Rebecca Stambanis v. TBWA Worldwide, Inc.

Opinion

1 O 2 3 4 5 6 7 8 United States District Court 9 Central District of California

11 REBECCA STAMBANIS, Case No. 2:19-cv-3962-ODW (JEMx)

12 Plaintiff, ORDER DENYING PLAINTIFF’S 13 MOTION FOR LEAVE TO AMEND 14 v. [51]

15 TBWA WORLDWIDE, INC., dba 16 TBWA/MEDIA ARTS LAB; and DOES 110, 17

18 Defendants. 19 21 Plaintiff Rebecca Stambanis moves for leave to file a Third Amended Complaint 22 (“proposed TAC”) (See Mot. for Leave to Amend (“Mot.”), ECF No. 51.) For the 23 reasons that follow, the Court DENIES Stambanis’s Motion for Leave to Amend 24 (“Motion”).1 26 On April 1, 2016, Stambanis joined TBWA/Media Arts Lab (“TBWA”) as its 27 1 After carefully considering the papers filed related to the Motion, the Court deemed the matter 28 appropriate for decision without oral argument. Fed. R. Civ. P. 78; L.R. 7-15. 1 Chief Strategy Officer, specifically to lead the advertising strategy for TBWA’s client, 2 “Apple.” (Second Am. Compl. (“SAC”), ¶¶ 1, 12, ECF No. 41.) 3 On March 11, 2016, Stambanis signed the offer letter (the “Letter Agreement”). 4 (SAC ¶ 17.) Stambanis officially began to work in April 2016, but TBWA promised to 5 allow her to work remotely in Portland until the end of April before she had to relocate 6 to Los Angeles. (SAC ¶ 17.) However, TBWA required Stambanis to attend several 7 meetings in California during that time. (SAC ¶ 18.) Later that month, Stambanis was 8 diagnosed with cervical cancer and needed immediate surgery. (SAC ¶ 19.) Despite 9 notifying TBWA of her procedure, TBWA scheduled conference calls with Stambanis 10 for the day after her surgery. (SAC ¶ 19.) 11 During the hiring process, Stambanis informed TBWA “that before she could 12 consider whether to accept the position, her partner would need legal status to be able 13 to live in the United States.” (SAC ¶ 14.) TBWA assured Stambanis that they were 14 familiar with the process and proposed several paths to obtain legal status for her 15 partner. (SAC ¶¶ 15, 16.) However, Stambanis alleges that by June 2016, TBWA had 16 done nothing to secure the visa it promised for Stambanis’s partner. (SAC ¶ 22.) As a 17 result of TBWA’s inability to obtain the visa, Stambanis informed TBWA that she 18 would need to resign effective the end of July 2016. (SAC ¶ 24.) TBWA pressured 19 Stambanis to stay and agreed to modify the terms of her employment in a subsequent 20 agreement (the “Letter Amendment”). (SAC ¶¶ 26–27.) 21 In late July 2016, Stambanis relocated from Portland to Los Angeles. (SAC 22 ¶ 29.) Stambanis alleges that after signing the Letter Amendment, TBWA’s leadership 23 isolated her and excluded her from meetings and decisions. (SAC ¶ 30) When she 24 visited her partner, Stambanis’s password to TBWA’s network stopped working. (SAC 25 ¶ 32.) Stambanis eventually learned that by mid-August 2016, TBWA had already hired 26 her replacement. (SAC ¶ 32.) On September 7, 2016, TBWA accused Stambanis of 27 “bad-mouthing” the agency and by September 16, 2016, TBWA terminated her. (SAC 28 ¶ 33, 34.) 1 On September 10, 2018, Stambanis initiated this wrongful termination and 2 employment violation lawsuit. (See SAC ¶ 1; Notice of Removal, ECF No. 1.) 3 Stambanis asserts thirteen employment-related causes of action against TBWA. (See 4 generally SAC.) TBWA moved to dismiss Stambanis’s First Amended Complaint, 5 which the Court granted in part, with leave to amend. (Order, ECF No. 34.) TBWA 6 then moved to dismiss the claim for intentional infliction of emotional distress in the 7 SAC, which the Court granted but without leave to amend. (Order, ECF No. 48.) Now, 8 Stambanis seeks leave to amend her complaint a third time to add factual allegations 9 supporting new claims for disability discrimination: failure to prevent disability 10 discrimination, failure to accommodate disability, failure to engage in good faith 11 interactive process, retaliation for engaging in protected activity, and retaliation because 12 of history of disability. (Mot. 4) 14 Under Federal Rule of Civil Procedure (“Rule”) 15(a), a party is allowed to 15 amend its pleading once as a matter of course within twenty-one days of serving the 16 pleading, or at any time before a responsive pleading is served. Fed. R. Civ. P. 15(a). 17 While Rule 15 provides that leave to amend shall be freely given, it is not automatic. 18 In re W. States Wholesale Nat. Gas Antitrust Litig., 715 F.3d 716, 738 (9th Cir. 2013). 19 “[T]he grant or denial of an opportunity to amend is within the discretion of the District 20 Court.” Foman v. Davis, 371 U.S. 178, 182 (1962). In evaluating whether to grant 21 leave to amend, courts in the Ninth Circuit consider if any of the following factors deter 22 the grant of leave: (1) bad faith, (2) undue delay, (3) prejudice to the opposing party, 23 (4) futility of amendment, and (5) previous opportunity to amend the complaint 24 (“Foman factors”). Id. However, “[n]ot all of the factors merit equal weight”; prejudice 25 to the opposing party carries the greatest weight. Eminence Capital, LLC v. Aspeon, 26 Inc., 316 F.3d 1048, 1052 (9th Cir. 2003). 27 28 2 Rule 15 provides that leave to amend should be freely given when justice so 3 requires. Fed. R. Civ. P. 15(a)(2). However, where the Foman factors are present, the 4 court may deny leave to amend. In re W. States, 715 F.3d at 738. The Court may deny 5 leave to amend based on any one factor. Cf. Eminence Capital, 316 F.3d at 1502 6 (“[A]bsent . . . a strong showing of any of the . . . Foman factors, there exists a 7 presumption under Rule 15(a) in favor of granting leave to amend.”) (demonstrating 8 that a showing of prejudice or a strong showing of any of the remaining Foman factors 9 may warrant denying leave to amend). But, here, the Court addresses both prejudice to 10 the opposing party and undue delay. 11 A. Prejudice to the Opposing Party 12 Of all the factors to consider, “prejudice to the opposing party requires the 13 greatest consideration.” Eminence Capital, 316 F.3d at 1052. Stambanis argues that 14 the additional expense of litigating new claims is not prejudicial to TBWA. (Reply 2, 15 ECF No. 55). However, the Ninth Circuit has held to the contrary. In Jackson v. Bank 16 of Hawaii, the Ninth Circuit held that conducting additional discovery on new claims 17 “[advancing] different legal theories and [requiring] proof of different facts” prejudices 18 the non-moving party. 902 F.2d 1385, 1387 (9th Cir. 1990). There, the plaintiff sought 19 leave to amend his complaint to add RICO claims. Id. The Ninth Circuit explained that 20 “putting the defendants ‘through the time and expense of continued litigation on a new 21 theory, with the possibility of additional discovery, would be manifestly unfair and 22 unduly prejudicial.’” 902 F.2d 1385, 1388 (9th Cir. 1990) (quoting Troxel Mfg. Co. v. 23 Schwinn Bicycle Co., 489 F.2d 968, 971 (6th Cir. 1973)). Thus, the court denied the 24 plaintiff’s motion for leave to amend. Id. at 1387–88 (citation omitted). 25 Here, Stambanis seeks to amend her complaint to include new claims for 26 disability discrimination and related claims. Like in Jackson, Stambanis’s proposed 27 claims rest on different legal theories than the claims asserted in her SAC and require 28 the addition of new factual allegations not previously pleaded. (See Mot.) If the Court 1 were to grant Stambanis’s Motion, TBWA would have to expend more time and incur 2 additional litigation costs to conduct additional discovery. Accordingly, granting 3 Stambanis leave to amend her complaint for a third time will prejudice TBWA. 4 Although the Court may deny the Motion on this basis alone, it also considers 5 undue delay. B. Undue Delay 6 The Ninth Circuit has described two scenarios where a court may find undue 7 delay. See Jackson, 902 F.2d at 1388. One aspect of the issue is whether an 8 “amendment . . . would produce an undue delay in the litigation.” Id. at 1387. The 9 second aspect is whether the plaintiff unduly delayed filing her amendment. See id. at 10 1387–89. The court in Jackson explained that, “relevant to evaluating the delay issue 11 is whether the moving party knew or should have known the facts and theories raised 12 by the amendment in the original pleading.” Id. at 1388. The Ninth Circuit has noted 13 that, “late amendments to assert new theories are not reviewed favorably when the facts 14 and the theory have been known to the party seeking amendment since the inception of 15 the cause of action.” Acri v. Int’l Ass’n of Mach. & Aerospace Workers, 781 F.2d 1393, 16 1398 (9th Cir. 1986) (citations omitted). See Jackson, 902 F.2d at 1388. (affirming 17 denial of leave to amend in part because plaintiff did not cite “new facts or theories 18 gleaned from the discovery period” to justify delay.) 19 Here, Stambanis seeks to add factual allegations in her proposed TAC detailing 20 events that happened to her during her employment in 2016. (See Mot.) Thus, these 21 facts arose before Stambanis filed her SAC in 2019, yet she failed to include any claims 22 for disability related discrimination. (See SAC.) Stambanis argues that the proposed 23 amendments reflect facts uncovered during her investigation and discovery that were 24 not known at the time she filed her SAC. (Reply 3.) However, the only fact Stambanis 25 claims she discovered was that TBWA’s leadership was upset that Stambanis did not 26 marry her partner and negotiated terms of the Letter Amendment. (Mot 10.) The lack 27 of knowledge for this singular fact should not have precluded her from raising 28 1 || disability-related claims in prior complaints; furthermore, this fact appears to be 2 || unrelated to the claims she wishes to add. Although discovery may have uncovered 3 || specific facts related to her proposed claims, given that the facts arose before Stambanis filed her SAC, she had sufficient information to have filed her proposed claims earlier 5 || without the recently discovered factual allegations. Accordingly, the Court finds that 6 || Stambanis unnecessarily delayed seeking to assert these new claims. 7 The Court notes that Stambanis is correct in pointing out that delay alone is 8 || insufficient to establish undue delay, and that bad faith or prejudice must also exist. (Reply 3). See U.S. v. Webb, 655 F.2d 977, 980 (9th Cir. 1981). However, in the 10 || discussion above, the Court already established that granting leave to amend here would 11 || prejudice TBWA. As delay and prejudice both exist, the Court finds that this factor has 12 || been met. 13 As the court has found amending would cause prejudice and undue delay, 14] granting leave to amend is not appropriate. Stambanis has already had two 15 | opportunities to amend her complaint. Accordingly, the Court denies Stambanis’s 16 | Motion. 18 For the foregoing reasons, the Court DENIES Stambanis’s Motion for Leave to 19} Amend. (ECF No. 51.) 20 22 23 July 20, 2020 24 25 GEA Wid UNITED STATES DISTRICT JUDGE