1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 DIANA AKKAWI, et al., No. 2:20-cv-01034-MCE-AC 12 Plaintiffs, 13 v. MEMORANDUM AND ORDER 14 KASRA SADR, et al., 15 Defendants. 16 17 Through the present action, Plaintiffs Diana Akkawi, Yasmin Akkawi, Katelyn J. 18 Button, Eric M. Stell, Steve W. Fox, and Edmond Tarverdian (collectively, “Plaintiffs”) 19 seek to stop Defendants Kasra Sadr (“Sadr”), the Car Law Firm (“CLF”), the Sadr Law 20 Firm (“SLF”), and Nationwide VIN Marketing (“Nationwide”) (collectively, “Defendants”) 21 from allegedly acquiring the personal information of vehicle owners from the California 22 Department of Motor Vehicles (“DMV”) “by submitting false information requests or by 23 purchasing this information from third parties and then using this information to sell and 24 solicit business in violation of these owners’ property and privacy rights . . .”1 ECF No. 25 35, at 4. Presently before the Court are two motions by Plaintiffs: (1) Motion for Leave 26 to File First Amended Complaint (“FAC”) pursuant to Federal Rule of Civil Procedure 27 1 The DMV was a previous Defendant to this action before it was voluntarily dismissed by all 28 Plaintiffs. ECF Nos. 9, 10, 39. 1 15(a),2 ECF No. 35, and (2) Administrative Motion for an Order Vacating the Current 2 Discovery Cut-off, ECF No. 82. For the reasons set forth below, both Motions are 3 GRANTED.3 4 5 ANALYSIS 6 7 A. Plaintiffs’ Motion for Leave to File FAC 8 Pursuant to Rule 15(a), Plaintiffs seek to amend their Complaint to include Ryan 9 Bancaya (“Bancaya”) as a defendant, alleging that he provided Defendants the personal 10 information of thousands of California vehicle owners so Defendants could “send 11 marketing letters to the Plaintiffs and other California vehicle owners to solicit legal 12 business based on the allegation that their vehicles may have frame damage.” ECF No. 13 35, at 9; see also Ex. B, ECF No. 39-1 ¶ 12. Generally, a motion to amend is subject to 14 Rule 15(a), which provides that “[t]he court should freely give leave [to amend] when 15 justice so requires.” Fed. R. Civ. P. 15(a)(2). However, once a pretrial scheduling order 16 is filed pursuant to Rule 16, “that rule’s standards control[].”4 Johnson v. Mammoth 17 Recreations, Inc., 975 F.2d 604, 607–08 (9th Cir. 1992). 18 Under Rule 16(b), a party seeking leave to amend must demonstrate “good 19 cause,” which “primarily considers the diligence of the party seeking the amendment.” 20 Id. at 609. “Although the existence or degree of prejudice to the party opposing 21 modification might supply additional reasons to deny a motion [to amend], the focus of 22 the inquiry is upon the moving party’s reasons for seeking modification.” Id. “If that party 23 was not diligent, the inquiry should end.” Id.
24 2 All further references to “Rule” or “Rules” are to the Federal Rules of Civil Procedure. 25 3 Because oral argument would not be of material assistance, the Court ordered these matters submitted on the briefs. E.D. Local Rule 230(g). 26
4 According to this Court’s Initial Pretrial Scheduling Order issued on May 21, 2020, “[w]ithin thirty 27 (30) days of service of the complaint on the last party, . . . the parties shall amend the complaint or join any parties pursuant to the Federal Rules of Civil Procedure. No other joinder of parties or amendments to 28 pleadings is permitted without leave of court, good cause having been shown.” ECF No. 5, at 2. 1 If good cause is found, the court must then evaluate the request to amend the 2 complaint in light of Rule 15(a)’s liberal standard. If the movant articulates a reason why 3 amendment is needed, the “burden then shifts to the opposing party to persuade the 4 court that ‘justice’ requires denial.” Stoddart v. Express Servs., Inc., No. 2:12-cv-01054- 5 KJM-CKD, 2015 WL 1812833, at *2 (E.D. Cal. Apr. 20, 2015). The Court considers five 6 factors in determining whether to permit an amendment to the complaint under Rule 7 15(a): (1) whether the amendment was filed with undue delay; (2) whether the movant 8 has requested the amendment in bad faith or as a dilatory tactic; (3) whether the movant 9 was allowed to make previous amendments which failed to correct deficiencies of the 10 complaint; (4) whether the amendment will unduly prejudice the opposing party; and (5) 11 whether the amendment would be futile. See Foman v. Davis, 371 U.S. 178, 182 12 (1962). Whether amendment will unduly prejudice the opposing party is the most 13 important factor in a court’s analysis under Rule 15(a). Eminence Capital, LLC v. 14 Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003). 15 Defendants first argue that the good cause requirement is not satisfied because 16 the proposed FAC does not allege sufficient facts showing that Bancaya was involved in 17 the alleged conspiracy. See ECF No. 43, at 3–5 (“[T]o show good cause, Plaintiffs must 18 show facts they have uncovered that shows Ryan Bancaya ‘knowingly’ obtained or 19 disclosed DMV information, and that he ‘knew’ that such information was going to be 20 used for an improper purpose. No facts uncovered show any such facts, and the FAC 21 does not even allege it.”). However, the good cause requirement examines the diligence 22 of the party seeking amendment, not the substance of the proposed amendment. See 23 Johnson, 975 F.2d at 609. Here, Plaintiffs state that the information relating to Bancaya 24 was obtained through the deposition of Defendant Sadr on February 10, 2022, and 25 through the production of documentation showing Sadr’s monthly payments to Bancaya 26 on April 15, 2022. ECF No. 35, at 8–9; see also ECF No. 35, at 14 ¶ 5 (declaration from 27 Plaintiffs’ counsel) (stating that Plaintiffs “did not know of the existence of Defendant 28 Bancaya and did not know of the sources or methods used by the Defendants to access 1 information” at the time the Complaint was filed). Within two weeks of the production of 2 documentation, on April 28, 2022, Plaintiffs filed the present Motion. Furthermore, the 3 current discovery deadline is October 1, 2022, which means discovery is still open, and 4 no trial date has been set. Absent a proper reason as to why Plaintiffs have not 5 demonstrated good cause, the Court turns to whether Plaintiffs have satisfied the 6 requirements of Rule 15(a). 7 Like their good cause argument, Defendants reiterate that the allegations 8 pertaining to Bancaya “are solely conclusory with no supported facts or allegations . . .” 9 See ECF No. 43, at 6–7. For purposes of this Motion, the Court declines to consider 10 such an argument. Although Defendants’ arguments concerning the sufficiency of 11 Plaintiffs’ proposed allegations against Bancaya may have merit, they should be 12 advanced in a fully briefed motion to dismiss under Rule 12. See Anthony v. Harmon, 13 No. 2:09-cv-02272-MCE-KJM, 2010 WL 4720889, at *2 (E.D. Cal. Nov. 17, 2010) 14 (explaining that “courts generally defer consideration of challenges to the merits of a 15 proposed amended pleading until after leave to amend is granted and the amended 16 pleading is filed.”) (citation omitted); Lillis v. Apria Healthcare, No. 12-cv-52, 2012 WL 17 4760908, at *1 (S.D. Cal. Oct. 5, 2012) (same).
Free access — add to your briefcase to read the full text and ask questions with AI
1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 DIANA AKKAWI, et al., No. 2:20-cv-01034-MCE-AC 12 Plaintiffs, 13 v. MEMORANDUM AND ORDER 14 KASRA SADR, et al., 15 Defendants. 16 17 Through the present action, Plaintiffs Diana Akkawi, Yasmin Akkawi, Katelyn J. 18 Button, Eric M. Stell, Steve W. Fox, and Edmond Tarverdian (collectively, “Plaintiffs”) 19 seek to stop Defendants Kasra Sadr (“Sadr”), the Car Law Firm (“CLF”), the Sadr Law 20 Firm (“SLF”), and Nationwide VIN Marketing (“Nationwide”) (collectively, “Defendants”) 21 from allegedly acquiring the personal information of vehicle owners from the California 22 Department of Motor Vehicles (“DMV”) “by submitting false information requests or by 23 purchasing this information from third parties and then using this information to sell and 24 solicit business in violation of these owners’ property and privacy rights . . .”1 ECF No. 25 35, at 4. Presently before the Court are two motions by Plaintiffs: (1) Motion for Leave 26 to File First Amended Complaint (“FAC”) pursuant to Federal Rule of Civil Procedure 27 1 The DMV was a previous Defendant to this action before it was voluntarily dismissed by all 28 Plaintiffs. ECF Nos. 9, 10, 39. 1 15(a),2 ECF No. 35, and (2) Administrative Motion for an Order Vacating the Current 2 Discovery Cut-off, ECF No. 82. For the reasons set forth below, both Motions are 3 GRANTED.3 4 5 ANALYSIS 6 7 A. Plaintiffs’ Motion for Leave to File FAC 8 Pursuant to Rule 15(a), Plaintiffs seek to amend their Complaint to include Ryan 9 Bancaya (“Bancaya”) as a defendant, alleging that he provided Defendants the personal 10 information of thousands of California vehicle owners so Defendants could “send 11 marketing letters to the Plaintiffs and other California vehicle owners to solicit legal 12 business based on the allegation that their vehicles may have frame damage.” ECF No. 13 35, at 9; see also Ex. B, ECF No. 39-1 ¶ 12. Generally, a motion to amend is subject to 14 Rule 15(a), which provides that “[t]he court should freely give leave [to amend] when 15 justice so requires.” Fed. R. Civ. P. 15(a)(2). However, once a pretrial scheduling order 16 is filed pursuant to Rule 16, “that rule’s standards control[].”4 Johnson v. Mammoth 17 Recreations, Inc., 975 F.2d 604, 607–08 (9th Cir. 1992). 18 Under Rule 16(b), a party seeking leave to amend must demonstrate “good 19 cause,” which “primarily considers the diligence of the party seeking the amendment.” 20 Id. at 609. “Although the existence or degree of prejudice to the party opposing 21 modification might supply additional reasons to deny a motion [to amend], the focus of 22 the inquiry is upon the moving party’s reasons for seeking modification.” Id. “If that party 23 was not diligent, the inquiry should end.” Id.
24 2 All further references to “Rule” or “Rules” are to the Federal Rules of Civil Procedure. 25 3 Because oral argument would not be of material assistance, the Court ordered these matters submitted on the briefs. E.D. Local Rule 230(g). 26
4 According to this Court’s Initial Pretrial Scheduling Order issued on May 21, 2020, “[w]ithin thirty 27 (30) days of service of the complaint on the last party, . . . the parties shall amend the complaint or join any parties pursuant to the Federal Rules of Civil Procedure. No other joinder of parties or amendments to 28 pleadings is permitted without leave of court, good cause having been shown.” ECF No. 5, at 2. 1 If good cause is found, the court must then evaluate the request to amend the 2 complaint in light of Rule 15(a)’s liberal standard. If the movant articulates a reason why 3 amendment is needed, the “burden then shifts to the opposing party to persuade the 4 court that ‘justice’ requires denial.” Stoddart v. Express Servs., Inc., No. 2:12-cv-01054- 5 KJM-CKD, 2015 WL 1812833, at *2 (E.D. Cal. Apr. 20, 2015). The Court considers five 6 factors in determining whether to permit an amendment to the complaint under Rule 7 15(a): (1) whether the amendment was filed with undue delay; (2) whether the movant 8 has requested the amendment in bad faith or as a dilatory tactic; (3) whether the movant 9 was allowed to make previous amendments which failed to correct deficiencies of the 10 complaint; (4) whether the amendment will unduly prejudice the opposing party; and (5) 11 whether the amendment would be futile. See Foman v. Davis, 371 U.S. 178, 182 12 (1962). Whether amendment will unduly prejudice the opposing party is the most 13 important factor in a court’s analysis under Rule 15(a). Eminence Capital, LLC v. 14 Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003). 15 Defendants first argue that the good cause requirement is not satisfied because 16 the proposed FAC does not allege sufficient facts showing that Bancaya was involved in 17 the alleged conspiracy. See ECF No. 43, at 3–5 (“[T]o show good cause, Plaintiffs must 18 show facts they have uncovered that shows Ryan Bancaya ‘knowingly’ obtained or 19 disclosed DMV information, and that he ‘knew’ that such information was going to be 20 used for an improper purpose. No facts uncovered show any such facts, and the FAC 21 does not even allege it.”). However, the good cause requirement examines the diligence 22 of the party seeking amendment, not the substance of the proposed amendment. See 23 Johnson, 975 F.2d at 609. Here, Plaintiffs state that the information relating to Bancaya 24 was obtained through the deposition of Defendant Sadr on February 10, 2022, and 25 through the production of documentation showing Sadr’s monthly payments to Bancaya 26 on April 15, 2022. ECF No. 35, at 8–9; see also ECF No. 35, at 14 ¶ 5 (declaration from 27 Plaintiffs’ counsel) (stating that Plaintiffs “did not know of the existence of Defendant 28 Bancaya and did not know of the sources or methods used by the Defendants to access 1 information” at the time the Complaint was filed). Within two weeks of the production of 2 documentation, on April 28, 2022, Plaintiffs filed the present Motion. Furthermore, the 3 current discovery deadline is October 1, 2022, which means discovery is still open, and 4 no trial date has been set. Absent a proper reason as to why Plaintiffs have not 5 demonstrated good cause, the Court turns to whether Plaintiffs have satisfied the 6 requirements of Rule 15(a). 7 Like their good cause argument, Defendants reiterate that the allegations 8 pertaining to Bancaya “are solely conclusory with no supported facts or allegations . . .” 9 See ECF No. 43, at 6–7. For purposes of this Motion, the Court declines to consider 10 such an argument. Although Defendants’ arguments concerning the sufficiency of 11 Plaintiffs’ proposed allegations against Bancaya may have merit, they should be 12 advanced in a fully briefed motion to dismiss under Rule 12. See Anthony v. Harmon, 13 No. 2:09-cv-02272-MCE-KJM, 2010 WL 4720889, at *2 (E.D. Cal. Nov. 17, 2010) 14 (explaining that “courts generally defer consideration of challenges to the merits of a 15 proposed amended pleading until after leave to amend is granted and the amended 16 pleading is filed.”) (citation omitted); Lillis v. Apria Healthcare, No. 12-cv-52, 2012 WL 17 4760908, at *1 (S.D. Cal. Oct. 5, 2012) (same). 18 Regarding the prejudice factor, Defendants contend that they “have already 19 conducted all their discovery, including taking depositions of all defendants they wish to 20 depose (5 of 6 defendants)[,]” and that “all written discovery is done by Defendants.” 21 ECF No. 43, at 7. Should the Court grant leave to amend, Defendants argue that 22 “Plaintiffs will have to retake 5 depositions and conduct more discovery.” Id. However, 23 the need to conduct additional discovery is insufficient to constitute a showing of 24 prejudice.5 See Adams v. Kraft, No. 10-CV-00602-LHK, 2010 WL 4939440, at *4 25 (N.D. Cal. Nov. 30, 2010) (“Examples of substantial prejudice include instances in which 26 amendment would create a need to reopen discovery and in which amendment would 27 5 As such, Defendants’ request that Plaintiffs should reimburse Defendants for subsequent 28 discovery, including costs and attorney’s fees, is DENIED. See ECF No. 43, at 7. 1 greatly alter the nature of the litigation at a late hour in the case.”) (citing Morongo Band 2 of Mission Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir. 1990)). Here, this is Plaintiffs’ 3 first attempt at amending the Complaint, the dispositive motion deadline has not yet 4 passed, and this case has not been set for trial. The discovery deadline has also not yet 5 expired, and Plaintiff would be entitled to conduct further discovery even if Defendants 6 claim to have finished conducting theirs. 7 Lastly, given that Defendants’ opposition is based on the prejudice and futility 8 factors, in addition to Rule 16(b)’s good cause requirement, the Court resolves the other 9 Foman factors in Plaintiffs’ favor. As a result, the Court finds that leave to file the FAC is 10 appropriate and thus Plaintiffs’ Motion for Leave to File FAC is GRANTED. 11 B. Plaintiffs’ Administrative Motion to Vacate Current Discovery Cut-off 12 Plaintiffs also seek to vacate the current discovery deadline of October 1, 2022, in 13 light of the pending Motion for Leave to File FAC, the need to conduct further discovery 14 should that Motion be granted, and the numerous discovery disputes between the 15 parties. ECF No. 82, at 3. Defendants oppose Plaintiffs’ request, arguing that it is 16 untimely and improper. See generally ECF No. 89. Because the pretrial scheduling 17 order has already been issued in this case, Rule 16(b)’s good cause standard applies. 18 See Johnson, 975 F.2d at 608. 19 As set forth above, the Court has now addressed Plaintiffs’ Motion for Leave to 20 File FAC, which was filed on April 28, 2022, and granted said motion with the knowledge 21 that Plaintiffs intend to conduct further discovery. Although Defendants intend to file a 22 motion for summary judgment on October 2, 2022, ECF No. 89, at 3 ¶ 7, such a motion 23 will be moot since Plaintiffs are filing an amended complaint. Furthermore, there are 24 discovery related motions pending before the assigned magistrate judge, and multiple 25 Joint Statements of Discovery Disagreements have been filed. See ECF Nos. 65, 78, 26 88, 90–93. The magistrate judge recently ruled on Defendants’ motion for protective 27 order and Plaintiffs’ motions to compel in July 2022. Overall, the Court finds that good 28 /// 1 | cause exists to extend the discovery deadline by 180 days and therefore, Plaintiffs’ 2 | Administrative Motion is GRANTED. 3 4 CONCLUSION 5 6 For the foregoing reasons, Plaintiffs’ Motion for Leave to File FAC, ECF No. 35, 7 | and Administrative Motion for an Order Vacating the Current Discovery Cut-off, ECF No. 8 | 82, are GRANTED. Plaintiffs shall file their proposed FAC not later than two (2) days 9 | from the date this Memorandum and Order is filed. Non-expert discovery shall be 10 | completed no later than one-hundred and eighty (180) days from the date this 11 | Memorandum and Order is filed. 12 IT IS SO ORDERED. 13 14 | Dated: September 21, 2022 Mater LEK Whig { AX Xo - ‘6 SENIOR UNITED STATES DISTRICT JUDGE 17 18 19 20 21 22 23 24 25 26 27 28