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Kilbride Investments Ltd. v. Cushman & Wakefield of Pennsylvania, Inc.

United States District Court, E.D. Pennsylvania

August 5, 2019



          DuBois, Judge


         This is a fraud case in which Kilbride Investments Limited, Busystore Limited in Liquidation, and Bergfeld Co. Limited (collectively, “plaintiffs”), allege that defendants, Cushman & Wakefield of Pennsylvania, Inc. (“C&W”), Blank Rome LLP (“Blank Rome”), [1] and Cozen O'Connor, P.C. (“Cozen”), induced them into investing at least $27 million in a real-estate development project, the River City Property (“River City” or “the Property”), in Philadelphia, Pennsylvania, by fraudulently misrepresenting applicable zoning restrictions, the feasibility of the project, and the valuation of the real estate. Plaintiffs' Amended Complaint asserts one count against defendant C&W-a count for fraudulent misrepresentation-and two counts against Blank Rome and Cozen-counts for civil conspiracy to commit fraud and aiding and abetting fraud brought under a theory of respondeat superior based on the conduct of Charles Naselsky, an attorney who worked sequentially at Cozen and Blank Rome. Am. Compl. 28-31. Naselsky is not a party to this case.

         The facts are set forth in detail in the Court's Memoranda dated February 16, 2018, (Document No. 185) and April 25, 2018, (Document No. 205). The Court will not repeat the factual history in this memorandum except as necessary to explain its decision.

         On May 17, 2018, upon settlement of plaintiffs' claims against Blank Rome, Blank Rome was dismissed from this action with prejudice. C&W and Cozen remain as defendants. The Order dismissing Blank Rome was the product of language negotiated by counsel for all parties. (Document No. 210). Now, plaintiffs and Cozen have entered into a Settlement Agreement and Mutual Release (“Settlement Agreement”). According to plaintiffs, “the language of the release between Plaintiffs and Cozen differ[s] from that between Plaintiffs and Blank Rome in that it does not concede joint tortfeasor status.” Pl. Mot. 5.

         Presently before the Court is Plaintiffs' Motion to Voluntary Dismiss Defendant Cozen O'Connor, P.C. Pursuant to Rule 41(a)(2) and For Entry of Final Judgment Pursuant to Rule 54(b) (Document No. 241, filed May 17, 2019). Plaintiffs' motion seeks Cozen's dismissal with prejudice. Pl. Mot. 1. Cozen joined plaintiffs' motion and requests that the Court rule as a matter of law that Cozen is not a joint tortfeasor with C&W (Document No. 243, filed May 24, 2019). C&W responded in partial opposition to the motion and Cozen's joinder, arguing that C&W is “entitled to an offset for the amount of Cozen's settlement against any verdict rendered against it” (Document No. 244, filed June 7, 2019). C&W Partial Opp. 3. Blank Rome filed a response and plaintiffs, Cozen, and C&W filed replies and a surreply, respectively (Document Nos. 245, 246, 247, 252, filed on June 14, 17, & 25, 2019). Plaintiffs' motion is now ripe for decision.


         Rule 41 of the Federal Rules of Civil Procedure governs voluntary and involuntary dismissals. For voluntary dismissals, a plaintiff is permitted to dismiss an opposing party either before an answer or a summary judgment motion is served or on the stipulation of all parties. See Fed. R. Civ. P. 41(a); Citizens Sav. Ass'n v. Franciscus, 120 F.R.D. 22, 24 (M.D. Pa. 1988). In this case, because plaintiffs' motion to voluntarily dismiss was filed after the completion of discovery, the “action may be dismissed at the plaintiff's request only by court order, on terms that the court considers proper.” Fed.R.Civ.P. 41(a)(2).

         A motion for voluntary dismissal under Rule 41(a)(2) lies within the sound discretion of the district court. Ferguson v. Eakle, 492 F.2d 26, 28 (3d Cir. 1974). “The purpose of the grant of discretion under Rule 41(a)(2) is primarily to prevent voluntary dismissals which unfairly affect the other side, and to permit the imposition of curative conditions to avoid such prejudice.” Carroll v. E-One, Inc., No. 15-0562, 2016 WL 4702145, at *2 (E.D. Pa. Sept. 8, 2016). “The courts have adopted a ‘liberal policy' with respect to Rule 41 motions for voluntary dismissal. Ordinarily, such motions ‘should be allowed unless defendant will suffer some prejudice other than the mere prospect of a second lawsuit.'” Exeter Twp. v. Franckowiak, No. 17-2709, 2018 WL 1010626, at *2 (E.D. Pa. Feb. 22, 2018) (quoting In re Paoli R.R. Yard PCB Litig., 916 F.2d 829, 863 (3d Cir. 1990)).


         C&W opposes, in part, plaintiffs' motion for voluntary dismissal, with prejudice, of defendant Cozen. Although C&W “does not oppose Cozen's dismissal from this action or the entry of the dismissal as a separate judgment, ” C&W argues that it will be legally prejudiced by Cozen's dismissal if they are precluded from receiving a pro rata reduction of any verdict against them based on Cozen's settlement pursuant to the Pennsylvania Uniform Contribution Among Joint Tortfeasors Act (“UCATA”) 42 Pa. Cons. Stat. §§ 8321-27.[2] C&W Partial Opp. 3. C&W argues that they are entitled to UCATA's pro-rata reduction because Cozen and C&W are “joint tortfeasors” under the Act. Id.

         Plaintiffs and Cozen argue that Cozen cannot be considered a joint tortfeasor with C&W because (1) Cozen, allegedly a vicariously liable party, cannot be considered a joint tortfeasor with C&W, allegedly a primarily liable party, and an intentional tortfeasor; (2) even if Cozen and C&W could be considered joint tortfeasors as a matter of law, the evidence in this case does not support a finding of joint tortfeasor status; and (3) C&W has waived its right to pursue a claim of contribution against Cozen under UCATA by failing to file a cross-claim in this action and/or by failing to join Naselsky as a third party defendant. Pl. Mot. 8-24. The Court considers each argument in turn.

         A. Can an Intentional Tortfeasor and a Vicariously Liable Party be Joint Tortfeasors under UCATA?

         Plaintiffs and Cozen argue that the present issue is “novel” because (1) C&W is allegedly an intentional tortfeasor, and (2) C&W is allegedly a primarily liable party while Cozen is allegedly secondarily liable under a theory of respondeat superior. Pl. Mot. 16. The Court concludes that neither factor bars joint tortfeasor status.

         1. Can an Intentional Tortfeasor Seek Contribution under Pennsylvania Law?

         UCATA defines joint tortfeasors broadly as “two or more persons jointly or severally liable in tort for the same injury to persons or property.” See 42 Pa. Cons. Stat. § 8322. Although intentional tortfeasors were not entitled to contribution at common law, a number of recent cases have concluded that UCATA's broad language presents no such restriction. Compare Britt v. May Dep't Stores Co., No. 94-3112, 1994 WL 585930, at *3 (E.D. Pa. Oct. 14, 1994), with Euro Motorcars Germantown Inc. v. Manheim Remarketing, Inc., No. 13-7614, 2015 WL 798969, at *10 (E.D. Pa. Feb. 25, 2015).

         In Euro Motorcars Germantown Inc. v. Manheim Remarketing Inc., after conducting a thorough analysis of UCATA and its interpretation in Pennsylvania courts, the court concluded that “[g]iven [UCATA's] language and history, . . . Pennsylvania appellate courts would . . . hold that the contribution statute permits a contribution remedy for intentional tortfeasors.” 2015 WL 798969, at *10. The Euro Motorcars court based its holding, in part, on a Pennsylvania Superior Court strict liability case, Svetz for Svetz v. Land Tool Co., 513 A.2d 403 (Pa. Super. Ct. 1986). In Svetz the Superior Court determined that a strictly liable party could recover from a negligent tortfeasor because “[t]he statutory language does not limit the right of contribution to tortfeasors who have been guilty of negligence. Contribution is available whenever two or more persons are jointly or severally liable in tort, irrespective of the theory by which tort liability is imposed.” Euro Motorcars, 2015 WL 798969, at *8 (citing Svetz, 513 A.2d 403).

         The holding in Euro Motorcars was subsequently endorsed by Impala Platinum Holdings Ltd. v. A-1 Specialized Servs. & Supplies, Inc., No. 16-1343, 2017 WL 2840352, at *10 (E.D. Pa. June 30, 2017) (“[W]e need look no further than the plain language of the statute, which neither ‘expressly limit[s] its applicability to torts based on negligence' nor in any other way constrains the statute's reach.” (quoting Alexander v. Hargrove, No. 93-5510, 1994 WL 444728, at *4 (E.D. Pa. Aug. 16, 1994)). The Court agrees with the reasoning in Euro Motorcars and concludes that C&W's claimed status as an intentional tortfeasor is not a bar to contribution.

         2. Can a Primarily Liable Party Seek Contribution From a Secondarily ...

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