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but it says it is discontinued WITHOUT prejudice. Does that mean the plaintiff is free to refile his claim in the future?
That is exactly what it means....they can try again at a later date until the statute of limitations expires on the debt.
So yes, if you can get them to agree to drop it with prejudice, then that makes it final forever.
Ok, this isn't technically a dismissal with or without prejudice because a judge does that.. Basically this would be the other party saying that they just don't want to continue.
But they can still voluntarily agree to give up the right to continue the case forever by entering the stipulation and agreeing to discontinue with prejudice.