Penske Media Corporation v. Shutterstock, Inc.

Filing 204

ORDER OF DISMISSAL: Accordingly, IT IS HEREBY ORDERED that this case is DISMISSED. Notwithstanding, IT IS FURTHER ORDERED that the Stipulated Protective Order at ECF No. 72 is AMENDED to permit the use, by either party, of any discovery in this case to be used in any subsequent action in which the surviving state law claims are ultimately litigated. The Clerk of Court is respectfully requested to close this case. SO ORDERED. (Signed by Judge Mary Kay Vyskocil on 3/27/2024) (tg)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #:
DATE FILED: 3/27/2024

PENSKE MEDIA CORPORATION,
Plaintiff,
-againstSHUTTERSTOCK, INC.,

1:20-cv-04583 (MKV)
ORDER OF DISMISSAL

Defendant.
MARY KAY VYSKOCIL, United States District Judge:
On March 11, 2024, the Court issued an Order [ECF No. 201] directing each party to file
a letter on the docket “showing cause why this case should not be dismissed for lack of federal
subject matter jurisdiction” in light of the parties’ voluntarily dismissal of all federal claims
and counterclaims upon which federal jurisdiction was based in this case, such that only state
law claims remain. [ECF No. 178].
Defendant filed a response asserting that “no cause exists to prevent dismissal of the case
for lack of federal subject matter jurisdiction,” and as such, “the case should be dismissed.” [ECF
No. 202].

Plaintiff filed a response “recognizing that the Court ‘may decline to exercise

supplemental jurisdiction,’ where, as here, it ‘has dismissed all claims over which it has original
jurisdiction.’ ” [ECF No. 203] (citing 28 U.S.C. § 1367(c)(3)). Plaintiff requested, however, that
“should the Court dismiss without prejudice the remaining state law claims . . . it should first
obtain assurances from both parties that they would not seek to duplicate or rehash in a new state
court action the significant discovery they have completed while the case has been pending before
this Court.” [ECF No. 202]. For the following reasons, this case is hereby DISMISSED.

DISCUSSION
Federal courts have limited subject matter jurisdiction and normally may not entertain
matters when they do not have jurisdiction. See e.g., Purdue Pharma L.P. v. Kentucky, 704 F.3d
208, 213 (2d Cir. 2013); Durant, Nichols, Houston, Hodgson, & Cortese–Costa, P.C. v. Dupont,
565 F.3d 56, 62 (2d Cir. 2009). Congress has granted district courts limited original jurisdiction
over cases in which there is a federal question, see 28 U.S.C. § 1331, and certain cases between
citizens of different states, so long as the requirements of complete diversity and amount in
controversy are met. See 28 U.S.C. § 1332. Purdue Pharma, 704 F.3d at 213. The parties concede
that all claims over which the Court had original jurisdiction in this action have now been
dismissed voluntarily by the parties. [ECF Nos. 201 and 202].
Under Title 18 United States Code Section 1367(c)(3), a district court “may decline to
exercise supplemental jurisdiction over a claim [if] . . . the district court has dismissed all claims
over which it has original jurisdiction.” 18 U.S.C.A. § 1367(c)(3). The Supreme Court has held
that “in the usual case in which all federal-law claims are eliminated before trial, the balance of
factors to be considered under the [supplemental] jurisdiction doctrine—judicial economy,
convenience, fairness, and comity—will point toward declining to exercise jurisdiction over the
remaining state-law claims.” United Mine Workers v. Gibbs, 383 U.S. 715, 725–29 (1966)
(emphasis added); see also Kolari v. New York-Presbyterian Hosp., 455 F.3d 118, 122 (2d Cir.
2006) (“Once a district court’s discretion is triggered under § 1367(c)(3), it balances the traditional
values of judicial economy, convenience, fairness, and comity in deciding whether to exercise
jurisdiction.”) (internal quotation marks and citations omitted). “Nonetheless, even “[w]hen
[Section] 1367(c)(3) applies, the district court must still meaningfully balance the supplemental
jurisdiction factors.” Catzin v. Thank You & Good Luck Corp., 899 F.3d 77, 86 (2d Cir. 2018).

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The Court has balanced the relevant factors and finds that they weigh in favor of declining
to exercise supplemental jurisdiction. First, judicial economy supports dismissal of Plaintiff’s state
law claims because this case is far from trial ready. See e.g., Catzin, 899 F.3d at 83; Kroshnyi v.
U.S. Pack Courier Servs., Inc., 771 F.3d 93, 102 (2d Cir. 2014); Valencia ex rel. Franco v. Lee,
316 F.3d 299, 306 (2d Cir. 2003). Comity also strongly supports dismissal of state law claims.
Although Plaintiff’s contract-related state claims are not particularly “novel” or “unsettled” areas
of state law, “[n]eedless decisions of state law should be avoided both as a matter of comity and to
promote justice between the parties, by procuring for them a surer-footed reading of applicable
law.” Gibbs, 383 U.S. 715, 726. Finally, any concerns with respect to fairness are mitigated by
the Court’s amendment of the Protective Order in this case, as ordered below.
For the foregoing reasons, the Court declines to exercise supplemental jurisdiction with
respect to purely contract-related state claims. See Myers v. Doherty, No. 21-3012-CV, 2022 WL
4477050, at *4 (2d Cir. Sept. 27, 2022) (“having properly dismissed all federal claims, the district
court did not abuse its discretion in also dismissing the state-law claims”).
Accordingly, IT IS HEREBY ORDERED that this case is DISMISSED. Notwithstanding,
IT IS FURTHER ORDERED that the Stipulated Protective Order at ECF No. 72 is AMENDED
to permit the use, by either party, of any discovery in this case to be used in any subsequent action
in which the surviving state law claims are ultimately litigated. The Clerk of Court is respectfully
requested to close this case.
SO ORDERED.
_________________________________
MARY KAY VYSKOCIL
United States District Judge

Date: March 27, 2024
New York, NY

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