Opinion
No. 02-2054-DJW
May 30, 2003.
MEMORANDUM AND ORDER
This case involves product liability claims brought by Plaintiff against Defendant Cessna Aircraft Company ("Cessna"). Plaintiff's claims are based on a variety of theories, including negligence, strict liability, breach of warranties, breach of contract and violation of the Kansas Consumer Protection Act. More specifically, Plaintiff asserts the Cessna Citation VII jet aircraft ("aircraft" or "airplane") he purchased from Cessna caught fire while being readied for flight. In his Complaint, Plaintiff alleges that defects in the aircraft's wiring system caused the fire, which resulted in extensive damage to the aircraft.
The matter currently is before the Court on Plaintiff's Motion for Dismissal Without Prejudice (doc. 46). Cessna opposes the Motion. For the reasons stated below, Plaintiff's Motion is granted subject to several conditions the Court believes will alleviate any potential legal prejudice Defendant may suffer.
Plaintiff has requested oral argument on this motion. Because the court has determined that oral argument will not materially assist in the resolution of the motion, the request is denied. See D.Kan. Rule 7.2.
I. Procedural Background
The Court finds helpful the following chronology, which summarizes the relevant procedural background in this matter:
• In September 2001, Plaintiff sued Raytheon Aircraft Services Limited ("Raytheon") in this Court alleging Raytheon was negligent in performing work on Plaintiff's airplane and thus was responsible for the fire that caused damage to the aircraft. Plaintiff ultimately dismissed the suit, claiming the Court lacked personal jurisdiction over Raytheon.
• Plaintiff filed this lawsuit against Cessna on February 8, 2002, alleging that manufacturer defects in the aircraft's wiring system caused the fire and the resulting damage.
• A telephone scheduling conference was held on June 10, 2002. During this conference, the Court ordered the parties to determine by July 15, 2002 whether any other parties were going to be joined in this litigation and, if they were, to advise those parties of this fact and request them to take part in the Rule 26(f) planning conference. In light of these circumstances, the Court continued the scheduling conference to August.
• On August 2, 2002, Plaintiff filed suit against Raytheon in Great Britain alleging that — like the lawsuit filed and dismissed in this Court — Raytheon was negligent in performing work on Plaintiff's aircraft and thus was responsible for the fire that caused damage to Plaintiff's aircraft.
• A telephone scheduling conference was held on August 16, 2002. During this conference, the Court was advised that another case involving the airplane fire may have been filed. The Court ordered Plaintiff to verify this information and then advise the Court and counsel within ten days if such a case had been filed.
• On August 26, 2002, Plaintiff's counsel notified the Court that Plaintiff filed suit against Raytheon in Great Britain on August 2, 2002.
• On August 30, 2002, the undersigned Magistrate Judge transmitted a letter to the Royal Courts of Justice in England, inquiring into the feasibility of ordering the parties in both matters to participate in tripartite mediation. A response was received on September 16, 2002, which notified this Court that the English case was not assigned to any particular judge yet, but that when an assignment was made, the Court's correspondence would be forwarded to that judge.
• A status conference was held on September 19, 2002. Counsel informed the Court that a hearing was scheduled for September 20, 2003 in the English litigation to discuss mediation. The Court ordered counsel for Plaintiff to advise the Court and counsel of the outcome of such hearing.
• Plaintiff served his first request for documents on September 25, 2002.
• On September 26, 2002, Plaintiff's counsel advised the Court that the judge in England ordered a stay of proceedings until October 31, 2002 in order to enable the parties in the English action to participate in tripartite mediation with the parties in this case.
• A status conference was held on October 1, 2002, during which the parties decided that plans to engage in alternative dispute resolution should be continued until the judge in England provided information regarding the feasibility of a mediation that included all three of the interested parties: Plaintiff, Cessna and Raytheon.
• On October 4, 2002, counsel for Raytheon informed this Court that Raytheon was not willing to participate in a tripartite mediation unless it first received assurances that Raytheon would preserve all jurisdictional and other defenses to suit by Plaintiff in a prospective Kansas case.
• On October 31, 2002, Plaintiff moved for a sixty-day extension of all deadlines in the scheduling order in order to continue efforts to arrange a tripartite mediation. Cessna opposed the motion, arguing Plaintiff failed to demonstrate good cause for the extension.
• On November 22, 2002, the Court granted Plaintiff's request to extend all deadlines sixty days and formally referred the case to mediation to occur no later than January 31, 2003.
• On December 13, 2002, Plaintiff submitted the name of a mediator.
• On December 17-18, 2002, Plaintiff took the deposition of five Cessna employees.
• On December 18, 2002, Raytheon in England served upon Cessna a pleading similar to a third-party complaint in the United States, which makes a claim for contribution against Cessna in the English action.
• On January 10, 2002, Defendant joined in on Plaintiff's choice for mediator.
• On January 10, 2002, Plaintiff moved to stay these proceedings pending resolution of his case against Raytheon in Great Britain.
• On January 23, 2003, Cessna filed an application in the English case to stay the claims asserted against Cessna pending resolution of the Kansas case.
• On January 24, 2003, this Court appointed the chosen mediator and extended the mediation deadline to February 28, 2003.
• On February 28, 2003 the parties jointly moved to extend the mediation deadline to March 4, 2003, which the Court subsequently granted.
• On March 19, 2003, the appointed mediator informed this Court that mediation was unsuccessful.
• On March 19, 2003, Cessna served Plaintiff with interrogatories, requests for admissions and requests for documents.
• On March 24, 2003, Cessna moved to dismiss three of the claims set forth in Plaintiff's Complaint.
• On March 26, 2003, Plaintiff filed this motion for voluntary dismissal and a request for extension of time to respond to the written discovery and dispositive motions served by Cessna.
Factual discovery in this matter is not complete and the parties have neither prepared for nor participated in a pretrial conference.
II. Discussion
Plaintiff moves to dismiss this action without prejudice on grounds that he cannot obtain satisfactory resolution of his claims without Raytheon and Cessna in the same case, and the only venue where that goal can be achieved is in England. Plaintiff argues he cannot bring an action against Raytheon in this district due to the lack of personal jurisdiction over Raytheon, an English corporation who undertook the allegedly tortious acts at issue in England. Plaintiff further argues Plaintiff, Raytheon and Cessna currently are existing parties to the English litigation and that, if Plaintiff's claims here are dismissed, Plaintiff can pursue a direct claim against Cessna in England. Cessna opposes the Motion, arguing it would subject them to legal prejudice if granted. Federal Rule of Civil Procedure 41(a)(2) governs voluntary dismissals after the opposing party has filed an answer or motion for summary judgment. Once a defendant has filed an answer, as is the case here, a plaintiff may voluntarily dismiss an action only upon order of the court. Rule 41(a)(2) "is designed `primarily to prevent voluntary dismissals which unfairly affect the other side, and to permit the imposition of curative conditions.'" Absent "legal prejudice" to the defendant, the district court normally should grant such a dismissal.
Clark v. Tansy, 13 F.3d 1407, 1411 (10th Cir. 1993) (quoting Alamance Indus., Inc. v. Filene's, 291 F.2d 142, 146 (1st Cir. 1961)).
Ohlander v. Larson, 114 F.3d 1531, 1537 (10th Cir. 1997).
"The parameters of what constitutes `legal prejudice' are not entirely clear," but factors the Tenth Circuit has held the district court should consider include "the opposing party's effort and expense in preparing for trial; excessive delay and lack of diligence on the part of the movant; insufficient explanation of the need for a dismissal; and the present stage of the litigation." Each factor does not have to favor the moving party for dismissal to be appropriate, nor does each factor need to favor the opposing party for denial of the motion to be proper. The list of factors is not exclusive and the court has discretion to, and should, consider other relevant factors in order to "insure substantial justice is accorded to both parties."
Id. (citing Phillips U.S.A., Inc. v. Allflex U.S.A., Inc., 77 F.3d 354, 358 (10th Cir. 1996)).
Id. (citing Phillips U.S.A., Inc., 77 F.3d at 358).
Id. (citing 9 Charles Alan Wright and Arthur R. Miller, Federal Practice and Procedure § 2364 at 278 (2d ed. 1994)).
Applying these factors, and taking into account the court's ability to impose curative conditions on the parties, the Court finds Cessna will not suffer legal prejudice if this case is dismissed without prejudice.
Ironically, five of the cases cited by Cessna in opposing dismissal resulted in a finding that the defendant would not suffer legal prejudice if the case was dismissed:
McCoy v. Whirlpool Corporation, 204 F.R.D. 471 (D.Kan. 2001) ("[P]laintiffs moved to dismiss shortly after the close of discovery, at a time when they could thoroughly assess the case with the facts fully developed." Although plaintiff should not be entitled to dismiss for sole purpose of adding non-diverse party and refiling in state court, "to the extent a potentially culpable party to be added would destroy complete diversity, and thereby the plaintiffs could not pursue a remedy against it in federal court, such considerations would be appropriate.").
Nunez v. IBP, Inc., 163 F.R.D. 356 (D.Kan. 1995) (finding no abuse of discretion in dismissing without prejudice, even where plaintiff's only motive is to refile in state court, because there was no showing dismissal would be "manifestly prejudicial" to defendant).
Breathouwer v. SmithKline Beecham Corp., No. 02-2476-JAR, 2003 WL 1342979 (D.Kan. March 17, 2003) (granting motion for dismissal and ordering that, if claim were refiled in state court, plaintiffs should compensate defendant for duplicative fees and expenses in order to alleviate any potential legal prejudice).
Cummings v. Washington County, Kansas, No. 02-4152-JAR, 2003 WL 272172 (D.Kan. Feb, 5, 2003) (same)
Kansas Waste Water, Inc. v. Alliant Techsystems, Inc., 01-2236-JWL, 2002 WL 1634362 (D.Kan. May 31, 2002) (where plaintiff sought dismissal to refile in state court with additional co-plaintiff, court found dismissal appropriate to avoid confusion and duplicative lawsuits, despite that a substantial amount of discovery was complete, because there had been no pretrial conference, no motion for summary judgment and the case was not on the verge of trial).
A. The Opposing Party's Effort and Expense in Preparing for Trial
Cessna argues it has expended substantial effort in investigating and defending Plaintiff's claims here. In support of its argument, Cessna states it retained litigation counsel, hired an expert, produced documents in response to discovery requests, produced witnesses noticed up for depositions and conducted legal research for and drafted dispositive motions.
The Court is not persuaded that the first factor weighs against dismissal. As a preliminary matter, Cessna readily concedes in its briefing that it intentionally withheld discovery efforts in this lawsuit "to reduce costs and efforts in light of Plaintiff's [early] requests for mediation and [Plaintiff's January 10, 2003] motion to stay the case." Consistent with this concession, Cessna has failed to take any depositions in this case and, although it apparently has identified experts, has not produced the expert reports as required. Although Cessna did serve written discovery upon Plaintiff eleven days before the scheduled March 31, 2003 discovery deadline, it appears this discovery was not timely served given the scheduling order in this matter requires "all discovery [to] be commenced or served in time to be completed by [the discovery deadline]" and the federal rules allow the party served thirty days in which to respond to such discovery.
Cessna's Response to Plaintiff's Motion to Dismiss at p. 8 (doc. 57).
September 19, 2002 Scheduling Order (doc. 19) at Section II(c).
See, e.g., Fed.R.Civ.P. 33, 34 and 36.
Even if there is potential prejudice to Cessna with respect to the efforts it did in fact expend, such prejudice readily can be alleviated by curative conditions. While it is true that Cessna produced documents, responded to written discovery and produced five Cessna employees for deposition, Cessna cites to no rule of law prohibiting any or all of this discovery to be used in the English action. Using discovery already conducted here in the English case will minimize any legal prejudice to Cessna. And, notably, Cessna must defend against Raytheon's contribution claim in England, whether Plaintiff's claim proceeds or not. Even though the discovery produced in this case may not have been capable of exact duplication in England due to a more limited scope of inquiry, there has been no authority cited that would prohibit all such discovery from being used in the English action. Thus, it appears such discovery has not been wasted.
See Jenkins v. Unified Sch. District No. 501, 175 F.R.D. 582, 584 (D.Kan. 1997) (permitting the use of materials from discovery already conducted).
Moreover, the Court believes that any further prejudice can be cured by requiring Plaintiff to pay any duplicative expenses the Court finds were incurred by Cessna. Typically, a court imposes as a condition of dismissal without prejudice that the plaintiff pay the defendant's expenses incurred in defending the lawsuit, which may include a reasonable attorney's fee. Plaintiff has indicated he will pursue his claims against Cessna in England; therefore, requiring Plaintiff to pay any part of Cessna's expenses that are duplicative, including a reasonable attorney's fee, is a particularly appropriate condition in this case.
United States v. Rockwell Int'l Corp., 282 F.3d 787, 810 (10th Cir. 2002).
In sum, the Court believes the ability of the parties to use this discovery in the English case combined with Cessna's ability to seek reimbursement for any duplicative expenses will alleviate any legal prejudice to Cessna with respect to the efforts and expenses expended by Cessna to date in preparing for trial in this case.
B. Excessive Delay and Lack of Diligence by Plaintiff
In support of its argument that Plaintiff excessively delayed this lawsuit by failing to diligently pursue litigation of his claims, Cessna asserts Plaintiff wasted months of useful time in this case by aggressively pursuing mediation: first between the three parties in both cases and then between Plaintiff and Cessna in this case. Cessna further asserts Plaintiff excessively delayed its request to dismiss this suit and add Cessna as a defendant to his United Kingdom suit. Finally, Cessna alleges Plaintiff used this suit to acquire discovery from Cessna that could not have been obtained in Plaintiff's English lawsuit. Cessna argues it is prejudiced by these tactics.
Contrary to Cessna's assertions, the Court finds Plaintiff has been diligent in the prosecution of this case and has not caused excessive delay. During the course of discovery, Plaintiff served two different sets of written discovery requests, took five depositions and provided extensive Rule 26(a)(2) reports from four experts. Significantly, and as specifically directed by this Court, Plaintiff aggressively has pursued settlement since the lawsuit was filed. Plaintiff promptly moved to voluntarily dismiss this action on March 26, 2003, just three weeks after the unsuccessful mediation between Plaintiff and Cessna. Conversely, Cessna did not file written discovery until March 19, 2003 and did not file its motions to dismiss until March 24, 2003 — two and three weeks, respectively, after the unsuccessful mediation. Simply put, the Court finds Plaintiff proceeded with trial preparation simultaneously with Court imposed efforts to resolve matters through alternative dispute resolution.
Cessna also alleges Plaintiff never intended to prosecute his case in this Court, and that Plaintiff filed suit here against Cessna only to acquire discovery in this Court not otherwise available in the United Kingdom court. Plaintiff vehemently denies these allegations, maintaining it was the December 2002 third-party action filed by Raytheon against Cessna in the England case — bringing all three parties into the same litigation — that prompted Plaintiff to seek a stay and then dismissal of Plaintiff's lawsuit against Cessna here. Plaintiff argues it is more beneficial for all the parties to have the English case move forward, in which they are all present, rather than to have this case move forward in piecemeal fashion.
In response to Cessna's question as to why Plaintiff did not make a direct claim against Cessna in England before now, Plaintiff provides the following explanation:
Plaintiff's counsel sought pre-litigation mediation from both Cessna and Raytheon without success. By August 2001, plaintiff's counsel were concerned about potentially applicable statutes of limitations. To that end, they sought to obtain Tolling Agreements from both Cessna and Raytheon. Cessna cooperated, however, Raytheon would not agree to do so. Therefore, in order to protect his interests, plaintiff initiated a lawsuit September 17, 2001, against Raytheon in this Court. However, due to concerns about the appropriate venue in view of the contractual language between plaintiff and Raytheon, plaintiff could not effect appropriate service of process upon Raytheon in that case, and plaintiff dismissed on May 10, 2002, in favor of an action against Raytheon in England, the jurisdiction specified in the Raytheon Services Agreement.
In the meantime, the Tolling Agreement between plaintiff and Cessna had expired, and Cessna was unwilling to renew it. Accordingly, plaintiff had to proceed with litigation against Cessna. When plaintiff initiated his litigation against Raytheon in England on August 2, 2002, he did not add a claim against Cessna, because Cessna was already named and served in this case, and plaintiff was concerned that Cessna would seek a stay in the English action against it, based on the presence of this case (which Cessna has now done in the current English action). Furthermore, plaintiff's efforts were still focused upon mediation, and plaintiff was optimistic that mediation would eventually take place and be successful.
Plaintiff's Reply Memorandum at pp. 4-5 (doc. 61).
The explanations provided by Plaintiff in support of his decision to file suit against Cessna here, along with Plaintiff's diligent pursuit of this litigation prior to the third party claim filed in December 2002, persuade the Court that Plaintiff legitimately sought relief against Cessna in this Court and was not merely using this forum for discovery. In light of these circumstances, the Court finds Plaintiff did not unduly delay or fail to diligently pursue this litigation and Cessna will not be legally prejudiced if this case is dismissed. Accordingly, this second factor weighs in favor of dismissal without prejudice.
As this Court considers Cessna's position that it will be unfairly prejudiced by defending against Plaintiff's claims in the English action, the Court notes that Cessna already is under an obligation to defend itself in England against the same factual issues in the third-party contribution claim by Raytheon already pending.
C. Insufficient Explanation of the Need for Dismissal
The third factor, whether Plaintiff has a sufficient explanation for the need for a dismissal, requires the court to assess Plaintiff's explanation for seeking to dismiss this case without prejudice. Plaintiff alleges he cannot obtain satisfactory resolution of his claims without Raytheon and Cessna in the same case, and the only venue where that goal can be achieved is in England. More specifically, Plaintiff argues he cannot bring an action against Raytheon in this district due to the lack of personal jurisdiction over Raytheon, an English corporation who undertook the allegedly tortious acts at issue in England. Plaintiff further argues Plaintiff, Raytheon and Cessna currently are existing parties to the litigation pending in England and that, if Plaintiff's claims against Cessna are dismissed here, Plaintiff can pursue a direct claim against Cessna in England.
The Court finds that this is a sufficient justification for seeking dismissal without prejudice. To decide otherwise would result in an injustice to Plaintiff.
D. The Present Stage of the Litigation.
The last factor, the present stage of the litigation, also favors Plaintiff. While some discovery is complete, there is a significant amount of discovery that has not yet been performed and both parties have requested an additional 180 days of discovery in the event this motion to dismiss is denied. Simply put, the Court does not believe this case has progressed to a point that would weigh against dismissal. This is not a situation where the pretrial conference has been held and the case is on the verge of trial.
Although Cessna does have two dispositive motions pending, Plaintiff's motion to dismiss was filed on March 26, 2003, only two days after the dispositive motions were filed by Cessna and the motions are not yet ripe for ruling. Moreover, even if Cessna ultimately were to prevail on these motions, they would not dispose of all of Plaintiff's claims; thus, the case law cited by Cessna noting the significance of whether comprehensive summary judgment motions were pending are not applicable here.
Phillips USA, Inc. v. Allflex USA, Inc., 77 F.3d 354 (10th Cir. 1996) (affirming district court's decision to deny dismissal without prejudice, court specifically noted motion for summary judgment had been pending for four months, there had been a prior judgment against plaintiff in Australia, the trial court already had granted plaintiff additional time to conduct further discovery and plaintiff offered little explanation for decision to dismiss); 103 Investors I, L.P. v. Square D Co., 222 F. Supp.2d 1263 (D.Kan. 2002) (weighing heavily against plaintiff in balancing factors, court found defendant had taken multiple fact witness depositions and two expert witness depositions and already had filed motion for summary judgment and Daubert motions); Flake v. Hoskins, 98-2450-KHV, 2001 WL 30649 (D.Kan. Jan. 11, 2001) (finding dismissal inappropriate given there had been significant litigation surrounding attempted certification of class action, a summary judgment motion filed by the defendant with an order to show cause why the court should not enter summary judgment against plaintiff and plaintiff's motion was filed less than one week before trial).
III. Conclusion
Taken as a whole, the factors, as applied to this case, do not lead the Court to the conclusion that Cessna will suffer legal prejudice if this case is dismissed without prejudice if such dismissal is subject to a number of curative conditions. Accordingly, the Court grants Plaintiff's Motion to Dismiss Without Prejudice subject to the following terms and conditions:
(1) Plaintiff shall consent to the use, in any case refiled here and in the pending English action, of any material resulting from any discovery already conducted in this case, subject to British law on such use;
(2) Defendant has until June 13, 2003, to make a detailed showing to this Court of any expenses, including reasonable attorney's fees, that it believes would be duplicative if a subsequent action is filed either here or in England; Plaintiff shall have until June 27, 2003, to respond to that showing; and the Court will determine any amount as promptly as possible thereafter.
(3) Upon filing a subsequent action against Cessna in England or upon refiling this action here, Plaintiff shall be required to pay to Cessna any expenses this Court finds would be duplicative.
(4) Failure to pay the amount set forth by the Court within twenty days after filing in England or refiling here will convert this dismissal into a dismissal with prejudice. The Court will retain jurisdiction over this matter to entertain a motion by Cessna to so convert such a dismissal.
IT IS SO ORDERED.