Cabot Golf CL-PP 1, LLC v. Nixon Peabody, LLP

Case: 13-40912 Document: 00512688615 Page: 1 Date Filed: 07/07/2014
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
FILED
July 7, 2014
No. 13-40912 Lyle W. Cayce
Summary Calendar Clerk
CABOT GOLF CL-PP 1, LLC; CABOT GOLF CL-PP 3, LLC;
CABOT GOLF CL-PP 4, LLC; CABOT GOLF CL-PP 5, LLC;
CABOT GOLF CL-PP 6, LLC; et al.,
Plaintiffs-Appellants,
v.
NIXON PEABODY, LLP,
Defendant-Appellee.
Appeal from the United States District Court
for the Eastern District of Texas
USDC No. 5:12-CV-39
Before DAVIS, SOUTHWICK, and HIGGINSON, Circuit Judges.
PER CURIAM: *
Plaintiffs Cabot Golf CL-PP 1, LLC and related entities (collectively,
“Cabot”) appeal from a final judgment dismissing all of their claims pursuant
to Federal Rule of Civil Procedure 41(a)’s two-dismissal rule, giving us
jurisdiction under 28 U.S.C. § 1291. We affirm.
Concerning voluntary dismissals, Rule 41(a) provides, in relevant part:
(1) By the Plaintiff.
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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No. 13-40912
(A) Without a Court Order. Subject to Rules
23(e), 23.1(c), 23.2, and 66 and any applicable
federal statute, the plaintiff may dismiss an
action without a court order by filing:
(i) a notice of dismissal before the opposing
party serves either an answer or a motion
for summary judgment; or
(ii) a stipulation of dismissal signed by all
parties who have appeared.
(B) Effect. Unless the notice or stipulation states
otherwise, the dismissal is without prejudice.
But if the plaintiff previously dismissed any
federal- or state-court action based on or
including the same claim, a notice of dismissal
operates as an adjudication on the merits. 1
At the end of April, 2012, Cabot filed three virtually identical lawsuits:
one in California state court, one in California federal court, and this action.
Shortly thereafter, Cabot’s counsel discussed with the defendants’ counsel
pursuing a single action in a single forum, but he did not obtain a stipulation
of dismissal signed by all parties under Rule 41(a)(1)(A)(ii). Instead, Cabot
voluntarily dismissed the California state action on November 13, 2012, then
filed a notice of dismissal in the California federal action on November 15,
2012, which the court granted the same day. That left, of course, only this
action.
On December 12, 2012, Defendant-Appellee Nixon Peabody LLP (“Nixon
Peabody”) filed a motion to dismiss under Fed. R. Civ. P. 12(b)(6) on the basis
that the dismissal of the California federal action operated as an adjudication
1 Fed. R. Civ. P. 41(a).
2
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on the merits under Rule 41(a)(1)(B)’s two-dismissal rule and thus barred by
the doctrine of res judicata. The magistrate judge issued a report and
recommendation recommending that the motion be granted, which the district
court adopted in full. The court dismissed Cabot’s claims with prejudice in a
final judgment entered July 25, 2013.
Cabot timely appealed. Whether Nixon Peabody’s motion is properly
considered a motion to dismiss under Fed. R. Civ. P. 12(b)(6) or, as Cabot
contends, a motion for summary judgment under Fed. R. Civ. P. 56, we review
the district court’s legal determination de novo, applying the same standards
as the district court. 2 Here, the material facts are undisputed, and we
address a pure question of law. In short, Cabot is subject to the two-dismissal
rule and is barred from bringing this suit.
Cabot first dismissed its California state action, then dismissed its
California federal action by filing a unilateral notice of dismissal. 3 The effect
of that second dismissal is determined by Rule 41(a)(1)(B)’s two-dismissal rule,
which applies on its face to these facts: “Unless the notice or stipulation states
otherwise, the dismissal is without prejudice. But if the plaintiff previously
dismissed any federal- or state-court action [here, the California state action]
2 United States v. Renda Marine, Inc., 667 F.3d 651, 655 (5th Cir. 2012); Nickell v. Beau View
of Biloxi, L.L.C., 636 F.3d 752, 754 (5th Cir. 2011).
3 On March 18, 2014, which was approximately eight months after the district court entered
judgment in this case and while this appeal was pending, appellant moved this court to abate
the appeal. We granted the motion to allow appellant to obtain an indication from the
district court whether it was inclined to give appellant relief from the judgment pursuant to
a pending Rule 60(b) motion. The district court denied that motion on May 5, 2014. We
received no notification from counsel that the order had been entered and no request for
further briefing on the issues involved in that motion or any other issues in this appeal.
Thus, we consider in this opinion the unaltered final judgment.
3
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based on or including the same claim, a notice of dismissal operates as an
adjudication on the merits.”
On appeal, Cabot argues that Rule 41(a)(1)(B)’s two-dismissal rule
should apply only to serial litigation (i.e., suits which are filed after the earlier
suits were dismissed), not to parallel/tandem litigation as in this case (i.e.,
suits which were already pending when the earlier suits were dismissed).
Cabot does not cite any cases applying this interpretation, nor does the plain
language of Rule 41 support it.
Similarly, Cabot argues that the Texas district court should not have
applied res judicata because a Texas state court would not have done so to the
voluntary dismissal of the California federal action. Specifically, Cabot
argues that Texas requires proof of a valid prior final judgment on the merits, 4
and the California federal dismissal was not such a judgment. Again, Cabot
fails to cite a case supporting its argument, and again the plain language of
Rule 41(a)(1)(B) shows that the argument is untenable: under the two-
dismissal rule, “a notice of dismissal [in the second case] operates as an
adjudication on the merits.” In other words, though the dismissal was
voluntary, it acts as a final judgment on the merits under Rule 41.
Finally, Cabot argues that applying Rule 41(a)(1)(B)’s two-dismissal rule
would be unfair because it is harsh and does not promote the rule’s goals of
“prevent[ing] unreasonable abuse and harassment.” 5 Unfortunately,
although the rule may be harsh under these circumstances, the language is
clear, and we must apply it as written. 6 Cabot points out that if it had
4 See Igal v. Brightstar Information Technology Group, Inc., 250 S.W.3d 78, 86 (Tex. 2008).
5 See Am. Cyanamid Co. v. McGhee, 317 F.2d 295, 297 (5th Cir. 1963).
6 See, e.g., Sutton Place Dev. Co. v. Abacus Mortgage Inv. Co., 826 F.2d 637, 639-41 (7th Cir.
4
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dismissed the California federal action first and the California state action
second, Rule 41(a)(1)(B)’s two-dismissal rule would not apply. 7 That is not
what Cabot did, however, and the argument only serves to emphasize the
applicability of the rule to these facts. 8
As the Seventh Circuit aptly put it,
it must be remembered that the federal rules are
carefully-crafted instruments designed to achieve, by
their uniform application, fairness and expedition in
the conduct of federal litigation. Therefore, when a
party contends that a court should disregard the
express language of a carefully-drawn rule of
procedure, that party bears a heavy burden of showing
that a departure from the plain language is justified. 9
The two-dismissal rule is a narrowly tailored and potentially harsh rule, but
the language is clear, and it is applicable to these facts. Cabot has not borne
its “heavy burden” of proving a justifiable departure from the plain language.
Accordingly, we affirm.
1987) (discussing the need to strictly construe the plain language of Rule 41 to apply to prior
dismissals only by notices of dismissal and not, as in Sutton to dismissals by court order with
conditions included).
7 See Manning v. S. Carolina Dep't of Highway & Pub. Transp., 914 F.2d 44, 47 n.5 (4th Cir.
1990); Stewart v. Stearman, 743 F. Supp. 793, 794 (D. Utah 1990); Kuhn v. Williamson, 122
F.R.D. 192, 194 (E.D.N.C. 1988).
8 Likewise, because Rule 41(a)(1)(B) applies only to unilateral notices of dismissal, Cabot
could have avoided the two-dismissal rule by choosing to file a stipulation of dismissal signed
by all parties instead.
9 Sutton Place Dev., 826 F.2d at 640.
5