United States District Court, D. Delaware
SCVNGR, INC. d/b/a LEVELUP, Plaintiff;
DAILYGOBBLE, INC. d/b/a RELEVANT, Defendant.
D. Neff, and Wali Rushdan, II, FOX ROTHSCHILD LLP,
Wilmington, DE; Brian C. Carroll, SCVNGR, INC. d/b/a LEVELUP,
Boston, MA, attorneys for Plaintiff.
Stephen B. Brauerman & Sara E. Bussiere, BAYARD, P.A.,
Wilmington, DE; Hao Ni, NI, WANG & MASSAND, PLLC, Dallas,
TX, attorneys for Defendant.
ANDREWS, U.S. DISTRICT JUDGE:
SCVNGR, Inc. d/b/a LevelUp filed a motion to dismiss Count II
of its Complaint without prejudice. (D.I. 109). The Court has
considered the parties' briefing. For the following
reasons, the Court GRANTS Plaintiffs motion to dismiss
SCVNGR, Inc. d/b/a LevelUp initiated this action against
Defendant DailyGobble, Inc. d/b/a Relevant in the United
States District Court for the District of Rhode Island. (D.I.
1). Plaintiffs Complaint alleged two causes of action. Count
I alleges Defendant infringed U.S. Patent No. 8, 924, 260
("the '260 patent"). Id. Count II
alleges a claim for tortious interference with contractual
relations under Rhode Island state law. Id.
Defendant filed a motion to dismiss for improper venue. (D.I.
92). The Rhode Island Court then transferred the case to the
this Court. (D.I. 97). Plaintiff now requests dismissal of
Count II without prejudice. (D.I. 109).
41(a)(2) of the Federal Rules of Civil Procedure provides,
"an action may be dismissed at the plaintiffs request
only by court order, on terms that the court considers
proper... . Unless the order states otherwise, a dismissal
under this paragraph (2) is without prejudice."
"[T]he grant or denial of voluntary dismissal without
prejudice is a matter of judicial discretion" Ockert
v. Union Barge Line Corp., 190 F.2d 303, 304 (3d Cir.
1951). A motion for voluntary dismissal without prejudice
should be granted unless the dismissal will result in legal
prejudice to the defendant. Sanitec Indus., Inc. v.
Sanitec Worldwide, Ltd., 2006 WL 890880, at *1 (D. Del.
Apr. 3, 2006) (citing DuToit v. Strategic Minerals
Corp., 136 F.R.D. 82, 85 (D. Del. 1991)). "The mere
prospect that a defendant will face a subsequent lawsuit is
not legal prejudice." Reach & Assocs. v.
Dencer, 2004 WL 253487, at *1 (D. Del. Feb. 9, 2004)
(citing DuToit, 136 F.R.D. At 85).
determining whether legal prejudice will result from
dismissal of the claim, "a court should consider 1) any
excessive and duplicative expense of a second litigation;
[2)] the effort and expense incurred by a defendant in
preparing for trial; [3)] the extent to which the pending
litigation has progressed; and [4)] the claimant's
diligence in moving to dismiss." Reach &
Assocs., 2004 WL 253487, at *1 (alteration in original)
(internal quotations omitted); Peltz v. Sears, Roebuck
& Co., 367 F.Supp.2d 711, 715 (E.D. Pa. 2005).
Plaintiff contends that the Court should look to differing
factors taken from other courts and circuits (D.I. 109 at 3),
but also cites to cases using the factors listed above.
Peltz, 367 F.Supp.2d at 715.
argues that Defendant will not suffer legal prejudice from a
dismissal without prejudice of Count II because the mere
prospect of a second litigation alone does not create legal
prejudice. (D.I. 109 at 4). Defendant asserts that Plaintiff
is forum-shopping to force Defendant to expend time, money,
and other resources on litigation in multiple
venues. (D.I. 110 at 4-6). Defendant further
argues that Count II should not be dismissed because it
"arises out of the same nucleus of operative fact"
as Count I, Plaintiffs patent infringement claim.
(Id. at 6).
has failed to show that it will suffer any legal prejudice if
Plaintiff s motion to dismiss is granted. With regard to the
first two factors, the effort and expense Defendant has
expended on discovery related to Count II will not be wasted.
Plaintiff states in its motion that it intends to refile
Count II in Rhode Island state court. Any discovery related
to Count II may be used in defending that litigation. While
Defendant argues that it has invested significant effort and
time in discovery, at the time of Plaintiff s filing, the
parties had only engaged in written discovery and document
production. (D.I. 109 at 4; D.I. 110 at 6). Defendant also
contends that permitting Plaintiff to refile Count II in
Rhode Island state court will create excessive and
duplicative expense because any litigation of Count II will
have to determine whether Defendant's technology
infringes the '260 patent. (D.I. 110 at 6-7). Plaintiff
responds that Count II does not require litigation of whether
the '260 patent was infringed because the elements of
tortious interference with contractual relations are
unrelated to infringement. (D.I. 112 at 1-2). Defendant
counters that Plaintiff specifically pled Defendant's use
of infringing technology to support Count II and therefore
the claims "arise from the same nucleus of operative
fact." (D.I. 110 at 6-7).
Defendant's reliance on the "same nucleus of
operative fact" test is misplaced. The determination of
whether claims "arise from the same nucleus of operative
fact" is relevant to determine whether a federal court
may exercise supplemental jurisdiction over a state law
claim, not whether a motion to dismiss a state law claim
without prejudice must be denied. Compare Cindrich v.
Fisher, 341 Fed.Appx. 780, 789 (3d Cir. 2009)
(discussing whether the district court had abused its
discretion in exercising supplemental jurisdiction), with
Reach & Assocs., 2004 WL 253487, at *1 (listing
factors for determination of legal prejudice caused by
voluntary dismissal). While litigation in Rhode Island state
court and the instant litigation may overlap, Defendant has
not shown that it creates legal prejudice beyond "[t]he
mere prospect that [Defendant] will face a subsequent
lawsuit." Reach & Assocs., 2004 WL 253487,
at * 1.
while the instant litigation had been ongoing for over two
years at the time Plaintiff filed its motion to dismiss,
discovery has not yet closed. There is over one year until
trial is scheduled to begin. This is not a case where the
Plaintiff has filed a motion to dismiss on the eve of trial.
Moreover, there is no evidence that Plaintiff has
unreasonably delayed filing its motion to dismiss. The
instant case was transferred to this Court on January 8,
2018. (D.I. 98). Plaintiff filed its motion roughly two
months later, on March 15, 2018. (D.I. 109). Courts have
upheld motions for dismissal without prejudice even when the
movant took longer than two months to file. The docket in