Stegmeyer v. Peet

Filing 25

ORDER re 21 Notice/Motion to Voluntarily Dismiss Case filed by Charles H. Stegmeyer: For the reasons articulated in the attached Order, the Court will grant Plaintiff's motion to voluntarily dismiss (Doc. 21), but will condition dismissal < i>without prejudice on Plaintiff's payment of the reasonable costs (not attorneys' fees) incurred by Defendant herein. Alternatively, Plaintiff can opt to dismiss the case with prejudice (each party to bear his own costs), or Pl aintiff can withdraw the motion for voluntary dismissal altogether and this lawsuit shall go forward. Plaintiff has until June 30, 2016 to elect how to proceed. See Order for details. (Action due by Plaintiff by 6/30/2016.) Signed by Chief Judge Michael J. Reagan on 6/18/16. (soh)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ILLINOIS
CHARLES H. STEGMEYER,
Plaintiff,
vs.
FREDERICK PEET,
Defendant.

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Case No. 16-cv-0096-MJR-PMF

MEMORANDUM AND ORDER
REAGAN, Chief Judge:
Attorney Charles Stegmeyer represented Frederick Peet, a Missouri podiatrist, in
several lawsuits. Peet sued Stegmeyer in Missouri state court for legal malpractice in
May 2013. In December 2015, Stegmeyer sued Peet in Illinois state court for defamation,
alleging that Peet slandered and libeled Stegmeyer in the Missouri malpractice case.
Peet removed the Illinois defamation lawsuit to this Court in January 2016,
invoking subject matter jurisdiction under the federal question statute, 28 U.S.C. 1332.
Threshold review revealed a pleading defect as to the citizenship allegations, and Peet
cured that via amended removal notice in February 2016. Stegmeyer (proceeding pro se
herein) moved to remand, asserting that Defendant Peet was not actually a Missouri
citizen -- mainly because he owns a house and pays real estate taxes on it in Illinois.
That was a decent argument but proved unsuccessful. The undersigned denied the
remand motion on March 16, 2016.

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On May 31, 2016, Stegmeyer filed a notice of voluntary dismissal of this suit
without prejudice. The following day the Court entered an Order noting that since
Defendant Peet had filed an answer herein, the Court had to treat the notice as a motion
to voluntarily dismiss and allow Defendant to voice any objection. Defendant did so on
June 6, 2017, opposing the without prejudice dismissal of this action and offering
reasons why the dismissal should either be with prejudice or (if without prejudice)
subject to an award of fees and costs incurred by Defendant in this action (see Doc. 23).
Rule 41(a)(1)(A) allows a plaintiff to voluntarily dismiss a suit without a court
order by dismissal notice before the defendant answers or moves for summary
judgment or stipulation signed by all parties who have appeared. Neither of those
situations is present here, so any voluntary dismissal falls under Rule 41(a)(2), which
allows dismissal of an action by court order, on conditions the court finds appropriate.
Rule 41(a)(2) “authorizes the court to allow a voluntary dismissal upon such terms as
the court thinks proper,” Wells Fargo Bank, N.A. v. Younan Properties, Inc., 737 F.3d
465, 469 (7th Cir. 2013), and such dismissal is allowed at the court’s sound discretion.
See, e.g., F.D.I.C. v. Knostman, 966 F.2d 1133, 1142 (7th Cir. 1992); Tyco Laboratories,
Inc. v. Koppers, Co., 627 F.2d 54, 56 (7th Cir. 1980).
In assessing whether to permit the dismissal and on what terms, the court
should consider whether the defendant will suffer legal prejudice, looking to such
factors as the defendant’s expense in preparing the case for trial, any excessive delay or
lack of diligence on the part of the plaintiff in prosecuting the action, whether there is
an insufficient explanation for the dismissal, and whether a summary judgment motion
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has been filed by the defendant. Kunz v. DeFelice, 538 F.3d 667, 677-78 (7th Cir. 2008).
See also Wojtas v. Capital Guardian Trust Co., 477 F.3d 924, 927 (7th Cir. 2007).
Reasonable terms which may be imposed on voluntary dismissal include, for
example, requiring the plaintiff to compensate the defendant for its costs in the district
court. See, e.g., Wells Fargo, 737 F.3d at 469 (“it is reasonable to require the plaintiff to
compensate the defendants for any wasted motion forced upon them….”); Chavez v.
Illinois State Police, 251 F.3d 612, 655-56 (7th Cir. 2001) (affirming award of costs but
not attorney’s fees as condition to voluntary dismissal on the eve of trial). Payment of
the defendant’s costs offsets the possible prejudice a defendant might otherwise suffer
from plaintiff dismissing his complaint without prejudice. Babock v. McDaniel, 148
F.3d 797, 799 (7th Cir. 1998), citing Marlow v. Winston & Strawn, 19 F.3d 300, 303 (7th
Cir. 1994).
Having carefully considered the record before it, the Court concludes that
voluntary dismissal without prejudice would be appropriate here if Plaintiff pays
Defendant’s reasonable costs incurred in this action. The undersigned is cognizant that
the universe of litigation between these parties is not confined to this action, but the
relevant consideration under Rule 41 is the stage of the proceeding in the instant case,
and this case is less than five months old with trial scheduled a year away, no
dispositive motion filed herein, and a January 13, 2017 discovery cutoff. Plaintiff has
not explained the reason for seeking voluntary dismissal, but he is guilty of no excessive
delay in prosecuting this action. He quickly moved to remand the case, advancing a
plausible basis on which to do so, and he participated in submitting a joint report of the
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parties to the Magistrate Judge assigned to the case. An award of costs is a fair price to
pay for dismissal without prejudice, to compensate Defendant for what he incurred in
defending this lawsuit. Or Plaintiff can opt to dismiss with prejudice and without costs.
So, the Court will grant the motion to voluntarily dismiss (Doc. 21), but will
condition dismissal without prejudice on Plaintiff’s payment of the reasonable costs
incurred by Defendant herein. Alternatively, Plaintiff can agree to dismissal of the case
with prejudice (each party to bear his own costs).

A plaintiff seeking voluntary

dismissal should be given the option to accept the conditions the district court will
impose on that dismissal or (if he finds the conditions “too onerous”) withdraw the
motion and proceed with the case. Mother & Father v. Cassidy, 338 F.3d 704, 713 (7th
Cir. 2003), citing Marlow, 19 F.3d at 304; Chavez, 251 F.3d at 656.
Accordingly, Plaintiff has until June 30, 2016 to move to withdraw his May 31, 2016
motion for voluntary dismissal. If no motion to withdraw is filed by that date, the Court will
dismiss this case without prejudice, subject to payment of Defendant’s reasonable costs (which
will be submitted by Defendant via separate itemized statement for the Court’s review/approval).
As an alternative, Plaintiff may by June 30, 2016 file a supplement to his May 31st motion
agreeing to dismissal of the case with prejudice, and the Court will dismiss the case with
prejudice, with each party to bear his own costs.
IT IS SO ORDERED.
DATED June 18, 2016.

s/Michael J. Reagan
Michael J. Reagan
United States District Judge

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