Teck Gen. Partnership v. Crown Cent. Petroleum

• Decision Date: 04 December 1998
• Docket Number: No. CIV.A. 98-966-A.,CIV.A. 98-966-A.
• Citation: 28 F.Supp.2d 989
• Parties: TECK GENERAL PARTNERSHIP, Plaintiff, v. CROWN CENTRAL PETROLEUM CORPORATION, Defendant.
• Court: U.S. District Court — Eastern District of Virginia

28 F.Supp.2d 989

TECK GENERAL PARTNERSHIP, Plaintiff, v. CROWN CENTRAL PETROLEUM CORPORATION, Defendant.

No. CIV.A. 98-966-A.

United States District Court, E.D. Virginia, Alexandria Division.

December 4, 1998.

Jonathan S. Gelber, Arlington, VA, for Plaintiff.

Michael P. McGovern, McGuire, Woods, Battle & Boothe, Washington, DC, for Defendant.

MEMORANDUM OPINION

ELLIS, District Judge.

In this removed diversity environmental tort case, plaintiff's attempt to obtain a non-prejudicial dismissal pursuant to Rule 41(a)(2), Fed.R.Civ.P., is opposed by defendant. For the reasons set forth herein, plaintiff's motion must be denied.

I.

On June 19, 1998, plaintiff filed a motion for judgment in the Circuit Court for Fairfax County in the Commonwealth of Virginia alleging that its property has been damaged and contaminated by the migration of petroleum from defendant's property, a Crown Service Station, to plaintiff's adjoining property. Relying on strict liability and trespass theories, plaintiff seeks various damages, including diminution in property value. On July 7, 1998, plaintiff, in timely fashion, removed the action to the United States District Court for the Eastern District of Virginia. Thereafter, on August 10, 1998, a Scheduling Order was entered setting November 27, 1998 as the discovery cut-off date, and specifying that "[e]xpert discovery shall be conducted as provided by Local Rule 26(D). Experts not properly identified, and from whom a report has not been timely provided, shall not testify at trial for any purpose." (emphasis in the original). Under Local Rule 26(D)(2), which governs the timing of disclosure, absent a consent order to the contrary, plaintiff was required to make its Rule 26(a)(2), Fed.R.Civ.P., disclosures no later than sixty (60) days before the discovery cutoff, i.e., by September 28, 1998.

On September 14, 1998, plaintiff notified defendant that it had retained an environmental consultant as an expert. On October 7, 1998, plaintiff sent defendant a letter transmitting a draft copy of its expert's report and requested that defendant sign a consent order waiving the disregarded September 28, 1998 deadline for all expert disclosures. In that letter, the plaintiff also stated:

The alternative to signing a consent order is obviously a voluntary dismissal, without prejudice, under F.R.C.P. 41(a). Of course, this option would drag out the litigation needlessly, increase cost and sour any further settlement discussions.

In the circumstances, defendant declined to endorse the order. Thereafter, on October 23, 1998, plaintiff provided defendant with a final version of the expert's report on the issue of liability.

Defendant filed its answer to plaintiff's complaint on July 13, 1998. During the course of this litigation, defendant has also (i) responded to plaintiff's interrogatories and requests for admission, (ii) served its own interrogatories and document requests, (iii) filed and argued a motion to compel discovery arising out of document requests regarding plaintiff's financial performance to which plaintiff objected, and (iv) filed and argued a motion to compel depositions arising out of failed attempts to schedule the deposition of plaintiff's primary factual witness and its expert.¹ Furthermore, on November 13, 1998, defendant filed a motion to strike the testimony of plaintiff's expert, which motion was granted by the magistrate judge on November 20, 1998. No appeal was taken to the district court.

On November 17, 1998, after the motion to strike was filed, plaintiff filed a motion to dismiss without prejudice pursuant to Rule 41(a), Fed.R.Civ.P., on the basis that it could not complete discovery within the Scheduling Order's time limits. Specifically, plaintiff asserts that it had no time to conduct discovery against a defendant inadvertently omitted,² that plaintiff's expert was unable to complete its report before the date required,³ and that it cannot comply with this Court's "expedited discovery schedule." Defendant filed its opposition to the motion for voluntary non-prejudicial dismissal on November 30, 1998, and the matter is ripe for disposition. Because the facts and arguments are adequately presented in the pleadings, oral argument would not aid in the decisional process, and accordingly, the matter will be decided on the record.

II.

A motion to dismiss without prejudice pursuant to Rule 41(a)(2) is committed to the sound discretion of the district court.⁴ Typically, such a motion is granted unless there is "substantial prejudice" or "plain legal prejudice" to the defendant. See S.A. Andes v. Versant Corp., 788 F.2d 1033, 1036 (4th Cir.1986); Gross v. Spies, 133 F.3d 914, 1998 WL 8006, *5 (4th Cir.1998) (unpublished disposition). The focus of district courts when considering a motion to dismiss without prejudice is "primarily on protecting the interests of the defendant." See Davis v. USX Corp., 819 F.2d 1270, 1272 (4th Cir.1987). In this regard, circuit precedent identifies the following general factors as relevant to the prejudice issue:

(1) the opposing party's effort and expense in preparing for trial; (2) excessive delay or lack of diligence on the part of the movant; (3) insufficient explanation of the need for a dismissal; and (4) the present stage of the litigation, i.e., whether a motion for summary judgment is pending.

See Gross, 1998 WL at *5.⁵ Neither the mere prospect of a second lawsuit, nor the possibility that plaintiff will gain a tactical advantage, such as that which would be gained by refiling in state court, are sufficient prejudice to deny a motion for voluntary dismissal. See id.; see also Davis, 819 F.2d at 1275.⁶

These principles, applied here, compel the conclusion that plaintiff's motion must be denied. In this case, although there are no motions for summary judgment pending, defendant has expended significant effort and expense in litigating, much of which would be of no benefit in a second action were plaintiff permitted to dismiss this action without prejudice. Before the motion for voluntary dismissal was filed, defendant (i) removed the action, (ii) answered the complaint, (ii) answered interrogatories and requests for admission, (iii) served its own interrogatories and documents requests, (iv) filed two motions to compel, and (v) filed a motion to strike plaintiff's expert witness. These efforts by defendant do not, alone, qualify this case as one of "extreme prejudice," but they are nonetheless significant and weigh persuasively against granting a dismissal. See Andes, 788 F.2d at 1036 (answer, summary judgment, and discovery not extreme prejudice but are sufficient basis for denying voluntary motion to dismiss without prejudice).

In any event, there is more here which, when taken together with defendant's litigating efforts thus far, amounts to substantial or plain legal prejudice. Specifically, plaintiff's lack of diligence and disregard for the strictures of the pretrial order has led to defendant's moving to strike plaintiff's tardy expert disclosures. And significantly, this motion was granted by the magistrate judge,⁷ and plaintiff took no appeal to the district court, filing instead the instant Rule 41(a) motion to avoid this adverse discovery ruling. Yet, it is settled that a plaintiff may not obtain a non-prejudicial voluntary dismissal simply to circumvent adverse rulings. See Paturzo v. Home Life Ins. Co., 503 F.2d 333, 336 (4th Cir.1974). In Paturzo, the Fourth Circuit held that the district court, in denying plaintiff's motion for non-prejudicial voluntary dismissal, "appropriately considered" that plaintiff had waived the right to jury trial by failure to make a timely demand and was requesting a jury in the newly filed action. See id. ("Understandably, the court below did not want to permit plaintiff to use indirect methods to obtain those rights he had forfeited through his own lack of diligence."); see also Webb v. Altec Industries, Inc., 1994 WL 162815, *2 (N.D.Ill.1994) (denying Rule 41(a) motion on grounds that loss of favorable discovery ruling is prejudicial harm to defendant). Similarly, here, plaintiff's attempt to use a Rule 41(a) non-prejudicial dismissal to avoid the consequences of an adverse ruling resulting from its lack of diligence in discovery is a decisive factor weighing against non-prejudicial dismissal.⁸

Moreover, plaintiff's explanation of its reasons for seeking voluntary dismissal is wholly inadequate. In essence, plaintiff claims that it cannot meet the requirements of the Scheduling Order because discovery in this Court is in some sense "expedited." Yet it should have been apparent to plaintiff's counsel, as it is to any plaintiff's counsel, that removal of the case to federal court was a distinct possibility, if not probability, and that if this occurred, the matter would proceed expeditiously. A prudent plaintiff's counsel in a case of this sort would know that an expert would be required and thus retain one in advance of filing the complaint⁹ or take steps to do so soon thereafter. In the event that plaintiff's counsel did not adequately consider the possibility of removal and his readiness or ability to comply with the discovery time constraints applicable in this district, counsel should have promptly moved for a non-prejudicial dismissal soon after the case was removed. Yet, plaintiff's counsel did not do so, choosing instead to proceed with the litigation in a dilatory fashion and without regard for the deadlines imposed by the Scheduling Order. There is no good reason to reward such dilatory behavior with a non-prejudicial dismissal. Were the Court to rule otherwise, the Scheduling Order would be reduced to a mere exhortation or request, rather than an order, and the "just, speedy and inexpensive" administration of the docket would be impaired. See Rule 1, Fed.R.Civ.P.¹⁰ In short, non-prejudicial dismissal under Rule 41(a) is not available to rectify a plaintiff's...