Parsons Xtreme Golf LLC v. Taylor Made Golf Company Incorporated

Filing 113

ORDER granting 87 Motion to Amend/Correct Counterclaim; denying as moot 110 Motion for Hearing. Signed by Judge John J Tuchi on 5/11/18. (DXD)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Parsons Xtreme Golf LLC,
Plaintiff,

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ORDER

v.

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No. CV-17-03125-PHX-JJT

Taylor Made Golf Company Incorporated,

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Defendant.

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At issue is Defendant Taylor Made Golf Company Inc.’s (“Taylor Made”) Motion

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for Leave to File Amended Counterclaim (Doc. 87, Mot.), to which Plaintiff Parson’s

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Xtreme Golf LLC (“PXG”) filed a Response (Doc. 94, Resp.), and to which Taylor Made

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filed a Reply (Doc. 97, Reply). Upon a showing of good cause, the Court grants Taylor

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Made’s Motion.

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I.

BACKGROUND

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In the January 9, 2018 Scheduling Order, the Court set February 2, 2018, as the

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deadline for motions to amend the Complaint and to join additional parties. (Doc. 61,

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Scheduling Order at 2.) At the February 2 deadline, PXG filed its Second Amended

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Complaint with the consent of Taylor Made. On February 15, shortly before Taylor

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Made’s Answer to the Second Amended Complaint was due, PXG delivered a letter to

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Taylor Made identifying alleged deficiencies with four patents 1 asserted as the basis for a

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These patents are U.S. Patent Nos. 8,096,896 (the “’896 patent”), 8,287,402 (the
“’402 patent”), 9,452,325 (the “’325 patent”), 9,839,821 (the “’821 patent”) (collectively,
the “Withdrawn Patents”).

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number of Taylor Made’s counterclaims. (Resp. Ex. A.) In that letter, PXG demanded

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that Taylor Made pull the Withdrawn Patents from its Counterclaim. (Resp. Ex. A at 3–

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4.) The following day, in conjunction with its Amended Answer, Taylor Made filed its

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Motion for Leave to File an Amended Counterclaim. In its proposed Amended

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Counterclaim, Taylor Made seeks to remove the Withdrawn Patents identified in PXG’s

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letter in favor of two patents 2 that it had not asserted in its prior Counterclaim. (Mot.

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At 2.) Although the New Patents contain different claim limitations, the substance of

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Taylor Made’s proposed Amended Counterclaim remains largely the same, as Taylor

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Made continues to allege infringement by the same set of PXG drivers, fairway woods,

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and hybrids. (Mot. at 3.)

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II.

LEGAL STANDARD

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A party may amend a pleading once as a matter of course within 21 days after

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service, or within 21 days of service of, among others, a Rule 12(b)(6) motion. Fed. R.

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Civ. P. 15(a). In all other circumstances, absent the opposing party’s written consent, a

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party must seek leave to amend from the court. Fed. R. Civ. P. 15(a)(2). Although the

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decision to grant or deny a motion to amend is within the trial court’s discretion, “Rule

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15(a) declares that leave to amend shall be freely given when justice so requires.” Foman

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v. Davis, 371 U.S. 178, 182 (1962) (citation and internal quotation marks omitted). “In

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exercising its discretion with regard to the amendment of pleadings, a court must be

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guided by the underlying purpose of Rule 15—to facilitate a decision on the merits rather

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than on the pleadings or technicalities.” Eldridge v. Block, 832 F.2d 1132, 1135 (9th Cir.

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1987) (citation and internal quotation marks omitted).

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However, the policy in favor of allowing amendments is subject to limitations.

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Madeja v. Olympic Packers, 310 F.3d 628, 636 (9th Cir. 2002) (holding that after a

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defendant files a responsive pleading, leave to amend is not appropriate if the

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“amendment would cause prejudice to the opposing party, is sought in bad faith, is futile,

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The patents are U.S. Patent Nos. 6,969,326 (the “’326 patent”) and 7,281,994
(the “’994 patent”) (collectively, the “New Patents”).
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or creates undue delay”). Moreover, where a court has entered a scheduling order under

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Rule 16 and set a deadline for amending the pleadings, a request to amend a pleading

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after the deadline is in effect a request to modify the case schedule and must be evaluated

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under Rule 16. Coleman v. Quaker Oats Co., 232 F.3d 1271, 1294 (9th Cir. 2000). Under

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Rule 16, a party must show “good cause for not having amended their complaint before

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the time specified in the scheduling order expired.” Id. “This standard ‘primarily

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considers the diligence of the party seeking the amendment.’” Id. (citing Johnson v.

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Mammoth Recreations, Inc., 975 F.2d 604, 607 (9th Cir. 1992)).

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III.

ANALYSIS

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Because Taylor Made’s request comes after the Court’s deadline for amendment,

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it must demonstrate that “good cause” exists to grant to the Motion. Coleman, 232 F.3d at

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1294. Thus, the Court must consider whether Taylor Made acted diligently in seeking

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leave to amend. See id. In support of its Motion, Taylor Made argues that it acted

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diligently because it moved to amend within a day of PXG’s letter, which brought to light

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purported deficiencies with the Withdrawn Patents in Taylor Made’s prior Counterclaim.

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(Mot. at 3.) In response, PXG argues that Taylor Made focuses on the wrong date in

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determining whether good cause exists and that, as the holder of the patents, Taylor Made

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should have been aware of any facial defects at the time it initially filed its Counterclaim.

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(Resp. at 4.) Thus, PXG concludes that Taylor Made’s diligence should be measured

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from November 2017, when the Counterclaim at issue was first filed.

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The Court finds good cause sufficient to permit modification of the Scheduling

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Order and the filing of an Amended Counterclaim regardless of the date that it looks to.

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Taylor Made filed its Motion the day after receiving PXG’s letter and, at worst, the

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Motion comes less than three months after Taylor Made first filed its Answer and

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Counterclaim. (See Doc. 40.) As such, the Court does not find any lack of diligence on

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Taylor Made’s behalf. Thus, good cause exists to modify the Scheduling Order and to

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grant the Motion.

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In addition to a showing of good faith under Rule 16, Taylor Made must also

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satisfy the requirements for amendment under Rule 15. Thus, the Court shall freely

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permit amendment unless “it would cause prejudice to the opposing party, is sought in

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bad faith, is futile, or creates undue delay.” Madeja, 310 F.3d at 636. PXG does not

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contend, nor does the Court find, that Taylor Made has acted in bad faith or that the

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amendment is futile. And, because the Court determines that Taylor Made acted with

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sufficient diligence, PXG fails to demonstrate any undue delay by Taylor Made. Thus,

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the Court must only assess PXG’s argument that allowing Taylor Made to amend its

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Complaint is “entirely unfair to PXG.” (Resp. at 5.)

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PXG’s assertion of prejudice fails to convince the Court. Although PXG points to

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case law in support of its argument, the cited cases involve a party seeking amendment

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either after summary judgment or after the close of discovery. (Resp. at 5 (citing Jackson

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v. Bank of Hawaii, 902 F.2d 1385, 1387–88 (9th Cir. 1990) (finding amendment after

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summary judgment briefing unduly prejudicial) and Safety Dynamics Inc. v. Gen. Star

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Indem. Co., No. CV-09-00695-TUC-CKJ, 2014 WL 11281291, at *7 (D. Ariz. Mar. 5,

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2014) (finding amendment after the close of discovery prejudicial)).) These cases do not

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apply here because the case at hand is still in its infancy. Moreover, PXG’s rationale is

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troubling in light of the amendment of its own Complaint—which also added a new

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patent—two weeks prior to Taylor Made’s Motion. (See Doc. 77.) Although amendment

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of the Counterclaim may require the adjustment of additional deadlines in the Scheduling

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Order, PXG fails to demonstrate that it would suffer prejudice as a result of Taylor

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Made’s proposed amendment.
IT IS THEREFORE ORDERED granting Taylor Made’s Motion for Leave to File

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Amended Counterclaim (Doc. 87).

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IT IS FURTHER ORDERED denying as moot Taylor Made’s Motion for Hearing
(Doc. 110).
Dated this 11th day of May, 2018.

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Honorable John J. Tuchi
United States District Judge

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