Ken-Mac Metals, a division of Thyssenkrupp Materials NA, Inc. v. Independent Sheet Metal, Inc., dba Independent, Inc.

Filing 55

ORDER GRANTING Ken-Mac's # 50 Motion to Dismiss counterclaim. FURTHER ORD that Independent's # 27 Amended counterclaim is DISMISSED. Signed by Magistrate Judge Valerie P. Cooke on 5/19/2011. (Copies have been distributed pursuant to the NEF - DRM)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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KEN-MAC METALS
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Plaintiff,
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v.
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INDEPENDENT SHEET METAL, INC. )
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Defendant.
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3:09-cv-00693-VPC

ORDER
May 19, 2011

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Before the court is plaintiff Ken-Mac Metal’s (“Ken-Mac”) motion to dismiss counterclaim

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(#50).1 Independent Sheet Metal (“Independent”) did not oppose. Ken-Mac filed a reply in support

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of its motion (# 53). Upon thorough review of the unopposed motion, the court grants Ken-Mac’s

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motion to dismiss counterclaim (#50).

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I. FACTUAL & PROCEDURAL BACKGROUND

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The present dispute is based upon an order for stainless steel that Independent, a

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manufacturer of kitchen hoods, placed with Ken-Mac. Id. Ken-Mac delivered the steel pursuant to

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Invoice No. 58851, for the amount of $59,462.74, and Invoice No. 59139, for the amount of

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$43,441.40. Id. at 2. Independent accepted the steel, but did not pay the amounts due for either

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invoice. Id. Ken-Mac filed a complaint alleging that Independent breached its contract, account

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stated, and quasi contract by not paying for the steel it received from Ken-Mac (#1). Independent

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filed an amended counterclaim against Ken-Mac alleging breach of contract and breach of the

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implied warranty of fitness for a particular purpose (#27). Independent alleges that Ken-Mac

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delivered defective steel, causing Independent to incur expenses to repair the nonconforming sheets

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of steel. Id.

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In preparation for trial, the parties engaged in discovery and submitted a joint pre-trial order

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Refers to the court’s docket number.

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on October 19, 2010, which the court adopted on December 14, 2010 (#s 41 & 42). During a hearing

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on January 21, 2011, the court granted Theirry V. Barkley and the law firm of Thorndal, Armstrong,

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Delk, Balkenbush & Eisinger’s motion to withdraw as counsel of record for Independent (#48).

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Counsel sought withdrawal because Independent “confirmed that it [wa]s unable to pay for services

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previously incurred as part of the defense in this matter and will not be able to pay the attorneys’ fees

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and costs that would be incurred if the firm continue[d] to represent [Independent] in this matter”

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(#44, p. 3). Mr. Steven Williams, President of Independent, attended the hearing at which the court

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granted the motion and confirmed that he is unable to obtain replacement counsel and not able to

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continue with the litigation due to cost (#48). The court explained to Mr. Williams that he may not

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proceed pro se on behalf of the corporation, vacated the scheduled bench trial, and instructed Ken-

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Mac to determine how to proceed with its claims. Id.

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Approximately one month later, on February 28, 2011, and March 1, 2011, Ken-Mac filed

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its motions for judgment on partial findings and motion to dismiss counterclaim (#s 49 & 50). The

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court issued a minute order on March 28, 2011, noting again that Independent may only appear in

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federal court through an attorney and ordering that the minute order, Ken-Mac’s motions, and any

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other documents filed, be served on Mr. Williams until Independent obtains counsel (#51). The

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court granted Independent twenty-one days from the date of the minute order to oppose Ken-Mac’s

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motions. Id. Independent did not file oppositions.

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II. LEGAL DISCUSSION AND ANALYSIS

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Ken-Mac moves this court to dismiss Independent’s counterclaim pursuant to Federal Rule

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of Civil Procedure 41(b).2 Id. Ken-Mac urges the court to “exercise its discretion and dismiss

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Independent’s counterclaim because Independent has indicated that it will be unable to prosecute the

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counterclaim.” Id. Ken-Mac notes that in Bankers Nat’l Life Ins. Co., the Northern District of

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Illinois dismissed a corporation’s counterclaim pursuant to Rule 41(b) after the corporation’s counsel

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withdrew, no substitute counsel appeared, and the corporation failed to participate in pre-trial

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preparation. Id. at 11 (citing Bankers Nat’l Life Ins. Co. V. Continental Nat’l Corp., 21 F.R.D. 448

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The court addresses Ken-Mac’s motion for judgment on partial findings in its May 18, 2011
minute order (#54).

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(N. D. Ill. 1981)).

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A.

Discussion

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Federal Rule of Civil Procedure 41(b) states: “If the plaintiff fails to prosecute or comply

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with these rules or a court order, a defendant may move to dismiss the action or any claim against

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it.” Fed. R. Civ. P. 41(b). A dismissal under 41(b) “operates as an adjudication on the merits.” Id.

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A dismissal pursuant to Rule 41(b) “‘must be supported by a showing of unreasonable delay.’”

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Omstead v. Dell, Inc., 594 F.3d 1081, 1084 (9th Cir. 2010) (quoting Henderson v. Duncan, 779 F.2d

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1421, 1423 (9th Cir. 1986)). The District Court must also weigh the following factors to determine

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whether a Rule 41(b) dismissal is warranted: “‘(1) the public’s interest in expeditious resolution of

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litigation; (2) the court’s need to manage its docket; (3) the risk of prejudice to the defendants; (4)

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the public policy favoring disposition of cases on their merits and (5) the availability of less drastic

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sanctions.’” Id. (quoting Henderson, 779 F.2d at 1423).

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B.

Federal Rule of Civil Procedure 41(b)

Analysis

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In the present action, Ken-Mac argues that Independent missed the original deadline to

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respond to its motion to dismiss counterclaim on March 18, 2011 (#53, p. 2). Likewise, Independent

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missed the extended deadline, set by the court in its March 28, 2011 minute order. Id. at 2-3. Based

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upon these delays and the representation made by Mr. Williams at the January 21, 2011 hearing, that

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he would not be able to obtain substitute counsel to prosecute Independent’s counterclaim, Ken-Mac

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argues that Independent is unable to proceed with its counterclaim. Id. Clearly, by Independent’s

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own admission, without the court’s intervention to resolve the case, unreasonable and perhaps

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indefinite delay will result.

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Having shown that Independent’s failure to prosecute its counterclaim has resulted in and

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will continue to cause unreasonable delay, the court now turns to evaluate the five factors required

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to support a dismissal pursuant to Rule 41(b).

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The first two factors, the public’s interest in expeditious resolution of litigation and the

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court’s need to manage its docket, weigh in favor of dismissal of Independent’s counterclaim.

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Independent did not respond to Ken-Mac’s motions, the court’s minute order, and has not identified
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substitute counsel. This failure to participate in the litigation hinders the court’s ability to resolve

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this case. Further, Independent indicated at the January 21, 2011 hearing, that it does not intend to

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hire substitute counsel and, therefore, will not be able to pursue this litigation. The court cannot

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allow this case to languish, unresolved.

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The third factor, risk of prejudice to the defendants, also weighs in favor of dismissal of

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Independent’s counterclaim. There is a rebuttable presumption of prejudice to a defendant that arises

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when a plaintiff unreasonably delays litigation. In re Eisen, 31 F.3d 1447, 1452-53 (9th Cir. 1994);

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Henderson, 779 F.2d at 1423. As the court explained above, Independent’s delays thus far and the

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future delays that will result from failure to obtain substitute counsel are unreasonable delays. As

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Independent did not oppose Ken-Mac’s motion, it has not rebutted the presumption that these delays

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will prejudice Ken-Mac.

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The fourth factor, public policy favoring disposition of cases on their merits, generally

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weighs against dismissal of a plaintiff’s claims. However, here, the court has no reason to believe

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that this case will ever proceed to trial given Independent’s representations and subsequent failure

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to respond to Ken-Mac’s motions. While public policy favors resolving cases on the merits, this

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preference does not outweigh Independent’s stated inability to proceed with this litigation.

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Finally, the fifth factor, availability of less drastic sanctions, weighs in favor of dismissal of

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Independent’s counterclaim. As stated above, this case simply is not moving toward resolution and

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without counsel for Independent the case cannot be resolved, nor can the court fashion a lesser

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sanction.

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These five factors weigh in favor of dismissal of Independent’s counterclaim for failure to

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prosecute, pursuant to Rule 41(b). Therefore, based upon the facts outlined in Ken-Mac’s motion;

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Mr. Williams’ representations at the court’s January 21, 2011 hearing; and Independent’s subsequent

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failure to respond to Ken-Mac’s motions, the court’s minute order, or to obtain substitute counsel,

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Independent’s amended counterclaim for breach of contract and breach of implied warranty of fitness

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for a particular purpose is dismissed.

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III. CONCLUSION
IT IS THEREFORE ORDERED that Ken-Mac’s motion to dismiss counterclaim (#50)
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is GRANTED.
IT IS FURTHER ORDERED that Independent’s amended counterclaim (#27) is
DISMISSED.

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IT IS SO ORDERED.

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DATED: May 19, 2011.

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_____________________________________

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UNITED STATES MAGISTRATE JUDGE

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