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SHAW GROUP INC. v. PICERNE INVESTMENT CORPORATION
September 14, 2005.
THE SHAW GROUP INC. and SHAW ENVIRONMENTAL & INFRASTRUCTURE, INC., Plaintiffs,
PICERNE INVESTMENT CORPORATION, Defendant.
The opinion of the court was delivered by: WILLIAM STANDISH, Senior District Judge
Plaintiffs, The Shaw Group Inc. and Shaw Environmental &
Infrastructure, Inc. (individually, "SEI"), filed this diversity
action against defendant, Picerne Investment Corporation, on
October 15, 2002, seeking damages for breach of contract and
breach of the implied covenant of good faith and fair
dealing.*fn1 SEI has filed a motion for voluntary dismissal
without prejudice under Fed.R.Civ.P. 41(a) (2). In the motion,
SEI offers no explanation for its request for a voluntary
dismissal without prejudice, although SEI asserts that defendant
will not be prejudiced by such a dismissal because (1) liability
discovery is ongoing, (2) no motions for summary judgment on the issue of liability have been filed,*fn2 and (3) discovery on
the issue of damages has not begun.
Defendant has filed a memorandum of law opposing SEI's motion
to the extent the motion seeks a voluntary dismissal without
prejudice. First, defendant objects to SEI's failure to offer
any explanation of the basis for the motion. Second, defendant
contends that SEI's claims in this case are meritless because SEI
has never had an ownership interest in the agreement that is at
issue in this case. Third, defendant notes that this litigation
has been proceeding for almost three years. Fourth, defendant
asserts that it has incurred approximately $200,000.00 in legal
expenses to defend this action. Finally, defendant disputes SEI's
assertion that defendant would not be prejudiced by a voluntary
dismissal of SEI's claims without prejudice.
With respect to the factors to be considered in ruling on a
motion for voluntary dismissal without prejudice under
Fed.R.Civ.P. 41(a) (2), the district court in Schandelmeier v.
Otis Division of Baker-Material Handling Corp., 143 F.R.D. 102
(W.D.Pa. 1992), stated:
* * *
In ruling on a motion to dismiss without prejudice
under Rule 41(a) (2), it is necessary to weigh the prejudice to the defendant, both in terms of legal
prejudice and litigation expense, together with the
plaintiff's diligence in bringing the motion and
explanation therefore. Conafay v. Wyeth
Laboratories, 793 F.2d 350 (D.C. Cir. 1986); Zagano
v. Fordham University, 900 F.2d 12, 14 (2d Cir.),
cert. denied, 498 U.S. 899, 111 S.Ct. 255,
112 L.Ed.2d 213 (1990). Another factor to consider is the
pendency of a dispositive motion by the non-moving
party. See, e.g., Chance v. Farm Bureau Mutual
Insurance Co., 756 F. Supp. 1440 (D.Kan. 1991).
Beyond general agreement on the factors to be
considered, the Courts of Appeal have diverged in
their approach to Rule 41(a) (2) dismissals, the
Ninth Circuit, Hamilton v. Firestone Tire and Rubber
Co., Inc., 679 F.2d 143 (9th Cir. 1982); Morgan
v. Walter, 758 F.Supp. 597 (D. Idaho1991), and Fifth
Circuit, (footnote omitted) Manshack v. Southwestern
Electric Power Co., 915 F.2d 172 (5th Cir.
1990), taking a fairly "pro-dismissal without
prejudice" stance, while the Second Circuit,
Zagano, supra, 900 F.2d at 14-15, and Eleventh
Circuit, Fisher v. Puerto Rico Marine Management,
Inc., 940 F.2d 1502 (11th Cir. 1991), take a
more restrictive view.
The Third Circuit lines up with the more restrictive
circuits. (Footnote omitted). Ferguson v. Eakle,
492 F.2d 26, 28-29 (3d Cir. 1974); see also Thomas
v. Amerada Hess Corp., supra.
Turning to the specifics of this case, plaintiffs
move to dismiss their complaint after it has been
pending for twenty months and has been scheduled for
trial. Plaintiffs do not explain why they seek
dismissal without prejudice, nor do they provide any
opposition to defendants' dispositive motion which
undoubtedly has been the product of some effort and
expense on the part of defendants. Under those
circumstances, dismissal must be with prejudice.
* * *
143 F.R.D. at 102-03.
After consideration, the Court agrees with defendant that SEI's
motion for a voluntary dismissal without prejudice should be denied because (a) like the plaintiffs in
Schandelmeier, supra, SEI offers no explanation for the
requested dismissal without prejudice; (b) SEI did not act
diligently in seeking the requested dismissal under Fed.R.Civ.P.
41 (a) (2); (c) the motion for dismissal without prejudice was
filed by SEI shortly before the deadline for the filing of
defendant's motion for summary judgment on the issue of liability
and the exhibits attached to defendant's memorandum of law in
opposition to SEI's motion support defendant's contention that
SEI does not have any interest in the agreement that is the
subject of this litigation; and (d) defendant has incurred
substantial legal expenses to defend the claims of SEI for the
past three years.*fn3 Under the circumstances, SEI's motion for a voluntary dismissal without
prejudice under Fed.R.Civ.P. 41(a) (2) will be denied.
AND NOW, this 14th day of September, 2005, IT IS SO
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