractor, and FK Construction Funding, LLC

(“FK”) (collectively, the “Defendants”). FK is a factoring

company with control over SEP’s finances and operations who

bought SEP’s accounts receivable for a discounted payment.

Compl. ¶¶ 1, 8, ECF No. 1. This civil action alleges six counts

as follows: declaratory judgment/contract (against both SEP and

FK) (Count I),1 declaratory judgment/liens (against both SEP and

FK) (Count II),2 breach of contract (only against SEP) (Count

III), negligent/intentional misrepresentation (only against FK)

(Count IV), instrumentality/joint venture (against both SEP and

FK) (Count V), and violation of the Massachusetts unfair or

deceptive act or practice law (against both SEP and FK) (Count

VI) (“93A claim”). Id. ¶¶ 39-62.

AUI’s claims stem from the following core allegations. AUI

hired SEP to complete certain projects in Massachusetts and

Maine, and AUI and SEP signed a Master Subcontract and various

work orders. Id. ¶¶ 1, 18, 22. FK induced AUI to pay FK

directly (instead of SEP) through misrepresentations that FK was

SEP’s fund manager and that all of AUI’s payments were going

directly to the SEP’s work projects for AUI. Id. ¶¶ 25-26. FK

1 AUI seeks declaratory judgments regarding the parties’

contractual obligations and rights under the subcontract/work

orders, specifically: that SEP breached the work orders, SEP is

obligated to indemnify AUI and defend it against liens, AUI does

not owe money to SEP, any transfer of SEP’s rights (presumably

to FK) was void and ineffective, AUI had the right to withhold

payments, and FK/SEP are jointly and severally liable for AUI’s

expenses and costs. Compl. ¶¶ 39-41, ECF No. 1.

2 AUI also seeks declaratory judgments related to the liens:

alleging that FK does not have standing to assert liens on any

projects, that FK/SEP’s liens are invalid because AUI does not

owe FK/SEP money, and that FK/SEP “intentionally inflated their

liens in bad faith.” Id. ¶¶ 42-44.

then wrongfully diverted AUI’s payments to unrelated projects.

Id. ¶ 27. SEP consequently had insufficient funds to complete

the work and failed to pay various vendors, employees, and

suppliers working on AUI’s projects, resulting in over $3M in

liens and fifteen lawsuits filed against AUI related to these

projects. Id. ¶¶ 27-33, 35, 38.

In their motion to dismiss briefing, the Defendants urged

this Court to abstain from exercising its diversity jurisdiction

over this case. The Defendants state that this Court must

abstain because AUI’s claims “affect numerous in rem state court

actions relating to parcels of real property encumbered by

state-authorized mechanic’s liens.” FK’s Mot. Dismiss Pl.’s

Compl. & Strike (“FK’s Mot.”) 1, ECF No. 13; see also SEP’s Mot.

Partial Dismissal (“SEP’s Mot.”) 1, ECF No. 16 (adopting FK’s

motion to dismiss as it relates to SEP). In making these

arguments, the Defendants invoked (both directly and indirectly)

the following abstention doctrines: Princess Lida abstention,

FK’s Mem. Supp. Mot. Dismiss Pl.’s Compl. (“FK’s Mem.”) 6, ECF

No. 14; Colorado River3 abstention; Younger abstention, FK’s

Reply 3-5, ECF No. 23; and Brillhart-Wilton abstention.4

3 SEP discussed Colorado River as an affirmative defense in

its answer. SEP’s Answer 9, ECF No. 11. FK implicitly raised

Colorado River in making its Princess Lida abstention arguments,

as discussed infra Section II.D.1.

4 While raising other abstention doctrines in their

briefing, Defense counsel first raised the Brillhart-Wilton

Given the strong presumption in favor of exercising

jurisdiction, this Court DENIED the Defendants’ abstention

arguments under Colorado River (and, relatedly, Princess Lida),

Younger, and Brillhart-Wilton. Accordingly, this Court RETAINED

its jurisdiction over all of the claims brought by AUI in this

case.

A. Procedural History

AUI filed its complaint in this action against FK and SEP

on October 5, 2023. Compl. On November 3, 2023, FK filed its

motion to dismiss. FK’s Mot. SEP filed its answer on October

31, 2023, SEP’s Answer, ECF No. 11, and its partial motion to

dismiss on November 7, 2023, SEP’s Mot. The parties have

briefed most of the issues. FK’s Mem.; AUI’s Opp’n FK’s Mot.

Dismiss & Strike (“Opp’n), ECF No. 19; AUI’s Opp’n SEP’s Mot.

Partial Dismissal, ECF No. 21.

On November 19, 2023, FK also filed a motion for leave to

file a reply brief “to respond to matters that could not

reasonably be anticipated” in AUI’s Opposition Brief –- namely

AUI’s alleged misrepresentations to the Court about whether

doctrine at the hearing. Neither party provided the Court any

additional briefing on this abstention doctrine. In addition to

the Defendants’ abstention arguments, the Defendants also moved

to dismiss the complaint for non-abstention reasons for failure

to state a claim under Federal Rule of Civil Procedure 12(b)(6).

FK’s Mot.; FK’s Mem. Supp. Mot. Dismiss Pl.’s Compl. (“FK’s

Mem.”), ECF No. 14; SEP’s Mot. This Court heard, and denied,

all of the Defendants’ motion to dismiss arguments.

there are parallel litigations to the current proceeding. FK’s

Mot. Leave File Reply Br. AUI’s Opp’n Mot. Dismiss &

Alternatively Strike (“FK’s Mot. Leave”), ECF No. 20. This

Court granted the motion to file a reply on November 28, 2023.

Electronic Order, ECF No. 22. FK filed its reply and attached

AUI’s third-party complaint against FK in a state litigation in

Middlesex County (“Middlesex State Action”) on November 29,

2023. FK’s Reply, ECF No. 23; id., Ex. 1 (“Third-Party

Complaint”), ECF No. 23-1. In this reply, FK for the first time

argued that this Court must abstain from exercising jurisdiction

under Younger abstention. FK’s Reply.

On January 10, 2024, this Court heard oral arguments on the

Defendants’ motions. Electronic Clerk’s Notes, ECF No. 27.

During this hearing, the Defendants raised the Brillhart-Wilton

abstention doctrine for the first time. After reviewing the

parties’ briefing and hearing oral argument, this Court DENIED

all of the Defendants’ motions to dismiss arguments.

The Court now publishes this opinion, further explaining

its decision as to the Defendants’ abstention arguments.

B. Facts Alleged

AUI, a general contractor, retained SEP as a subcontractor

in 2022 for several construction projects in Massachusetts and

Maine. Compl. ¶¶ 1, 17, 22.

Without AUI’s knowledge, SEP gave FK complete control and

management of its accounts receivable. Id. ¶ 1. SEP then

became completely financially dependent on FK. Id. Purporting

to be SEP’s fund manager, FK then induced AUI to pay FK directly

(instead of AUI paying SEP) by representing that all of AUI’s

payments would be going directly to SEP’s projects with AUI.

Id. ¶¶ 1, 25. Instead, FK diverted the funds to unrelated

projects, and SEP became financially unable to complete the

work. Id. ¶ 27; see also id. ¶ 4 (alleging that “SEP was under-

capitalized, had insufficient assets to operate and intended to

allow FK to continue to collect money to pay off its existing

debts”).

FK and SEP failed to pay SEP’s employees, suppliers, and

vendors for AUI-SEP projects. Id. ¶ 1. As a result of SEP’s

defaults, its unpaid suppliers, vendors, and employees filed

over $3,000,000 in liens and over fifteen lawsuits against AUI,

with SEP failing to complete almost $4,000,000 of work. Id.

1. History Between the Parties

FK engages in “factoring,” “which is a type of financing

designed to allow struggling companies to sell a portion or all

of their outstanding invoices (or accounts receivable) to a

third party factoring company in exchange for a discounted

immediate payment.” Id. ¶ 7.

AUI alleges that FK’s owner and operator –- Frank Skelly --

markets his factoring services to “struggling (and unsuspecting)

subcontractors[.]” Id. ¶ 8. It further alleges that one of

these struggling subcontractors was Amps, which was formed by

John Bianchi, the current owner of SEP, in 2016. Id. ¶¶ 8-9.

Amps is SEP’s alleged predecessor-in-interest. Id. Amps

struggled financially, signed a factoring agreement with FK in

2020, and transferred control of its business to FK. Id. ¶¶ 10-

14. Under FK’s control and after FK allegedly advanced Amps

money, Amps defaulted on its employees, vendors, and suppliers.

Id. ¶¶ 10-15. Bianchi, Amps’ founder, with “knowledge and

consent of FK,” created SEP to avoid paying Amps’ debts. Id. ¶¶

9, 16.

In March 2022, Bianchi submitted bids through Amps to AUI

for work on several projects. Id. ¶ 17. AUI accepted the bids.

Id. With FK’s approval and knowledge, Bianchi substituted his

new company, SEP, for Amps. Id. ¶ 18. Both SEP and AUI signed

the subcontract for SEP’s work on various projects. Id.

2. Master Subcontract

SEP and AUI entered into a 2021 General Provisions of

Subcontract (“Master Subcontract”) in 2022. Id. ¶¶ 17-18;

Compl., Ex. A, 2021 General Provisions Subcontract Agreement

(“Agreement”), ECF No. 1-2.

The Master Subcontract has provisions preventing SEP from

“assign[ing] or transfer[ing] this Subcontract . . . including .

. . the right to the proceeds therefrom without express written

consent from [AUI].” Agreement, art. 2.9. It also states that

SEP “agrees to indemnify, defend, and hold harmless [AUI] from

any claim or cause of action of any assignee related to this

Subcontract.” Id. The Master Subcontract further contains

several other provisions, including the following: requiring SEP

to complete the work “promptly, efficiently and at a speed that

will not cause delay[;]” requiring SEP provide “sufficient

forces to complete the Work in accordance with the Project

Schedule[;]” providing AUI “the absolute right” to withhold due

payments to protect AUI or the project owner from losses;

requiring that SEP “indemnify, defend and hold harmless

indemnified parties from and against any claim, damage, loss or

expense arising out of or relating to any and all liens or bond

claims or claims of right to enforce such liens or bond

claims[;]” and allowing AUI to “retain the entire subcontract

balance until the completion of the project.” Id., arts. 1.3.1,

2.6.1, 6.1.3.1, 7.2.2, 7.3.

3. FK’s Control Over SEP

AUI had work orders with SEP, and FK approved these orders.

Compl. ¶¶ 22-23. SEP provided materials and laborers for the

work, invoiced AUI for these expenses, and “directed that all

payments be issued directly to FK.” Id. ¶ 24. As alleged by

AUI, FK asserted “actual, participatory dominion and control”

over both Amps and SEP by “managing and directing [its] business

operations,” “controlling [SEP’s] funds and managing [SEP’s]

revenue for its own purposes,” “directing all of SEP’s revenue,”

including payments to “[SEP’s] creditors, suppliers, laborers

and vendors,” communicating with others (like AUI) to “induce

payment to SEP,” and negotiating with contractors, vendors, and

suppliers. Id. ¶ 56.

4. Fraudulent Representations

To induce AUI to pay FK directly for SEP’s invoices, FK

represented to AUI that it was SEP’s fund manager, and that all

project funds received from AUI would go directly to the

associated project. Id. ¶ 25. Relying on FK’s

misrepresentations and at SEP’s direction, AUI was induced to

direct payments to FK. Id. ¶ 26. FK knew that those

misrepresentations were false when made and did not use the

funds as represented. Id. ¶ 52. Instead, FK “diverted [the

funds] for other expenses (on unrelated projects) or for other

purposes.” Id. ¶ 27. Consequently, SEP’s project costs

remained unpaid, SEP did not have sufficient labor to complete

its work, and “SEP’s progress to complete the work was delayed.”

Id.

5. Consequences of SEP’s Failure to Complete Work

By January 2023, “SEP was struggling to prosecute the

work,” and submitted inflated invoices to AUI. Id. ¶ 28. In

response to these issues, AUI sent notices asking SEP to cure

these defects. Id. ¶ 29. SEP refused to remedy the defects and

instead claimed that outstanding orders to modify the work

prevented SEP from completing the projects. Id.

Several of SEP’s unpaid employees, vendors, and suppliers

filed liens on the projects. Id. ¶ 31. SEP did not discharge

or pay off these lien claims. Id. ¶ 33. FK and SEP also filed

six of their own liens against AUI in Maine and Massachusetts

state courts. Id. ¶¶ 33, 38. AUI alleges that Defendants’

liens were “inflated . . . to leverage AUI to pay money that was

not owed.” Id. ¶ 36. The liens filed by FK and SEP include:

 An action filed by FK captioned FK Construction

Funding LLC as assignee of Workers Employed by SEP

v. AUI Partners and United States Fire and Insurance

Company, pending in Plymouth County Superior Court,

Civil Action No. 2383 cv 00418;

 An action filed by FK captioned FK Construction

Funding LLC as assignee of Workers employed by SEP

v. AUI and United States Fire Insurance Company,

Civil Action No. 2353 cv 000330[,] pending in

Middlesex District Court;

 An action filed by SEP captioned State Energy

Partner LLC v. AUI Partners LLC and United Fire

Insurance Company, Civil Action No. 2383 cv 00580[,]

pending in Plymouth County Superior Court.

 An action filed by FK captioned FK Construction

Funding LLC as assignee of Workers employed by State

Energy Partners v. AUI Partners LLC, Enfield Hammett

Road Solar LLC and Vambutas Land Co., LLC, Docket

No. 2023-00019[,] pending in Penobscot County

Superior Court, Maine;

 An action filed by FK captioned FK Funding LLC as

assignee of Workers employed by State Energy

Partners LLC v. AUI Partners LLC, Exeter Mills Road

Solar, and James Crane and Steven Crane, Docket No.

2023-00020[,] pending in Penobscot County Superior

Court, Maine;

 An action filed by FK captioned FK Construction

Funding LLC as assignee of Workers employed by State

Energy Partner LLC v. AUI Partners LLC, Walden Solar

NE LLC, Nautilus Solar Energy LLC, and City of

Sanford, Docket No. 2023-00044[,] pending in York

County Superior Court, Maine.

Id. ¶ 38.

In sum, as alleged by AUI, SEP’s failures “forced [AUI] to

issue more than $4.2 million in bonds and defend these various

liens in approximately fifteen (15) separate lawsuits pending in

Maine and Massachusetts.” Id. ¶ 35.

II. ANALYSIS

A. Pleading Standard

The First Circuit has not clearly resolved whether to apply

Rule 12(b)(1) or Rule 12(b)(6)5 in deciding whether to abstain

from exercising jurisdiction. Massachusetts Delivery Ass'n v.

Coakley, 671 F.3d 33, 40 n.6 (1st Cir. 2012) (noting that there

is a dispute as to which standard to use when evaluating Younger

abstention among district courts in the First Circuit); Tran v.

5 FK moves for dismissal under Rule 12(b)(6) in its papers.

FK’s Mot. 1; FK’s Mem. 3-4.

Healey, No. CV 22-40086-LTS, 2022 WL 12480458, at *1-2 (D. Mass.

Sept. 13, 2022) (Sorokin, J.), appeal dismissed sub nom. Tran v.

Campbell, No. 22-1774, 2023 WL 7152041 (1st Cir. May 8, 2023)

(noting that the First Circuit has not decided this question

with respect to Younger abstention); see also Marshall v.

Bristol Superior Ct., 753 F.3d 10, 17 (1st Cir. 2014) (noting

that Younger is “not a jurisdictional bar” but is instead a

“prudential limitation” on the court’s exercise of properly-held

jurisdiction).

As such, district courts, within the First Circuit, have

disputed whether to apply 12(b)(1) or 12(b)(6) to abstention

claims.6 “A primary difference between the two [standards] is

6 Tran, 2022 WL 12480458, at *1-2 (noting that this is

unresolved but applying Rule 12(b)(6) because the plaintiff

invoked Rule 12(b)(6) and it is more favorable to the

plaintiff); Jafri v. New Hampshire Supreme Ct. Comm. on

Character & Fitness, No. 1:22-CV-0039-JL, 2022 WL 10600019, at

*1 n.1 (D.N.H. Oct. 18, 2022), aff'd, No. 22-1802, 2023 WL

7294994 (1st Cir. Oct. 23, 2023) (acknowledging that the First

Circuit has not resolved which standard to apply for Younger

abstention but opting to assess these arguments under Rule

12(b)(1)); Ironshore Indem. Inc. v. Villa Marina Yacht Harbor

Inc., No. CV 23-1370 (FAB), 2023 WL 6815125, at *4 (D.P.R. Oct.

17, 2023) (“Brillhart abstention does not raise Rule 12(b)(1)

jurisdictional defects or a Rule 12(b)(6) challenge to the

facial sufficiency of the complaint.”); Rivera-Delgado v.

Chardon, 932 F. Supp. 2d 282, 283 n.2 (D.P.R. 2013) (stating

that Younger abstention is not a subject matter jurisdiction

argument); Burckhart Search Grp., Inc. v. Doral Fin. Corp., No.

CIV. 11-1565 JAF, 2011 WL 6029817, at *3 n.5 (D.P.R. Nov. 30,

2011) (stating that there is disagreement among the circuit as

to whether Younger is a jurisdictional question but noting that

Justice Scalia has stated that the Supreme Court has treated

that, under Rule 12(b)(1), the district court may weigh the

evidence and make factual determinations, if necessary, to

determine whether it has jurisdiction to hear the case.”

Massachusetts Delivery Ass'n, 671 F.3d at 40 n.6. Here, the

Court does not (and needs not) weigh the evidence to decide

whether it ought abstain its jurisdiction. It makes its

decision in consideration of undisputed facts, namely the

complaint and publicly available documents (including documents

and dockets from the state court proceedings). See id. Thus,

the Court does not resolve the issue of whether to apply Rule

12(b)(6) or Rule 12(b)(1) in evaluating abstention arguments.

See id. (deciding it need not decide which standard to apply

because the court made its abstention decisions based on

“undisputed” facts); Action Network v. Maine, 679 F. Supp. 2d

140, 144 & n.2 (D. Me. 2010) (recognizing that the First Circuit

has not clearly stated “any pleading or burden requirements” in

the context of abstention and choosing not to apply either Rule

12(b)(1) or Rule 12(b)(6) because the question is “academic” and

the parties do not dispute “the existence of content of the

pertinent documents”).7

Younger as jurisdictional in Steel Co. v. Citizens for a Better

Env't, 523 U.S. 83, 100 n.3 (1998)).

7 This Session, in a short order, once held that because

Younger abstention applies, “dismissal of this action for lack

of jurisdiction is appropriate.” Lane v. Brigham & Women's

Hosp., No. CV 22-10810-WGY, 2022 WL 2374728, at *1 (D. Mass.

B. Subject Matter Jurisdiction

This Court has diversity jurisdiction pursuant to 28 U.S.C.

§ 1332. See Guillemard-Ginorio v. Contreras-Gomez, 585 F.3d

508, 517 (1st Cir. 2009) (explaining how abstention doctrines

“call upon federal courts to decline to exercise their properly

held jurisdiction”). AUI has its principal place of business in

Texas, SEP has its principal place of business in Massachusetts,

and FK has its principal place of business in Florida. Compl.

¶¶ 3-5. Thus, there is complete diversity. There is no dispute

that the amount in controversy exceeds $75,000. See id. ¶ 6;

FK’s Mem. (not disputing the amount in controversy).

C. Abstention

The Defendants asked this Court to abstain from exercising

its federal jurisdiction under several abstention doctrines:

June 21, 2022), aff'd, No. 22-1503, 2022 WL 18144099, at *1 (1st

Cir. Oct. 4, 2022). This Court did not explain whether Rule

12(b)(6) or Rule 12(b)(1) was the appropriate standard for

review, instead simply stating that the case was dismissed under

Younger for lack of jurisdiction. Id. In another case, this

Session granted a motion to dismiss based on abstention and the

parties invoked Rule 12(b)(6); there, the Court did not specify

which standard it was applying and simply stated that it was

granting the motion to dismiss. Michael Haynes & Assocs., LLC

v. Sec. Credit Servs., LLC, No. CV 20-10389-WGY, 2020 WL

13579432, at *1, 3 (D. Mass. Apr. 8, 2020). Having waffled over

this issue, I presently consider the issue an open question, as

(1) the First Circuit has kept it open despite opportunities to

clarify, and (2) its resolution is not necessary for the present

analysis.

Princess Lida abstention, Colorado River abstention, Younger

abstention, and Brillhart-Wilton abstention.8

Courts have a “virtually unflagging obligation”9 to exercise

federal jurisdiction. Colorado River Water Conservation Dist.

v. United States, 424 U.S. 800, 817 (1976); see also Quackenbush

v. Allstate Ins. Co., 517 U.S. 706, 716 (1996) (“We have often

acknowledged that federal courts have a strict duty to exercise

the jurisdiction that is conferred upon them by Congress.”).

The Supreme Court consistently emphasizes that abstention is the

exception, not the rule. See, e.g., Sprint Commc'ns, Inc. v.

Jacobs, 571 U.S. 69, 81-82 (2013) (citing Hawaii Housing

Authority v. Midkiff, 467 U.S. 229, 236 (1984) (quoting Colorado

River, 424 U.S. at 813)). “Nevertheless, this obligation [to

exercise federal jurisdiction] is not absolute—and the Supreme

Court has developed a small cluster of doctrines that either

require or allow federal courts to defer to state proceedings in

8 With respect to the variety of abstention doctrines

available to federal litigants, the First Circuit has recognized

that “these doctrines ‘are not rigid pigeonholes into which

federal courts must try to fit cases.’ . . . [but that] ‘the

categories do matter.’” See Rossi v. Gemma, 489 F.3d 26, 34

(1st Cir. 2007).

9 This unflagging duty does not exist for claims brought

under the Brillhart-Wilton abstention doctrine, discussed infra

Section II.E, as courts have more discretion in deciding whether

to retain those claims. Atlas Copco Const. Tools, Inc. v.

Allied Const. Prod., LLC, 307 F. Supp. 2d 228, 232 (D. Mass.

2004) (Ponsor, J.) (citing El Dia, Inc. v. Hernandez Colon, 963

F.2d 488, 493 (1st Cir. 1992)).

particular circumstances.” Sirva Relocation, LLC v. Richie, 794

F.3d 185, 191 (1st Cir. 2015) (citing Quackenbush, 517 U.S. at

716–18).

Courts are sometimes confronted with applying abstention

doctrines to different claims of relief. See, e.g.,

Massachusetts Biologic Lab'ys of the Univ. of Massachusetts v.

MedImmune, LLC, 871 F. Supp. 2d 29 (D. Mass. 2012) (Gorton, J.).

There is “coercive” relief and declaratory relief. Id. at 33.

“Coercive” relief includes relief for damages or an injunction,

whereas declaratory relief, as the name suggests, is relief

requested under the Declaratory Judgment Act. Id. Some courts

segregate the plaintiff’s claims and apply abstention doctrines

to each individual claim based on the type of relief requested

(the “surgical approach”). In Massachusetts Biologic Lab'ys,

this Court applied a surgical approach when the federal

plaintiff requested both coercive and declaratory relief by

applying Colorado River to the plaintiff’s coercive contract

claims and the Brillhart-Wilton standard for the declaratory

judgment claim. Id. at 35. In deciding whether to apply the

surgical approach, the Court did note that while the First

Circuit in Rossi did apply the surgical approach, the First

Circuit did not -- unlike many of its sister circuits -- state

whether it was endorsing the surgical approach over other

approaches. Id. at 33-36 (interpreting Rossi as allowing the

so-called surgical approach but not requiring it); see also

Rossi v. Gemma, 489 F.3d 26, 39 (1st Cir. 2007) (applying

Brillhart-Wilton to the declaratory claims, not Colorado River,

and indicating that Colorado River is the proper test for the

state law damages claims).

Another approach, used by several circuit courts (and what

this Court is referring to as the “non-surgical” approach),

includes applying Colorado River to both declaratory and

coercive claims. Massachusetts Biologic Lab'ys, 871 F. Supp. 2d

at 33-34. The Massachusetts Biologic Lab'ys Court observed that

it ultimately did not matter, practically, whether a court

applied the surgical or non-surgical approach, because they

almost always render the same result.10

Although FK’s arguments have focused on exercising

abstention for the declaratory judgment claim about liens (Count

10 The Massachusetts Biologic Lab'ys Court stated:

While [the surgical approach] appears to be unique,

[this] approach will nearly always yield the same

result as [the approach applying Colorado River to

both the coercive and declaratory claims] because when

a plaintiff seeks relief in addition to a declaratory

judgment, such as damages or injunctive relief, both

of which a court must address, “the entire benefit

derived from exercising discretion not to grant

declaratory relief is frustrated, and a stay would not

save any judicial resources.”

Massachusetts Biologic Lab'ys, 871 F. Supp. 2d at 34

(citing Chase Brexton Health Servs., Inc. v. Maryland, 411

F.3d 457, 466 (4th Cir. 2005)).

II), FK argues that the entire complaint ought be dismissed.

FK’s Reply 1-2 (asking this Court to “abstain from these

proceedings” but more specifically mentioning that the requested

declarations interfere with the state proceedings); FK’s Mot. 1

(arguing that “[t]he Complaint must be dismissed . . . as the

relief AUI seeks directly affects numerous in rem state court

actions relating to parcels of real property encumbered by

state-authorized mechanic’s liens in Massachusetts and Maine

state court claims.”). SEP pointed out that AUI’s 93A claim

(Count IV) also pertains to the validity of the liens. SEP’s

Mot. 1. Accordingly, this Court presumes that the Defendants

are moving to dismiss all of AUI’s claims under abstention

doctrines.

In accordance with Rossi, this Court applies Colorado River

to AUI’s coercive claims: specifically, the claims pertaining to

chapter 93A, breach of contract, misrepresentation, and joint

venture/instrumentality. See infra Section II.D. The Court

then analyzes the declaratory judgment claims under the

Brillhart-Wilton doctrine in accordance with the surgical

approach. See infra Section II.E. Lastly, the Court addresses

the Defendants’ Younger abstention arguments. See infra Section

II.F.

D. This Court Rejected Defendants’ Arguments for

Abstention Under Princess Lida and Colorado River.

This Court did not abstain under Princess Lida or Colorado

River, because (1) there is no parallel action; and (2) there

are not extraordinary circumstances warranting abstention.

As discussed infra, the Defendants’ abstention arguments,

while not directly discussing Colorado River, implicate that

abstention approach due to the First Circuit’s treatment of

Princess Lida abstention. Thus, while neither party fully

briefed Colorado River,11 this Court nevertheless conducts a full

Colorado River analysis, using the information available to it

at the time of this Court’s ruling in January 2024.

11 While FK argued for dismissal under Princess Lida

abstention, it did not address Colorado River abstention

specifically. FK’s Mem. SEP raised Colorado River abstention

as an affirmative defense, summarily adopted FK’s Princess Lida

arguments, but did not mention or elaborate upon its Colorado

River arguments in its motion to dismiss. SEP’s Answer 9; SEP’s

Mot. 1. AUI briefed Princess Lida and Colorado River generally

but did not apply the Colorado River factors to the facts of the

case, arguing that doing so is “impossible” because FK failed to

identify a “parallel suit” warranting abstention. Opp’n 7-12 &

n.8. In its reply, FK later challenged AUI’s claim that there

are no parallel suits and attached AUI’s third party complaint

in the Middlesex State Action as evidence of a parallel suit.

FK’s Reply. FK also pointed out that AUI referenced, in its

complaint, several lien actions brought by FK and SEP in state

courts. Id. at 4.

1. This Court Followed the First Circuit’s Guidance

in Treating Princess Lida Abstention as One of

Several Colorado River Factors.

This Court rules that Princess Lida abstention is not

compulsory but instead is treated as one of several factors

considered under this Court’s Colorado River analysis.

FK argued that, under Princess Lida, this Court “is without

jurisdiction to adjdudicate [sic] in rem or quasi in rem claims

subject to preexisting state court actions.” FK’s Mem. 5. AUI

argued that Princess Lida abstention is not mandatory under

First Circuit jurisprudence and is thus not a “standalone basis

to abstain." Opp’n 10-11.

In Princess Lida, the Supreme Court held that “if the two

suits are in rem . . . [such that] the court, or its officer,

has possession or must have control of the property which is the

subject of the litigation in order to proceed with the cause and

grant the relief sought[,] the jurisdiction of the one court

must yield to that of the other.” Princess Lida of Thurn &

Taxis v. Thompson, 305 U.S. 456, 466 (1939).

The First Circuit, unlike its sister circuits,12 has

analyzed Princess Lida as a part of its discretionary Colorado

12 AUI recognized that although most courts consider

Princess Lida abstention mandatory, the First Circuit is the

exception. Opp 11 n.7; Selton v. U.S. Bank Tr. Nat. Assn., 124

F. Supp. 3d 1245, 1249-50 (M.D. Fla. 2015) (explaining that

although several circuits view Princess Lida abstention as

River abstention analysis. See, e.g., United States v. Fairway

Cap. Corp., 483 F.3d 34, 40 n.2 (1st Cir. 2007); see also Selton

v. U.S. Bank Tr. Nat. Assn., 124 F. Supp. 3d 1245 (M.D. Fla.

2015) (recognizing that Colorado River and Princess Lida

abstention are “permissive” under the First Circuit

jurisprudence). Specifically, Princess Lida has been analyzed

under the first Colorado River “exceptional circumstances”

factor, which assesses “whether either court has assumed

jurisdiction over a res.” Fairway Cap. Corp., 483 F.3d at 40

n.2 (“treat[ing] the issue of a state court's in rem or quasi in

rem jurisdiction as the first factor to be considered in

the Colorado River abstention analysis, and [thus determining]

it is unnecessary to address abstention under Princess Lida

separately”); see id. at 41 (stating that although the state

court did exercise quasi in rem jurisdiction, this “does not

make abstention mandatory” under First Circuit precedent). FK

does not specifically address the First Circuit’s treatment of

Princess Lida.

Thus, in accordance with the First Circuit’s treatment of

Princess Lida abstention, this Court proceeds to analyze these

arguments under the Colorado River abstention doctrine, see

infra Section II.D.2.a.

mandatory “the First Circuit [instead] treats Princess Lida as a

factor in the Colorado River permissive abstention analysis”).

2. This Court Held That There Is No Parallel Action,

Nor Are There Extraordinary Circumstances

Warranting Abstention; Thus, This Court Retained

Jurisdiction of the Coercive Claims Under

Colorado River (and Princess Lida) Abstention.

This Court retained its jurisdiction under Colorado River.

In order to apply Colorado River abstention, a court must

assess, as a “threshold inquiry”, whether there is parallel

litigation in both state and federal court. OHI Asset (CT)

Lender, LLC v. Woodland Manor Improvement Ass'n ex rel. Shine,

687 F. Supp. 2d 12, 17-18 (D.R.I. 2010). It is well

established, however, that parallel litigation alone is not

enough to warrant Colorado River abstention. Jiménez v.

Rodriguez-Pagan, 597 F.3d 18, 27 (1st Cir. 2010). Recognizing

the strong presumption in favor of exercising federal

jurisdiction, courts must not abstain under Colorado River

unless exceptional circumstances exist warranting abstention.

Id. at 27–28 (stating that only the “clearest of justifications”

warrant dismissal).

Considering the strong presumption against abstention, the

lack of sufficient parallels between this action and the state

action(s), and the foregoing weighing of the Colorado River

“extraordinary circumstances” factors, this Court RETAINED

jurisdiction over these claims.

a. Colorado River Abstention Is Not Warranted

Because the State and Federal Proceedings

Are Not Parallel.

There is no parallel state court action because the present

federal action has a greater scope than the individual state

court actions; thus, the resolution of one of these state court

proceedings would not resolve all of the federal claims.

FK argued that “there are multiple pending state court

actions seeking to enforce and foreclose mechanic’s liens in

various jurisdictions across Massachusetts and Maine.” FK’s

Mem. 5. AUI asserted that FK failed to identify any parallel

state litigation specifically; in other words, FK failed to show

how “substantially the same parties” are litigating

“substantially the same issues” and there is a “substantial

likelihood that the state litigation would dispose of all claims

presented in the federal case.” Opp’n 9.

In response, FK pointed to the five lien enforcement

actions, filed by FK against AUI and referenced in AUI’s

complaint, stating that “there had been no reason to specify

other parallel litigation . . . because AUI had admitted to the

existence of the operative litigation.” FK’s Reply 1-2. FK

also pointed out, in its reply, that AUI’s third party complaint

(“Third Party Complaint”) filed in one of the lien enforcement

actions (“Middlesex State Action”) is “nearly identical to the

complaint filed in this matter.” Id. at 4.

“A state proceeding is considered parallel to its federal

counterpart . . . where ‘substantially the same parties are

contemporaneously litigating substantially the same issues’ and

there is a ‘substantial likelihood that the state litigation

will dispose of all claims presented in the federal case.’”

Massachusetts Biologic Lab'ys, 871 F. Supp. 2d at 36; Adams v.

West Bend Mut. Ins. Co., No. 92 C 20359, 1993 WL 114558, at *2

(N.D. Ill. Apr. 5, 1993) (explaining that the parallel

proceeding test focuses on whether the state proceeding can

“dispose of all claims presented in the federal case”).

“[S]tate and federal claims arising out of the same factual

circumstances do not qualify as parallel if they differ in scope

or involve different remedies.” vonRosenberg v. Lawrence, 849

F.3d 163, 168 (4th Cir. 2017)(cautioning against abstention if

there exists “any serious doubt that the state action would

resolve all of the claims”); Fru–Con Const. Corp. v. Controlled

Air, Inc., 574 F.3d 527, 535 (8th Cir. 2009) (holding that

“[w]hile both [contract and lien] actions stem from the same

project and contractual relationship, each is premised on a

different wrong arising from different occurrences,” and thus

reversing a district court’s decision in favor of abstention).

i. Lien Enforcement Actions Filed by FK

With respect to the lien enforcement actions filed by FK,

see supra Section I.B.5 (listing the lien enforcements

specifically brought by the Defendants), AUI stated that SEP is

not a party to the lien enforcement actions brought by FK

(whereas all of the parties are involved in this federal

litigation), and those lien enforcement actions do not include

contract claims. Opp’n 9. In these cases, FK sued AUI as an

assignee for SEP’s workers and is only seeking monies for labor

(not materials) for that particular project under “general

equitable theories and a statutory bond claim.” Id.; see supra

Section I.B.5. The relief sought by AUI appears to be broader

than the relief at issue in FK’s enforcement liens: here, AUI is

seeking relief as to whether it owes money and whether SEP/FK

breached their agreement, as per the Master Subcontract and work

orders. See Compl. 39-48.

Thus, although the state lien enforcement claim arises from

the same set of facts, these litigations are not “parallel”

because the federal action involves different claims and has a

potentially broader scope of relief: the present case involves

claims that go beyond the individual Project at issue in each

individual lien enforcement action.

ii. Middlesex State Action

The Middlesex State Action –- submitted by FK as a

“parallel action” -- involves plaintiff Consolidated Electrical

Distributors, Inc. (“CED”) suing defendants SEP, AUI, and two

other defendants “to enforce a mechanic’s lien and to recover

damages on a contract relating to the sale of electrical

materials for solar panels” for a construction project in Woburn

(“Woburn Project”). See Compl., Consolidated Elec. Distrib.,

Inc. v. State Energy Partners, LLC et al., No. 2381-CV-02022

(Middlesex Sup. Ct. July 13, 2023). CED brought contract and

quantum merit claims against SEP, and a bond claim against AUI.

Id. ¶¶ 30-42.

In the Middlesex State Action, AUI brought a Third-Party

Complaint against FK, seeking a declaration that “FK has no

standing to assert a lien on the Project,” and that “FK’s lien

is invalid,” because AUI does not owe money, as well as claims

for misrepresentation and joint venture/instrumentality. Third-

Party Complaint ¶¶ 32-44. This complaint is similar to AUI’s

complaint in the current action. See generally Compl.13

While there are overlaps between the types of claims in the

present action and the Middlesex State Court Action, AUI asks

this Court for broader relief. In the Middlesex State Action,

AUI seeks a declaration that “FK has no standing to assert a

lien on the Project,” only mentions five liens, and does not

reference other state court litigations. Third Party Complaint

13 The only difference, in terms of the kind of claims (not

scope) brought against the Defendants in the Middlesex State

Action compared to this present federal action, is that the

federal complaint has a chapter 93A claim, whereas this Third-

Party Complaint does not.

¶¶ 26-27, 34 (discussing five liens –- the Defendants’ liens and

liens from other actors -- and not mentioning other state court

litigations); see id. ¶ 1 (defining “Project” to include only

the Woburn job site). But see id. 10 (requesting in its prayer

for relief that this Court declare “FK has no standing to assert

a lien on any Project”) (emphasis added).

The present action, however, asks for a declaration on FK’s

standing to assert liens on any project and whether the liens

are invalid/inflated, discussing other liens not mentioned in

the Third-Party Complaint. Compl. ¶¶ 31, 35, 38, 44 (mentioning

more projects than the Woburn Project, referencing liens on

other projects, discussing six lawsuits filed by the Defendants,

and requesting a declaration that “FK has no standing to assert

a lien on any Project”); see id. ¶ 61 (alleging inflated liens

as a chapter 93A violation).

Similarly, in the same Middlesex State Action, AUI filed a

cross claim against SEP for a declaration of rights,14 breach of

14 AUI requested a judicial determination of the following:

SEP failed to perform under the Work Order, SEP breached the

Work Order, there is no amount due to SEP under the work order,

the transfer of any rights under the Work Order is void and

ineffective, SEP is required to indemnify and hold AUI harmless

from any liens on the project, AUI had the right to withhold

payments, and SEP’s lien was intentionally inflated and filed in

bad faith. See Answer, Affirmative Defenses and Cross-Claim 13,

Consolidated Elec. Distrib., Inc. v. State Energy Partners, LLC

et al., No. 2381-CV-2022 (Middlesex Sup. Ct. October 6, 2023)

(“Cross Claim”).

contract, and joint venture/instrumentality. See Answer,

Affirmative Defenses and Cross-Claim, Consolidated Elec.

Distrib., Inc. v. State Energy Partners, LLC et al., No. 2381-

CV-02022 (Middlesex Sup. Ct. October 6, 2023) (“Cross Claim”).15

Here too, the only difference between AUI’s claims against SEP

in the present action and the Middlesex State Court Action is

that the latter’s allegations are tailored specifically to the

Woburn Project. Compare, id. 6, 11-13 (referring to some

determinations specific to the Woburn Project and referencing

five liens), with Compl. ¶ 41 (asking for a declaration with

respect to multiple liens and projects), and id. ¶ 31

(referencing liens and projects outside of the Woburn Project).

Despite arising from similar factual circumstances, the

scope of each action differs enough to provide “serious doubt

that the state action would resolve all of the claims.” See

vonRosenberg, 849 F.3d at 168; see also Shields v. Murdoch, 891

F. Supp. 2d 567, 577–78 (S.D.N.Y. 2012) (stating that any doubt

regarding whether a parallel action exists ought be resolved in

favor of exercising federal jurisdiction).

Thus, this Court rules that the Defendants did not

sufficiently identify a parallel action and thus the threshold

15 Neither party submitted evidence of this cross claim to

the Court –- it was found on the public court docket for the

Middlesex State Action.

requirement for a Colorado River abstention fails. Even if

there were a parallel action, this Court rules that Colorado

River abstention is still not appropriate, as discussed infra,

because this case does not present extraordinary enough

circumstances to overcome the strong presumption in favor of

this Court’s exercise of federal jurisdiction.

b. Colorado River Factors & Presumption Against

Abstention

Even were the actions parallel, this Court nevertheless

deems Colorado River inappropriate because there exist no

exceptional circumstances warranting abstention.

Courts with jurisdiction over an action have a “virtually

unflagging obligation” to exercise this jurisdiction, even if

there is a pending state action concerning the same matter.

Colorado River, 424 U.S. at 817. Courts have emphasized that

Colorado River abstention is only appropriate “in certain

‘exceptional’ circumstances.” Id.; see also Villa Marina Yacht

Sales, Inc. v. Hatteras Yachts, 947 F.2d 529, 532 (1st Cir.

1991). “Abstention from the exercise of federal jurisdiction is

the exception, not the rule.” Colorado River, 424 U.S. at 813.

The circumstances warranting abstention must implicate

“considerations of ‘[w]ise judicial administration, giving

regard to conservation of judicial resources and comprehensive

disposition of litigation.’” Id. at 817 (citing Kerotest Mfg.

Co. v. C-O-Two Fire Equip. Co., 342 U.S. 180, 183 (1952)).

There is thus a “strong presumption” in favor of a federal

court exercising federal jurisdiction. Gonzalez v. Cruz, 926

F.2d 1, 3 (1st Cir. 1991) (citing Moses H. Cone Mem'l Hosp. v.

Mercury Constr. Corp., 460 U.S. 1, 16 (1983)). Colorado River

abstention ought “be approached with the most caution, with

‘[o]nly the clearest of justifications’ warranting dismissal.”

Jiménez, 597 F.3d at 27; see also Massachusetts Biologic Lab'ys,

871 F. Supp. 2d at 33 (“[T]he ‘crevice’ in federal jurisdiction

carved out by [Colorado River] is a narrow one,” and must be

exercised “sparingly and approached with great caution[.]”)

(quoting Jiménez, 597 F.3d at 27; Nazario-Lugo v. Caribevision

Holdings, Inc., 670 F.3d 109, 115 (1st Cir. 2012)). Courts

balance the following non-dispositive factors in assessing

Colorado River abstention:

(1) whether either court has assumed jurisdiction over

a res; (2) the [geographical] inconvenience of the

federal forum; (3) the desirability of avoiding

piecemeal litigation; (4) the order in which the

forums obtained jurisdiction; (5) whether state or

federal law controls; (6) the adequacy of the state

forum to protect the parties' interests; (7) the

vexatious or contrived nature of the federal claim;

and (8) respect for the principles underlying removal

jurisdiction.

Jiménez, 597 F.3d at 27-28 (quoting Rio Grande Cmty. Health Ctr.

v. Rullan, 397 F.3d 56, 71–72 (1st Cir. 2005)); see Moses H.

Cone, 460 U.S. at 16 (explaining that assessment of the Colorado

River factors is not a “mechanical checklist” but instead

warrants a “balancing of the important factors,” with the

“balance heavily weighted in favor of the exercise of

jurisdiction”).

Upon analyzing each of the Colorado River factors as they

relate to the Middlesex State Action,16 detailed infra, and

recognizing the strong presumption in favor of exercising

jurisdiction, this Court ruled that the circumstances do not

warrant Colorado River (and similarly Princess Lida) abstention

in the present case.

i. Jurisdiction over the Res (& Princess

Lida)

This factor weighs in favor of abstention for AUI’s claims

involving liens, although not heavily.

16 The Court primarily used the Middlesex State Action for

its Colorado River analysis because it is specifically

identified by FK as having allegations “almost identical” to the

current federal case, and it is the only state litigation where

FK has submitted additional information (i.e., a state

complaint). Moreover, SEP similarly referred to this action

when invoking its Colorado River affirmative defense in its

Answer. SEP’s Answer 9, ECF No. 11. The Court does, however,

note when it observed differences or similarities from this

analysis when considering publicly available information from

the state court actions filed specifically by the Defendants (as

they are arguably the other state court litigations argued as

“parallel” by FK). See supra Section I.B.5 (listing the liens

filed by the Defendants); infra Section II.D.2.b.viii (including

additional analysis as to the state actions filed by the

Defendants); see infra Section II.D.2.b.iv (same).

The first Colorado River factor is “whether either court

has assumed jurisdiction over a res.” Jiménez, 597 F.3d at 27.

As discussed, the Defendants’ Princess Lida arguments are

relevant to this first Colorado River abstention factor. See

supra Section II.D.1. FK asserted that “there are multiple

pending state court actions seeking to enforce and foreclose

mechanic’s liens in various jurisdictions across Massachusetts

and Maine” and that because certain state courts have

“jurisdiction over a res,” this Court is “without jurisdiction”

“over these claims seeking to affect rights to that same res.”

FK’s Mem. 5-6. FK states that AUI is requesting that this Court

“interfere with FK’s real estate mechanic’s lien claims,” which

are “subject to exclusive prior state court jurisdiction.” Id.

at 5.

Although AUI’s declaratory judgment lien claim more

directly involves the mechanic’s liens filed in Massachusetts

and Maine state courts, see infra note 20 (detailing the

declaratory claims), some of AUI’s coercive claims here also

involve these mechanic’s liens, especially the chapter 93A

claim, see infra note 23(discussing to what extent the coercive

claims overlap with the declaratory claims). These coercive

claims also relate to the parties’ obligations under the Master

Subcontract and work orders -- i.e., whether AUI owes SEP money

(and if so, how much) relates to whether the liens were

inflated/invalid (also at issue in the chapter 93A claim), and

whether FK was a valid assignee of SEP’s rights and obligations

under the Master Subcontract relates to whether it had standing

to assert a lien.

As a threshold matter, the Court first addresses whether

the mechanic’s liens involved here are considered “in rem” or

“in personam”. This distinction matters, as this first Colorado

River factor concerns jurisdiction over the “res”. Courts

generally hold mechanic’s liens proceedings to be in “rem”

because they “involve claims against property, not persons.” 53

Am. Jur. 2d Mechanics' Liens § 320. The parties agree that AUI

substituted bonds as security for these liens. Opp’n 12; FK’s

Reply 2. AUI asserts that by substituting “bonds as security

for liens[, it] has essentially converted these actions from in

rem to in personam.” Opp’n 12. In Rossi, however, the First

Circuit (although in the context of Younger abstention) did not

make a distinction between an enforcement action for a

substituted bond and mechanic’s lien –- it referred to the

proceeding as an “in rem” action even though the lien was bonded

off. Rossi, 489 F.3d at 28, 35, 37 (explaining how the

proceeding is an in rem action to enforce a mechanic’s lien even

after plaintiff obtained a lien substitution by paying the state

court registry and dissolving the lien); see also United States

v. Certified Indus., Inc., 361 F.2d 857, 860-62 (2nd Cir. 1966)

(determining that a proceeding is still in rem even when a

mechanic’s lien is substituted out for the bond). Although

state lien enforcement actions are clearly in rem proceedings,

and the Court accordingly weighs this factor in favor of

abstention, this Court does not weigh this first factor

“heavily” in favor of abstention considering this bond

substitution. See Comau, LLC v. Bayview Elec. Co., LLC, No. 20-

12865, 2021 WL 1037728, at *8 (E.D. Mich. Mar. 17, 2021) (noting

that the first Colorado River factor weighed in favor of

abstention, although “not heavily,” because the lien was

discharged through a “surety bond”).

AUI’s claims, referencing state mechanic’s liens, relate to

whether AUI owes FK or SEP money; thus, the resolution of AUI’s

claims would not interfere with the state’s control over the res

(meaning control over the state liens) in a way that runs

contrary to Princess Lida. In Princess Lida, “the Supreme Court

considered whether a federal district court could properly

exercise concurrent jurisdiction over a suit involving the

administration and control of a trust res that was already

within the exclusive jurisdiction of the [state court].”

Bergeron v. Est. of Loeb, 777 F.2d 792, 798 (1st Cir. 1985). In

setting the outer limits of this doctrine, the Princess Lida

Court explained that abstention was warranted because “[n]o

question is presented in the federal court as to the right of

any person to participate in the res or as to the quantum of his

interest in it. The contentions are solely as to administration

and restoration of corpus.” Princess Lida, 305 U.S. at 467.

Princess Lida delineated the types of cases that are not subject

to Princess Lida abstention: “a case in federal court based upon

diversity of citizenship, wherein the plaintiff seeks merely an

adjudication of his right of his interest as a basis of a claim

against a fund in the possession of a state court.” Id. at 466.

The Court further elaborated that “an action in the federal

court to establish the validity or the amount of a claim

constitutes no interference with a state court's possession or

control of a res.” Id. at 467. This case would fall into

Princess Lida’s exemption and thus the doctrine does not apply.

Here, the Court’s resolution of AUI’s claims does not require

the control or administration of the state mechanic’s liens (or

now bonds); instead, such a resolution would simply assess the

parties’ contractual rights in relation to those liens/bonds.

Although conducting a Younger analysis, the First Circuit

in Rossi suggested that there are strong reasons to defer to a

state court action when the state court has jurisdiction over

the res and the federal plaintiff’s “constitutional challenge

goes to the very authority of the state court to administer the

res, and it is not simply a request to adjudicate a claimed

entitlement to a portion of the res.” Rossi, 489 F.3d at 37 &

n.19. Again, because AUI’s claims involving state court liens

(the “res”) only concern the parties’ rights with respect to the

res and the validity of FK’s lien (in terms of amount and

standing to file a lien), Rossi similarly does not warrant

abstention.

In Amica, plaintiff sought a declaratory judgment in

federal court seeking to expunge a mechanic’s lien filed against

it. Amica Mut. Ins. Co. v. Downs, No. 17-CV-1115-MJR-RJD, 2018

WL 9988607, at *1 (S.D. Ill. Mar. 16, 2018). The court had

diversity jurisdiction and defendants moved to dismiss under

Princess Lida abstention. Id. The court ruled Princess Lida

inapplicable, in part because there was no evidence that the

defendant had an ongoing state litigation regarding the lien

(filing of a lien in a state is different than a proceeding

being instituted in state court, and therefore, the filed lien

did not constitute an ongoing state litigation). Id. at *2. As

a further reason, relevant here, the court also ruled the

Princess Lida exemption relevant, because the case was based on

diversity jurisdiction, and “plaintiff seeks a declaratory

adjudication of his rights in relation to the lien filed in the

state of Illinois.” Id. Although, unlike Amica, here there are

state court litigations regarding the liens, see supra Section

I.B, the present case is similarly based on diversity

jurisdiction, and AUI here seeks determinations of its rights,

and Defendants’ rights, in relation to the state lien. See id.

Thus, there is not a strong case for Colorado River

abstention, at least solely based on this factor, because the

federal case relates to the parties’ rights with respect to the

mechanic’s liens, which are now bonded off, and AUI’s claims

ultimately center on who-owes-what-and-to-who determinations

under the Master Subcontract and work orders. This first factor

would be neutral for those claims not involving the mechanic’s

liens –- the misrepresentation and joint venture/instrumental

claim, see infra note 23 -- because there is no “res” involved

in these claims.

ii. Inconvenience of the Federal Forum

This factor is neutral. It is of similar inconvenience for

FK and SEP to litigate this suit in this federal forum (in

Boston, Massachusetts) as it is for FK (based in Florida) and

SEP (based in Massachusetts) to litigate its claims Middlesex

County, or other state courts in Massachusetts and Maine.

iii. Desirability to Avoid Piecemeal

Litigation

This factor weighs against abstention.

The First Circuit has explained that the concern with

“piecemeal litigation” does not warrant abstention “simply

because related issues otherwise would be decided by different

courts, or even because two courts otherwise would be deciding

the same issues.” Villa Marina Yacht Sales, Inc. v. Hatteras

Yachts, 915 F.2d 7, 16 (1st Cir. 1990). For example, in

Colorado River itself, this factor weighed in favor of

abstention because Congress expressed policy concerns about

piecemeal litigation with respect the subject at issue. Id.

Here, the only potential concern about piecemeal litigation is

routine inefficiency of multiple proceedings, which is not

enough to weigh this factor in favor of abstention. See id.

The Court here even doubts that retaining these claims

would result in inefficiencies –- to the contrary, if this Court

resolves AUI’s claims before the state court proceedings, it may

result in less “piecemeal litigation” because AUI is asking for

determinations and remedies that affect multiple state court

litigations. See, e.g., Compl. ¶ 44 (AUI asking for this Court

to declare that “FK has no standing to assert a lien on any

Project”) (emphasis added). It would be more efficient for this

Court to resolve legal issues common to or related to these

individual state court proceedings. This is notable,

considering “pragmatic concerns” drive Colorado River

abstention. Guzzi v. Thompson, 470 F. Supp. 2d 17, 21 (D. Mass.

2007), vacated and remanded on other grounds, No. 07-1537, 2008

WL 2059321 (1st Cir. May 14, 2008).

Thus, this factor weighs against abstention.

iv. The Order in Which the Fora Obtained

Jurisdiction

This factor is neutral.17

In assessing this factor, courts do not merely look at in

which court a complaint was first filed, “but rather in terms of

how much progress has been made in the two actions” at the time

the Colorado River assessment is done. Moses H. Cone, 460 U.S.

at 21; Elmendorf Grafica, Inc. v. D.S. Am. (E.), Inc., 48 F.3d

46, 52 (1st Cir. 1995); Guzzi, 470 F. Supp. 2d at 23 (stating

this factor favors abstention when the state litigation was

filed first and “advanced to a significant degree”). AUI filed

this case in early October 2023, see generally Compl., and the

Court rendered its abstention decision in January 2024, see

Electronic Clerk’s Notes, ECF No. 27.

The parties did not submit evidence on the progress of the

Middlesex State Action. This information, however, was publicly

available for the Court to review.18 As of this Court’s hearing

17 The Court notes that, during the motion to dismiss

hearing, counsel remarked on how expedited this Court’s schedule

towards trial was compared to their experience in state court

litigations.

18 The Court notes that, upon its review of the publicly

available dockets for the liens filed by FK and SEP, they

similarly have not progressed to a significant degree:

 In the lien action filed by SEP against AUI in

Plymouth County, SEP’s original complaint was filed on

7/31/2023, AUI filed a motion to dismiss on 9/28/2023,

the Court denied the motion without prejudice on

11/13/2023 (and invited AUI to re-file its motion to

in January 2024, the Middlesex State Action had not progressed

much -– CED’s complaint was filed on July 13, 2023, and AUI

filed its answer, affirmative defenses, cross claims, and third-

dismiss), and AUI re-filed its renewed motion to

dismiss on 12/13/2023. As of the time this Court’s

decision in January 2024, the Plymouth court still had

not yet ruled on AUI’s renewed motion to dismiss. See

Docket, State Energy Partners, LLC v. AUI Partners,

LLC et al., No. 2383-CV-00580 (Plymouth Sup. Ct.).

 In the lien action filed by FK against AUI in Plymouth

County, FK’s original complaint was filed on 5/24/2023

and AUI answered the complaint on 1/5/2024. See

Docket, FK Construction Funding v. AUI Partners LLC et

al., No. 2383-CV-00418 (Plymouth Sup Ct.).

 In the lien action filed by FK against AUI in

Penobscot County, the case was filed on 5/19/2023 and

a motion for judgment on the pleadings was filed on

7/7/2023. The decision (if any were made) as to this

motion is not publicly accessible, nor did FK submit

any evidence as to the progress of this docket. See

Docket, FK Construction Funding v. AUI Partners LLC et

al., No. PENSC-REA-2023-00019 (Penobscot Sup. Ct.).

 In the lien action filed by FK against AUI in

Penobscot County, the case was filed on 5/19/2023 and

a motion for judgment on the pleadings was filed on

7/7/2023. The decision (if any were made) as to this

motion is not publicly accessible, nor did the

Defendants submit any additional evidence as to the

progress of this docket. See Docket, FK Construction

Funding v. AUI Partners LLC et al., No. PENSC-REA-

2023-00020 (Penobscot Sup. Ct.).

 The Court was unable to review the action filed by FK

against AUI in York County (Docket No. 2023-00044) as

it does not appear that it is publicly available

online, and the Defendants did not submit information

as to this docket’s progress.

 The Court was unable to review the action filed by FK

against AUI in Middlesex County (Docket No. 2353-cv-

000330) as it does not appear that it is publicly

available online and the Defendants did not submit

information as to this docket’s progress.

party complaint on October 6, 2023. See Docket, Consolidated

Elec. Distrib., Inc. v. State Energy Partners, LLC et al., No.

2381-CV-02022 (Middlesex Sup. Ct.). There was also motion to

dismiss briefing filed in late 2023, but it was not heard or

decided by the state court before this Court’s motion session in

January 2024. Id.

Because the present action and the Middlesex State Action

are at comparable stages, this factor is neutral.

v. Whether State or Federal Law Controls

This factor weighs against abstention, because all of AUI’s

claims involve in the present case involve routine “garden

variety” common law claims common to diversity cases.

This factor only weighs in favor of abstention when the

federal claims involve deciding complex or novel issues of state

law. See Villa Marina Yacht Sales, 947 F.2d at 534 (citing

Villa Marina, 915 F.2d at 15); Pike Co. v. Universal Concrete

Prods., 284 F. Supp. 3d 376, 390-91 (W.D.N.Y. 2018) (observing

that claims related to a breach of contract, unjust enrichment,

and the vacatur of a mechanic's lien are not “particularly novel

or complex” for purposes of Colorado River and thus weighing

this factor against abstention); see also Frydman v.

Verschleiser, 172 F. Supp. 3d 653, 666 (S.D.N.Y. 2016) (weighing

this factor as against abstention when the case involves federal

claims and not complex state law claims, such as breach of

contract claims). Federal courts are equipped to address

routine issues of state law. See Gonzalez, 926 F.2d at 5.

Here, there are no federal claims. The state law claims

raised do not involve complex or novel issues of state law;

thus, this factor weighs against abstention.

vi. Whether State Court Can Provide a

Remedy

This factor is neutral because “both fora are capable of

determining the parties’ rights and obligations.” Massachusetts

Biologic Lab'ys, 871 F. Supp. 2d at 37.

vii. Vexatious Nature of the Proceedings

This factor is neutral. In assessing whether to abstain

under Colorado River, courts consider whether the federal action

was “vexatious or reactive.” Villa Marina Yacht Sales, 947 F.2d

at 532 (explaining that the filing of the federal suit was

vexatious when before plaintiff filed in federal court, the

state court action rejected plaintiff’s motion for preliminary

injunction). There is no indication from the Middlesex State

Action docket that AUI’s motivations were “vexatious,”

especially because its Third-Party Complaint was only filed in

early October 2023, and the case had not yet progressed much

since the case was filed. See Third Party Complaint; see supra

Section II.D.2.b.iv.

This Court acknowledges that AUI technically “reacted”, as

the term is commonly used, to these state court litigations by

filing the present action in order to consolidate the issues

involved in the state court cases. There is no evidence,

however, that AUI had an improper motive for doing so. To the

contrary, this Court understands that -- if this Court were

promptly to resolve this case (which it intends to) -- this

could result in a more efficient resolution of similar claims at

issue in the state court litigation. Cf. Villa Marina Yacht

Sales, 947 F.2d at 532 (providing examples of when a litigant is

acting “vexatious” or “reactive”, such as when the litigant is

reacting to an adverse ruling in state court or engaging in

abusive litigation).

Thus, because AUI did not “react” to an adverse ruling and

had a proper motive in filing the present action, this factor is

neutral.

viii. Principles Underlying Removal

Jurisdiction

This factor is neutral. “Removal principles” may weigh in

favor of abstention when allowing a plaintiff to file in federal

court would essentially be allowing the plaintiff to remove a

suit plaintiff filed in state court to federal court. Villa

Marina Yacht Sales, 915 F.2d 7 at 14. This concern is not

directly relevant here. AUI was brought into the case

originally as a defendant by plaintiff CED and thus did not

initially choose the forum. See supra Section II.D.2.a.ii.

While the Court notes that AUI did not have to bring its third-

party complaint, see Mass. R. Civ. P. 14, allowing AUI now to

file in federal court still does not clearly violate principles

related to removal, because AUI was originally brought into the

Middlesex litigation by another party. Further, removal

concerns could not at all be of concern in litigations filed by

FK and SEP in various state courts actions, see supra Section

I.B.5; II.D.2.a.i, because AUI did not at all initiate those

actions in state court. Thus, this factor is neutral.

ix. The Balancing of These Factors, Along

with the Presumption Against

Abstention, Cautions Against

Abstention.

With one factor weighing in favor of abstention (and not

heavily), five neutral factors, and two factors weighing against

abstention, and considering the strong presumption in favor of

this Court exercising federal jurisdiction, this Court does not

apply Colorado River abstention. There is nothing exceptional

about these circumstances warranting this Court’s relinquishment

of its jurisdiction.

E. This Court Rejected the Defendants’ Brillhart-Wilton

Abstention Arguments for the Declaratory Claims

Because Abstaining Under This Doctrine Would Not Make

Disposition of the Case More Efficient.

This Court applied the Brillhart-Wilton doctrine to AUI’s

declaratory claims. AUI alleged two claims for declaratory

relief: relief relating to the state court liens and relief

related to the Master Subcontract/work orders.19

The Defendants raised the applicability of Brillhart-Wilton

to their declaratory claims for the first time at the motion

hearing. The parties did not submit additional briefing on this

issue. This Court rejected the Defendants’ Brillhart-Wilton

abstention arguments.

Under the Brillhart-Wilton standard, “if the federal

plaintiffs seek declaratory relief, a district court has broad

discretion to stay the federal action as long as the necessary

parties have been joined in the state court proceeding and the

19 AUI alleges, as part of its declaratory judgment claim

(lien) against FK and SEP, that FK has no standing to assert a

lien on any project, that FK/SEP’s existing liens are invalid

because AUI owes no money under the work orders, and that FK/SEP

intentionally inflated their liens in bad faith. Compl. ¶¶ 42-

44; Opp’n 10. AUI alleges, as a part of its declaratory

judgment claim (contract) against FK and SEP, that SEP failed to

perform under the work order, SEP breached the work order, SEP

is obligated to defend and indemnify AUI from the lien claims,

that there is no amount due to SEP, that any alleged transfer of

rights by SEP was a breach and is thus void and ineffective, AUI

has the right to withhold payments, and finally, that FK and SEP

are jointly responsible for payments and costs to AUI. Compl. ¶

41.

claims of all parties in interest can satisfactorily be

adjudicated by that tribunal.” Massachusetts Biologic Lab'ys,

871 F. Supp. 2d at 33. The doctrine asks whether the claims

brought under the Declaratory Judgment Act “can better be

settled in the proceeding pending in the state court” when

considering “practicality and wise judicial administration.”

Wilton v. Seven Falls Co., 515 U.S. 277, 282, 288 (1995);

Brillhart v. Excess Ins. Co. of America, 316 U.S. 491 (1942).

Federal courts have more discretion to dismiss a claim for

declaratory judgment under Brillhart-Wilton as compared to

Colorado River. Rossi, 489 F.3d at 38-39.

Unlike Colorado River, abstention under Brillhart-Wilton is

not precluded even if there is a lack of parallel proceedings.20

A lack of parallel proceedings does, however, militate

20 In Wilton itself, the court declined to define the “outer

boundaries” of courts’ discretion to resolve claims for

declaratory relief in cases where there are no parallel

proceedings. Wilton, 515 U.S. at 290. Several district courts

in the First Circuit have interpreted the doctrine as still

allowing for abstention even if parallel proceedings are not

present. See, e.g., Maxum Indem. Co. v. Thermax, Inc., No. CV

19-10583-NMG, 2020 WL 9743896, at *8 (D. Mass. Jan. 7, 2020)

(Bowler, M.J.) (stating that the absence of parallel proceedings

does not compel the district court to entertain the declaratory

claims); OHI Asset (CT) Lender, LLC, 687 F. Supp. 2d at 23-24

(stating that a determination of no parallel state proceedings

does not foreclose Brillhart-Wilton abstention); Arbella Prot.

Ins. Co., Inc. v. Regan Heating & Air Conditioning, Inc., No. CV

15-441 S, 2016 WL 3248256, at *2 (D.R.I. June 10, 2016) (stating

that a lack of a parallel action does not preclude Brillhart-

Wilton abstention).

significantly in favor of retaining jurisdiction. Kinsale Ins.

Co. v. R. Greenleaf Organics, Inc., No. CV 21-10289-NMG, 2022 WL

657676, at *2 (D. Mass. Mar. 3, 2022) (Gorton, J.) (citing AIG

Prop. Cas. Co. v. Green, 150 F. Supp. 3d 132, 138 (D. Mass.

2015) (Mastroiani, J.)); see also Scottsdale Ins. Co. v. Detco

Indus., Inc., 426 F.3d 994, 998 (8th Cir. 2005) (explaining that

some courts decided that less discretion is warranted under this

doctrine when there is a lack of parallel proceedings). Here,

this Court decided that parallel proceedings do not exist for

the purposes of Colorado River, since this federal action has a

scope greater (in terms of the claims, liens, and projects it

covers) than do the individual state court actions. See supra

Section II.D.2.a. The Court does note here, however, that the

validity of the Defendants’ liens would be directly at issue in

the individual lien actions. Thus, the state court proceedings

will address the validity of the liens, even though there is not

one proceeding deciding the validity for all of the liens.

As for the declaratory judgment contract claim, the Court

observes that, while there is evidence of a declaratory judgment

claim against SEP as to the parties’ contract rights for the

Woburn Project, the Defendants did not submit evidence about

whether this declaratory judgment contract claim was brought in

other state actions with respect to the other work orders and

projects encompassed in the present action. See Cross Claim 11-

13 (defining “Work Order” as the work order for the Woburn

Project and asking for a declaration of rights under the work

order); see also Third-Party Complaint ¶¶ 1, 18, 32-34

(similarly tailoring its allegations to the Woburn Project for

its the declaratory judgment claim). Thus, the Court’s doubt as

to whether there are parallel proceedings militating against

abstention under the Brillhart-Wilton standard.

In addition to considering whether the proceedings are

parallel, courts generally consider the following Brillhart-

Wilton factors in determining whether to abstain under this

doctrine:

(1) the scope of the pending state court proceeding

and the nature of defenses open there; (2) whether the

claims of all parties in interest can be adjudicated

satisfactorily in the state proceeding; (3) whether

necessary parties have been joined; (4) whether all

necessary parties are amenable to process in the state

proceeding; and (5) the virtue of avoiding

uneconomical proceedings, vexatious proceedings, and

gratuitous interference by a federal court with an

orderly and comprehensive suit pending in a state

court, presenting the same issues, not governed by

federal law, between the same parties.

Flectat Ltd. v. KASL Seabreeze, LLC, 257 F. Supp. 3d 152, 156-57

(D. Mass. 2017) (Kelley, M.J.) (citing Wilton, 515 U.S. at 283).

This list is not exhaustive, and no individual factor is

dispositive. Kinsale Ins., 2022 WL 657676, at *3 (citing

Wilton, 515 U.S. at 283). The court in Perelman explained how

these factors may be less relevant in cases in which the federal

court has already decided to exercise jurisdiction for the

related coercive claims, as is the case here:

The factors set out by the Supreme Court in Brillhart

and Wilton . . . were all formulated in the context of

cases in which the federal action contained only

declaratory claims and, therefore, in which a decision

to stay or dismiss would necessarily terminate the

federal litigation and leave all claims to be decided

in state court. Many of these factors have much less

relevance in cases like this one, where a coercive

claim will remain in federal court, whether or not the

declaratory claims are dismissed or stayed. For

example, the question of whether the claims of all

parties in interest could be resolved in the pending

state court proceeding has much less pertinence when,

as a practical matter, at least some of those claims

will continue to be litigated in federal court.

Perelman v. Perelman, 688 F. Supp. 2d 367, 378 (E.D. Pa. 2010).

The Perelman court went on to explain that, in cases in which

the federal court is retaining jurisdiction over a coercive

claim, “the paramount consideration in deciding whether to

dismiss or stay declaratory claims is whether, as a matter of

‘practicality and wise judicial administration,’ doing so will

be more efficient and convenient for the court and the

litigants.” Id.

This Court agrees with the Perelman court that, because

here the Court retained the coercive claims, the Brillhart-

Wilton factors21 may not be as instructive. Accordingly, the

21 As for the first and second Brillhart-Wilton factors,

although the issues concerning whether the liens are inflated

and FK’s standing will be addressed in the state proceeding, and

there would therefore be overlaps between this federal

Court focuses primarily on the fifth Brillhart-Wilton factor

(whether the proceedings are economical and vexatious) and holds

that this significantly weighs against abstention. AUI’s

declaratory claims are not “uneconomical” or “vexatious.” This

Court has determined that AUI has not acted in a vexatious

manner in its Colorado River analysis. See supra Section

II.D.2.b.vii. Moreover, the Court’s retention of these claims

would not be uneconomical because the non-declaratory claims are

intertwined with the facts and issues raised in the declaratory

judgment claims.22 In Massachusetts Biologic Lab'ys, the Court

proceeding and the individual state proceedings, the limited

scope of the individual state proceedings cautions the Court

against abstention. For the third factor, although SEP and FK

are parties to the Middlesex State Action, AUI noted that SEP is

not a party to the lien enforcement actions brought by FK, Opp’n

9; thus, not all necessary parties were joined in the state

court actions. An identity of parties, however, is not required

so long as there is “an available procedural vehicle in state

court” for a federal plaintiff to resolve the issues raised in

the federal court action. Flectat Ltd., 257 F. Supp. 3d at 157.

As for the fourth factor, while AUI has filed this federal case,

there is no indication that AUI is not amenable to the state

court actions, as AUI is actively participating in these

proceedings.

22 In its chapter 93A claim, AUI also states that FK and SEP

filed false and inflated liens in bad faith. Compl. ¶ 61.

While the contract claims do not relate to the validity of the

liens as directly as the chapter 93A claim, the issues of both

whether the liens are valid because AUI owes no further

payments, or whether FK has standing to bring the liens, are

intertwined with SEP’s alleged breach of the contract/work

orders. AUI’s contract claims focus on whether SEP breached its

duties under the contract and involve similar facts that would

be at issue in assessing whether the liens were inflated or

invalid. Id. ¶¶ 45-48 (contract claims asking whether SEP

applied Colorado River to the plaintiff’s contract claims and

the Brillhart-Wilton standard for the declaratory judgment

claim. Massachusetts Biologic Lab'ys, 871 F. Supp. 2d at 33,

38. Because the Court kept the coercive claims in federal

court, the Court, citing Perelman, decided to keep the

declaratory judgment claim because staying the declaratory

judgment “would not make things more efficient or convenient.”

Id. at 38. Here too, it would not be more efficient to stay or

dismiss the declaratory judgment claims because the non-

declaratory claims involve similar issues and facts as those

raised by the declaratory claims.

For these reasons, this Court rejected the Defendants’

Brillhart-Wilton abstention doctrine arguments.

F. This Court Held That Younger Abstention Does Not

Apply.

FK argued that this Court should abstain from making

declarations with respect to the mechanic’s liens under Younger

abstention. See generally FK’s Reply. This Court held that

Younger abstention does not apply, because AUI is not asking

this Court for a determination that affects the state court’s

ability to perform its judicial functions or enforce judgments

breached by failing to perform the work, by failing to indemnify

AUI from the liens, and by assigning its rights to FK, among

other claimed breaches). The misrepresentation claim and

instrumentality/joint venture claims do not at all involve these

liens. See id. ¶¶ 49-57.

of its courts, and thus this does not fall within the third

Younger category. Adjudicating this case, therefore, would not

be an “interference” as defined by the First Circuit. Thus,

Younger abstention does not apply.

1. Legal Framework for Evaluating Younger Abstention

in the First Circuit

Younger requires this Court to abstain from exercising its

jurisdiction in certain circumstances, invoking principles of

equity and comity between federal and state courts. Sirva

Relocation, 794 F.3d at 191.

The First Circuit in Sirva recognized a three-step approach

to Younger abstention. Id. at 192-93. First, the court must

determine that the state proceeding falls into one of Younger’s

three exceptional categories. Id. Second, the court must

consider whether the Middlesex factors weigh in favor of

abstention. Id. Third, and lastly, the court must consider

whether any Younger exceptions apply.23 Id.

23 The Supreme Court has recognized some exceptions to

Younger. First, abstention is not appropriate if a state

proceeding is brought in bad faith (i.e., for the purposes of

harassment). Sirva, 794 F.3d at 192 (citing Younger, 401 U.S.

at 53–54). Second, the federal court need not abstain if the

“state forum provides inadequate protection of federal rights.”

Id. (citing Gibson v. Berryhill, 411 U.S. 564, 575, 578–79

(1973)). Third, abstention is not appropriate when “a state

statute is ‘flagrantly and patently violative of express

constitutional prohibitions.’” Id. (quoting Younger, 401 U.S.

at 53). None of the exceptions are applicable here.

As explained by the First Circuit in Sirva, the Supreme

Court in Sprint limited Younger to three exceptional

circumstances: (1) state criminal prosecutions, (2) “civil

proceedings that are akin to criminal prosecutions,” (3)

proceedings “that implicate a State's interest in enforcing the

orders and judgments of its courts.” Id. at 192; Sprint, 571

U.S. at 72-73. Absent “exceptional circumstances,” federal

courts should exercise their jurisdiction even if there are

state court proceedings concerning the same subject matter.

Sprint, 571 U.S. at 73, 82. Only the third category is

applicable to this case.24

The Supreme Court in Middlesex “added a further gloss” to

Younger (i.e., provided additional factors to consider before

invoking abstention), explaining that a federal court must

abstain under Younger if the federal proceeding would interfere

with an ongoing state judicial proceeding that implicates an

important state interest and provides an adequate opportunity

for the federal plaintiff to advance his federal challenges.

Sirva Relocation, 794 F.3d at 192 (citing Middlesex Cnty. Ethics

24 Here, the first category is not applicable because this

case does not involve a state criminal proceeding. The second

category is not applicable because this is not a coercive

proceeding “brought by the state as enforcement actions against

an individual.” See Rio Grande Cmty. Health Ctr., Inc. v.

Rullan, 397 F.3d 56, 69 (1st Cir. 2005).

Comm. v. Garden State Bar Ass'n, 457 U.S. 423, 432 (1982)); see

also Rossi, 489 F.3d at 34-35.

Although some lower courts after Middlesex started applying

the Middlesex factors as a “free-standing test” for determining

whether Younger applies, the First Circuit in Sirva,

interpreting the Supreme Court in Sprint, clarified that

“[g]iving independent life to the Middlesex factors” would

impermissibly expand Younger abstention beyond its limited

“exceptional circumstances” to cover “virtually all parallel

state and federal proceedings.” Sirva, 794 F.3d at 192.

Determining that the Middlesex factors are non-dispositive, the

Supreme Court in Sprint explained that “[d]ivorced from their

quasi-criminal context, the three Middlesex conditions would

extend Younger to virtually all parallel state and federal

proceedings, at least where a party could identify a plausibly

important state interest,” which is “irreconcilable with our

dominant instruction that . . . abstention . . . is the

‘exception, not the rule.’” Sprint, 571 U.S. at 81-82. Thus,

the Middlesex factors are additional factors in favor of

abstention, but do not alone warrant Younger abstention.25 Id.

at 81.

25 In its reply, FK states the Middlesex factors alone as

the test for whether Younger applies and does not mention the

Younger categories. FK’s Reply 3. Both the Supreme Court in

Sprint and the First Circuit in Sirva have made it abundantly

Younger abstention only occurs if the federal court’s

relief would “interfere” with state court proceedings. Rio

Grande Cmty. Health Ctr., Inc. v. Rullan, 397 F.3d 56, 70 (1st

Cir. 2005). The First Circuit in Rio Grande explained that,

while the “interference” in Younger itself referred to enjoining

state criminal proceedings, courts have also expanded what

constitutes interference to “where the plaintiff is seeking a

declaratory judgment that a prosecution, or the statute serving

as its basis, is illegal or unconstitutional.” Id. The Rio

Grande court concluded that interference “usually” occurs when

the federal proceeding “either enjoins the state proceeding or

has the ‘practical effect’ of doing so.” Id. The Rio Grande

court clarified, however, that “[n]ormal res judicata effects of

federal actions on state actions . . . are of course not enough

to trigger Younger.” Id. at 71.26

clear that the Middlesex factors alone do not warrant Younger

abstention.

26 FK stated that, if this Court were to rule in favor of

AUI for its declaratory judgment claims with respect to the

mechanic’s liens, that would “pos[e] a risk of conflicting

federal and state rulings on the validity of these lien

claims[.]” FK’s Reply 2. FK argued that this is an

interference under the First Circuit’s decision in Rio Grande.

FK’s reading of Rio Grande, however, is overly expansive. A

declaration that the state lien is invalid because no money is

due or that FK has no standing simply poses res judicata

concerns and does not “enjoin” or have the effect of enjoining a

state proceeding like a declaration that the state proceeding

was unconstitutional would. For these reasons, resolution of

the present action’s federal claims involving the state

mechanic’s liens do not constitute an interference.

2. This Court Rejected the Defendants’

Interpretation of the First Circuit’s Decision in

Rossi and Was Not Persuaded by the District of

Colorado’s Opinion in Saanen.

In arguing that Younger abstention ought apply, FK focused

on the First Circuit’s opinion in Rossi and a recent case from

the District of Colorado –- Saanen -- interpreting Rossi. See

FK’s Reply 4-5. This Court held that Rossi does not compel this

Court to exercise Younger abstention, and it was not persuaded

by Saanen to apply Younger abstention.

a. Rossi v. Gemma

FK heavily relied on Rossi for its argument that Younger

abstention is warranted. See FK’s Reply 4-5. The Court

rejected these arguments.

The Rossis were respondents in a state court lien

enforcement petitioner brought by Gem (the company owned by Mr.

Gemma). Rossi, 489 F.3d at 27-28. In the state court action,

the Rossis challenged the constitutionality of a state

mechanics’ lien law under the due process clause (both federal

and state) and challenged the validity of the lien under state

law.27 Id. at 27-29. After a complicated procedural history,28

the Rossis filed a federal complaint seeking:

[A] declaration that the [old state lien law was]

unconstitutional, a declaration that Gem's continued

use of the [old state lien law] violated the Rossis'

due process rights, a declaration that [the

defendant’s attorney’s signature] rendered

[defendant’s] lien void, an injunction to prevent Gem

from depriving the Rossis of the funds in the Superior

Court's registry, an injunction requiring Gem to

cooperate with the Rossis in obtaining the release of

their funds, [as well as]. . . damages.

Id. at 31-32.

The Rossi court separated the Rossis’ claims into various

categories before applying differing abstention principles. The

Rossi court divided the analysis into: Younger abstention on the

equitable claims, Younger abstention on the damages claim, and

then separately discussed the Rossis’ state law claim for

slander of title and a declaration that Gem’s lien was invalid.

Id. at 34-40.

27 The Rossis challenged the validity of the lien on the

grounds that Gem’s attorney signed the notice of intention to

perfect the lien, not Gem as (allegedly) required under law.

Rossi, 489 F.3d at 28-29.

28 The history is as follows. First, the Massachusetts

Superior Court ruled the Massachusetts lien law

unconstitutional. Id. at 29-32. While an appeal was pending

with the Massachusetts Supreme Judicial Court, the Massachusetts

legislature changed the lien law. Id. The Rossis then brought

a federal complaint seeking (among other relief) a declaration

that the new lien law was unconstitutional, and that the lien

was void. Id. Soon after the Rossis filed their federal

complaint, the Massachusetts Supreme Judicial Court declared the

new lien law constitutional. Id.

The First Circuit ruled that Younger applied to the Rossis’

requests for a declaration that the state lien law was

unconstitutional and for injunctive relief.29 Id. at 37. That

court recited the Middlesex factors and explained that granting

the requested relief would interfere with the state court

proceeding. Id. at 34-35. The court reasoned, as to the

request for injunctive relief, that the Rossis “obtain[ing] the

return of their funds from the court registry . . . will deprive

the Superior Court of its ability to satisfy any claim that [the

defendant] may have against those funds.” Id. at 35. Moreover,

for the “requested declaratory relief, and [if] it is adjudged

that the [old state lien law] is unconstitutional as applied to

them, they will essentially have obtained a judgment that the

continuation of the state proceeding against them violates their

due process rights,” which “is interference for Younger

purposes.” Id. at 35.

Ruling two out of three Middlesex factors easily satisfied,

the Rossi court assessed the third factor: whether an important

state interest is implicated. Id. at 35. The Rossi court ruled

29 The Rossis sought a declaration that the old state law

was unconstitutional, a declaration that Gem’s continued use of

the state lien law violated the Rossis’ due process rights, an

injunction restraining the defendants from further depriving the

Rossis of their money held in the state registry, and an

injunction requiring Gem to cooperate in releasing the Rossis’

funds. Id. at 30-32, 35.

it was, stating that the Supreme Court has recognized that

abstention is appropriate when the federal proceeding interferes

with states’ “important interests in administering certain

aspects of their judicial system.” Id. at 35-36 (citing

Pennzoil Co. v. Texaco, Inc., 481 U.S. 1, 4 (1987)). In

Pennzoil, a federal plaintiff filed a case under 42 U.S.C. §

1983, claiming that the state judicial procedure mandating the

posting of a bond for appeal was unconstitutional. Pennzoil,

481 U.S. at 1, 6-8. The Rossi court stated that, like Pennzoil,

this case “involve[d] challenges to the processes by which the

State compels compliance with the judgment of its courts,” and

thus abstention was appropriate for the section 1983 equitable

claims. Rossi, 489 F.3d at 36-37.30

As for the request for a declaration as to the lien’s

validity, the Rossi court applied the Brillhart-Wilton

abstention doctrine. Id. at 38-39. Ruling Colorado River

inapplicable (not mentioning Younger abstention at all), the

Rossi court explained that courts have more discretion in

exercising jurisdiction under the Declaratory Judgment Act, and

30 Although Sprint’s clarification of the Middlesex factors

came after Rossi, Rossi did rule (implicitly) that this case

falls within the third Younger abstention category (citing

Pennzoil) and thus Rossi was not one of the lower courts

(discussed in Sirva, see supra Section II.F.1) that improperly

used Middlesex as a freestanding test. See Rossi, 489 F.3d at

37.

that the district court had correctly abstained from hearing the

state law claim (as to the validity of the lien) under the

Brillhart-Wilton doctrine. Id.

On one hand, it can be argued that inherent in Rossi’s

analysis is a determination that Younger abstention does not

apply to declaratory relief on the validity of a state lien.

Unlike a declaration that the state law was unconstitutional or

an injunction preventing the state court from giving the bond

funds to the defendant, the Rossi court (arguably) decided that

declaring the validity of a lien does not implicate an

interference with the state’s judicial process. On the other

hand, the Rossi court did not explicitly say Younger abstention

is inapplicable to the declaratory claim as to the lien’s

validity, but only that –- under a more discretionary abstention

standard (Brillhart-Wilton) –- the district court properly

dismissed the claim for declaratory relief of the lien’s

validity. Thus, Rossi did not need to decide if Younger

mandated dismissal because the court could already dismiss the

case in its discretion under a much more permissive abstention

doctrine.

FK brought to the Court’s attention an unreported opinion

in the District of Colorado that interprets Rossi in this

context. This case, Saanen v. Silich Construction, recently

applied Rossi to circumstances very similar to the case at bar

and held that Younger abstention does apply. For the reasons

discussed infra, this Court, however, does not adopt Saanen’s

reasoning or disposition, because it does not find it

persuasive.

b. Saanen v. Silich Construction

In Saanen v. Silich Construction, Saanen hired Silich to

build a home, the relationship between the parties faltered, and

Silich filed a mechanic’s lien on Saanen’s home.31 2021 WL

4201560, at *1 (D. Colo. Apr. 12, 2021). Saanen then brought a

suit in federal court, seeking, among other relief, declaratory

relief stating that the mechanic’s lien was invalid. Id.

Silich sought to foreclose the delinquent lien in state court

soon after. Id. Silich moved to dismiss the federal case under

Younger. Id.

The Saanen court identified the Middlesex factors as

“Younger’s prima facie elements” and noted that the parties

agreed these factors were met.32 Id. As discussed supra,

31 Saanen is factually more analogous to the case at bar

than Rossi. In Saanen, the federal complaint had a breach of

contract claim, misrepresentation claims, as well as a

declaration that the liens were invalid (which similarly appears

related to the breach of contract claim). First Am. Compl.,

Saanen, 2020 WL 9763206. In Rossi, the plaintiff argued that

the lien was invalid under state law because the defendant’s

attorney signed the notice of intent preceding the lien, instead

of the defendant. See supra note 27.

32 Here, the parties have not indicated that these factors

were met. In fact, as discussed infra, the Court is not

however, these are not prima facie elements of Younger

abstention, but additional factors that could warrant abstention

for a proceeding that already fits in one of Younger’s

exceptional circumstances. See supra Section II.F.1 (discussion

on how the Supreme Court in Sprint clarified how to apply the

Middlesex factors as discussed by the First Circuit in Sirva).

Still, the Saanen court did acknowledge Sprint, and

explained that “an effort to stop a state-court from enforcing a

mechanic’s lien is precisely the kind of important state-court

judicial proceeding contemplated by Sprint for application of

Younger[‘s third category].” Id. at *2. Saanen cites Pennzoil

as requiring Younger abstention when “the [s]tate's interests in

the proceeding are so important that exercise of the federal

judicial power would disregard the comity between the States and

the National Government.” Id. at *1 (citing Pennzoil, 481 U.S.

at 11). In support of this argument, the Saanen court cited

Rossi’s holding that Younger abstention applies to a “due-

process challenge to application of state mechanic’s-lien

statute” because it involved –- similar to Pennzoil –- a

“challenge to the processes by which the [s]tate compels

compliance with the judgment of its courts.” Id. In applying

convinced that the Middlesex factors of “interference” and

“state interest” are met in this case, see infra Section

II.F.3.b.

this principle to plaintiff Saanen’s request for a non-

constitutional declaration of the lien’s validity and citing

Rossi as direct support, the Saanen court stated: “A federal-

court challenge to a state-court proceeding to foreclose a pre-

judgment mechanic's lien implicates precisely this kind of

important state interest.” Id.

The Saanen court does not address why the First Circuit in

Rossi did not apply Younger abstention to the declaration of the

lien’s validity. Moreover, even assuming Saanen’s circumstances

presented a sufficient state interest or interference to invoke

Younger, Sprint’s analysis of Middlesex tells us that the

importance of the state’s interest alone is not enough: there

must be a determination, as in Pennzoil, that declaring a lien

invalid would “challenge[] . . . the process[] by which the

[s]tate compels compliance with the judgments of its courts” or

“orders that are uniquely in furtherance of the state courts’

ability to perform their judicial functions.” Pennzoil, 481

U.S. at 13-14; Sprint, 571 U.S. at 73 (quoting New Orleans Pub.

Serv., Inc. v. Council of City of New Orleans, 491 U.S. 350, 368

(1989)).

Declaring the state court’s procedures unconstitutional

certainly challenges states’ processes for ensuring compliance

with its judgments and has the effect of enjoining the state

procedure. In a footnote, the Rossi court explained that the

“constitutional challenge goes to the very authority of the

state court to administer the res, and it is not simply a

request to adjudicate a claimed entitlement to a portion of the

res.” Rossi, 489 F.3d at 37 n.19. Declaring a lien invalid

because no money is due, however, goes to the Defendants’

“claimed entitlement” under the lien and does not as clearly

implicate state processes or authority. AUI’s request that this

Court declare that FK does not have standing to assert a lien

does seem to invoke some kind of constitutional challenge, even

though this is different from the due process constitutional or

procedural challenges typically discussed in the context of

Younger; the question of standing, however, poses the same

question -- was FK a valid assignee of AUI and SEP’s rights

under the Master Subcontract. Thus, given the nature of AUI’s

claims with respect to these liens, a declaration as to the

lien’s validity or to whether FK can bring a lien generally does

not appear to rise to the level of “interference” as defined by

Rio Grande -- instead, it seems to implicate normal res judicata

effects of federal courts on state courts, which are

insufficient to trigger Younger. See supra Section II.F.1.

For these reasons, this Court is not persuaded to adopt the

analysis adopted in Saanen.

Looking outside of Rossi and Saanen, the Court further

conducts its analysis of whether AUI’s claims with respect to

the lien fall within Younger’s third exceptional category.

3. This Court Ruled That Younger Does Not Apply to

AUI’s Claims.

This Court held that Younger abstention did not apply to

AUI’s claims involving state mechanic’s liens.

The Supreme Court has stated that the third Younger

category is applicable to state proceedings “involving certain

orders . . . uniquely in furtherance of the state courts’

ability to perform their judicial functions” or those “that

implicate a State’s interest in enforcing the orders and

judgments of its courts.” Sprint, 571 U.S. at 72-73; see, e.g.,

Pennzoil, 481 U.S. at 2, 14 (holding that federal courts should

not interfere with the constitutionality of bond requirements

for appeal of state courts because it affects how state courts

enforce their own judgments and challenge “the very process by

which those judgments were obtained”); Juidice v. Vail, 430 U.S.

327, 336 n.12 (1977) (holding that federal courts should not

declare unconstitutional state provisions authorizing a party to

be held in contempt because this process “stands in the aid of

the authority of the judicial system, so that its orders or

judgments are not rendered nugatory”).

The Second Circuit in Cavanaugh recently ruled Younger’s

third category inapplicable to a federal plaintiff’s request for

a declaration that the plaintiff did not have a lien on his

inheritance after the state probate court already decided that

the inheritance was subject to the lien. Cavanaugh v. Geballe,

28 F.4th 428, 429, 431 (2d Cir. 2022). The Second Circuit

reasoned that the state court’s order recognizing the lien or

the defendant Commissioner’s “standing to participate in the

proceedings neither ‘lies at the core of the administration of

[the] State’s judicial system’. . . , nor implicates a process

that aids the state court’s core ability to function or force

the parties to comply with its order.” Id. at 434 (explaining

that the state court proceeding “was no more than a run-of-the-

mill challenge to a claim for money” and that the “federal suit

would not hinder the probate court’s basic authority to enforce

its orders”).

Moreover, the fact that the state court proceedings

generally involved a “bond” does not alone warrant application

of the third Younger category. In Dignity Health, a state labor

commission, upon an employee filing a claim against her

employer, ruled for the employee and ordered relief. Dignity

Health v. Department of Indus. Rels., Div. of Lab. Standards

Enf't, 445 F. Supp. 3d 491, 495 (N.D. Cal. 2020). The employer

first asked a federal court to declare that the commission’s

order was preempted, and then -- the next day -- appealed the

commissioner’s order. Id. Even though the employer had to post

a bond to appeal the order in the state proceeding, the court

determined that the third Younger category did not apply,

because the federal plaintiff challenged the merits of the

Commissioner’s decision, not the appeal bond procedural

requirements (which was at issue in Pennzoil). Id. at 497-98

(“[T]he relevant question is whether the federal plaintiff

‘question[s] the process by which [state] courts compel

compliance’ with state orders.”).

Lastly, if a case involves two private litigants, Younger

abstention may be even less appropriate. See AmerisourceBergen

Corp. v. Roden, 495 F.3d 1143, 1150 (9th Cir. 2007); see also

Rowland v. Novus Fin. Corp., 949 F. Supp. 1447, 1456 (D. Haw.

1996) (recognizing that “a state foreclosure proceeding [is]

purely private and hence [does] not implicate important states

interests [under Younger].”). The Ninth Circuit in

AmerisourceBergen ruled that a state’s interest in “enforcing

the judgment in [one] particular case,” is insufficient to show

an important state interest under Middlesex. AmerisourceBergen,

495 F.3d at 1150. The Ninth Circuit has “made it clear that

‘[t]he importance of the [state's] interest is measured by

considering its significance broadly, rather than by focusing on

the state's interest in the resolution of an individual case.’”

Id. (citations omitted). Although Pennzoil itself involved

private litigants, the federal plaintiff’s request for relief

affected the “state’s wholesale interest in preserving its

procedure for posting an appeal bond,” as the request challenged

the constitutionality of the bond requirements. Id. (citing

Pennzoil, 481 U.S. at 12-14; Juidice, 430 U.S. at 327, 330,

335).

This Court ruled that Younger abstention is not appropriate

in this case.

First, and fatally, AUI’s claims do not fit into Younger’s

third category. The First Circuit’s opinion in Sirva clarified

the proper test for Younger abstention in light of the Supreme

Court’s decision in Sprint. Several cases falling into

Younger’s third category involve requests for a federal court to

assess the constitutionality of a state’s judicial procedure

(Pennzoil, Juidice). Even Rossi involved the declaration of the

constitutionality of a state law, along with a requested

injunction to enjoin the State from using its funds to satisfy

defendant’s potential recovery. Here, AUI is asking this court

to determine the validity of a lien based on what is owed under

the Master Subcontract and associated work orders. Like the

Second Circuit in Cavanaugh, this Court’s assessment of whether

the lien is inflated, or whether FK has standing to assert a

lien, does not “lie[] at the core of the administration of the

state’s judicial system” or “implicate a process that aids the

state court’s core ability to function” -- it does not interfere

with the state court’s authority, process, or procedures.

Moreover, the fact that a bond is involved (like Pennzoil) is

immaterial here because no one is challenging the state’s bond

requirements or process, just the underlying merits of the

liens. Thus, this case does not fit into the third Younger

category.

Second, not all of the Middlesex factors are met. The

federal proceeding would not interfere with the state court

proceeding, as the First Circuit in Rio Grande has held that

normal res judicata concerns do not warrant Younger abstention

and this federal proceeding would not practically enjoin the

state proceeding –- it is not declaring the state lien law

unconstitutional (Rossi), it is not declaring the state court’s

procedures unconstitutional (like Pennzoil or Juidice), and it

is not enjoining the state’s use of the bond funds (Rossi).

There is also not a sufficient state interest here, because the

state interest does not transcend the current case, as the Ninth

Circuit recognized in AmerisourceBergen, nor does it implicate

the process by which the state court enforces its judgments.

For these reasons, this Court held that Younger abstention

does not apply.

III. CONCLUSION

This Court REJECTED the Defendants’ abstention arguments

under Colorado River, Princess Lida, Brillhart-Wilton, and

Younger. Accordingly, this Court DENIED the Defendants’ motions

to dismiss, ECF No. 13 and ECF No. 16.

_/s/ William G. Young__

WILLIAM G. YOUNG

JUDGE

of the

UNITED STATES33

33 This is how my predecessor, Peleg Sprague (D. Mass. 1841-

1865), would sign official documents. Now that I’m a Senior

District Judge I adopt this format in honor of all the judicial

colleagues, state and federal, with whom I have had the

privilege to serve over the past 46 years.