Jackson v. Nationwide Insurance Company of America
Filing
53
OPINION AND ORDER that Plaintiff's Motion for Voluntary Dismissal Without Prejudice 34 is GRANTED. Plaintiff's claims against Defendant are DISMISSED WITHOUT PREJUDICE. IT IS FURTHER ORDERED that Defendant's Motion for Summary Judgme nt on Plaintiffs Complaint 37 is DENIED AS MOOT. IT IS FURTHER ORDERED that Defendant's Motion for Entry of Default Judgment 36 is GRANTED. The Clerk is DIRECTED to enter judgment in favor of Defendant against Plaintiff in the amount of $24,659.45. Signed by Judge William S. Duffey, Jr on 11/27/2013. (anc)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
MARION L. JACKSON,
Plaintiff,
v.
1:12-cv-2850-WSD
NATIONWIDE MUTUAL FIRE
INSURANCE COMPANY OF
AMERICA,
Defendant.
OPINION AND ORDER
This matter is before the Court on Plaintiff’s Motion for Voluntary
Dismissal Without Prejudice [34] (“Motion for Voluntary Dismissal”) and
Defendant’s Motion for Entry of Default Judgment [36] (“Motion for Default
Judgment”). Also before the Court is Defendant’s Motion for Summary Judgment
on Plaintiff’s Complaint [37] (“Motion for Summary Judgment”).
I.
BACKGROUND
On July 18, 2012, Plaintiff Marion L. Jackson (“Jackson”) filed this
insurance coverage action in the Superior Court of Fulton County, Georgia. In his
Complaint [1-1], Jackson alleges that, in August 2011, his home was burglarized
and that various articles of his personal property were stolen or damaged. He
further alleges that, in connection with these losses, he submitted an insurance
claim under his homeowner’s insurance policy (the “Policy”) with Defendant
Nationwide Mutual Fire Insurance Company of America (“Nationwide”). Jackson
alleges that, although Nationwide tendered some funds to him, Nationwide later
denied the insurance claim and refused to make additional payments. Jackson’s
Complaint asserts claims for breach of contract and bad faith against Nationwide.
On August 17, 2012, Nationwide removed this action to this Court. On
August 24, 2012, Nationwide filed its Counterclaim [2] alleging that Jackson
submitted falsified repair estimates in connection with his insurance claim and that
Nationwide paid to Jackson $24,659.45 based on these falsified estimates.
Nationwide asserts claims for fraud and breach of contract.
Jackson did not answer, or otherwise respond to, Nationwide’s
Counterclaim.1 On April 25, 2013, Nationwide moved for entry of default against
Jackson, which the Clerk granted on April 26, 2013.
On May 1, 2013, Jackson filed his Motion for Voluntary Dismissal seeking
leave to dismiss, without prejudice, his claims against Nationwide. On May 8,
1
On December 17, 2012, Jackson moved for leave to file an untimely answer to
the Counterclaim. On April 4, 2013, the Court denied Jackson’s motion because it
was offered more than three months after the deadline and offered no reason for
the multi-month failure to file.
2
2013, Nationwide filed its Motion for Default Judgment on its Counterclaim
against Jackson in the amount of $24,659.45.2 Jackson did not oppose, or
otherwise respond to, Nationwide’s Motion for Default Judgment.
II.
PLAINTIFF’S MOTION FOR VOLUNTARY DISMISSAL
Rule 41(a)(2) of the Federal Rules of Civil Procedure provides that after an
answer or motion for summary judgment has been filed, “an action may be
dismissed at the plaintiff’s request only by court order, on terms that the court
considers proper.” Fed. R. Civ. P. 41(a)(2). Unless otherwise specified in the
order, a dismissal under Rule 41(a)(2) is without prejudice. Id.
District courts have broad discretion to determine whether to allow a
voluntary dismissal under Rule 41(a)(2), although it is clear that in most instances
a dismissal without prejudice should be granted “unless the defendant will suffer
clear legal prejudice, other [than] the mere prospect of a subsequent lawsuit, as a
result.” Pontenberg v. Bos. Scientific Corp., 252 F.3d 1253, 1255 (11th Cir. 2001)
(quoting McCants v. Ford Motor Co., Inc., 781 F.2d 855, 856–57 (11th Cir.
1986)). “In exercising its broad equitable discretion under Rule 41(a)(2), the
district court must weigh the relevant equities and do justice between the parties in
2
On May 8, 2013, Nationwide filed its Motion for Summary Judgment on
Jackson’s claims.
3
each case, imposing such costs and attaching such conditions to the dismissal as
are deemed appropriate.” Id. (internal quotation omitted).
The purpose of Rule 41(a)(2) is to preclude voluntary dismissals that
inequitably affect the opposing party, and to allow the implementation of curative
conditions by the court. Farmaceutisk Laboratorium Ferring A/S v. Reid Rowell,
Inc., 142 F.R.D. 179, 181 (N.D. Ga. 1991) (citing McCants, 781 F.2d at 856).
“[W]hen exercising its discretion in considering a dismissal without prejudice, the
court should keep in mind the interests of the defendant, for Rule 41(a)(2) exists
chiefly for protection of the defendants.” Fisher v. P.R. Marine Mgmt., Inc., 940
F.2d 1502, 1503 (11th Cir. 1991). For Rule 41(a)(2) purposes, the plaintiff’s
interest in dismissal is “of little concern.” Farmaceutisk, 142 F.R.D. at 181 (citing
LeCompte v. Mr. Chip, Inc., 528 F.2d 601, 604 (5th Cir. 1976)). “[T]he prospect
of a second lawsuit on the same set of facts” is not sufficient legal prejudice to the
defendant to justify denying a plaintiff’s motion to dismiss without prejudice. See
McCants, 781 F.2d at 859; Durham, 385 F.2d at 368.
“The Eleventh Circuit has not explicitly adopted a list of factors that a trial
court should consider when determining whether a defendant would suffer ‘plain
prejudice’ versus ‘the mere prospect of a second lawsuit’” in deciding if dismissal
without prejudice is appropriate. Mosley v. JLG Indus. Inc., No. 7:03-cv-119HL,
4
2005 WL 2293567, at *3 (M.D. Ga. Sept. 20, 2005), aff’d, 189 F. App’x 874 (11th
Cir. 2006). The Mosley court noted, however, that the cases in our Circuit “have
hinged on various factors as the courts sought ‘to weigh the relevant equities and
do justice between the parties.’” Id. (quoting Stephens v. Ga. Dep’t of Transp.,
134 F. App’x 320, 323 (11th Cir. 2005)). That is, substantial discretion is vested in
the district court to evaluate what is a just resolution. As the Eleventh Circuit
explains: “[t]he crucial question to be determined is, Would the defendant lose any
substantial right by the dismissal[?]” Pontenberg, 252 F.3d at 1255 (quoting
Durham v. Fla. E. Coast Ry. Co., 385 F.2d 366, 368 (5th Cir. 1967)).
Nationwide asserts here that it will suffer prejudice if Jackson’s Motion for
Voluntary Dismissal is granted because discovery in this matter is concluded and
Nationwide’s Motion for Summary Judgment is now pending. The Court
disagrees. Although Nationwide may be required to duplicate some efforts in a refiled action, the Court notes that most, if not all, of the discovery conducted in this
matter will be available for use in a re-filed action, if a re-filed action is allowed.
Additionally, Nationwide’s Motion for Summary Judgment was not filed until after
Jackson filed his Motion for Voluntary Dismissal, and the Court has not ruled on
the Motion for Summary Judgment. See Conafay ex rel. Conafay v. Wyeth Labs.,
841 F.2d 417, 420 (D.C. Cir. 1988) (reversing the district court’s denial of
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voluntary dismissal where the defendant’s summary judgment was not filed until
after the filing of the motion for voluntary dismissal). On the facts and procedural
posture of this case, the Court finds that Nationwide will not “lose any substantial
right” by the dismissal of Jackson’s claims.3 Jackson’s Motion for Voluntary
Dismissal is granted.4
III.
DEFENDANT’S MOTION FOR DEFAULT JUDGMENT
A.
Legal Standard
Rule 55(b) of the Federal Rules of Civil Procedure governs the entry of
default judgments:
(1) By the Clerk. If the plaintiff’s claim is for a sum certain or a sum
that can be made certain by computation, the clerk—on the
plaintiff’s request, with an affidavit showing the amount due—
must enter judgment for that amount and costs against a defendant
who has been defaulted for not appearing and who is neither a
minor nor an incompetent person.
3
The Court notes that any potential inconvenience to Nationwide may be
diminished by the potentially preclusive effect of the default judgment to which
Nationwide is entitled on its counterclaims, as discussed below. See In re Bush, 62
F.3d 1319, 1325 (11th Cir. 1995) (“Where a party has substantially participated in
an action in which he had a full and fair opportunity to defend on the merits, but
subsequently chooses not to do so . . . , it is not an abuse of discretion for a district
court to apply the doctrine of collateral estoppel to prevent further litigation of the
issues resolved by the default judgment in the prior action.”).
4
Because the Court grants Jackson’s Motion for Voluntary Dismissal,
Nationwide’s Motion for Summary Judgment is moot and is denied on that basis.
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(2) By the Court. In all other cases, the party must apply to the court
for a default judgment. . . . If the party against whom a default
judgment is sought has appeared personally or by a representative,
that party or its representative must be served with written notice
of the application at least 7 days before the hearing. The court
may conduct hearings or make referrals . . . when, to enter or
effectuate judgment, it needs to:
(A) conduct an accounting;
(B) determine the amount of damages;
(C) establish the truth of any allegation by evidence; or
(D) investigate any other matter.
“The entry of a default judgment is committed to the discretion of the district
court . . . .” Hamm v. DeKalb Cnty., 774 F.2d 1567, 1576 (11th Cir. 1985) (citing
10A Charles Alan Wright et al., Federal Practice and Procedure § 2685 (1983)).
“In considering a motion for entry of default judgment, a court must investigate the
legal sufficiency of the allegations of the plaintiff’s complaint.” Bruce v. WalMart Stores, Inc., 699 F. Supp. 905, 906 (N.D. Ga. 1988).
B.
Analysis
1.
Fraud
Nationwide first seeks default judgment on its fraud claim. Under Georgia
law, fraud has five elements: (1) a false representation by the defendant; (2)
scienter; (3) intention to induce reliance by the plaintiff; (4) justifiable reliance by
the plaintiff; and (5) damages. Home Depot U.S.A., Inc. v. Wabash Nat’l Corp.,
724 S.E.2d 53, 60 (Ga. Ct. App. 2012). In this case, Nationwide alleges that
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Jackson intentionally made false representations to it by submitting falsified repair
estimates in connection with Jackson’s insurance claim. Nationwide further
alleges that Jackson intended to deceive Nationwide and that Nationwide relied on
the falsified estimates in making insurance payments to Jackson in the amount of
$24,659.45. These allegations, which the Court deems admitted, are sufficient to
show fraud on the part of Jackson. See id.; see also Eagle Hosp. Physicians, LLC
v. SRG Consulting, Inc., 561 F.3d 1298, 1307 (11th Cir. 2009) (“A ‘defendant, by
his default, admits the plaintiff’s well-pleaded allegations of fact.’” (quoting
Nishimatsu Constr. Co., v. Hous. Nat’l Bank, 515 F.2d 1200, 1206 (5th Cir.
1975))). Nationwide is entitled to judgment in the amount of $24,659.45.5
2.
Breach of Contract
Nationwide next seeks default judgment on its breach of contract claim.
Under Georgia contract law, “[t]he essential elements of a breach of contract claim
are (1) a valid contract; (2) material breach of its terms; and (3) damages arising
5
The Court notes that, despite being in default, Jackson retained the right to
contest the amount of Nationwide’s damages. See Gulf Coast Fans, Inc. v.
Midwest Elecs. Imps., Inc., 740 F.2d 1499, 1512 (11th Cir. 1984). Jackson did not
do so, and the Court thus considers the amount of Nationwide’s damages to be
unopposed. See Kramer v. Gwinnett Cnty., 306 F. Supp. 2d 1219, 1221 (N.D. Ga.
2004) (holding that, under Rule 7.1(B) of the Court’s Local Rules, “a party’s
failure to respond to any portion or claim in a motion indicates such portion, claim
or defense is unopposed”).
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therefrom.” TDS Healthcare Sys. Corp. v. Humana Hosp. Illinois, Inc., 880 F.
Supp. 1572, 1583 (N.D. Ga. 1995); see also Budget Rent-A-Car of Atlanta, Inc. v.
Webb, 469 S.E.2d 712, 713 (Ga. Ct. App. 1996). In this case, Nationwide alleges
the existence of a contract in the form of the Policy. Nationwide further alleges
that Jackson breached the Policy by submitting falsified repair estimates in
violation of a provision of the Policy excluding coverage if Jackson “intentionally
concealed or misrepresented any material fact or circumstance” in connection with
the loss. (See Counterclaim [2] ¶ 10.) Nationwide states that, because of
Jackson’s breach, it was damaged in the amount $24,659.45, the amount it paid,
but did not owe, under the Policy. These allegations, which the Court deems
admitted, are sufficient to show breach of the Policy by Jackson and that
Nationwide is entitled to judgment in the amount of $24,659.45.6 See TDS, 880 F.
Supp. at 1583; see also Eagle Hosp., 561 F.3d at 1307.
IV.
CONCLUSION
Accordingly, for the foregoing reasons,
IT IS HEREBY ORDERED that Plaintiff’s Motion for Voluntary
Dismissal Without Prejudice [34] is GRANTED. Plaintiff’s claims against
6
As noted above, Jackson did not contest the amount of Nationwide’s damages,
and the Court considers the amount to be unopposed. See Kramer, 306 F. Supp. 2d
at 1221.
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Defendant are DISMISSED WITHOUT PREJUDICE.
IT IS FURTHER ORDERED that Defendant’s Motion for Summary
Judgment on Plaintiff’s Complaint [37] is DENIED AS MOOT.
IT IS FURTHER ORDERED that Defendant’s Motion for Entry of
Default Judgment [36] is GRANTED. The Clerk is DIRECTED to enter
judgment in favor of Defendant against Plaintiff in the amount of $24,659.45.
SO ORDERED this 27th day of November, 2013.
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