McCoy v. Erie Insurance

204 F.R.D. 80, 2001 U.S. Dist. LEXIS 18257, 2001 WL 1379869
District Court, S.D. West Virginia·Decided November 2, 2001·No. No. Civ.A. 2:01-0054·Published·Cited by 2 cases

Opinion

MEMORANDUM OPINION AND ORDER

HADEN, Chief Judge.

Pending is Plaintiffs motion to amend her complaint to delete the existing class action allegations. The sole reason for which Plaintiff putatively seeks dismissal is lack of sufficient time to perform class discovery in aid of certification. Plaintiff, however, has not requested the Court to grant additional time within which to conduct such discovery.

The Court has considered Plaintiffs request carefully, mindful that amendments are to be freely granted when the litigation schedule will not be impacted adversely. If Plaintiff has determined to abandon class claims, the Court will not, of course, force her to pursue them. Nonetheless, the Court does not wish to foreclose Plaintiff from maintaining a putative class action in this forum simply because of a mistaken belief the Court would not entertain a reasonable request to modify the Scheduling Order. Plaintiff suggests if additional class discovery time is allowed or ordered to run concurrent with merits discovery, she will move for class certification as ordered by the Court. At the same time, prior to a class certification ruling, Plaintiff requests a different type of certification, namely transmitting a novel substantive legal question to the Supreme Court of Appeals of West Virginia: Does West Virginia recognize a diminished value coverage cause of action in a first party insurance dispute. The answer to that question would affect the scope of insured risk on the majority of motor vehicle property damage policies issued in this State.

Conversely, Defendants seek to force Plaintiff to pursue her class claims here and now or, in the alternative, to pay Defendants’ costs and fees associated with the attempted withdrawal of the class claims. While neither request is well-taken, both are worthy of discussion.

Regarding the request to force Plaintiff to litigate the class claims, the Court [82]*82recently addressed an analogous1 situation where defendants sought to force plaintiffs to litigate despite the latter’s request to voluntarily dismiss their ease pursuant to Rule 41(a)(2), Federal Rules of Civil Procedure:

“Typically, a motion for dismissal without prejudice should not be denied ‘absent substantial prejudice to the defendant[.]’ ” West Virginia-Ohio Valley Area I.B.E.W. Welfare Fund v. American Tobacco Co., 188 F.R.D. 425, 426 (S.D.W.Va.1999) (quoting Andes v. Versant Corp., 788 F.2d 1033, 1036 (4th Cir.1986)); see also Davis v. USX Corp., 819 F.2d 1270, 1273 (4th Cir.1987) (“The purpose of Rule 41(a)(2) is freely to allow voluntary dismissals unless the parties will be unfairly prejudiced.”).
The Court of Appeals in Davis further observed:
It is well established that, for purposes of Rule 41(a)(2), prejudice to the defendant does not result from the prospect of a second lawsuit. Moreover, the possibility that the plaintiff will gain a tactical advantage over the defendant in future litigation will not serve to bar a second suit. Thus, in this case, the mere prospect of the transfer of litigation to state court was an insufficient basis for denying the motion for voluntary dismissal. “Ordinarily the mere fact that a plaintiff prefers the state courts ought not to prevent his discontinuing his suit; one court is as good as another.” Young v. Southern Pacific Co., 25 F.2d 630, 632 (2 Cir.1928) (Learned Hand, J., concurring).
Indeed, in cases involving the scope of state law, courts should readily approve of dismissal when a plaintiff wishes to pursue a claim in state court.
Id. at 1274-75 (some citations omitted); see also American Tobacco 188 F.R.D. at 428 n. 5.
Toppings v. Meritech Mortgage Servs., No. 2:00-1055, slip op. at 8-9 (S.D.W.Va. Sept.19, 2001).

Second, Defendants assert the amendment dropping the class claims should be denied because the deadline for motions to amend has passed under the Scheduling Order and a modification of that date requires a showing of good cause under Rule 16(b). The good cause requirement, however, practically is intended to prevent a plaintiff from decimating a Scheduling Order with late attempts to complicate or change the nature of the case. That salutary purpose is not offended here. Deletion of the class claims would greatly simplify the case, perhaps permitting it to be resolved earlier than contemplated by the Scheduling Order.

Defendants also assert Plaintiffs proposed amendment cannot satisfy Rule 15(a). Our Court of Appeals and the Supreme Court, however, have repeatedly frowned on the denial of amendments sought under the generous Rule 15(a) standard. See, e.g., Pittston Co. v. United States, 199 F.3d 694 (4th Cir.1999) (quoting Foman v. Davis, 371 U.S. 178, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962)) (“ ‘Rule 15(a) declares that leave to amend “shall be freely given when justice so requires”; this mandate is to be heeded.’ ”). There is no substantial indication of unfair prejudice or bad faith here. Even assuming a surreptitious desire to renew the class claims in state court, a desire Plaintiff expressly disavows,2 unfair prejudice and bad faith are absent. Any class discovery conducted in this case likely would be useful in a later state action.3 Further, while the Court [83]*83welcomes complex diversity class actions, a plaintiff who favors a state, rather than a federal, forum cannot on that basis alone be charged with bad faith.4

Finally, Defendants assert the Court should inquire deeper into the amendment request based upon Shelton v. Pargo, 582 F.2d 1298 (4th Cir.1978). The Court of Appeals in Shelton observed:

Had the appellees been other than the representative parties, there would be no objection to a voluntary settlement of their claim. But, by asserting a representative role on behalf of the alleged class, these appellees voluntarily accepted a fiduciary obligation towards the members of the putative class they thus have undertaken to represent. They may not abandon the fiduciary role they assumed at will or by agreement with the appellant, if prejudice to the members of the class they claimed to represent would result or if they have improperly used the class action procedure for their personal aggrandizement. This has been declared in repeated decisions.

Id. at 1305 (emphasis added). The Court of Appeals further observed, however, “If [the district court finds] ... no violation of the fiduciary responsibilities by the plaintiff, there would be no reason why the District Court should not decide whether or not to permit the dismissal without certification and without notice to absent putative class members.” Id.

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McCoy v. Erie Insurance, 204 F.R.D. 80, 2001 U.S. Dist. LEXIS 18257, 2001 WL 1379869 (S.D.W. Va. 2001).

204 F.R.D. 80 (McCoy v. Erie Insurance) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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