The opinion of the court was delivered by: Diamond, J.
Defendant D.R. Horton asks me to mark this breach of warranty action dismissed "with prejudice," and to impose sanctions on Plaintiffs. I will deny Defendant's Motion.
In June, 2008, Plaintiffs Gary G. Stauffer and Linda S. Stauffer brought this action in the Lancaster County Common Pleas Court, alleging that in 2006 they purchased a house that Defendant had newly constructed. (Doc. No. 1, Ex. 1 at ¶ 3-4.) Plaintiffs alleged that subsequent inspections revealed a number of construction defects for which Defendant is responsible. (Doc. No. 1, Ex.1 at 6-10.) Plaintiffs included claims for breach of contract, breach of the implied warranty of reasonable workmanship, breach of warranty, and violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law. (CI-08-06339; Doc. No. 1, Ex. 1.)
In July 2008, Defendant removed to this Court, invoking diversity jurisdiction. 28 U.S.C. § 1332(a) (Doc. No. 1.) Defendant then moved pursuant to Fed. R. Civ. P. 12(b)(6) to dismiss with prejudice for failure to state a claim, or in the alternative, to compel arbitration. Defendant argued that: (1) under the Parties' Warranty Agreement, it was not a proper defendant; (2) the warranty process, as set forth in Parties' contract, requires arbitration; (3) Plaintiffs agreed to Defendant's disclaimer of limited warranties; and (4) Plaintiffs' UTPCPL claim was not plead with particularity and was otherwise not cognizable. (Doc. No. 3.)
In August 2008 -- twenty-seven days after Defendant removed to this Court and almost two months after Plaintiffs first served Defendant with the Complaint -- Plaintiffs filed a Notice of Voluntary Dismissal pursuant to Fed. R. Civ. P. 41(a)(1)(A), and the matter was dismissed without prejudice. (Doc. No. 7.)
Acting pursuant to Fed. R. Civ. P. 11 and the Parties' Warranty Agreement, Defendant now asks me to mark the dismissal of this action "with prejudice," and to impose on Plaintiffs $34,719.85 in litigation costs and attorneys' fees. (Doc. No. 8 at 2-3.) I will deny the Motion.
A. Voluntary Dismissal Under Rule 41(a)(1)
A plaintiff may dismiss his or her action without permission of court "by filing...a notice of dismissal before the opposing party serves either an answer or a motion for summary judgment." Fed. R. Civ. P. 41(a)(1)(A). A Rule 41(a)(1) dismissal is without prejudice unless the notice states otherwise or in other limited circumstances. Fed. R. Civ. P. 41(a)(1)(B). The Third Circuit has held that the filing of a Rule 12 motion to dismiss does not terminate a plaintiff's right voluntarily to dismiss his or her action without prejudice. See In re Bath and Kitchen Fixtures Antitrust Litigation, 535 F.3d 161, 166 (3d Cir. 2008) ("Because a motion to dismiss under Fed.R.Civ.P. 12(b)(6) is neither an answer nor a motion for summary judgment, its filing generally does not cut off a plaintiff's right to dismiss by notice.").
Although a timely notice of voluntary dismissal under Rule 41(a)(1)(A) usually ends a case and deprives the court of jurisdiction to issue a merits ruling, the court may continue to decide "collateral" issues, including sanctions, costs, and attorneys' fees. Id. at 166, n.8 (citing Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 396-98 (1990)).
B. Federal Rule of Civil Procedure 11
Rule 11 authorizes the Court through the imposition of sanctions "to check abuses in the signing of pleadings." Fed. R. Civ. P. 11 Advisory Committee Notes (1983 Amendments); see also Martin v. Brown, 63 F.3d 1282, 1264 (3d Cir. 1995). "The purpose of Rule 11 is to deter litigation abuse that is the result of a particular 'pleading, written motion, or other paper' and, thus, streamline ...