Bigham v. Life Insurance Company of North America

Filing 27

OPINION. Signed by Honorable Judge Myron H. Thompson on 2/19/14. (scn, )

IN THE DISTRICT COURT OF THE UNITED STATES FOR THE
MIDDLE DISTRICT OF ALABAMA, SOUTHERN DIVISION

MAURINE BIGHAM,
Plaintiff,
v.
LIFE INSURANCE COMPANY OF
NORTH AMERICA,
Defendant.

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CIVIL ACTION NO.
1:13cv689-MHT
(WO)

OPINION
Plaintiff Maurine Bigham alleges that defendant Life
Insurance Company of North America (LINA) misled her into
believing that she was purchasing a significantly more
generous disability-insurance policy than she actually
did.

When she became disabled and the policy ended

earlier than she believed it would, she brought this
lawsuit making claims for fraud and breach of contract.
LINA brought a counterclaim that, rather than owing Bigham
more

on

her

insurance

policy,

overpaid her by $ 20,253.12.

the

company

actually

The court has diversity-of-

citizenship jurisdiction over Bigham’s claims, 28 U.S.C.

§

1332,

and

supplemental

jurisdiction

over

LINA’s

counterclaim, 28 U.S.C. § 1367.
This lawsuit is now before the court on Bigham’s
motion to add party and motion to dismiss her claims
without prejudice.

The court will grant the latter and

deny the former as moot.

The court will also dismiss

LINA’s counterclaim without prejudice.

I.

Background

Bigham now believes that her employer, Houston County
Healthcare

Authority

d/b/a

Southeast

Alabama

Medical

Center (SAMC), may have participated in or perpetrated the
fraudulent representations with regard to the disabilityinsurance policy.

She initially moved to add SAMC as a

defendant in this case, but, since SAMC and Bigham are
both citizens of Alabama, that would destroy diversity of
citizenship.

Therefore, Bigham has filed a separate suit

against SAMC in state court, and she now also moves to
dismiss this federal action, so she can pursue her claims

2

against both LINA and SAMC together and in full in state
court.
II.

Discussion
A.

After

a

defendant

has

answered

a

plaintiff’s

complaint, she may dismiss her case only by either signed
stipulation

of

all

parties,

Fed.

R.

Civ.

P.

41(a)(1)(A)(ii), or court order, Fed. R. Civ. P. 41(a)(2).
Because LINA does not consent to dismissal, her suit may
be dismissed only by court order.

The Eleventh Circuit

Court of Appeals has explained that:

“The district court

enjoys broad discretion in determining whether to allow a
voluntary dismissal under Rule 41(a)(2). ... [I]n most
cases, a voluntary dismissal should be granted unless the
defendant will suffer clear legal prejudice, other then the
mere prospect of a subsequent lawsuit, as a result. ... The
crucial question to be determined is, Would the defendant
lose

any

exercising

substantial
its

broad

right

by

equitable

3

the

dismissal.

discretion

...

under

In

Rule

41(a)(2),

the

district

court

must

weigh

the

relevant

equities and do justice between the parties in each case,
imposing such costs and attaching such conditions to the
dismissal as are deemed appropriate.” Pontenberg v. Boston
Scientific Corp., 252 F.3d 1253, 1255-1256 (11th Cir. 2001)
(internal citations removed) (quotation marks omitted)
(emphasis in original). In Pontenberg, the appellate court
held that delay and neglect by the plaintiff, even until
the summary-judgment stage, did not give rise to “clear
legal prejudice” which would justify refusal to dismiss a
plaintiff’s case.

Id. at 1256.

In this case, LINA admitted that it would face no
prejudice from dismissal, merely the loss of a preferred
forum. No depositions have been taken yet, and the written
discovery which has been exchanged will be useful to a
state lawsuit as well.

Indeed, LINA acknowledges that it

may in fact benefit from having SAMC as a fellow defendant
to share liability.

Bigham’s dismissal motion should be

granted.

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B.
Moreover, there is an alternative ground to dismiss
this lawsuit.

As stated, Bigham initially moved to add

SAMC as a defendant.

Joinder may be pursuant to either

Fed. R. Civ. P. 19 (“Required Joinder of Parties”) or Fed.
R. Civ. P. 20 (“Permissive Joinder of Parties”). Although
Bigham describes SAMC as a “necessary party,” her motion
does not identify which form of joinder she seeks, nor does
she describe how SAMC is a necessary party. The court will
treat the motion as a Rule 20 motion.

However, since SAMC

and Bigham are both citizens of Alabama, such permissive
joinder would destroy diversity of citizenship, with the
result that this case would have to be dismissed.
Under Rule 40(a)(2) of the Federal Rules of Civil
Procedure, discussed above, the focus was on prejudice to
the defendant--whether LINA would suffer “clear legal
prejudice.”

However, with regard to joinder, the focus is

also on the plaintiff, here Bigham.

The court should

consider whether plaintiff will be significantly injured

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if the joinder is not allowed, whether plaintiff has been
dilatory in asking for joinder, and any other factors
bearing on the equities.

Cf. Hensgens v. Deere & Co., 833

F.2d 1179, 1182 (5th Cir. 1987) (district court, when
confronted

with

an

amendment

to

add

a

nondiverse

nonindispensable party that would warrant remand, should
consider

a

number

factors

in

the

exercise

of

its

discretion), cert. denied, 493 U.S. 851 (1989).
Under these considerations, Bigham’s lawsuit should
still be dismissed.

First, it appears that Bigham desires

to pursue a proper claim against SAMC, since she alleges
that

an

SAMC

employee

was

the

one

misrepresented the terms of the policy.

who

fraudulently

Second, counsel

for Bigham represents that he did not learn about SAMC’s
involvement until about a month and a half ago.

Thus,

while it is true that Bigham waited several months before
seeking to amend her complaint or dismiss the action, she
has not been dilatory.

Third and finally, it would be in

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the best interest of all parties for the claims against
LINA and SAMC to be tried by the same factfinder.
Indeed,

the

fact

that

Bigham

has

met

these

more

rigorous considerations underscores the propriety of the
dismissal of this lawsuit.

C.
Rule 41(a)(2) of the Federal Rules of Civil Procedure
“also

allows

the

court

to

prevent

prejudice

to

the

defendant in such cases by attaching conditions to the
dismissal.” Pontenberg, 252 F.3d at 1258. Here, dismissal
will result in no prejudice to LINA; indeed, it appears
that the pursuit of Bigham’s claims against both LINA and
SAMC in one lawsuit will benefit LINA. The court therefore
sees no need to impose any conditions of dismissal on
Bigham.

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D.
When the court dismisses all claims over which it had
original

jurisdiction,

it

may

decline

to

exercise

supplemental jurisdiction over the remaining claims. 28
U.S.C. § 1367(c)(3). Since LINA’s counterclaim is for less
than

the

$

75,000

amount-in-controversy

minimum

for

diversity jurisdiction, 28 U.S.C. § 1332(a), there are no
remaining

claims

for

which

this

court

has

original

jurisdiction. When the court has the option of declining
to

exercise

should

be

supplemental
guided

by

jurisdiction,

“judicial

its

economy,

discretion

convenience,

fairness to the parties, and whether all the claims would
be expected to be tried together.” Palmer v. Hospital Auth.
of Randolph Cnty., 22 F.3d 1559, 1569 (11th Cir. 1994)
(citing United Mine Workers v. Gibbs, 383 U.S. 715, 726
(1966)).

It best furthers judicial economy, convenience

of the parties, and common sense for all of the claims
Bigham has against LINA and SAMC and the counterclaim LINA

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has against Bigham to be tried together, for they are all
factually interrelated.
***
For the above reasons, Bigham’s motion to dismiss will
be

granted

and

her

claims

will

be

dismissed

without

prejudice. Her motion to add party will be denied as moot.
LINA’s

counterclaim

prejudice.

will

also

be

dismissed

without

An appropriate judgment will be entered.

DONE, this the 19th day of February, 2014.

/s/ Myron H. Thompson
UNITED STATES DISTRICT JUDGE