## Facts

- Hinfin Realty Corp., Harbor Fuel Company, Inc., and Glenwood Terminal Corp. (plaintiffs) sued The Pittston Company (Pittston) on July 24, 2000, alleging environmental damage to plaintiffs’ property from an oil spill tied to tanks and related equipment Pittston allegedly owned, maintained, or controlled.
- After filing, plaintiffs took no meaningful action until they filed an amended complaint on February 1, 2001.
- Very little discovery occurred after the amended complaint.
- Pittston moved to stay the proceedings; plaintiffs initially opposed the stay.
- While plaintiffs opposed the stay, Pittston began making discovery demands and incurred expenses associated with responding to the case and pursuing discovery.
- During the litigation, Hinfin’s president, Donald Death, Sr., became ill and died; he was an important witness for plaintiffs.
- Plaintiffs’ financial condition worsened while the case was pending.
- Pittston provided plaintiffs with information suggesting Pittston might not be the proper defendant.
- Plaintiffs asked Pittston to stipulate to a voluntary dismissal without prejudice so plaintiffs could assess whether Pittston was the correct defendant to sue; Pittston refused.
- Plaintiffs then withdrew their opposition to the stay request; when the court denied a stay, plaintiffs moved under Federal Rule of Civil Procedure 41(a)(2) to voluntarily dismiss the case without prejudice.
- Pittston opposed dismissal, arguing it would be harmed if the suit were brought again because it would face duplicate litigation and, with delay, witnesses could die and memories could fade.
- In the alternative, Pittston asked the court to condition any dismissal without prejudice on plaintiffs’ payment of about $135,000 in costs and attorney’s fees.

## Issues

1. Under Federal Rule of Civil Procedure 41(a)(2), should the court allow plaintiffs to voluntarily dismiss the action without prejudice over Pittston’s objection?
2. If dismissal without prejudice is allowed, should the court condition dismissal on payment of Pittston’s costs and attorney’s fees?

## Decision

- The court granted plaintiffs’ Rule 41(a)(2) motion and dismissed the action without prejudice.
- The court found Pittston had not shown “plain legal prejudice” that would justify denying dismissal, given the case’s early posture and limited discovery.
- The court rejected Pittston’s argument that the chance of a later lawsuit, possible duplication of effort, and general concerns about fading memories or loss of witnesses were enough to bar dismissal without prejudice on this record.
- The court declined to condition dismissal on Pittston’s requested $135,000 in costs and attorney’s fees.

## Legal Principles

- Under Rule 41(a)(2), after an answer or summary-judgment motion is filed, a plaintiff may dismiss an action only by court order, on terms the court considers proper.
- The central question is whether the defendant would suffer “plain legal prejudice,” not merely the burden of facing a later lawsuit.
- In evaluating prejudice, courts commonly consider: (1) the plaintiff’s diligence in seeking dismissal; (2) whether the plaintiff acted in an unduly vexatious manner; (3) how far the litigation has progressed and the defendant’s effort and expense in preparation; (4) the extent to which work would have to be repeated if the case is refiled; and (5) the plaintiff’s stated reason for seeking dismissal.
- General claims of duplicate litigation, ordinary litigation expense, or the passage of time (without a stronger showing tied to the case record) typically do not establish plain legal prejudice.
- Conditions on dismissal (including costs or attorney’s fees) are discretionary and should match any concrete unfairness shown by the defendant.

## Conclusion

Hinfin Realty Corp. v. Pittston Co. holds that Rule 41(a)(2) permits dismissal without prejudice where the defendant cannot show plain legal prejudice beyond the routine effects of a possible refiled case, and that substantial cost- and fee-shifting is not automatic when the case is at an early stage and the plaintiff offers legitimate reasons for discontinuance, including the death of a key witness, financial hardship, and doubt about whether the defendant is the proper party.


Hinfin Realty Corp. v. Pittston Co., 206 F.R.D. 350 (2002)