Filed: May 23, 2012
Latest Update: May 23, 2012
Summary: ORDER KRISTI K. DuBOSE, District Judge. This action is before the Court on the parties' joint stipulation of dismissal with prejudice pursuant to Fed. R. Civ. P. 41(a)(1)(A)(ii) (doc. 62). The stipulation is signed by all parties who have appeared in this action. Upon consideration of the stipulation and for the reasons set forth herein, this action is DISMISSED with prejudice, with each party to bear his or its costs as stipulated, and the Clerk of the Court is directed to close this file.
Summary: ORDER KRISTI K. DuBOSE, District Judge. This action is before the Court on the parties' joint stipulation of dismissal with prejudice pursuant to Fed. R. Civ. P. 41(a)(1)(A)(ii) (doc. 62). The stipulation is signed by all parties who have appeared in this action. Upon consideration of the stipulation and for the reasons set forth herein, this action is DISMISSED with prejudice, with each party to bear his or its costs as stipulated, and the Clerk of the Court is directed to close this file. ..
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ORDER
KRISTI K. DuBOSE, District Judge.
This action is before the Court on the parties' joint stipulation of dismissal with prejudice pursuant to Fed. R. Civ. P. 41(a)(1)(A)(ii) (doc. 62). The stipulation is signed by all parties who have appeared in this action. Upon consideration of the stipulation and for the reasons set forth herein, this action is DISMISSED with prejudice, with each party to bear his or its costs as stipulated, and the Clerk of the Court is directed to close this file.
Previously, this action was stayed as to defendant Bender Shipbuilding & Repair, Co., Inc. (Bender, Inc), pursuant to the automatic stay provision of 11 U.S.C. § 362 (doc. 38) and stayed as to defendant Thomas B. Bender, Jr., on the motion to stay pending resolution of the bankruptcy of Bender, Inc. (doc. 43). Although the automatic stay as to Bender, Inc. has issued, "courts retain jurisdiction `to determine the applicability of the stay to litigation pending before them, and to enter orders not inconsistent with the terms of the stay.'" Robert v. Bell Helicopter Textron, Inc., 2002 WL 1268030, 2 (N.D. Tex. May 31, 2002) (quoting Picco v. Global Marine Drilling Co., 900 F.2d 846, 850 (5th Cir. 1990)).
The automatic stay, in relevant part, operates to stay the continuation of judicial proceeding against the debtor. 11 U.S.C. § 362(a)(1). Also, the automatic stay serves two primary purposes: To relieve the debtor from the financial expense of litigation during the bankruptcy proceedings and to protect creditors by preserving the debtor's estate. Carver v. Carver, 954 F.2d 1573, 1576 (11th Cir.1992).
However, "courts have held that the automatic stay does not prevent a court from dismissing a case against the debtor on the motion of the plaintiff pursuant to rule 41(a) of the Federal Rules of Civil Procedure", so long as the dismissal is not inconsistent with the purpose of the automatic stay. Settles v. Commissioner of Internal Revenue, 138 T.C., No. 19, 2012 WL 1605350, *3 (U.S. Tax Ct. May 8, 2012) (citing Arnold v. Garlock Inc., 288 F.3d 234 (5th Cir.2002); Slay v. Living Ctrs. E., Inc., 249 B.R. 807 ( S.D.Ala. 2000)1; Chase Manhattan Bank, N.A. v. Celotex Corp., 852 F.Supp. 226 (S.D.N.Y. 1994)).2 Because dismissal of this action would relieve defendant Bender, Inc. of the expense of litigation and preserve to all creditors any assets which would be subject to a potential recovery in this action, dismissal of this litigation against defendant Bender, Inc. is not inconsistent with the purposes of the automatic stay. Accordingly, this action is due to be dismissed with prejudice with each party to bear their own costs, as stipulated.
DONE and ORDERED.
