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Blakley v. Celadon Group, Inc.

United States District Court, S.D. Indiana, Indianapolis Division

March 2, 2017

WILLIAM BLAKLEY on behalf of himself and those similarly situated, HELEN BLAKLEY on behalf of herself and those similarly situated, and KIMBERLY SMITH on behalf of herself and those similarly situated, Plaintiffs,
v.
CELADON GROUP, INC., CELADON TRUCKING SERVICES, INC., QUALITY COMPANIES, LLC, QUALITY EQUIPMENT LEASING, LLC, and JOHN DOES 1-10, Defendants.

          ORDER ON MOTION TO FILE AMENDED COMPLAINT NUNC PRO TUNC

          LARRY J. McKINNEY, JUDGE United States District Court

         This matter comes before the Court on Plaintiffs', William Blakely, Helen Blakely, and Kimberly Smith, on behalf of themselves and all other similarly situated (collectively, “Plaintiffs'”), Motion to File Amended Complaint Nunc Pro Tunc, or in the Alternative, Extend the Time to Respond to Defendants' Motion to Dismiss (the “Motion to Amend”). Dkt. No. 62. In their Motion to Amend, Plaintiffs request that the Court consider its Third Amended Complaint or, in the alternative, grant Plaintiffs a seven-day extension to respond to the Motion to Dismiss filed by Defendants, Celadon Group, Inc., Celadon Trucking Services, Inc., Quality Companies, Inc., and Quality Equipment Leasing, Inc. (collectively, “Celadon”). Id.

         I. BACKGROUND & ARGUMENTS

         Plaintiffs initiated this action on February 12, 2016, by filing its original Complaint against Celadon. Dkt. No. 1. On April 13, 2016, Plaintiffs filed their First Amended Complaint, Dkt. No. 21, and Celadon answered the First Amended Complaint on May 2, 2016. Dkt. No. 24. In response to the Court's December 2, 2016 Order dismissing Counts IV, V, and VI of Plaintiffs' First Amended Complaint without prejudice, Dkt. No. 50, Plaintiffs filed their Second Amended Complaint on December 15, 2016. Dkt. No. 52.

         The Amended Case Management Plan approved on July 6, 2016, bifurcated discovery in this action to allow the parties to conduct pre-certification discovery to inform Plaintiffs' anticipated motion for conditional and class certification. Dkt. No. 36 at 7. The Amended Case Management Plan set the pre-certification discovery deadline for December 19, 2016, Id., but on December 21, 2016, the Court granted the parties' Joint Motion to Extend the pre-certification discovery deadline to March 6, 2017. Dkt. No. 56. To date, the parties have conducted extensive pre-certification discovery, including depositions of each of the named plaintiffs and several Celadon employees, as well as substantial written discovery. Dkt. No. 63 at 5, Ex. A.

         On January 12, 2017, Celadon filed its Motion to Dismiss Counts IV, V, and VI of Plaintiffs' Second Amended Complaint, pursuant to Federal Rules of Civil Procedure 8(a) and 12(b)(6) (the “Motion to Dismiss”). Dkt. No. 59. On January 25, 2017, one day before the deadline to respond to Celadon's Motion to Dismiss, Plaintiffs filed their Third Amended Complaint. Dkt. No. 61. In their Third Amended Complaint, Plaintiffs seek to name Element Financial Corporation (“Element”) as a defendant and to assert a claim of civil conspiracy against all defendants. Id. Although the Court informed Plaintiffs on January 26, 2017, that they would need to seek leave of the Court to amend their complaint, Plaintiffs believed that they could file their Third Amended Complaint as a matter of course pursuant to Federal Rule of Civil Procedure 15 (“Rule 15”), after Celadon filed its Motion to Dismiss. See Dkt. No. 63, Ex. A-1.

         Plaintiffs filed their Motion to Amend on January 30, 2017, in which they argue that they could amend their pleading as a matter of course following Celadon's Motion to Dismiss under Rule 15, but seek leave of the Court to amend “out of an abundance of caution.” Dkt. No. 62, ¶¶ 7-8. Plaintiffs further assert that their Third Amended Complaint is necessary because Plaintiffs only learned about the extent of Element's involvement in relation to the claims at issue in this action through pre-certification discovery efforts and indicate that their new allegations “do not make changes to the factual pleadings challenged in [the] Motion to Dismiss.” Id. at ¶¶ 12-14. If the Court were to deny them leave to amend their pleading, Plaintiffs alternatively request that the Court grant them an extension of seven days to file their response to Celadon's Motion to Dismiss. Id. at 3.

         In response to Plaintiffs' Motion to Amend, Celadon argues that Plaintiffs should not be given leave to amend their pleading because allowing such an amendment would (1) unduly delay this litigation, (2) unduly prejudice the defendants in this action, (3) fail to cure the deficiencies in Plaintiffs' Second Amended Complaint, and (4) be futile. Dkt. No. 63 at 5-10. Celadon also contends that Plaintiffs should not receive an extension of time to respond to its Motion to Dismiss because Plaintiffs could have responded to the Motion to Dismiss within the permissible time period while simultaneously filing its Third Amended Complaint since, as Plaintiffs concede, the Third Amended Complaint did not address the allegations challenged in the Motion to Dismiss. Id. at 10. Furthermore, Celadon asserts that Plaintiffs' misinterpretation of Rule 15 does not meet the standard of “excusable neglect” to justify granting an extension of time after the deadline for a response has expired. Id. at 10-11.

         II. DISCUSSION

         A. LEAVE TO AMEND

         Under Rule 15(a)(1), “[a] party may amend its pleading once as a matter of course” within (1) twenty-one days of serving the pleading, (2) twenty-one days after service of a responsive pleading, or (3) twenty-one days “after service of a motion under Rule 12(b), (e), or (f).” In all other instances, “a party may amend its pleading only with the opposing party's written consent or the court's leave, ” and “[t]he court should freely give leave when justice so requires.” Fed.R.Civ.P. 15(a)(2).

         While Plaintiffs rely on Rule 15 to contend that their Third Amended Complaint could be filed as a matter of course, Plaintiffs “effectively used up” their right to amend their pleading as a matter of course by amending their complaint for the first time on April 13, 2016, and “[a]ny further amendment required leave of the court.” Perkins v. Silverstein, 939 F.3d 463, 471 (7th Cir. 1991). See also, Rodgers v. Lincoln Towing Serv., Inc., 771 F.2d 194, 203 (7th Cir. 1985) (“[A] party has a right to amend his pleading ‘once as a matter of course at any time before a responsive pleading is served, ' and Rodgers has already amended his complaint once.”) (internal citations omitted); Davis v. Anderson, No. 2:16-CV-120-PPS-PRC, 2016 WL 5724470 at *1 (N.D. Ind. Sept. 30, 2016) (“Though [p]laintiffs had the right to amend their pleading once as a matter of course, they have already amended their pleading once, so that right has been extinguished.”). Therefore, in order for Plaintiffs to amend their pleading, or for the Court to consider Plaintiffs' Third Amended Complaint, Plaintiffs must obtain leave of the Court.

         Although Rule 15 requires that leave to amend a pleading be freely given as justice requires, the Court has “ʻbroad discretion to deny leave to amend where there is undue delay, bad faith, dilatory motive, repeated failure to cure deficiencies, undue prejudice to the defendants, or where the amendment would be futile.'” Hueck v. Aurora Loan Servs., 588 F.3d 420, 432 (7th Cir. 2009) (quoting Arreola v. Godinez, 546 F.3d 788, 796 (7th Cir. 2008)). Delay alone may be insufficient to deny leave to amend; the degree of prejudice to an opposing party is typically considered a more significant factor when determining whether denial of leave is justified. See Dubicz v. Commonwealth Edison Co., 377 F.3d 787, 792-93 (7th Cir. 2004) (quoting Park v. City of Chicago, 297 F.3d 606, 612 (7th Cir. 2002)).

         Plaintiffs' request for leave to amend is seemingly guided by a dilatory motive and would create an undue delay in this litigation. Although Plaintiffs argue that they did not understand the significance of Element's role in connection to the misconduct alleged in this action as it relates to the putative class, Dkt. No. 65 at 2, Plaintiffs noted in their Third Amended Complaint that each of the named plaintiffs entered into agreements with Element in 2015. Dkt. No. 61, ¶¶ 45-49. Specifically, the Third Amended Complaint alleges that all three named plaintiffs entered into agreements with Element in 2015 that required them to restrict their use of leased vehicles solely to use for Celadon. Id. at ¶¶ 45-46, 48. William Blakely and Kimberly Smith also entered into agreements with Element in 2015, in which they assigned certain amounts of their earnings to Element to pay for tools necessary to perform their jobs. Id. at ΒΆΒΆ 47, 49. Based on these agreements between the named plaintiffs and ...


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