Dentsply International Inc. v. Bio-Pure Products, Inc.

Filing 25

MEMORANDUM re pltf's MOTION to voluntarily dismiss 21 (Order to follow as separate docket entry)Signed by Honorable Sylvia H. Rambo on 8/17/15. (ma)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
DENTSPLY INTERNATIONAL INC., :
:
Plaintiff
:
:
v.
:
:
BIO-PURE PRODUCTS INC.,
:
:
Defendant
:

Civil No. 1:14-cv-0848

Judge Sylvia H. Rambo

MEMORANDUM
Presently before the court is Plaintiff’s motion to voluntarily dismiss
this action without prejudice pursuant to Federal Rule of Civil Procedure 41(a)(2).
(Doc. 21.) Defendant opposes Plaintiff’s motion and requests that the court dismiss
the matter with prejudice and award costs and attorney’s fees. For the reasons set
forth below, the court will dismiss the action with prejudice, but without the
imposition of costs and attorney’s fees.
I.

Background
On May 2, 2014, Plaintiff Dentsply International Inc. (“Plaintiff”)

initiated this action by filing a complaint against Defendant Bio-Pure Products Inc.
(“Defendant”) for false advertising and unfair competition pursuant to the Lanham
Act, 15 U.S.C. § 1125, and Pennsylvania state law. (Doc. 1.) In the complaint,
Plaintiff alleged, inter alia, that Defendant engaged in an extensive advertising
campaign that disparaged Plaintiff’s products and misrepresented the efficacy of its
own products. (See id.) On July 2, 2014, Defendant filed an answer to the
complaint, wherein it denied making any false, misleading, or disparaging claims

regarding Plaintiff’s products or Defendant’s own products. (Doc. 7.) Since that
time, the parties have engaged in some discovery, but they have not taken
depositions, exchanged expert reports, or filed dispositive motions. (Doc. 21, p. 2 of
5; Doc. 23, p. 5 of 6.)
On June 5, 2015, Plaintiff filed the instant motion to dismiss the action
without prejudice (Doc. 21), followed by a brief in support on June 19, 2015 (Doc.
22). In support of its motion, Plaintiff argues that it should be permitted to
voluntarily dismiss this action without prejudice pursuant to Rule 41(a)(2) because
the action is merely in its preliminary stages. Specifically, Plaintiff argues that,
although the case was filed in May, 2014, the parties have done nothing but engage
in limited written discovery, and therefore, Defendants have presumably expended
very little time, money, and resources in the litigation. (See generally id.) On July 2,
2014, Defendant filed an opposition to the motion, wherein it argues that, contrary to
Plaintiff’s representations, the parties have engaged in significant discovery during
the pendency of the year-long litigation, and that Plaintiff is simply seeking to
dismiss this case because it was filed frivolously in an attempt to thwart Defendant’s
increasing market share in the dental evacuation industry. (Doc. 23.) While
Defendant does not oppose dismissal, it contends that the court should dismiss the
action with prejudice and award costs and attorney’s fees. (Id.) In a reply filed on
July 16, 2015, Plaintiff reiterates that the case should indeed be dismissed without
prejudice, but requests that the court dismiss the action with prejudice in lieu of a
reimbursement condition to a dismissal without prejudice. (Doc. 24.)

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II.

Legal Standard
Under Federal Rule of Civil Procedure 41(a)(2), a plaintiff seeking to

dismiss an action after the defendant has filed an answer may do so “only by court
order, on terms that the court considers proper.” While the decision to dismiss the
action pursuant to Rule 41(a)(2) falls within the sound discretion of the district court,
such motions should be granted without prejudice unless dismissal would cause
“plain legal prejudice” to the defendant. See In re Paoli R.R. Yard PCB Litig., 916
F.2d 829, 863 (3d Cir. 1990); Peltz ex rel. Estate of Peltz v. Sears, Roebuck & Co.,
367 F. Supp. 2d 711, 715 (E.D. Pa. 2005). Whether a dismissal will be prejudicial to
the defendant depends upon the circumstances of each case. Total Containment, Inc.
v. Aveda Mfg. Corp., Civ. No. 90-cv-4788, 1990 WL 290146, *2 (E.D. Pa. Dec. 7,
1990). However, the legal prejudice required to deny a motion pursuant to Rule
41(a)(2) must be more than the mere prospect of a second lawsuit or a tactical
advantage. See Hayden v. Westfield Ins. Co., 586 F. App’x 835, 842 (3d Cir. 2014).
Rather, prejudice is generally found “where a plaintiff seeks to start its litigation
anew in the advanced stages of a lawsuit, after discovery has closed and the parties
have filed dispositive motions or prepared for trial.” Ravenel v. Smithkline Beecham
Corp., Civ. No. 2:13-cv-3390, 2013 WL 4223706, *1 (E.D. Pa. Aug. 14, 2013)
(citing In re Diet Drugs (Phentermine / Fenfluramine / Dexfenfluramine) Prods.
Litig., 85 F. App’x 845, 847 (3d Cir. 2004)).
In considering whether dismissal would be prejudicial, courts have
considered: (1) the excessive and duplicative expense of a second litigation; (2) the
effort and expense incurred by the defendant in preparing for trial; (3) the extent to
which the current suit has progressed; (4) the plaintiff’s diligence in bringing the
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motion to voluntary dismiss the suit; and (5) the pendency of the dispositive motion
by the non-moving party. Lincoln Gen. Ins. Co. v. Kingsway Am. Agency, Inc., Civ.
No. 1:11-cv-1195, 2013 WL 214634, *13 (M.D. Pa. Jan. 18, 2013) (citations
omitted). Another factor which has been recognized as bearing on the issue of
prejudice includes the insufficiency of the explanation as to why dismissal is
warranted. Total Containment, 1990 WL 290146 at *2.
The court may, in its discretion, impose conditions on the granting of a
motion to voluntarily dismiss an action without prejudice pursuant to Rule 41(a)(2),
such as reimbursement of costs and attorney’s fees. Young v. Johnson & Johnson
Corp., Civ. No. 05-cv-2393, 2005 WL 2886218, *7 (E.D. Pa. Nov. 2, 2005).
Although reimbursement of costs and fees is not a prerequisite for granting a
dismissal without prejudice, it is “very common” for the court to impose such a
condition and often necessary “to protect a defendant from any prejudice or
inconvenience that may result from a plaintiff’s voluntary dismissal” of a case. Id.
(internal citations omitted); John Evans Sons, Inc. v. Majik, Inc., 95 F.R.D. 186, 191
(E.D. Pa. 1982) (stating that “numerous courts have [awarded costs and attorney’s
fees] where a voluntary dismissal has been granted without prejudice.”).
III.

Discussion
In their respective motions, the parties agree that dismissal of this case

is proper. Therefore, the only contested issues are whether the case should be
dismissed with or without prejudice and whether attorney’s fees and costs should be
assessed.

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Under the facts and circumstances presented in this case, the court
would ordinarily, in its discretion, grant Plaintiff’s motion to voluntarily dismiss the
action without prejudice conditioned upon its payment of Defendant’s costs and
attorney’s fees. Indeed, a dismissal without prejudice should be permitted where no
harm will result to the defendant or where curative conditions could be imposed to
alleviate any harm to the defendant. See Citizens Sav. Ass’n v. Franciscus, 120
F.R.D. 22, 26 (M.D. Pa. 1988).
A dismissal without prejudice is appropriate here because the case has
not progressed far beyond the pleadings. Although the parties have engaged in
discovery, they have not taken depositions, exchanged expert reports, or begun to
prepare for trial. Furthermore, there are no outstanding counterclaims or dispositive
motions. A curative condition to the dismissal without prejudice is necessary,
however, because this action has been pending for over a year, during which time
Defendant has incurred expenses in contesting Plaintiff’s action throughout the pretrial stage. While the prejudice that Defendant asserts would result from a dismissal
without prejudice at this stage of the litigation is, in the court’s estimation,
overstated, Defendant has established, at a minimum, financial prejudice in the form
of fees and costs.
As such, dismissal on the condition that Plaintiff pay all reasonable
costs and attorney’s fees incurred by Defendant in litigating this action would be
appropriate. The court must emphasize, however, that its imposition of a condition
to dismissal would by no means suggest that it accepts Defendant’s assertion that
Plaintiff brought this case frivolously or with an intent to drive a competitor out of
the market. The court has not made any factual findings in that regard. Rather, by
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requiring Plaintiff to reimburse Defendant for its expenses as a prerequisite to
dismissal without prejudice, the court would simply ensure that Defendant is not
prejudiced by the court’s granting of the motion. See id. at 26-27.
In the alternative to an order granting Plaintiff’s motion on the condition
that it pay Defendant’s reasonable costs and attorney’s fees, however, Plaintiff has
requested that the court dismiss the action with prejudice and without an award of
attorney’s fees and costs. (Doc. 24); see Citizens, 120 F.RD. at 26 (providing
Plaintiff the option to pay the reasonable costs and attorney’s fees and take the
without prejudice dismissal, withdraw the motion entirely, or move for a with
prejudice dismissal in lieu of paying the defendant’s costs and fees); Total
Containment, 1990 WL 290146 at *4 (same). The court finds this an appropriate
disposition of the action. Although Defendant seeks both dismissal with prejudice
and the reimbursement of costs and attorney’s fees, the purpose of an award of costs
and attorney’s fees is to compensate the defendant for having incurred the expenses
of litigation without the benefit of a final determination on the controversy. See John
Evans, 95 F.R.D. at 191 (E.D. Pa. 1982). However, this consideration is not present
where dismissal is with prejudice because the termination of the litigation gives the
defendant the benefit of a final determination on the controversy without the
additional expense it would have incurred by proceeding to a trial on the merits. Id.
Accordingly, the court will dismiss the action with prejudice and will not impose the
payment of attorney’s fees and costs as a condition of the voluntary dismissal.

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IV.

Conclusion
For the reasons set forth above, the court finds that this case may be

properly dismissed without prejudice on the condition that Plaintiff pay Defendant’s
reasonable costs and attorney’s fees. However, on the basis of Plaintiff’s alternative
request, the court will instead dismiss the case with prejudice and without the
imposition of a condition to dismissal.
s/Sylvia H. Rambo
United States District Judge
Dated: August 17, 2015.

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