Bridgetree, Inc. et al v. RED F Marketing LLC et al

Filing 97

ORDER granting 84 Motion to Dismiss Defendants Jason Li and Mali Xu. Signed by Senior Judge Graham Mullen on 9/16/11. (gpb)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NORTH CAROLINA
CHARLOTTE DIVISION
Civil Action No.: 3:10-cv-228-FDW-DSC
BRIDGETREE, INC., and
TWO BIT DOG, LLC,

)
)
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Plaintiffs,
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vs.
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RED F MARKETING LLC, TARGET
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POINT, LLC, DANIEL ROSELLI, TENG )
LI, JASON LI, MALI XU, MARK
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EPPERLY, and ELTON T. SCRIPTER,
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Defendants.
)
)

ORDER

THIS MATTER comes now before the Court upon Plaintiffs’ Motion to Voluntarily Dismiss
Defendants Jason Li and Mali Xu from this action without prejudice pursuant to Rule 41(a)(2) of
the Federal Rules of Civil Procedure. For the reasons set forth, Plaintiffs’ Motion to Voluntarily
Dismiss Defendants Jason Li and Mali Xu is GRANTED.
Plaintiffs Bridgetree, Inc., and Two Bit Dog, LLC, (collectively “Plaintiffs”) assert in their
Memorandum in Support of their Motion to Voluntarily Dismiss Defendants Jason Li and Mali Xu
that, “[u]nder Rule 41 of the Federal Rules of Civil Procedure, a plaintiff may dismiss an action
upon order of the court and upon such terms and conditions as the court deems proper.” (Doc. No.
85 at 2). The issue before this Court relates to the scope of Rule 41 and its functionality as a vehicle
to dismiss certain co-defendants from an action rather than an action in its entirety.
Rule 41(a) refers to the voluntary dismissal of “an action.” Interpreting this portion of the
Rule on its face, the Second Circuit held that “the word ‘action’ as used in the Rules denotes the
entire controversy, whereas ‘claim’ refers to what has traditionally been termed ‘cause of action.’”

Harvey Aluminum, Inc. v. American Cyanimid Co., 203 F.2d 105, 108 (2nd Cir. 1953), cert. denied,
345 U.S. 964. Under the Second Circuit’s strict interpretation of the Rule, a plaintiff may not
dismiss a handful of co-defendants to an action under 41(a); rather, he must proceed under Rule 15
or Rule 21 to accomplish this desired end.
As noted in Defendants’ briefs, several courts have been influenced by the Second Circuit’s
reading of Rule 41(a), including a fellow court in this District.1 The greater weight of authority,
however, maintains that contrary to its plain language, Rule 41(a) allows for dismissal of less than
the entirety of an action. See Young v. Wilky Carrier Corp., 150 F.2d 764 (3d Cir. 1945), cert.
denied, 326 U.S. 786 (granting dismissal of one of two defendants under Rule 41(a)(2)); Wilson v.
City of San Jose, 111 F.3d 688 (9th Cir. 1997) (holding plaintiff may dismiss some or all defendants
through Rule 41(a)(1)).
Moreover, the Fourth Circuit has demonstrated an unwillingness to be bound by the strictures
of the Rule’s language. See Miller v. Terramite Corp., 111 Fed.Appx. 536 (4th Cir. 2004) (finding
no abuse of judicial discretion regardless of whether [a motion] is construed as an attempt to dismiss
the action under Rule 41(a)(2) or as a motion to amend the pleading under Rule 15); Skinner v. First
American Bank of Virginia, 1995 WL 507264, *2 (4th Cir. 1995) citing Mechmetals Corp. v. Telex
Computer Prods., Inc., 709 F.2d 1287, 1294 (9th Cir. 1983) (holding that while Rule 15 is
technically the proper vehicle to accomplish a partial dismissal due to the fact that Rule 41 provides
for the dismissal of actions rather than claims, “similar standards govern the exercise of discretion

1

See Volvo Trademark Holding Aktiebolaget v. AIS Construction Equip. Corp., 162 F. Supp. 2d 465, 472
(W .D.N.C. 2001) (holding that a Rule 41 dismissal of a party rather than an entire action is ineffectual as a matter of
law; plaintiff should have proceeded under Rule 15); see also Hilliard v. RHS Howell Care Centers, 2009 W L
21770008 (holding that a “Rule 41 dismissal, either by court order or entered voluntarily, is defective where the
parties attempt to dismiss less than the entire action inasmuch as it would be a violation of the language of the Rule
41(a)(1)”).

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under either rule”); See also Ownby v. Cohen, 2002 WL 1877519 (W.D. Va. 2002) (holding it
undesirable and unnecessary to invoke inherent power to avoid an artificial limit on Rule 41(a)
reached only by an overly literal reading of the rule). In focusing on substance rather than procedure,
the Fourth Circuit’s interpretation echoes Justice Blackmun’s sentiments while a member of the
Eighth Circuit: “[I]t may not be material whether the court acts under Rule 15(a) which relates to
amendments, or Rule 21 which concerns misjoinder, or Rule 41(a)(2).” Johnston v. Cartwright, 355
F.2d 32, 39 (8th Cir. 1966). In sum, it is clear the Fourth Circuit has tacitly approved of the use of
Rule 41(a)(2) as a vehicle to dismiss discrete claims and parties from actions as well as actions in
their entirety.
Having determined that Plaintiffs may utilize Rule 41(a)(2) as a means to dismiss certain codefendants from this action, the Court must then consider whether such dismissal is proper under
the circumstances. It is well established that a plaintiff's motion under Rule 41(a)(2) for dismissal
without prejudice should not be denied absent substantial prejudice to the defendant. Andes v.
Versant Corp., 788 F.2d 1033, 1036 (4th Cir. 1986); See also Kenrose Mfg. Co. v. Fred Whitaker
Co., 512 F.2d 890, 895 (4th Cir. 1972). Taking into consideration the present stage of litigation,
Plaintiffs’ explanation for dismissal, and the absence of evidence showing a lack of diligence on
behalf of Plaintiffs in attempting to serve Defendants Jason Li and Mali Xu, the Court finds
dismissal without prejudice proper. If the remaining co-defendants believe it necessary in the
interest of justice and in the interests of their clients that these individuals be parties to this suit, this
non-prejudicial action will not preclude their ability to cross-claim and add them as co-defendants.
IT IS THEREFORE ORDERED that Plaintiffs’ Motion to Voluntarily Dismiss Defendants
Jason Li and Mali Xu from this action without prejudice pursuant to Federal Rule of Procedure
41(a)(2) (Doc. No. 84) is GRANTED.
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IT IS SO ORDERED.
Signed: September 16, 2011

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