Abbey Dental Center v. Consumer Opinion LLC

Filing 51

ORDER Granting Plaintiff's 48 Motion to Dismiss. Plaintiff's case is DISMISSED without prejudice to the refiling of a new case. The Clerk of Court shall close the case. Signed by Chief Judge Gloria M. Navarro on 8/9/2017. (Copies have been distributed pursuant to the NEF - SLD)

Download PDF
1 UNITED STATES DISTRICT COURT 2 DISTRICT OF NEVADA 3 ABBEY DENTAL CENTER, INC., 4 Plaintiff, 5 vs. 6 CONSUMER OPINION LLC, 7 Defendant. 8 ) ) ) ) ) ) ) ) ) Case No.: 2:15-cv-2069-GMN-PAL ORDER 9 Pending before the Court is the Motion to Dismiss, (ECF No. 48), filed by Plaintiff 10 11 Abbey Dental Center, Inc. (“Plaintiff”). Defendant Consumer Opinion LLC (“Defendant”) 12 filed a Response, (ECF No. 49), and Plaintiff filed a Reply, (ECF No. 50). For the reasons 13 discussed below, the Court GRANTS Plaintiff’s Motion. 14 I. 15 BACKGROUND This case arises out of Plaintiff’s trademark dispute under the Lanham Act, 15 U.S.C. 16 §§ 1114, 1125, regarding Plaintiff’s registered trademark of “Abbey Dental.” (First Am. 17 Compl. (“FAC”) ¶¶ 9-10, ECF No. 28). On October 27, 2015, Plaintiff filed its Complaint, 18 (ECF No. 1), and on December 8, 2016, Plaintiff filed its First Amended Complaint. 19 Defendant filed Motions to Dismiss, (ECF Nos. 25, 30) for both of Plaintiff’s Complaints and 20 alleged that Plaintiff’s suit is a Strategic Lawsuit Against Public Participation under Nevada 21 Revised Statute (“NRS”) 41.635–70 (“Anti-SLAPP Statute”). (See, e.g., Sec. Mot. to Dismiss 22 2:18–23, ECF No. 30). Additionally, Defendant filed a Motion for Summary Judgment, (ECF 23 No. 31). 24 25 On June 20, 2017, Plaintiff filed the instant Motion to Dismiss without Prejudice Pursuant to FRCP 41(a). (ECF No. 48). Plaintiff seeks to dismiss its own action because, although it alleges this case was originally filed in “a good-faith effort to protect its trademark,” Page 1 of 6 1 it is “no longer financially practicable to continue prosecuting this matter.” (Pl.’s Mot. to 2 Dismiss 2:9, 2:21). 3 II. 4 LEGAL STANDARD Rule 41(a)(2) freely permits the plaintiff, with court approval, to voluntarily dismiss an 5 action so long as no other party will be prejudiced. Fed. R. Civ. Pro. 41(a)(2); 9 Wright & 6 Miller, Federal Practice & Procedure: Civil, § 2364, at 165 (1971). Allowing the court to 7 attach conditions to the order of dismissal prevents defendants from being unfairly affected by 8 such dismissal. Id. Thus, “in ruling on a motion for voluntary dismissal, the District Court 9 must consider whether the defendant will suffer some plain legal prejudice as a result of the 10 dismissal.” Id. “Legal prejudice” means “prejudice to some legal interest, some legal claim, 11 some legal argument.” Smith v. Lenches, 263 F.3d 972, 976 (9th Cir. 2001). 12 Plaintiff’s voluntary dismissal with prejudice with each party to pay its own fees 13 amounts to judgment on the merits, and in such a case the defendant is technically the 14 prevailing party. Zenith Ins. Co. v. Breslaw, 108 F.3d 205, 207 (9th Cir. 2007) (abrogated on 15 other grounds). The prevailing party on a Lanham Act claim may be entitled to reasonable 16 attorney fees in exceptional cases. 15 U.S.C. § 1117(a) (“The court in exceptional cases may 17 award reasonable attorney fees to the prevailing party.”) (emphasis added). Exceptional 18 circumstances include when “a plaintiff’s case is groundless, unreasonable, vexatious, or 19 pursued in bad faith.” Interstellar Starship Servs., Ltd. v. Epix Inc., 184 F.3d 1107, 1112 (9th 20 Cir. 1999) (internal quotation marks omitted). Under the Lanham Act, an award of attorney’s 21 fees is within the district court’s discretion. The District Courts decision is reviewed under an 22 abuse of discretion standard. Stephen W. Boney, Inc. v. Boney Services, Inc., 127 F.3d 821, 825 23 (9th Cir. 1997). 24 25 “The Ninth Circuit has long held that the decision to grant a voluntary dismissal under Rule 41(a)(2) is addressed to the sound discretion of the District Court.” Hamilton v. Firestone Page 2 of 6 1 Tire & Rubber Co., Inc., 679 F.2d 143, 145 (9th Cir. 1982). In deciding whether to award fees 2 and costs relating to voluntarily dismissed claims, the district court has “broad fact-finding 3 powers” to grant or decline sanctions and that its findings warrant “great deference.” Smith v. 4 Lenches, 263 F.3d 972, 978 (9th Cir. 2001). 5 III. 6 DISCUSSION Plaintiff seeks dismissal because “Plaintiff has made a careful assessment of the Parties’ 7 financial resources and based on that assessment, has determined that pursuit of the case is no 8 longer financially feasible.” (Pl.’s Mot. to Dismiss 5:13–15). Defendant argues that Plaintiff’s 9 dismissal should be denied, and if it is granted, “it should be construed as a consent to the Anti- 10 SLAPP Motion, and thus should function as a dismissal with prejudice, and with all requested 11 attorneys’ fees granted.” (Resp. 3:20–22, ECF No. 49). Defendant continues that “this is not 12 only a SLAPP suit, but [also] an ‘exceptional case’ under the Lanham Act,” rendering 13 attorneys’ fees necessary in this situation as well. (Id. 3:22–23). The Court will first address 14 Defendant’s arguments concerning the SLAPP suit and then will address Defendant’s 15 arguments under the Lanham Act. 16 A. Anti-SLAPP Motion 17 A Strategic Lawsuit Against Public Participation (“SLAPP”) is a meritless suit that 18 seeks to use “costly, time-consuming litigation” to chill a person's constitutionally protected 19 right to free speech. See Metabolife Int’l, Inc. v. Wornick, 264 F.3d 832, 839 (9th Cir. 2001). 20 When a plaintiff files a SLAPP suit against a defendant, Nevada’s Anti-SLAPP Statute allows 21 the defendant to file a special motion to dismiss in response to the action. NRS 41.660(1). 22 Additionally, NRS 41.670(2) provides, “[i]f the court grants a special motion to dismiss filed 23 pursuant to NRS 41.660 . . . [t]he person against whom the action is brought may bring a 24 separate action to recover: (a) [c]ompensatory damages; (b) [p]unitive damages; and (c) 25 [a]ttorney’s fees and costs of bringing the separate action.” Page 3 of 6 1 Defendant argues that the Court should award Defendant fees under the Anti-SLAPP 2 statute “as there is a presumption that a defendant is the prevailing party in an Anti-SLAPP 3 motion when the plaintiff dismisses its claims prior to a hearing on an Anti-SLAPP motion.” 4 (Resp. 7:1–3). The Nevada Supreme Court holds, however, that “a defendant may not pursue 5 an action for damages and attorney fees pursuant to NRS 41.670(2) when the plaintiff 6 voluntarily dismisses the alleged SLAPP suit before a special motion to dismiss is filed or 7 granted.” Stubbs v. Strickland, 297 P.3d 326, 329 (Nev. 2013) (emphasis added). Although 8 Defendant has not pursued a specific action for damages, it is essentially doing so here in 9 seeking attorneys’ fees pursuant to the Anti-SLAPP Motion. (See Resp. 3:22; 3:25–27 n.1 10 (asserting that “attorneys’ fees are mandatory when a party brings a special motion to dismiss 11 under NRS 41.660 and prevails”)). The Court holds that pursuant to the Nevada Supreme 12 Court’s statement in Stubbs, Defendant is not entitled to a ruling on its Anti-SLAPP Motion as 13 it argues, and attorneys’ fees are not automatically entered in its favor. As such, Defendant’s 14 Anti-SLAPP argument for attorneys’ fees is not persuasive. 15 B. Lanham Act 16 Defendant next asserts that Plaintiff’s Motion should be denied because this is an 17 “exceptional case” under the Lanham Act. (Resp. 3:23). Specifically, Defendant avers that 18 “Plaintiff has abused the Lanham Act as a tool of censorship [and therefore] an award of fees is 19 warranted.” (Id. 3:24-25). 20 The prevailing party on a Lanham Act claim may be entitled to reasonable attorneys’ 21 fees in exceptional cases. 15 U.S.C. § 1117(a) (“The court in exceptional cases may award 22 reasonable attorney fees to the prevailing party.”). Exceptional circumstances include when “a 23 plaintiff’s case is groundless, unreasonable, vexatious, or pursued in bad faith.” Interstellar 24 Starship Servs., Ltd. v. Epix Inc., 184 F.3d 1107, 1112 (9th Cir. 1999). Moreover, under the 25 Lanham Act, an award of attorney’s fees is within the district court’s discretion. Page 4 of 6 1 In support of this theory for why it deserves attorneys’ fees, Defendant does not present 2 any argument as to why Plaintiff’s case is exceptional under the Lanham Act other than just 3 summarily alleging so. As such, the Court is not persuaded that this is an exceptional case and 4 will not presently award attorneys’ fees under the Lanham Act. 5 C. Rule 41(a) Legal Prejudice 6 Because the Court is not persuaded by any of Defendant’s arguments for attorneys’ fees, 7 the Court will now turn to the customary Rule 41(a) analysis as to whether Defendant will 8 suffer prejudice from this case’s dismissal. Defendant alleges that it “will suffer plain legal 9 prejudice” because Defendant believes and again asserts that it would have prevailed on its 10 11 Anti-SLAPP Motion, entitling it to attorneys’ fees. (Resp. 5:8–11). The Ninth Circuit has defined legal prejudice as including situations where dismissal of 12 a party would have rendered the remaining parties unable to conduct sufficient discovery to 13 untangle complex claims and adequately defend themselves. See Westlands Water Dist. v. 14 United States, 100 F.3d 94, 97 (9th Cir. 1996) (citing Hyde & Drath v. Baker, 24 F.3d 1162, 15 1169 (9th Cir. 1994)). Additionally, the Circuit in Westlands Water District acknowledged 16 similar situations of legal prejudice arising where dismissal without prejudice would result in 17 the loss of a federal forum, the right to a jury trial, or a statute-of-limitations defense. Id. 18 Moreover, “[w]e have explicitly stated that the expense incurred in defending against a lawsuit 19 does not amount to legal prejudice.” Id. 20 Here, Defendant has failed to show legal prejudice to prevent voluntary dismissal of this 21 action. Defendant does not plead loss of a federal forum, loss of right to a jury trial, or loss of a 22 statute-of-limitations defense. See id. Although Defendant is discernably upset over the 23 amount of fees incurred due to the progression of this lawsuit, Defendant fails to prove legal 24 prejudice to amount to an award of attorneys’ fees. Moreover, such requests for attorneys’ fees 25 Page 5 of 6 1 must be filed separately. See L.R. 54-14. Accordingly, the Court will grant Plaintiff’s Motion 2 to Dismiss without prejudice. 3 IV. 4 CONCLUSION IT IS HEREBY ORDERED that Plaintiff Abbey Dental’s Motion to Dismiss, (ECF 5 No. 48), is GRANTED. Plaintiff’s case is DISMISSED without prejudice to the refiling of a 6 new case. 7 IT IS FURTHER ORDERED that the Clerk of Court shall close the case. 8 9 DATED this _____ day of August, 2017. 9 10 11 ___________________________________ Gloria M. Navarro, Chief Judge United States District Judge 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Page 6 of 6

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?