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was premature. The judgment of the Court of Appeals must be reversed because the court should have done no more than require reconsideration by petitioner in light of Colorado River Water Conservation Dist. v. United States, 424 U. S. 800, which was decided after petitioner's stay order. Pp. 667-668.

REHNQUIST, J., announced the Court's judgment and delivered an opinion, in which STEWART, WHITE, and STEVENS, JJ., joined. BLACKMUN, J., filed an opinion concurring in the judgment, post, p. 667. BURGER, C. J., filed a dissenting opinion, post, p. 668. BRENNAN, J., filed a dissenting opinion, in which BURGER, C. J., and MARSHALL and POWELL, JJ., joined, post, p. 668.

Milton V. Freeman argued the cause for petitioner. With him on the briefs were Dennis G. Lyons, Werner J. Kronstein, and Stanley A. Kaplan.

Louis Loss argued the cause for respondent Calvert Fire Insurance Co. With him on the brief was Michael L. Weissman. Thomas J. Weithers and D. Kendall Griffith filed a brief for American Mutual Reinsurance Co., respondent under this Court's Rule 21 (4), in support of petitioner.

MR. JUSTICE REHNQUIST announced the judgment of the Court, and delivered an opinion in which MR. JUSTICE STEWART, MR. JUSTICE WHITE, and MR. JUSTICE STEVENS joined.

On August 15, 1977, the Court of Appeals for the Seventh Circuit granted a petition for writ of mandamus ordering petitioner, a judge of the United States District Court for the Northern District of Illinois, "to proceed immediately" to adjudicate a claim based upon the Securities Exchange Act of 1934 and brought by respondent, Calvert Fire Insurance Co., against American Mutual Reinsurance Co., despite the pendency of a substantially identical proceeding between the same parties in the Illinois state courts. 560 F. 2d 792, 797. The Court of Appeals felt that our recent decision in Colorado River Water Conservation Dist. v. United States, 424 U. S. 800 (1976), compelled the issuance of the writ. We granted

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437 U.S.

certiorari to consider the propriety of the use of mandamus to review a District Court's decision to defer to concurrent state proceedings, 434 U. S. 1008, and we now reverse.

I

Respondent Calvert writes property and casualty insurance. American Mutual operates a reinsurance pool whereby a number of primary insurers protect themselves against unanticipated losses. Membership in the pool requires both the payment of premiums by pool members and indemnification of the pool in the event that losses exceed those upon which the premiums are calculated. Calvert joined the pool in early 1974, but in April of that year notified American Mutual of its election to rescind the agreement by which it became a member.

In July 1974, American Mutual sued in the Circuit Court of Cook County, Ill., to obtain a declaration that the pool agreement between it and Calvert was in full force and effect. Six months later, Calvert in its answer to that suit asserted that the pool agreement was not enforceable against it because of violations by American Mutual of the Securities Act of 1933, the Securities Exchange Act of 1934, the Illinois Securities Act, the Maryland Securities Law, and the state common law of fraud. With its answer Calvert filed a counterclaim seeking $2 million in damages from American Mutual on all of the grounds that it set up in defense except for the defense based on the Securities Exchange Act of 1934. Since § 27 of that Act, 48 Stat. 902, as amended, 15 U. S. C. § 78aa (1976 ed.), granted the district courts of the United States exclusive jurisdiction to enforce the Act, Calvert on the same day filed a complaint in the United States District Court for the Northern District of Illinois seeking damages from American Mutual for an alleged violation of Rule 10b-5, 17 CFR § 240.10b-5 (1977), issued under § 10 (b) of the Act, 15 U. S. C. § 78j (b) (1976 ed.). Joined with this Rule 10b-5

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count were claims based on each of the other grounds asserted by it in defense to American Mutual's state-court action.

In February 1975, more than seven months after it had begun its state-court action, but less than one month after Calvert had filed its answer and counterclaim in that action and its complaint in the federal court, American Mutual moved to dismiss or abate the latter. The claim for dismissal was based on the substantive assertion that the reinsurance agreement was not a "security" within the meaning of the 1933 or 1934 Act. The motion to abate was based on the fact that the state proceedings commenced six months before the federal proceedings included every claim and defense except the claim for damages based on Rule 10b-5 under the 1934 Act.

In May 1975, Judge Will substantially granted American Mutual's motion to defer the federal proceeding until the completion of the state proceedings, observing that a tentative trial date had already been set by the state court. Federal litigation of the same issues would therefore be duplicative and wasteful. He rejected Calvert's contention that the court should proceed with the entire case because of its exclusive jurisdiction under the 1934 Act, noting that the state court was bound to provide the equitable relief sought by Calvert by recognizing a valid Rule 10b-5 claim as a defense to the state action.1 Only Calvert's claim for damages under Rule 10b-5 was subject to the exclusive jurisdiction of the federal court. Petitioner therefore stayed all aspects of Calvert's federal action subject to the concurrent jurisdiction of both courts, recognizing "only Calvert's very limited claim for

1 Calvert's answer in the state action explicitly contended that it was "entitled to rescission of its purchase of the aforesaid security" because of the alleged Rule 10b-5 violation. App. to Pet. for Cert. D-5. It sought identical equitable relief in its federal complaint. Id., at E-6. See Weiner v. Shearson, Hammill & Co., 521 F. 2d 817, 822 (CA9 1975); Aetna State Bank v. Altheimer, 430 F. 2d 750, 754 (CA7 1970).

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monetary damages under the 1934 Securities Act as a viable claim in this court." App. to Pet. for Cert. B-9. On May 9, 1975, Judge Will heard oral argument on the basic question of whether Calvert's interest in the reinsurance pool is a security within the meaning of the 1934 Act. He has not yet rendered a decision on that issue.2

Judge Will rejected two motions to reconsider his stay order and refused to certify an interlocutory appeal pursuant to 28 U. S. C. § 1292 (b). On May 26, 1976, Calvert petitioned the Court of Appeals for the Seventh Circuit for a writ of mandamus directing Judge Will to proceed to adjudicate its Rule 10b-5 claims. Nearly 14 months later, on August 15, 1977, the Court of Appeals granted the petition and directed Judge Will to "proceed immediately with Calvert's claim for damages and equitable relief under the Securities Exchange Act of 1934." 560 F. 2d, at 797.*

3

2 The state court, however, has reached a decision on the issue. The Circuit Court concluded that the agreement was not a security, and therefore struck the federal issues from Calvert's answer and counterclaim. On an interlocutory appeal the Illinois Appellate Court affirmed, holding that the agreement was not a security within the meaning of either the 1933 or the 1934 Act and that, in any event, § 2 (b) of the McCarran-Ferguson Act, 15 U. S. C. § 1012 (b) (1976 ed.), exempted insurance from the reach of the federal securities laws. American Mutual Reinsurance Co. v. Calvert Fire Ins. Co., 52 Ill. App. 3d 922, 367 N. E. 2d 104 (1977), pet. for leave to appeal denied, No. 50,085 (Jan. 26, 1978), cert. denied, 436 U. S. 906 (1978).

3 As already noted, the stay order did not apply to Calvert's claim for damages under Rule 10b-5. Judge Will had stayed Calvert's claim for equitable relief because the state court had jurisdiction to rescind the agreement by recognition of a Rule 10b-5 defense.

The petition did not seek to require Judge Will to proceed with the state-law claims or the federal claim based on the 1933 Act. 560 F. 2d 792, 794 n. 2.

* Although Calvert's petition addressed only its Rule 10b-5 claims, the court went on to note: "The logic behind our holding in this case supports the conclusion that the stay of 1933 Act claims, as well as the 1934 Act claims, was improper." 560 F. 2d, at 797 n. 6.

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We granted certiorari to consider Judge Will's contention that the issuance of the writ of mandamus impermissibly interfered with the discretion of a district court to control its own docket. 434 U. S. 1008 (1978).

II

The correct disposition of this case hinges in large part on the appropriate standard of inquiry to be employed by a court of appeals in determining whether to issue a writ of mandamus to a district court. On direct appeal, a court of appeals has broad authority to "modify, vacate, set aside or reverse" an order of a district court, and it may direct such further action on remand "as may be just under the circumstances." 28 U. S. C. § 2106. By contrast, under the All Writs Act, 28 U. S. C. § 1651 (a), courts of appeals may issue a writ of mandamus only when "necessary or appropriate in aid of their respective jurisdictions." Whereas a simple showing of error may suffice to obtain a reversal on direct appeal, to issue a writ of mandamus under such circumstances "would undermine the settled limitations upon the power of an appellate court to review interlocutory orders." Will v. United States, 389 U. S. 90, 98 n. 6 (1967).

As we have repeatedly reaffirmed in cases such as Kerr v. United States District Court, 426 U. S. 394, 402 (1976), and Bankers Life & Cas. Co. v. Holland, 346 U. S. 379, 382 (1953), the "traditional use of the writ in aid of appellate jurisdiction both at common law and in the federal courts has been to confine an inferior court to a lawful exercise of its prescribed jurisdiction or to compel it to exercise its authority when it is its duty to do so." Roche v. Evaporated Milk Assn., 319 U. S. 21, 26 (1943). Calvert makes no contention that petitioner has exceeded the bounds of his jurisdiction. Rather, it contends that the District Court, in entering the stay order, has refused "to exercise its authority when it is its duty to do so." Ibid. There can be no doubt that, where a district