Matthews et al. v. General RV Center et al.

Filing 35

OPINION and ORDER Granting Plaintiffs' 32 Motion to Voluntarily Dismiss and Denying as Moot Defendant's 23 Motion for Summary Judgment. Signed by District Judge Linda V. Parker. (RLou)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
ROBERT MATTHEWS and
COLLEEN MATTHEWS,
Plaintiffs,
Civil Case No. 16-13463
Honorable Linda V. Parker

v.
GENERAL RV CENTER, INC.
and ALLY FINANCIAL,
Defendants.
_______________________________/

OPINION AND ORDER GRANTING PLAINTIFFS’ MOTION TO
VOLUNTARILY DISMISS (ECF NO. 32) AND DENYING AS MOOT
DEFENDANT’S MOTION FOR SUMMARY JUDGMENT (ECF NO. 23)
This lawsuit arises from Plaintiffs’ purchase of a recreational vehicle from
Defendant General RV Center, Inc. (“General RV”) for which financing was
provided by Defendant Ally Financial (“Ally”). After the case was transferred to
this District from the Northern District of Ohio, Ally filed a motion to dismiss. In
response, Plaintiffs stipulated to the dismissal of their claims against Ally. (ECF
No. 20.) After General RV filed an Answer to Plaintiffs’ Complaint on November
9, 2016, this Court set a scheduling conference to establish inter alia deadlines for
discovery and dispositive motions. Before that conference, however, General RV
filed a motion for summary judgment. (ECF No. 23.) In response to the motion,
Plaintiffs filed a motion to voluntarily dismiss their claims with prejudice against

General RV. (ECF No. 32.) General RV opposes the motion, only to the extent
that it wants any dismissal conditioned on an award of costs and fees. (ECF No.
33.)
Rule 41(a)(2) of the Federal Rules of Civil Procedure requires a plaintiff to
seek an order of the court or stipulation of the opposing party to voluntarily
dismiss an action where, as is the case here, the opposing party has filed an answer
or motion for summary judgment. Fed. R. Civ. P. 41(a)(2). The decision whether
to dismiss a complaint under Rule 41(a)(2) lies within the sound discretion of the
court. Grover by Grover v. Eli Lilly & Co., 33 F.3d 716, 718 (6th Cir. 1994)
(citing Banque de Depots v. Nat’l Bank of Detroit, 491 F.2d 753, 757 (6th Cir.
1974)). “[I]t is an abuse of discretion for a [c]ourt to refuse to grant such a
dismissal with prejudice.” Bridgeport Music, Inc. v. Universal-MCA Music
Publ’g, Inc., 345 F. Supp. 2d 836, 841 (M.D. Tenn. 2004) (citing Smoot v. Fox,
340 F.2d 301, 302-03 (6th Cir. 1964)). Nevertheless, Rule 41(a)(2) authorizes
courts to impose “terms that the court considers proper” when granting a plaintiff’s
motion to voluntarily dismiss. Fed. R. Civ. P. 41(a)(2).
Among the factors considered in determining whether to award defense
costs under Rule 41(a)(2) are:
“(1) whether the plaintiff acted in good faith in bringing
and prosecuting the litigation; (2) whether the defendant
incurred substantial expenses in defending the action; (3)
whether the plaintiff delayed in bringing the motion to
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dismiss; and (4) whether the work performed can be used
in a subsequently filed action.”
Seals v. Scutt, No. 10-cv-15054, 2011 WL 1793331, at *2 (E.D. Mich. Apr.
20, 2011) (quoting Yetman v. CSX Transp., Inc., No. 08–1130, 2009 WL 35351, at
*3 (W.D. Mich. Jan.6, 2009) (citations omitted). For the following reasons, these
factors do not weigh in favor of an award of costs to General RV.
Plaintiffs were represented by counsel different from their current counsel
when they filed their Complaint in this matter. Plaintiffs state that they now are
moving to dismiss their claims against General RV because their current counsel
has determined that some of those claims have no merit under Michigan law and
that they lack a sufficient legal basis to counter the arguments General RV asserts
in its summary judgment motion with respect to their remaining claims. There
does not appear to have been any delay or lack of diligence on the part of Plaintiffs
in prosecuting the action. It also does not appear that General RV has expended
significant resources to defending this action. In fact, General RV represents in its
dispositive motion that no discovery is needed to be conducted to seek dismissal of
Plaintiffs’ claims. (ECF No. 23 at Pg ID 212.)
An award of attorney’s fees under Rule 41(a)(2) is generally only
appropriate when a lawsuit is voluntarily dismissed without prejudice. Colombrito
v. Kelly, 764 F.2d 122, 133 (2d Cir. 1985); see also Spar Gas, Inc. v. AP Propane,
Inc., No. 91-6040, 1992 WL 172129, at *2 (6th Cir. July 22, 1992) (quoting Smoot
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v. Fox, 353 F.2d 830, 933 (6th Cir. 1965) (“Smoot II”) (The rule in this circuit has
long been that attorneys’ fees are not awardable on a dismissal with prejudice, but
are permitted against the dismissing party on a dismissal without prejudice …”).
“The purpose of such awards is … to reimburse the defendant for the litigation
costs incurred, in view of the risk (often the certainty) faced by the defendant that
the same suit will be refiled and will impose duplicative expenses upon him.”
Colombrito, 764 F.2d at 133; see also Smoot II, 353 F.2d at 833. “The reason for
denying a fee award upon dismissal of claims with prejudice is simply that the
defendant, unlike a defendant against whom a claim has been dismissed without
prejudice, has been freed of the risk of relitigation of the issues just as if the case
had been adjudicated in his favor after a trial, in which event (absent statutory
authorization) the American Rule would preclude such an award.” Colombrito,
764 F.2d at 134. As such, an award of attorney’s fees following a dismissal with
prejudice must be pursuant to Federal Rule of Civil Procedure 11 (as sanctions) or
independent statutory authority. Degussa Admixtures, Inc. v. Burnett, 471
F.Supp.2d 848, 853 (W.D. Mich. 2007) (citing cases); Colombrito, 764 F.2d at 134
(“Several courts have held that a Rule 41(a)(2) award of fees [when a lawsuit is
dismissed with prejudice] is appropriate only when there is independent statutory
authority for such an award. This Circuit has previously assumed as much.”

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(citations omitted)). General RV does not provide the Court with such a basis for
an award of attorney’s fees in this case.
For the above reasons,
IT IS ORDERED that Plaintiffs’ motion to voluntarily dismiss their
Complaint with prejudice (ECF No. 33) is GRANTED;
IT IS FURTHER ORDERED that Defendant General RV Center, Inc.’s
motion for summary judgment (ECF No. 23) is DENIED AS MOOT.
s/ Linda V. Parker
LINDA V. PARKER
U.S. DISTRICT JUDGE
Dated: January 31, 2017
I hereby certify that a copy of the foregoing document was mailed to counsel of
record and/or pro se parties on this date, January 31, 2017, by electronic and/or
U.S. First Class mail.
s/ Richard Loury
Case Manager

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