Federal Rule of Civil Procedure 41(a) allows a plaintiff to voluntarily dismiss its claims, either before a responsive pleading has been filed, or with the court’s permission. But Rule 41 also allows the trial court to impose conditions on an order dismissing a case. So what happens if a plaintiff decides a case isn’t worth pressing but can’t get a dismissal order without meeting an unexpected—and expensive—condition first?

Paysys International, a payment software company, sued Atos IT Services for breaching a licensing agreement’s territorial restrictions. Three years later, Paysys had lost on twelve of its thirteen claims. Paysys decided the last claim wasn’t worth the price of litigation and moved for a voluntary dismissal without prejudice under Rule 41(a). Atos told the trial court it would agree to the motion but only if the court awarded Atos attorneys’ fees under the licensing agreement.

The trial court granted Paysys’s motion, ordered Paysys to pay attorneys’ fees—and denied Paysys’s request to allow the company to withdraw the motion instead of paying. Paysys appealed and the Second Circuit reversed.

The Second Circuit held that a plaintiff has the right to withdraw a motion for voluntary dismissal if the trial court grants the motion but imposes conditions. The Court of Appeals noted that “Rule 41(a) permits voluntary dismissals of cases, regardless of whether they might otherwise have sufficient merit to be litigated to trial.” That’s because the point of the Rule is cost-efficient litigation. So the Rule allows a plaintiff to dismiss a claim when it decides the costs of litigating the case outweigh the likely benefit. “[I]t is efficient to incentivize that party to dismiss its case (on terms that will not prejudice the defendant), rather than remain in court, wasting our resources and those of the opposing party.”

If the trial court’s order changes that cost-benefit analysis, the plaintiff should be allowed to change its mind. Here the trial court’s order allowed Paysys to dismiss its last claim but only at a price that Paysys hadn’t counted on. The Second Circuit reversed the trial court’s order and remanded the case to give Paysys “a reasonable period of time in which to make [the] decision” whether to withdraw its motion.

Read the Second Circuit’s decision here.