Nelson v. Bezos et al
Filing
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ORDER granting Plaintiffs' 55 Motion to Voluntarily Dismiss Without Prejudice. Signed by U.S. District Judge John C. Coughenour. (KRA)
THE HONORABLE JOHN C. COUGHENOUR
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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE
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IN RE AMAZON.COM, INC.
SHAREHOLDER DERIVATIVE
LITIGATION
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CASE NO. C22-0559-JCC
ORDER
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This matter comes before the Court on Plaintiffs’ motion for voluntary dismissal without
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prejudice (Dkt. No. 55). Having thoroughly considered the parties’ briefing and the relevant
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record, the Court hereby GRANTS the motion for the reasons explained herein.
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I.
BACKGROUND
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This is a shareholder derivative action against nineteen current and former Amazon.com,
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Inc. directors and officers, seeking a remedy for their alleged breaches of fiduciary duties, waste
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of corporate assets, and unjust enrichment. (See Dkt. No. 40 at 2.) 1 On January 30, 2024, this
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Court granted Defendants’ motion to dismiss in part for failure to plead demand futility under
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Federal Rule of Civil Procedure 23.1. (See Dkt. No. 53 at 14.) Importantly, though, the dismissal
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was without prejudice and with leave to amend within 30 days of the order. (Id.) The Court
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Amazon is named as the nominal defendant solely in a derivative capacity. (See id. at 53.)
Accordingly, the Court refers to the individual defendants in this case as “Defendants.”
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further indicated that if Plaintiffs did not file an amended complaint curing the demand futility
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pleading infirmities within that period, a judgment would issue. (Id.) Rather than file an amended
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complaint, Plaintiffs now move for voluntary dismissal without prejudice. (See Dkt. No. 55.)
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Defendants oppose, arguing that the Court should grant dismissal with prejudice. (See Dkt. No.
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56.)
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II.
DISCUSSION
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Under Federal Rule of Civil Procedure 23.1(c), a derivative action may be voluntarily
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dismissed “only with the court’s approval.” The dismissal may be granted “on terms the court
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considers proper.” Fed. R. Civ. P. 41(a)(2). This rule grants a broad range of discretion to the
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court without a “preference for one kind of dismissal or another.” Hargis v. Foster, 312 F.3d
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404, 407 (9th Cir. 2002). However, “[w]here the request is to dismiss without prejudice, ‘[a]
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District Court should grant a motion for voluntary dismissal under Rule 41(a)(2) unless a
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defendant can show that it will suffer some plain legal prejudice as a result.’” Kamal v. Eden
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Creamery, LLC, 88 F.4th 1268, 1279 (9th Cir. 2023) (alterations in original) (quoting WPP Lux.
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Gamma Three Sarl v. Spot Runner, Inc., 655 F.3d 1039, 1058–59 n.6 (9th Cir. 2011)). Legal
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prejudice is a “prejudice to some legal interest, some legal claim, [or] some legal argument.”
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Westlands Water Dist. v. United States, 100 F.3d 94, 97 (9th Cir. 1996). It does not, however,
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arise from “the threat of future litigation.” Id. at 96.
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As an initial matter, Defendants’ arguments seem to be centered around a misreading of
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the Court’s order granting dismissal (Dkt. No. 53). Under their interpretation, Plaintiffs’ failure
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to timely amend the complaint would result in a judgment granting dismissal with prejudice. (See
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Dkt. No. 56 at 3.) This is inconsistent with the plain language of the order, which dismisses the
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case without prejudice and merely delays the issuance of the judgment until after Plaintiffs’
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failure to amend the complaint within 30 days. (See Dkt. No. 53 at 14.) But the lapse of this 30-
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day period would not otherwise convert the Court’s ruling to a dismissal with prejudice.
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Moreover, Defendants have not shown that a dismissal without prejudice would result in legal
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prejudice. As previously explained, the threat of future litigation does not, alone, constitute legal
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prejudice. See Fischman on behalf of Sempra Energy & S. California Gas Co. v. Reed, 2017 WL
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3337162, slip op. at 2 (S.D. Cal. 2017) (granting plaintiff’s motion for voluntary dismissal
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without prejudice under similar circumstances). And Defendants fail to put forth any other
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reasonable basis for a determination of legal prejudice. (See generally Dkt. No. 56.)
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III.
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CONCLUSION
For the foregoing reasons, Plaintiffs’ motion to voluntarily dismiss this action without
prejudice (Dkt. No. 55) is GRANTED.
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DATED this 27th day of March 2024.
A
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John C. Coughenour
UNITED STATES DISTRICT JUDGE
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ORDER
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