Freedom International Trucks, Inc. v. Eagle Enterprises, Inc.

182 F.R.D. 172, 1998 U.S. Dist. LEXIS 14623, 1998 WL 639254
CourtDistrict Court, E.D. Pennsylvania
DecidedSeptember 15, 1998
DocketNo. CIV. A. 97-4237
StatusPublished
Cited by3 cases

This text of 182 F.R.D. 172 (Freedom International Trucks, Inc. v. Eagle Enterprises, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Freedom International Trucks, Inc. v. Eagle Enterprises, Inc., 182 F.R.D. 172, 1998 U.S. Dist. LEXIS 14623, 1998 WL 639254 (E.D. Pa. 1998).

Opinion

MEMORANDUM

LOWELL A. REED, Jr., District Judge.

Presently before the Court is the motion of plaintiff Freedom International Trucks, Inc. (“Freedom”) for leave to amend and supplement its complaint pursuant to Federal Rule of Civil Procedure 15(a). Plaintiffs proposed second amended complaint contains an additional claim (Count VII) against Robert Fer-ro, Sonya Ferro and Patricia Ferro (the “Ferros”) for violation of the Racketeer Influenced and Corrupt Organizations Act, (“RICO”), 18 U.S.C. § 1961 et seq. Based on the following analysis, the motion will be granted.

I. Legal Standard

The decision whether to grant or deny a motion for leave to amend is within the sound discretion of the district court. Zenith Radio Corp. v. Hazeltine Research, Inc., 401 U.S. 321, 330, 91 S.Ct. 795, 28 L.Ed.2d 77 (1971); In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1434 (3d Cir.1997). The Federal Rules of Civil Procedure provide that leave to amend “shall be freely given when justice so requires.” Fed. R. Civ.P. 15(a). Indeed, in the. absence of any apparent reason, “this mandate is to be heeded.” Foman v. Davis, 371 U.S. 178, 182, 83 S. Ct. 227, 9 L.Ed.2d 222 (1962); Kiser v. General Elec. Corp., 831 F.2d 423, 426-27 (3d Cir.1987), cert. denied sub nom., 485 U.S. 906, 108 S.Ct. 1078, 99 L.Ed.2d 238 (1988). Factors that militate against granting leave to amend are “undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, [and] futility of amendment....” Foman, 371 U.S. 178,182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962).

II. Analysis

I conclude that leave to file an amended complaint should be granted because it is not unduly prejudicial to defendants Eagle Enterprises, Inc., (“Eagle”), Robert Ferro, Sonya Ferro and Patricia Ferro (the “Ferros”) (collectively the “Defendants”). Nor is there evidence of bad faith [175]*175on the part of Freedom to warrant a denial of Freedom’s motion to amend. Furthermore, the amendment is not futile because it properly avers facts sufficient to state a claim under the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. § 1961 et seq.

A. Undue Delay

The party seeking leave to amend bears the burden of explaining the reasons for the delay. Cresswell v. Sullivan & Cromwell, 922 F.2d 60, 72 (2nd Cir.1990), cert. denied, 505 U.S. 1222, 112 S.Ct. 3036, 120 L.Ed.2d 905 (1992). The Defendants argue that the proposed amendment is untimely and, therefore, is prejudicial. However, mere delay is not by itself enough to justify denial of leave to amend. Kiser, 831 F.2d at 427. “The delay, to become a legal ground for denying a motion to amend, must result in prejudice to the party opposing the amendment, and it is the opposing party’s burden to prove that such prejudice will occur.” Id. at 427-28. Moreover, a “mere claim of prejudice is not sufficient; there must be some showing that [the defendant] was unfairly disadvantaged or deprived of the opportunity to present facts or evidence which it would have offered had the ... amendments been timely.” Dole v. Arco Chemical Co., 921 F.2d 484, 488 (3d Cir.1990) (quoting Heyl & Patterson Int’l, Inc. v. F.D. Rich Housing of the Virgin Islands Inc., 663 F.2d 419, 426 (3d Cir.1981), cert. denied, 455 U.S. 1018, 102 S.Ct. 1714, 72 L.Ed.2d 136 (1982)). Because I conclude that the Defendants will suffer, no undue prejudice as a result of the proposed amendment, I will not deny Freedom’s Motion to Amend on the basis of delay.

B. Bad Faith

A court may also justify the denial of a motion to amend on grounds of bad faith or dilatory motive. Foman, 371 U.S. at 182, 83 S.Ct. 227. As the basis for the Defendants’ contention that Freedom’s motion to amend is brought in bad faith, the Defendants argue that Freedom is “conjuring up” a federal question claim in “an attempt to keep this controversy in federal court.” (Def.’s Mem at 8). However, amending a complaint to assert a new basis for jurisdiction is not by itself an act of bad faith. See Berkshire Fashions, Inc. v. M.V. Hakusan II, 954 F.2d 874, 887 (3d Cir.1992); Scattergood v. Perelman, 945 F.2d 618, 626-27 (3d Cir.1991). It follows that amending a complaint to add a claim which may provide an alternative basis for jurisdiction is also not by itself an act of bad faith. See id. In this case, there is no basis for the Court to conclude that Freedom acted in bad faith. Therefore, I will not deny Freedom’s Motion to Amend on the basis of bad faith.

C. Futility

In addition, a court may justify the denial of a motion to amend on the grounds that the amendment would be futile. “Futility” challenges an amendment’s legal sufficiency. In assessing futility, the Court “applies the same standard of legal sufficiency as applies under Rule 12(b)(6).” In re Burlington Coat Factory, 114 F.3d at 1434. Thus, in deciding whether an amendment is futile, a court must take all well pleaded facts in the complaint as true and view them in the light most favorable to the plaintiff. Id.; Jenkins v. McKeithen, 395 U.S. 411, 421, 89 S.Ct. 1843, 23 L.Ed.2d 404 (1969) (standard for motion to dismiss). Similarly, leave to file an amendment should be denied if “it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations.” Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984) (standard for motion to dismiss).

1. Freedom’s RICO Claims (Count VII)

Freedom’s proposed second amended complaint avers facts sufficient to state a civil RICO claim.

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Bluebook (online)
182 F.R.D. 172, 1998 U.S. Dist. LEXIS 14623, 1998 WL 639254, Counsel Stack Legal Research, https://law.counselstack.com/opinion/freedom-international-trucks-inc-v-eagle-enterprises-inc-paed-1998.