UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
_________________________________ ) A LOVE OF FOOD I, LLC, ) ) Plaintiff, ) ) v. ) Civil Action No. 1:12-CV-1117(KBJ) ) MAOZ VEGETARIAN USA, INC., ) ) Defendant. ) )
MEMORANDUM OPINION AND ORDER
Presently before the Court is defendant Maoz Vegetarian USA, Inc.’s (“Maoz’s”)
motion for leave to amend its answer. Defendant requests permission to add a fifth
affirmative defense based on the one-year statute of limitations provision found in the
parties’ franchise agreement. (Def.’s Mot. for Leave to File a First Amended Answer
(“Def.’s Mot.”), ECF No. 65 at 2.) Upon consideration of defendant’s motion,
plaintiff’s opposition (Pl.’s Mem. in Opp’n (“Pl.’s Opp’n”), ECF No. 66), defendant’s
reply thereto (Def.’s Reply, ECF No. 69), and the record herein, the Court hereby
DENIES the defendant’s motion for leave to amend the answer.
I. PROCEDURAL HISTORY
This matter involves a contract dispute arising out of a 2007 franchise agreement
between the parties. (Amended Compl., ECF No. 6, at 3-4.) Plaintiff initiated this civil
action on August 25, 2010 (Compl., ECF No. 1), and filed an amended complaint on
November 11, 2010 (Amended Compl., ECF No. 6). Defendant filed an answer to the
amended complaint on July 21, 2011 (Def.’s Answer, ECF No. 16), and the court
1 entered a scheduling order (ECF No. 12) that set an August 22, 2011, deadline for
amendment of the pleadings. Neither party subsequently asked to extend that deadline
until the present motion, which was filed on July 5, 2013.
Defendant filed the current motion to amend its answer after the close of
discovery (which concluded on November 21, 2011 1) and almost two years after the
court’s deadline for filing an amended answer. Defendant’s motion to amend also
comes after motions to dismiss and motions for summary judgment were adjudicated in
part (ECF Nos. 55, 56); after a judge in the District of Maryland transferred this case to
the District of Columbia (ECF No. 56); and after this Court inquired whether the parties
sought to renew their previously-filed and still-pending motions for summary judgment
(Minute Order of May 2, 2013). 2 The amendment to the answer that defendant now
requests—to be allowed to assert the additional affirmative defense that the parties
agreed to bring any claims arising out of the contract within one year of knowledge of
the facts giving rise to such claim—is based on a provision in the franchise agreement
that is the backbone of this entire lawsuit. (See Def.’s Mot. at 2.) 3
II. ANALYSIS
Defendant’s motion to amend the complaint contends that the Court should apply
the standard of Rule 15 of the Federal Rules of Civil Procedure, which states that “[t]he
court should freely give leave [to amend pleadings] when justice so requires.” (Def.’s
1 Defendant sought to postpone the discovery deadline, but the Court denied its request. (See Order of July 19, 2011, ECF No. 15 (“The Court declines to postpone the scheduling order and expects the Parties to comply with its deadlines.”).) 2 The parties indicated their intent to renew their previously-filed motions for summary judgment in a status report on May 28, 2013. (Status Report, ECF No. 64.) 3 The particular contract provision states that the parties must commence “any claim concerning the Franchised Unit or the Franchise Agreement or any related agreement within one (1) year from the date on which Franchisee or Franchisor knew or should have known, in the exercise of reasonable diligence, of the facts giving rise to the claim.” (Def.’s Mot. at 2.)
2 Mot. at 2 (citing Foman v. Davis, 371 U.S. 178, 182 (1962)).) Plaintiff, by contrast,
asserts in its opposition that this Court should apply the “good cause” standard of Rule
16 of the Federal Rules of Civil Procedure. (Pl.’s Opp’n at 3.) Defendant’s reply does
not oppose plaintiff’s argument that Rule 16 applies; indeed, defendant apparently
concedes that the Rule 16 good cause standard is applicable in this situation because the
reply directly addresses whether there is “good cause” to amend the answer in this case.
(Def.’s Reply at 2.) See also Nat’l Sec. Counselors v. C.I.A., 898 F. Supp. 2d 233, 268
(D.D.C. 2012) (“[T]he Court may treat the plaintiff’s failure to oppose the defendant’s
. . . arguments as a decision to concede those arguments.”) (internal citations omitted).
This Court agrees that Rule 16 applies. Although the D.C. Circuit has not had
occasion to address this issue, district court case law makes clear that once the court
enters a scheduling order, that schedule can only be modified with the court’s consent
and with good cause shown. See Lurie v. Mid-Atl. Permanente Med. Grp., P.C., 589 F.
Supp. 2d 21, 23 (D.D.C. 2008) (Lamberth, C.J.) (“Given their heavy case loads, district
courts require the effective case management tools provided by Rule 16. Therefore,
after the deadlines provided by a scheduling order have passed, the good cause standard
must be satisfied to justify leave to amend the pleadings.”); see also Buruca v. Dist. of
Columbia, 902 F. Supp. 2d 75, 79 n.1 (D.D.C. 2012); United States v. Kellogg Brown &
Root Servs., Inc., 285 F.R.D. 133, 135-36 (D.D.C. 2012); Brooks v. Clinton, 841 F.
Supp. 2d 287, 296-97 (D.D.C. 2012); In re Papst Licensing GmbH & Co. KG Litig., 762
F. Supp. 2d 56, 59 (D.D.C. 2011); cf. Shea v. Clinton, 288 F.R.D. 1, 4-5 (D.D.C. 2012)
(Rule 15’s standard for amendment applies when the scheduling order did not include a
deadline for amendment of pleadings). While “[m]otions to amend pleadings filed
3 within the time set by a scheduling order are subject to review under the standard of
[Fed. R. Civ. P.] 15, which instructs that the ‘court should freely give leave when
justice so requires’ . . . such motions filed after a scheduling order deadline has passed
are subject to the more stringent ‘good cause’ standard of [Fed. R. Civ. P.] 16(b)(4)[.]”
Brooks, 841 F. Supp. at 296 (emphasis added). “To hold otherwise would allow Rule
16’s standards to be short circuited by those of Rule 15 and would allow for parties to
disregard scheduling orders, which would undermine the court’s ability to control its
docket, disrupt the agreed-upon course of the litigation, and reward the indolent and the
cavalier.” Lurie, 589 F. Supp. 2d at 23 (citation and internal quotation marks omitted).
This approach is consistent with the circuits that have addressed this question. See
Nourison Rug Corp. v. Parvizian, 535 F.3d 295, 298 (4th Cir. 2008) (collecting cases
from the First, Second, Fifth, Sixth, Eighth, and Eleventh Circuits).
The primary factor in determining whether good cause exists is the diligence of
the party: “the Court’s inquiry must focus on the reasons the [moving party] has given
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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
_________________________________ ) A LOVE OF FOOD I, LLC, ) ) Plaintiff, ) ) v. ) Civil Action No. 1:12-CV-1117(KBJ) ) MAOZ VEGETARIAN USA, INC., ) ) Defendant. ) )
MEMORANDUM OPINION AND ORDER
Presently before the Court is defendant Maoz Vegetarian USA, Inc.’s (“Maoz’s”)
motion for leave to amend its answer. Defendant requests permission to add a fifth
affirmative defense based on the one-year statute of limitations provision found in the
parties’ franchise agreement. (Def.’s Mot. for Leave to File a First Amended Answer
(“Def.’s Mot.”), ECF No. 65 at 2.) Upon consideration of defendant’s motion,
plaintiff’s opposition (Pl.’s Mem. in Opp’n (“Pl.’s Opp’n”), ECF No. 66), defendant’s
reply thereto (Def.’s Reply, ECF No. 69), and the record herein, the Court hereby
DENIES the defendant’s motion for leave to amend the answer.
I. PROCEDURAL HISTORY
This matter involves a contract dispute arising out of a 2007 franchise agreement
between the parties. (Amended Compl., ECF No. 6, at 3-4.) Plaintiff initiated this civil
action on August 25, 2010 (Compl., ECF No. 1), and filed an amended complaint on
November 11, 2010 (Amended Compl., ECF No. 6). Defendant filed an answer to the
amended complaint on July 21, 2011 (Def.’s Answer, ECF No. 16), and the court
1 entered a scheduling order (ECF No. 12) that set an August 22, 2011, deadline for
amendment of the pleadings. Neither party subsequently asked to extend that deadline
until the present motion, which was filed on July 5, 2013.
Defendant filed the current motion to amend its answer after the close of
discovery (which concluded on November 21, 2011 1) and almost two years after the
court’s deadline for filing an amended answer. Defendant’s motion to amend also
comes after motions to dismiss and motions for summary judgment were adjudicated in
part (ECF Nos. 55, 56); after a judge in the District of Maryland transferred this case to
the District of Columbia (ECF No. 56); and after this Court inquired whether the parties
sought to renew their previously-filed and still-pending motions for summary judgment
(Minute Order of May 2, 2013). 2 The amendment to the answer that defendant now
requests—to be allowed to assert the additional affirmative defense that the parties
agreed to bring any claims arising out of the contract within one year of knowledge of
the facts giving rise to such claim—is based on a provision in the franchise agreement
that is the backbone of this entire lawsuit. (See Def.’s Mot. at 2.) 3
II. ANALYSIS
Defendant’s motion to amend the complaint contends that the Court should apply
the standard of Rule 15 of the Federal Rules of Civil Procedure, which states that “[t]he
court should freely give leave [to amend pleadings] when justice so requires.” (Def.’s
1 Defendant sought to postpone the discovery deadline, but the Court denied its request. (See Order of July 19, 2011, ECF No. 15 (“The Court declines to postpone the scheduling order and expects the Parties to comply with its deadlines.”).) 2 The parties indicated their intent to renew their previously-filed motions for summary judgment in a status report on May 28, 2013. (Status Report, ECF No. 64.) 3 The particular contract provision states that the parties must commence “any claim concerning the Franchised Unit or the Franchise Agreement or any related agreement within one (1) year from the date on which Franchisee or Franchisor knew or should have known, in the exercise of reasonable diligence, of the facts giving rise to the claim.” (Def.’s Mot. at 2.)
2 Mot. at 2 (citing Foman v. Davis, 371 U.S. 178, 182 (1962)).) Plaintiff, by contrast,
asserts in its opposition that this Court should apply the “good cause” standard of Rule
16 of the Federal Rules of Civil Procedure. (Pl.’s Opp’n at 3.) Defendant’s reply does
not oppose plaintiff’s argument that Rule 16 applies; indeed, defendant apparently
concedes that the Rule 16 good cause standard is applicable in this situation because the
reply directly addresses whether there is “good cause” to amend the answer in this case.
(Def.’s Reply at 2.) See also Nat’l Sec. Counselors v. C.I.A., 898 F. Supp. 2d 233, 268
(D.D.C. 2012) (“[T]he Court may treat the plaintiff’s failure to oppose the defendant’s
. . . arguments as a decision to concede those arguments.”) (internal citations omitted).
This Court agrees that Rule 16 applies. Although the D.C. Circuit has not had
occasion to address this issue, district court case law makes clear that once the court
enters a scheduling order, that schedule can only be modified with the court’s consent
and with good cause shown. See Lurie v. Mid-Atl. Permanente Med. Grp., P.C., 589 F.
Supp. 2d 21, 23 (D.D.C. 2008) (Lamberth, C.J.) (“Given their heavy case loads, district
courts require the effective case management tools provided by Rule 16. Therefore,
after the deadlines provided by a scheduling order have passed, the good cause standard
must be satisfied to justify leave to amend the pleadings.”); see also Buruca v. Dist. of
Columbia, 902 F. Supp. 2d 75, 79 n.1 (D.D.C. 2012); United States v. Kellogg Brown &
Root Servs., Inc., 285 F.R.D. 133, 135-36 (D.D.C. 2012); Brooks v. Clinton, 841 F.
Supp. 2d 287, 296-97 (D.D.C. 2012); In re Papst Licensing GmbH & Co. KG Litig., 762
F. Supp. 2d 56, 59 (D.D.C. 2011); cf. Shea v. Clinton, 288 F.R.D. 1, 4-5 (D.D.C. 2012)
(Rule 15’s standard for amendment applies when the scheduling order did not include a
deadline for amendment of pleadings). While “[m]otions to amend pleadings filed
3 within the time set by a scheduling order are subject to review under the standard of
[Fed. R. Civ. P.] 15, which instructs that the ‘court should freely give leave when
justice so requires’ . . . such motions filed after a scheduling order deadline has passed
are subject to the more stringent ‘good cause’ standard of [Fed. R. Civ. P.] 16(b)(4)[.]”
Brooks, 841 F. Supp. at 296 (emphasis added). “To hold otherwise would allow Rule
16’s standards to be short circuited by those of Rule 15 and would allow for parties to
disregard scheduling orders, which would undermine the court’s ability to control its
docket, disrupt the agreed-upon course of the litigation, and reward the indolent and the
cavalier.” Lurie, 589 F. Supp. 2d at 23 (citation and internal quotation marks omitted).
This approach is consistent with the circuits that have addressed this question. See
Nourison Rug Corp. v. Parvizian, 535 F.3d 295, 298 (4th Cir. 2008) (collecting cases
from the First, Second, Fifth, Sixth, Eighth, and Eleventh Circuits).
The primary factor in determining whether good cause exists is the diligence of
the party: “the Court’s inquiry must focus on the reasons the [moving party] has given
for his delay instead of the substance of the proposed amendment.” Lurie, 589 F. Supp.
2d at 23. In other words, “Rule 16(b)’s good cause standard focuses on the timeliness
of the amendment and the reasons for its tardy submission.” Id. (internal citation
omitted). In addition to diligence, the movant should also show lack of prejudice to the
opposing parties. Papst, 762 F. Supp. 2d at 59.
Here, the sole explanation that defendant provides for the delay in seeking to
amend the answer to include the contractual statute of limitations affirmative defense is
“oversight.” (Def.’s Mot. at 4.) But mere oversight is not even sufficient to show
excusable neglect, see D.A. v. Dist. of Columbia, No. 07-1084 (PLF/JMF), 2007 WL
4 4365452, *4-5 (D.D.C. Dec. 6, 2007), and “‘[g]ood cause’ requires a greater showing
than ‘excusable neglect.’” Michael Grecco Photography, Inc. v. Everett Collection,
Inc., No. 07-Civ-8171(CM)(JCF), 2008 WL 4580024, *2 (S.D.N.Y. Oct. 14, 2008)
(internal citations omitted).
The fact that defendant mentioned this affirmative defense in summary judgment
briefing over a year ago—but did not seek to amend the answer at that time—merely
underscores the inadequacy of the “oversight” explanation. (See Def.’s Combined
Opp’n to Pl.’s Mot. for Summ. J. & Reply In Supp. of Cross-Mot. for Summ. J., ECF
No. 45.) In responding to defendant’s invocation of the statute of limitations argument
at the summary judgment stage, plaintiff clearly stated that Fed. R. Civ. P. 8(c)(1)
requires that affirmative defenses be raised in the responsive pleadings. (Pl.’s Reply
Mem., ECF No. 46, at 2.) Yet even after the court ruled on the parties’ cross-motions
for summary judgment and transferred the case to this district (ECF Nos. 55, 56), the
“oversight” continued: defendant let another full year pass before moving to amend the
answer.
While it is true that, as defendant notes, this case has been essentially “dormant”
for the past year (Def.’s Reply at 2), this inactivity extended to all aspects of the case
and, in any event, it provides no excuse. This is not a situation in which a new
affirmative defense arose after the scheduling order had passed due to a change in law
or newly discovered evidence. And because the statute of limitations defense stems
from the language of the franchise agreement that is at the heart of this dispute, the
amendment that defendant now wishes to make was available when defendant first
5 answered the amended complaint two years ago, and it has remained at defendant’s
disposal throughout the pendency of this case.
Presented with a similar set of facts, the Fourth Circuit rejected a defendant’s
attempt to amend a pleading after the scheduling order deadline had passed. See
Nourison, 535 F.3d at 298. In Nourison, the defendant sought to amend his answer
after the deadline had passed because he realized an additional affirmative defense was
available after rereading the pleadings. Id. “The Fourth Circuit summarily rejected this
explanation for tardiness, ruling that it fell ‘far short of what is required to satisfy the
good cause standard, and the District Court thus properly denied the motion.’” Lurie,
589 F. Supp. 2d at 24 (citing Nourison, 535 F.3d at 298) (emphasis in original).
So it is here. Although defendant argues that “good cause is met by the need for
an informed and reasoned decision” (Def.’s Reply at 2), the Court’s good cause inquiry
must focus on defendant’s reason for the delay, not the anticipated results of granting
the motion. See Lurie, 589 F. Supp. 2d at 23. Here, defendant has not shown that it
acted diligently; thus, the Court’s inquiry must end, regardless of whether the
amendment will assist the factfinder or result in prejudice to the plaintiff. See Kellogg
Brown & Root Servs., 285 F.R.D. at 136 (“If the party was not diligent, the inquiry
should end.”) (quoting Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 609 (9th
Cir. 1992)).
CONCLUSION
The deadline for amending the pleadings in this case was August 22, 2011, as set
forth in the court’s Scheduling Order. Defendant’s contention that it should now be
given leave to amend the pleadings to include a fifth affirmative defense because it
6 forgot to add that defense to the answer in the first instance, or presumably at any time
over the last two years, constitutes neither diligence nor good cause. Accordingly,
defendant’s motion for leave to amend the answer is DENIED.
Date: July 22, 2013 Ketanji Brown Jackson KETANJI BROWN JACKSON United States District Judge