1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 FLOREXPO LLC and KENDAL Case No.: 20-CV-1024 JLS (DEB)

FLORAL SUPPLY, LLC,

12

ORDER (1) DENYING

Plaintiffs, 13 DEFENDANT’S MOTION TO v. DISMISS PURSUANT TO RULE 14 41(b) AND (2) ENTERING FINAL

TRAVELERS PROPERTY CASUALTY

15 JUDGMENT IN FAVOR OF

COMPANY OF AMERICA,

DEFENDANT

16 Defendant. 17 (ECF No. 22) 18

19 Presently before the Court is Defendant Travelers Property Casualty Company of 20 America’s Motion to Dismiss for Failure to Prosecute Pursuant to Federal Rule of Civil 21 Procedure 41(b) (“Mot.,” ECF No. 22). Plaintiffs FlorExpo, LLC and Kendal Floral 22 Supply, LLC (collectively, “Plaintiffs”) filed an Opposition to the Motion (“Opp’n,” ECF 23 No. 23), and Defendant filed a Reply in support of its Motion (“Reply,” ECF No. 24). The 24 Court decides the matter on the papers submitted and without oral argument pursuant to 25 Civil Local Rule 7.1(d)(1). See generally ECF No. 25. Having carefully reviewed the 26 Parties’ arguments and the relevant law, the Court DENIES Defendant’s Motion. 27 /// 28 /// 1 BACKGROUND 2 Plaintiffs are importers and distributors of fresh-cut flowers from South America. 3 See ECF No. 1 (“Compl.”) ¶ 7. Defendant issued Plaintiffs a commercial property 4 insurance policy that provided coverage for loss or damages to Plaintiffs’ flower stock. Id. 5 ¶¶ 7, 11–12, 14. On or about April 21, 2020, Plaintiffs tendered a loss and damage claim 6 to Defendant for loss of stock, and on April 30, 2020, Defendant denied Plaintiffs’ claim. 7 See id. ¶¶ 22–23. On June 3, 2020, Plaintiffs filed suit against Defendant alleging breach 8 of contract, breach of the implied covenant of good faith and fair dealing, and seeking 9 declaratory relief. See generally id. 10 On March 8, 2021, the Court granted Defendant’s motion to dismiss, see ECF No. 11 5, and dismissed Plaintiffs’ complaint pursuant to Federal Rule of Civil Procedure 12(b)(6), 12 see ECF No. 21 (“Order”). The Court granted Plaintiffs until April 7, 2021 to file an 13 amended complaint. See Order at 15. Plaintiffs did not file an amended pleading or 14 otherwise notify the Court of their intentions to proceed with this action. See generally 15 Docket. On May 3, 2021, Defendant filed the present Motion. See ECF No. 22. 16 LEGAL STANDARD 17 Federal Rule of Civil Procedure 41(b) permits the Court to dismiss an action or claim 18 involuntarily for a plaintiff’s failure to prosecute. See Link v. Wabash R. Co., 370 U.S. 19 626, 630–31 (1962). The Ninth Circuit has articulated a five-factor test for determining 20 whether dismissal for failure to prosecute is warranted. The Court must evaluate: (1) the 21 public’s interest in expeditious resolution of the litigation; (2) the court’s need to manage 22 its docket; (3) the risk of prejudice to the defendants; (4) the public policy favoring 23 disposition of cases on their merits; and (5) the availability of less drastic sanctions. 24 Omstead v. Dell, Inc., 594 F.3d 1081, 1084 (9th Cir. 2010) (quotations and citations 25 omitted). Moreover, a Rule 41(b) dismissal must be supported by a showing of 26 unreasonable delay. Id. (quotations and citations omitted). 27 /// 28 /// 1 ANALYSIS 2 Defendant argues that a Rule 41(b) dismissal is appropriate in this action because 3 “[a]ll five of the factors weigh in favor of dismissal.” Mot. at 4. Defendant argues that 4 Plaintiffs’ failure to file an amended complaint amounts to “a failure to comply with the 5 Court’s order,” which “hinders the Court’s ability to manage its docket and indicates that 6 Plaintiffs do not intend to proceed with litigating this action.” Id. at 5 (citation omitted). 7 Further, Defendant argues it is prejudiced by unreasonable delay because Plaintiffs’ 8 inaction “require[s Defendant] to continue to litigate this case and expend resources.” Id. 9 In response, Plaintiffs state that they would not oppose a final judgment of dismissal but 10 argue that Defendant’s Motion pursuant to Rule 41(b) is improper. Opp’n at 2. Plaintiffs 11 argue the Court’s Order did not “require Plaintiffs to file an amended complaint within 30 12 days.” Id. (emphasis in original). Plaintiffs claim they “elected not to file an amended 13 complaint, and instead to allow the Court’s ruling to ripen into a final, appealable 14 judgment.” Id. 15 The distinction between a Rule 12(b)(6) dismissal and a Rule 41(b) dismissal is “not 16 merely formal” because “a Rule 41(b) dismissal is deemed a sanction for disobedience, 17 while a Rule 12(b)(6) dismissal carries no such stigma.” Edwards v. Marin Park, Inc., 356 18 F.3d 1058, 1065 (9th Cir. 2004). The Ninth Circuit reviews a Rule 41(b) dismissal only 19 for abuse of discretion, while it reviews a Rule 12(b)(6) dismissal de novo. Id. 20 Under these circumstances, the Court finds a Rule 41(b) dismissal of Plaintiffs’ 21 action inappropriate. Although Plaintiffs failed to file an amended complaint within the 22 time specified in the Order, the Court merely granted Plaintiffs the opportunity to amend 23 and did not require Plaintiffs amend their pleading. See Order at 15 (stating Plaintiffs “may 24 file an amended complaint within thirty (30) days” (emphasis added)); see also G.P.P., Inc. 25 v. Guardian Prot. Prod., Inc., No. 1:15-CV-00321-SKO, 2018 WL 385372, at *16 (E.D. 26 Cal. Jan. 9, 2018) (declining to dismiss pursuant to Rule 41(b) when the plaintiff failed to 27 amend complaint where court order dismissing complaint without prejudice provided only 28 that plaintiff “may” amend its complaint to state a claim). Plaintiffs have not engaged in 1 || the sort of inaction or disobedience of a court order that would merit the sanction of a Rule 2 ||41(b) dismissal. See Edwards, 356 F.3d at 1065. Instead, having failed to amend their 3 || pleading within the Court’s deadline, the proper result in this case is that Plaintiffs are no 4 || longer free to amend their pleading. 5 Here, Defendant has not made a sufficient showing of unreasonable delay. See 6 || Omstead, 594 F.3d at 1084. Plaintiffs formally notified the Court in their Opposition that 7 || they do not intend to file an amended pleading. Opp’n at 2. Although the notification did 8 ||not come before the time to amend expired, there is no evidence of unreasonable delay. 9 || Plaintiffs notified the Court only 30 days after the expiration of the Order’s deadline that 10 |/they did not intend to amend their complaint. See id. “When the plaintiff timely responds 11 || with a formal notice of [its] intent not to amend, the threatened dismissal merely ripens 12 |/into a final, appealable judgment.” Edwards, 356 F.3d at 1065. The Court finds that 13 || Plaintiffs have expressed their intent to stand on their initial pleading within a reasonable 14 || time. 15 Additionally, the critical factor of availability of less drastic sanctions weighs 16 decisively in favor of Plaintiffs. Plaintiffs have agreed to a Rule 12(b)(6) dismissal. Opp’n 17 2. This matter is still expeditiously resolved, and the Court is able to manage its docket. 18 || Accordingly, the Court declines to dismiss pursuant to Rule 41(b). 19 CONCLUSION 20 For the reasons stated above, the Court DENIES Defendant’s Motion to Dismiss for 21 ||Failure to Prosecute Pursuant to Federal Rule of Civil Procedure 41(b) (ECF No. 22). The 22 || Clerk of the Court SHALL ENTER final judgment in favor of Defendant against Plaintiffs 23 || for the reasons set forth in the Court’s March 8, 2021 Order (ECF No. 21). The Clerk of 24 Court SHALL CLOSE the file. 25 IT IS SO ORDERED. 26 || Dated: July 22, 2021 . tt f Le 27 on. Janis L. Sammartino 28 United States District Judge