Inspired Development Group, LLC v. Inspired Products Group, LLC

Filing 127

ORDER on Counter-Plaintiff's Motion for Voluntary Dismissal 55 . Signed by Judge Robin L. Rosenberg on 1/13/2017. (bkd)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF FLORIDA
CASE NO.:9:16-CV-80076-RLR
INSPIRED DEVELOPMENT GROUP,
LLC, a Florida limited liability company,
Plaintiff,
vs.
INSPIRED PRODUCTS GROUP, LLC,
d/b/a KIDSEMBRACE, LLC, a California
limited liability company,
Defendant.
_____________________________________
INSPIRED PRODUCTS GROUP, LLC,
d/b/a KIDSEMBRACE, LLC, a California
limited liability company,
Counter-Plaintiff,
vs.
INSPIRED DEVELOPMENT GROUP,
LLC, a Florida limited liability company, and
MITCHELL PRINE, individually,
Counter-Defendants.
____________________________________/
ORDER ON COUNTER-PLAINTIFF’S MOTION
TO VOLUNTARILY DISMISS ITS COUNTERCLAIMS
AND THIRD PARTY CLAIM WITHOUT PREJUDICE
THIS CAUSE is before the Court upon Defendant/Counter-Plaintiff Inspired Products
Group, LLC’s (“Inspired Products”) Motion for Voluntary Dismissal Without Prejudice of its
Counterclaims [DE 55]. The Court has reviewed the motion, response, reply and court file. For
the reasons set forth below, the Court imposes certain conditions upon Inspired Products which
must be met before the motion is granted.
The Complaint in this case was filed on January 14, 2016. Inspired Products answered
the Complaint and filed its counterclaims and third party claims [DE 15] on April 12, 2016.

Inspired Products alleged four counterclaims against Plaintiff/Counter-Defendant, Inspired
Development Group, LLC (“Inspired Development”) and one third party claim against Third
Party Defendant, Mitchell Prine. Prine owns fifty percent of Inspired Development and is its
managing member. Inspired Development and Prine are jointly represented by counsel and they
jointly answered the counterclaims and third party claim on April 12, 2016 [DE 28]. Discovery
in this case closed on November 22, 2016, a little over seven months after the counterclaim and
third party claim were filed. [DE 52]. No party has ever moved for a continuance of the trial
date, which is presently scheduled to commence on February 6, 2017. Inspired Products filed its
Motion for Voluntary Dismissal of the counterclaims and third party claim pursuant to Fed. R.
Civ. P. 41(a)(2) on December 1, 2016, prior to any summary judgment motions being filed in
this case.
“District courts enjoy broad discretion in determining whether to allow a voluntary
dismissal under Rule 41(a)(2).” Pontenberg v. Boston Scientific Corp., 252 F.3d 1253, 1255
(11th Cir. 2001). The purpose of Rule 41(a)(2) “is primarily to prevent voluntary dismissals
which unfairly affect the other side, and to permit the imposition of curative conditions.”
McCants v. Ford Motor Co., 781 F.2d 855, 856 (11th Cir. 1986). However, “[i]n most cases, a
voluntary dismissal should be granted unless the defendant will suffer clear legal prejudice, other
than the mere prospect of a subsequent lawsuit, as a result.” Pontenberg, 252 F.3d at 1255.
(emphasis in original). “The crucial question to be determined is, would the defendant lose any
substantial right by the dismissal.” Id., at 1255-1256 (emphasis added).
Inspired Development and Prine argued they would suffer prejudice if the counterclaims
and third party claim are dismissed because they incurred attorney time in defending these claims
through discovery, which included several depositions as well as written discovery and

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document production. The Court is without sufficient knowledge, however, that: (1) Inspired
Development and Prine have undertaken written discovery, document production, or depositions
in this case that are (2) related only to Inspired Product’s counterclaims or third party claim. To
the extent Inspired Development and Prine have incurred expenses that may be traced solely to
their defense of Inspired Product’s counterclaims, the Court questions the extent of such
expenses when juxtaposed with the expenses each side has occurred in connection with the
prosecution and defense of Inspired Development’s complaint. For example, the first, second,
and third counts of Inspired Products’ counterclaim closely mirror its sixth, seventh, and eighth
affirmative defenses. Discovery in this case would have been similar regardless of the filing of
counterclaims and third party claim. Inspired Development and Prine fail to show any “clear
legal prejudice” that amounts to the loss of a “substantial right.”
Even if there were a showing that Inspired Product’s claims required some additional
discovery, clear legal prejudice, bad faith, or similar grounds are required to deny the motion.
See, e.g., Goodwin v. Reynolds, 757 F.3d 1216, 122 (11th Cir. 2014) (dismissal without prejudice
affirmed where no legal prejudice or bad faith); Stachurski v. Wright Med. Tech., Inc., 2013 WL
12095269, at *2 (S.D. Fla. Nov. 27, 2013) (granting motion to voluntarily dismiss and finding
expense of resources to defend action did not constitute legal prejudice); Wilber v. Maryland
Cas. Co., 2013 WL 12096397, at *1 (S.D. Fla. Oct. 17, 2013) (granting motion to voluntarily
dismiss without prejudice even though case had been pending a year because no showing of
excessive delay or other dilatory efforts).
Inspired Development and Prine did not argue, nor did they demonstrate, any showing of
bad faith. There is also no evidence of delay by Inspired Products. Inspired Products never
moved to extend the discovery cut-off, nor the trial date. The case is set to begin trial only ten

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months after the counterclaim and third party claim were filed. Without evidence of bad faith,
extra discovery, or dilatory tactics by Inspired Products, there is no basis to deny this motion for
voluntary dismissal.
Inspired Development and Prine additionally argue they would suffer prejudice because
their subsequently filed motions for summary judgment are pending and the motion for
voluntarily dismissal is an attempt to avoid an adverse ruling on their summary judgment
motions. This too is insufficient to show legal prejudice or loss of a substantial right. In the
Eleventh Circuit, “mere pendency of a summary judgment motion, by itself, does not constitute
legal prejudice sufficient to support a denial of Rule 41(a)(2) voluntary dismissal without
prejudice.” Pontenberg, 252 F.3d at 1258. Although summary judgment motions are pending
on the counterclaims and third party claim, Inspired Products filed its motion for voluntary
dismissal prior to the filing of any summary judgment motions.

Prine filed his summary

judgment motion [DE 58] on December 1, 2016 several hours after Inspired Products filed its
motion for voluntary dismissal. Inspired Development filed its summary judgment motion the
following week on December 7, 2016. Considering the motion for voluntary dismissal was filed
prior to either summary judgment motion, and also considering Inspired Products opposed those
summary judgment motions and maintains its responses are meritorious, Inspired Products
cannot be convincingly accused of dismissing its claims in an attempt to avoid an adverse
summary judgment ruling. Regardless, there is still no evidence of bad faith or dilatory tactics.
The Court finds no basis to deny Inspired Products’ motion to voluntarily dismiss these claims.
Notwithstanding the Court’s decision that Inspired Products’ motion should not be
denied, the Court may grant a voluntary dismissal upon “such terms and conditions as the court
deems proper.” The rule affords the Court this discretion for the protection of defendants. See,

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e.g., LeCompte v. Mr. Chip, Inc., 528 F.2d 601, 604-05 (5th Cir. 1976) (“[T]he district court
should impose only those conditions which will alleviate the harm caused to the defendant.”).
Inspired Development and Prine argue that in the event the dismissal is granted, that Inspired
Products should be required to pay their reasonable attorney fees upon dismissal.
It has become commonplace for district courts to require a plaintiff to pay a defendant’s
costs in connection with Rule 41(a)(2) dismissals. See generally CHARLES ALAN WRIGHT ET AL.,
FEDERAL PRACTICE

AND

PROCEDURE § 2366 (3d ed.) (collecting cases). The Court may also

impose a condition of payment of attorney’s fees, however, any award of attorney’s fees must be
limited to fees for services that will not be useful in a subsequent lawsuit. Id.; see also Parrish v.
Ford Motor Co., 299 F. App’x 856, 860-61 (11th Cir. 2008). For example, the costs of filing
motions, making copies of motions, and preparing motions only useful in the original action may
be recovered, see McLaughlin v. Chesire, 676 F.2d 855, 857 (D.C. Cir. 1982), but fees incurred
in connection with discovery are not recoverable as discovery materials may be useful in
subsequent litigation. See, e.g., WRIGHT, supra, § 2366 (collecting cases).
The Court finds that in light of the amount of time that passed in this case prior to the
filing of the motion before the Court, there is a possibility that Inspired Development and Prine
have incurred expenses that could be reimbursed pursuant to the limitations described in cases
such as McLaughlin v. Chesire, cited above. As a result, this Court will impose the following
condition upon Inspired Product’s request for dismissal. Inspired Product’s motion shall be
granted, provided that if Inspired Products refiles its claims at a later date, such a filing must be
preceded by a full payment of attorney’s fees and costs to Inspired Development and Prine that
(1) Inspired Development and Prine incurred that were not useful in a subsequent lawsuit and (2)
Inspired Development and Prine incurred solely in connection with Inspired Product’s

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counterclaims and third party claim. See Potenberg v. Boston Scientific Corp., 252 F.3d 1253
(11th Cir. 2001).
Inspired Products shall have two (2) days from the date of rendition of this Order to file a
notice indicating its agreement of the conditions upon which this Court will permit a voluntary
dismissal. See Elbaor v. Tripath Imaging, Inc., 279 F.3d 314, 320 (5th Cir. 2002) (holding that a
plaintiff must be given the opportunity to refuse the conditions imposed by a court on a Rule
41(a)(2) dismissal). In the event Inspired Products does not agree to these conditions, the Court
will deny Inspired Product’s motion. In the event Inspired Products agrees to these conditions,
the Court will grant Inspired Product’s motion.
Accordingly, it is hereby ORDERED AND ADJUDGED that Inspired Product’s Motion
for Voluntary Dismissal Without Prejudice of its Counterclaims [DE 55] will be GRANTED
contingent upon the Inspired Product’s agreement to the conditions described in this Order.
Inspired Products is ORDERED to file a notice within two (2) days of the date of rendition of
this Order regarding its position as to the above conditions..
DONE AND ORDERED in Chambers, Fort Pierce, Florida this 13th day of January,
2017.

_____________________________
ROBIN L. ROSENBERG
United States District Judge

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