City of Wyoming v. Procter & Gamble Company

Background

The plaintiffs brought a proposed class action against companies that marketed and sold “flushable wipes.” They alleged that the wipes did not degrade as advertised and caused damage to sewer systems and wastewater treatment plants.

Tufco Technologies Inc., Procter & Gamble Company, Nice-Pak Products, Inc., and Professional Disposables International, Inc. were the “Settling Defendants.” The plaintiffs and those defendants jointly sought dismissal under Federal Rule of Civil Procedure 41. The court had previously rejected an earlier dismissal stipulation because it was not signed by all parties, but it found a separate stipulation dismissing the City of Wyoming’s claims against all defendants valid because all parties had signed it.

The plaintiffs then moved under Rule 41(a)(2) to dismiss the Settling Defendants. The Settling Defendants joined that motion. Kimberly-Clark Corporation and Rockline Industries did not oppose dismissal, but asked the court to impose two conditions: settlement-related discovery and continued personal jurisdiction over the Settling Defendants. Personal jurisdiction is a court’s authority over a party.

Rule 41(a)(2) standard

Rule 41(a)(2) allows a plaintiff to dismiss an action by court order and on terms the court considers proper. The court considers whether the plaintiff has a proper reason for dismissal, whether dismissal would waste judicial time and effort, and whether dismissal would prejudice the defendants.

The court found that the plaintiffs had properly explained their reasons for dismissal and that dismissal would not waste judicial resources. The Settling Defendants did not claim prejudice and supported the motion. The court therefore focused on possible prejudice to Kimberly-Clark and Rockline.

Requested discovery condition

Kimberly-Clark and Rockline argued that settlement-related discovery could bear on class certification, the adequacy of the plaintiffs as class representatives, the merits of the claims, the requested relief, and the credibility of potential witnesses. They also argued that the plaintiffs had accepted individual settlements while giving up some possible relief for the proposed class.

The court concluded that any potential prejudice from the requested discovery would result from the plaintiffs’ refusal to provide discovery, not from dismissal of the Settling Defendants. Because the plaintiffs would remain in the case, the court determined that the discovery dispute could be addressed through a separate discovery motion without keeping the Settling Defendants in the case. The court therefore did not impose the requested discovery condition.

Retention of personal jurisdiction

Kimberly-Clark and Rockline also asked the court to retain personal jurisdiction over the Settling Defendants so that employees of those defendants could later be subpoenaed. The court noted that discovery had closed and the deadline for identifying witnesses had passed. It found no need to retain personal jurisdiction to issue additional discovery orders beyond the discovery period.

The court stated that it would hold the plaintiffs to their representation that the evidence gathered during discovery was the complete universe of evidence for trial. It also stated that it would not allow late-disclosed witnesses or evidence without a very strong reason.

Disposition

Judge John R. Tunheim ordered that the plaintiffs’ Motion to Dismiss Settling Defendants, Docket No. 581, was GRANTED. The court granted the motion without imposing the two conditions requested by Kimberly-Clark and Rockline.