Red Hed Oil, Inc. et al v. The H.T. Hackney Co. et al

Filing 49

MEMORANDUM OPINION & ORDER: (1) the court construes pla's motion under Rule 41(a)(1)(A)(ii) for voluntary dismissal with prejudice as to dft H.T. Hackney Company as a motion under Rule 21; (2) GRANTING 48 Motion; (3) all claims against The H.T. Hackney Co. are DISMISSED WITH PREJUDICE; (4) the stipulation of dismiss does not apply to dft NJoy, Inc. Signed by Judge Joseph M. Hood on 10/29/18.(KJR)cc: COR

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF KENTUCKY
CENTRAL DIVISION at LEXINGTON

RED HED OIL, INC., doing
business as REDI MART NO. 9,
et al.
Plaintiffs,
v.
THE H.T. HACKNEY CO., et al.,
Defendants.

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Civil Case No.
5:17-cv-180-JMH
MEMORANDUM ORDER
AND OPINION

***
Plaintiffs Red Head Oil, Inc. and Federated Mutual Insurance
Company and Defendant The H.T. Hackney Company move the Court for
voluntary dismissal pursuant to Fed. R. Civ. P. 41(a)(1)(A)(ii).
[DE 48].

The moving parties have notified the Court that a

settlement has been reached and move for dismissal of the claims
with prejudice.

[Id.].

But here, the moving parties have chosen the wrong procedural
vehicle to reach their desired destination.

Under Sixth Circuit

law, Rule 41 permits a plaintiff to voluntarily dismiss only the
entire controversy, not a portion of the claims.

Philip Carey

Mfg.

Cir.

Co.

v.

Taylor,

286

F.2d

782,

785

(6th

1961).

Additionally, Rule 41(a)(1)(A)(ii) requires “a stipulation of
dismissal signed by all parties who have appeared.”
added).

1 

(emphasis

But because the Court construes filings “by their substantive
content and not by their labels,” this Court will consider the
current Motion under Rule 21.

See Coleman v. Ohio State Univ.

Med. Ctr., No. 2:11-cv-0049, 2011 WL 3273531, at *3 (S.D. Ohio
Aug. 1, 2011).

For the reasons stated herein, the moving parties’

Motion, when considered under Rule 21, is GRANTED.
I.
Red

Head

and

Procedural History

Federated

brought

this

products

liability

lawsuit in March 2017 in Madison Circuit Court against seven
defendants.

[DE 1-1].

Defendant Logic Technology Development

removed the case to federal court in April 2017 based on diversity
jurisdiction pursuant to 28 U.S.C. §§ 1441 and 1332.

[DE 1].

On May 3, 2017, the matter was stayed as to Defendant NJoy,
Inc. [DE 16] after NJoy filed a suggestion of Chapter 11 bankruptcy
[DE 13].

Subsequently, all claims against Defendants Swisher

International,

Inc.,

Logic

Technology

Development

LLC,

Spark

Industries LLC, R.J. Reynolds Vapor Company, and Fontem Ventures
B.V. were dismissed.

[DE 37].

Thus, H.T. Hackney and NJoy became

the only remaining defendants in this action.
The current stipulation of dismissal is signed by counsel for
Red Head Oil, Federated Mutual Insurance, and H.T. Hackney, but is
not

signed

by

counsel

for

NJoy.

As

a

result,

the

current

stipulation of dismissal is not signed by all parties who have
appeared in the action.
2 

II.
“Except

as

provided

Analysis

in Rule

41(a)(1),

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).

Rule

41(a)(1) allows dismissal of actions without a court order when a
plaintiff files the notice of dismissal either (1) before the
opposing party serves an answer or motion for summary judgment or
(2) plaintiff presents a dismissal signed by all parties who have
appeared.

Fed. R. Civ. P. 41(a)(1).

Under either Rule 41 method, a plaintiff may dismiss only an
“action.”

In Philip Carey Manufacturing Company v. Taylor, the

Sixth Circuit interpreted “action” to mean “entire controversy.”
286 F.2d 782, 785.

The Court held that Rule 41 did not allow a

court to dismiss claims against some, but not all, defendants in
a single case.

Id.

Recently, this Court issued an opinion explaining the state
of the law regarding Rule 41(a) in the Sixth Circuit.

United

States ex rel. Doe v. Preferred Care, Inc., 326 F.R.D. 462 (E.D.
Ky. 2018). Ultimately, while some circuits disagree with the Sixth
Circuit’s interpretation of Rule 41(a), this Court is bound by
Sixth Circuit precedent.

See id. at 464; see, e.g., Van Leeuwen

v. Bank of Am., N.A., 304 F.R.D. 691, 693–94 (D. Utah 2015)
(discussing the circuit split and citing cases).

Thus, the moving

parties here may not dismiss a single defendant under Rule 41.
3 

But

the

moving

parties

defendant under Rule 21.

may

seek

dismissal

of

a

single

See Taylor, 286 F.2d at 785 (“we think

that [Rule 21] is the one under which any action to eliminate” a
single defendant should be taken); see also Letherer v. Alger Grp.,
LLC, 328 F.3d 262, 266; Wilkerson v. Brakebill, No. 3:15-CV-435TAV-CCS, 2017 WL 401212 (E.D. Tenn. Jan. 30, 2017) (“Rule 21 is
the more appropriate rule”); Columbia Gas Transmission, LLC v.
Raven Co., Inc., No. 12-CV-72-ART, 2014 WL 12650688, at *1; Lester
v. Wow Car Co., Ltd., No. 2:11-cv-850, 2012 WL 1758019, at *2, n.2
(S.D. Ohio May 16, 2012) (“the Sixth Circuit has suggested that
dismissal of an individual party, as opposed to an entire action,
is properly conducted pursuant to Rule 21, not Rule 41”).

Warfel

v. Chase Bank USA, N.A., No. 2:11-cv-699, 2012 WL 441135, at *2
(S.D. Ohio Feb. 10, 2012). Thus, the Court construes the current
Motion under Rule 21.
“On motion or on its own, the court may at any time, on just
terms, add or drop a party.”

Fed. R. Civ. P. 21.

The rule applies

where “no relief is demanded from one or more of the parties joined
as defendants.”

Letherer, 328 F.3d at 267. Under the rule, Courts

must consider prejudice to the nonmoving party.

See Wilkerson,

2017 WL 401212, at *2; Arnold v. Heyns, No. 13–14137, 2015 WL
1131767, at *4 (E.D. Mich. Mar. 11, 2015).
with

Rule

41

standards

“as

prejudice to the non-movant.”

guidance

evaluating

potential

Wilkerson, 2017 WL 401212, at *2.
4 

in

The inquiry overlaps

Courts determine whether the nonmoving party would suffer “plain
legal prejudice” and consider: (1) defendant’s effort and expense
of preparation for trial; (2) excessive delay and lack of diligence
on plaintiff’s part in prosecuting the case; (3) insufficient
explanation for the need for dismissal; and (4) whether a motion
for summary judgment is pending.”

Grover v. Eli Lily & Co., 33

F.3d 716, 718 (6th Cir. 1994).
Here, dismissal is proper under Rule 21.

The only issue with

the motion under Fed. R. Civ. P. 41(a)(1)(A)(ii) is that all
parties

that

stipulation

have

of

stipulation.

appeared

dismissal
Still,

all

have

because
other

not

signed

NJoy

has

parties

have

the

not

voluntary

signed

agreed

to

the
the

stipulation of dismissal.
Additionally, NJoy, the only nonmoving party, will not suffer
any prejudice because of the dismissal.

NJoy has likely spent

little time and invested few resources in defending this action
considering the pending bankruptcy action and current stay of the
claims as to NJoy.

Furthermore, there has been no excessive delay

on the part of the Plaintiffs.
prosecuted

this

case

as

The Plaintiffs have diligently

evidenced

by

the

settlement

of

all

remaining claims against H.T. Hackney. Finally, the moving parties
have provided good reasons for the proposed dismissal and there
are

no

pending

motions

for

summary

5 

judgment.

As

a

result,

dismissal of all claims against Defendant H.T. Hackney is proper
under Rule 21.
Thus, for the reasons stated herein, IT IS ORDERED as follows:
(1)

The

Court

construes

Plaintiff’s

Motion

under

Rule

41(a)(1)(A)(ii) for Voluntarily Dismissal with Prejudice
as to Defendant H.T. Hackney Company [DE 48] as a Motion
under Rule 21;
(2)

The Motion [DE 48] is GRANTED;

(3)

All claims against Defendant The H.T. Hackney Company
are hereby DISMISSED WITH PREJUDICE; and

(4)

The stipulation of dismissal [DE 48] does not apply to
Defendant NJoy, Inc.

This the 29th day of October, 2018.

6