Voluntary Dismissal Appropriate Even if Precipitated by an Adverse Ruling Against Plaintiffs: Eighth Circuit | Practical Law

Voluntary Dismissal Appropriate Even if Precipitated by an Adverse Ruling Against Plaintiffs: Eighth Circuit | Practical Law

In Mullen v. Heinkel Filtering Systems, Inc., decided on October 22, 2014, the US Court of Appeals for the Eighth Circuit held that the district court did not abuse its discretion by granting the plaintiffs' motion for voluntary dismissal, which the plaintiffs filed one day after the magistrate refused to extend their expert deadline. The Eighth Circuit also concluded that the district court did not abuse its discretion by failing to award costs and fees to the defendants.

Voluntary Dismissal Appropriate Even if Precipitated by an Adverse Ruling Against Plaintiffs: Eighth Circuit

by Practical Law Litigation
Published on 24 Oct 2014 • USA (National/Federal)
In Mullen v. Heinkel Filtering Systems, Inc., decided on October 22, 2014, the US Court of Appeals for the Eighth Circuit held that the district court did not abuse its discretion by granting the plaintiffs' motion for voluntary dismissal, which the plaintiffs filed one day after the magistrate refused to extend their expert deadline. The Eighth Circuit also concluded that the district court did not abuse its discretion by failing to award costs and fees to the defendants.
In Mullen v. Heinkel Filtering Systems, Inc., decided on October 22, 2014, the US Court of Appeals for the Eighth Circuit held that the district court did not abuse its discretion by granting the plaintiffs' motion for voluntary dismissal, which the plaintiffs filed one day after the magistrate issued an adverse ruling refusing to extend their expert deadline. The Eighth Circuit also concluded that the district court did not abuse its discretion by failing to award costs and fees to the defendants. (No. 13-3512, (8th Cir. Oct. 22, 2014).)
The plaintiffs brought products liability claims in Iowa state court. The defendants removed the action to federal court based on diversity jurisdiction. The plaintiffs then failed to name an expert by the expert deadline. Over a month after the deadline expired, the plaintiffs moved to extend the deadline. However, because the plaintiffs' attorney "simply forgot" about the deadline, the magistrate judge found that there was no excusable neglect under FRCP 6(b), and entered an order denying the motion.
The next day, the plaintiffs filed a voluntary motion to dismiss without prejudice, claiming that they intended to add defendants that would probably destroy diversity, and that the current defendants would not be prejudiced because the case had not progressed very far. The plaintiffs asserted that their motion was based on recent discovery disclosures. Two weeks later, the plaintiffs filed a motion for reconsideration of the magistrate's ruling. The plaintiffs argued that the case could not be adjudicated on the merits without expert testimony because the plaintiffs would be unable to meet their burden of proof. The plaintiffs also filed a motion to compel discovery. The district court entered an order reserving ruling on both the motion to reconsider and the motion to dismiss pending the magistrate's ruling on the motion to compel. However, before the magistrate ruled on the motion to compel, the district court granted the plaintiffs' motion to voluntarily dismiss without prejudice, and without explanation. It also ordered the parties to bear their own costs, and did not award fees or costs to the defendants. The defendants appealed.
The Eighth Circuit upheld the dismissal. Although it noted that the district court's order was "abbreviated to the point of terseness" and that the plaintiffs' failure to obtain an extension of the expert deadline may have precipitated their motion to dismiss, it nonetheless found that the district court did not abuse its discretion because:
  • The plaintiffs had legally viable claims against the defendants they sought to add, as shown by the fact that the plaintiffs re-filed suit in Iowa state court following the dismissal.
  • The federal case had not progressed very far, and thus there was no waste of judicial time and effort.
  • The expense and effort of drafting and responding to discovery prior to dismissal, and the loss of the tactical advantage that the magistrate's ruling provided to defendants (which effectively deprived the plaintiffs of the ability to prove their case), did not constitute legal prejudice to defendants.
In addition, the Eighth Circuit affirmed the district court's decision not to award fees or costs to defendants, finding that:
  • No great progress had been made in the case, as the parties had engaged in minimal discovery.
  • Almost all of the efforts expended by defendants and their counsel in the federal case could be utilized in the state litigation.
Although courts generally prohibit parties from escaping adverse decisions or forum shopping, counsel should keep in mind that motions for voluntary dismissal can be an effective adversarial tool, particularly where a case is in its initial stages and the parties have engaged in minimal discovery.