Koch v. Liberty Mut. Fire Ins. Co.
| Decision Date | 03 November 2022 |
| Docket Number | 4:22-CV-3080 |
| Parties | KRISTINA KOCH, Plaintiff, v. LIBERTY MUTUAL FIRE INSURANCE CO., Defendant. |
| Court | U.S. District Court — District of Nebraska |
This matter is before the Court in a somewhat unusual procedural posture: Both parties want the case dismissed. The plaintiff however, wants to voluntarily dismiss it without prejudice, presumably pursuant to Fed.R.Civ.P. 41(a)(2). See filing 35. The defendant, Liberty Mutual, wants it dismissed with prejudice pursuant to Fed.R.Civ.P 12(c). Filing 30. The Court finds that Liberty Mutual has the better part of the argument, and will dismiss the plaintiff's complaint with prejudice.
The plaintiff was injured in a January 3, 2017 automobile accident with an underinsured motorist. Filing 16 at 3. She suffered permanent injuries and her car was totaled. Filing 16 at 4. The tortfeasor ultimately found responsible for the accident was insured to a policy limit of $100,000. Filing 16 at 7. The plaintiff was covered by an auto insurance policy issued by Liberty Mutual, which included underinsured motorist coverage for another $100,000. See filing 16 at 3; filing 17-1 at 4; filing 31-1 at 8.
On November 12, 2018, the plaintiff demanded her policy limits from Liberty Mutual based on documentation of more than $200,000 in damages.
Filing 16 at 5. Liberty Mutual refused coverage, and the plaintiff sued Liberty Mutual for breach of contract. Filing 16 at 5; filing 31-1 at 45-49.
On February 19, 2021, the tortfeasor tendered her $100,000 policy limit, and the plaintiff accepted it with Liberty Mutual's assent a few weeks later. Filing 16 at 7; filing 17 at 9. A month after that, Liberty Mutual offered to settle the plaintiff's breach of contract claim for $30,000. Filing 16 at 7. The plaintiff refused and the case was tried to a Lancaster County jury, which returned a verdict for the plaintiff in the amount of $2,600,000. Filing 16 at 8; filing 31-1 at 79. Judgment was ultimately entered on April 7, 2022 in the amount of $125,354.66, comprising the policy limits attorney's fees of $25,000, and costs of $354.66. Filing 17 at 10; filing 31-1 at 212-13.
The plaintiff initiated this case on May 6, 2022. Filing 1. The plaintiff filed an amended complaint on June 29, filing 16 and Liberty Mutual answered on July 13, filing 17. As relevant, the plaintiff's operative amended complaint seeks damages for Liberty Mutual's alleged bad faith handling of her underinsured motorist claim, and attorney's fees pursuant to Neb. Rev. Stat. § 44-359.[1] Filing 16.
Liberty Mutual filed its motion for judgment on the pleadings (filing 30) on September 6, arguing that the plaintiff's bad faith claim is precluded by virtue of her failure to assert it in the previous coverage litigation. See filing 32. On September 30, the plaintiff filed two documents: a brief (filing 36) opposing Liberty Mutual's motion for judgment on the pleadings, and a motion to dismiss without prejudice (filing 35). Liberty Mutual opposes the motion to dismiss. Filing 38.
As noted above, there are two issues here. The first is whether the plaintiff should be permitted to voluntarily dismiss her complaint without prejudice. Filing 35. The second is whether Liberty Mutual is entitled to dismissal with prejudice based on claim preclusion. Filing 30.
Rule 41(a)(1)(A)(i) provides that a plaintiff may voluntarily dismiss her case without the Court's permission by filing a notice of dismissal before the defendant serves an answer or motion for summary judgment. But Liberty Mutual has appeared and answered and opposes dismissal, so the plaintiff is not entitled to dismiss her claim as a matter of right. Rule 41(a)(1)(A) is out of play. Instead, the plaintiff can only rely on Rule 41(a)(2), which provides in relevant part that her "action may be dismissed at the plaintiff's request only by court order, on terms that the court considers proper."
A decision whether to allow a party to voluntarily dismiss a case rests upon the sound discretion of the court. In exercising that discretion, a court should consider factors such as whether the party has presented a proper explanation for its desire to dismiss; whether a dismissal would result in a waste of judicial time and effort; and whether a dismissal will prejudice the defendants. Likewise, a party is not permitted to dismiss merely to escape an adverse decision nor to seek a more favorable forum.
Thatcher v. Hanover Ins. Grp., Inc., 659 F.3d 1212, 1213-14 (8th Cir. 2011); see Tillman v. BNSF Ry. Co., 33 F.4th 1024, 1027 (8th Cir. 2022).
Here, however, the plaintiff has offered no explanation whatsoever for her desire to dismiss. Her motion contains only one sentence: "Plaintiff, Kristina Koch, moves the Court for a dismissal without prejudice of the above captioned matter." Filing 35. And she filed neither a brief in support of her motion, nor any reply to Liberty Mutual's opposition.
That leaves the Court with little choice, because the Eighth Circuit has been quite clear that it's an abuse of discretion to grant a plaintiff's motion for dismissal without prejudice after the defendant files a dispositive motion, if the plaintiff's motion "fails to disclose the reason for seeking the dismissal without prejudice" and "[t]he only possible basis for the dismissal without prejudice appears to be that plaintiff feared the trial court might grant the [defendant's] motion." See Williams v. Ford Motor Credit Co., 627 F.2d 158, 159-60 (8th Cir. 1980); see also Tillman, 33 F.4th at 1028; Hamm v. Rhone-Poulenc Rorer Pharms., Inc., 187 F.3d 941, 951 (8th Cir. 1999). The Court is obliged to address the plaintiff's purported reason for the voluntary motion to dismiss and determine whether the stated purpose is proper. Tillman, 33 F.4th at 1028; see Thatcher, 659 F.3d at 1214. The Eighth Circuit has "repeatedly noted the importance of inquiring into whether a party has a proper explanation for its desire to dismiss." Tillman, 33 F.4th at 1028. And a plaintiff's "failure to explain why voluntary dismissal is being sought and to advise what claims may be filed in a new action often justifies denying a motion to dismiss without prejudice." Id.
It is true that the other factors the Court must consider do not weigh heavily in favor of dismissal. The Court has expended very little time and effort on this case, because it is barely past the pleading stage. See Mullen v. Heinkel Filtering Sys., Inc., 770 F.3d 724, 728 (8th Cir. 2014). Nor does Liberty Mutual's claim to prejudice-that the plaintiff "has given Liberty Mutual the benefit of certainty and finality with respect to her pleadings and her waiver of objections to Liberty Mutual's outstanding discovery requests," filing 38 at 7-carry much weight. Legal prejudice means more than simply the possibility of defending another action. Mullen, 770 F.3d at 728; see Tillman, 33 F.4th at 1030. Nor is a defendant sufficiently prejudiced by losing the tactical advantage of a missed discovery deadline. Mullen, 770 F.3d at 728.
Nonetheless, the Court cannot overlook the plaintiff's complete failure to provide any explanation for voluntary dismissal without prejudice, much less a proper one. Accordingly, the Court will deny the plaintiff's motion to dismiss.
Liberty Mutual's claim preclusion argument is presented via a motion for judgment on the pleadings. As a general rule, a Rule 12(c) motion for judgment on the pleadings is reviewed under the same standard as a Rule 12(b)(6) motion to dismiss. Buckley v. Hennepin Cnty., 9 F.4th 757, 760 (8th Cir. 2021); Ginsburg v. InBev NV/SA, 623 F.3d 1229 1233 n.3 (8th Cir. 2010). Judgment on the pleadings is appropriate only when there is no dispute as to any material facts and the moving party is entitled to judgment as a matter of law. Rossley v. Drake Univ., 958 F.3d 679, 683 (8th Cir. 2020); Levitt v. Merck& Co., Inc., 914 F.3d 1169, 1171 (8th Cir. 2019). A Rule 12(c) motion requires the Court to view all facts pleaded by the nonmoving party as true and grant all reasonable inferences in favor of that party. Rossley, 958 F.3d at 683; Buckley, 9 F.4th at 760.
The Court generally may not consider matters outside the pleadings on a motion for judgment on the pleadings. von Kaenel v. Armstrong Teasdale, LLP, 943 F.3d 1139, 1143 (8th Cir. 2019). The Court may, however, consider some public records, materials that do not contradict the complaint, or materials that are necessarily embraced by the pleadings. Id.; see Buckley, 9 F.4th at 760; see also Planet Sub Holdings, Inc. v. State Auto Prop. & Cas. Ins. Co., Inc., 36 F.4th 772, 776 (8th Cir. 2022). That includes court records from previous proceedings. See Greenman v. Jessen, 787 F.3d 882, 887 (8th Cir. 2015); Porous Media Corp. v. Pall Corp., 186 F.3d 1077, 1079 (8th Cir. 1999).
Claim preclusion bars relitigation of any right, fact, or matter directly addressed or necessarily included in a former adjudication if (1) the former judgment was rendered by a court of competent jurisdiction, (2) the former judgment was a final judgment, (3) the former judgment was on the merits and (4) the same parties or their privies were involved in both actions. Marie v. State, 922 N.W.2d 733, 738 (Neb. 2019). The doctrine bars relitigation not only of those matters actually litigated, but also of those matters which might have been litigated in the prior action. Id. The doctrine rests on the necessity to terminate litigation and on the belief that a person should not be vexed twice for the same cause. Id. Accordingly, the judgment in a former action between the same parties is final as to every issue which could have been decided in that action. Lincoln...
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