Alexsam, Inc. v. Green Dot Corporation et al

Filing 143

MINUTES OF Motion Hearing held before Judge Christina A. Snyder RE: Defendants' Motion for Leave to Amend the Answer and Counterclaims 127 ; Plaintiff's Motion for Leave to Amend the Complaint 130 . Plaintiff's motion for leave to am end the complaint is GRANTED. Plaintiff is ordered to file its proposed amended complaint within seven days of this Order. Thereafter, defendants shall have 14 days to answer or otherwise respond. Defendants' motion for leave to amend the answer and counterclaim is GRANTED. Defendants shall file an amended answer and counterclaim within seven days of this Order. Court Reporter: Laura Elias. (gk)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL

‘O’

Case No.

2:15-cv-05742-CAS (PLAx)

Title

ALEXSAM INC. V. GREEN DOT CORP. ET AL.

Present: The Honorable

Date

October 17, 2016

CHRISTINA A. SNYDER

Catherine Jeang
Deputy Clerk

Laura Elias
Court Reporter / Recorder

N/A
Tape No.

Attorneys Present for Plaintiffs:

Attorneys Present for Defendants:

Steven Ritcheson

Alfred Shaumyan

Proceedings:

DEFENDANTS’ MOTION FOR LEAVE TO AMEND THE
ANSWER AND COUNTERCLAIMS (Filed September 19, 2016,
Dkt. 127)
PLAINTIFF’S MOTION FOR LEAVE TO AMEND THE
COMPLAINT (Filed September 19, 2016, Dkt. 130)

I.

INTRODUCTION

On June 12, 2015, Alexsam, Inc. (“plaintiff”) filed a complaint with the Superior
Court of California for the County of Los Angeles against Green Dot Corporation, Next
Estate Communications, Inc., and Does one through ten, inclusive (collectively
“defendants”). Dkt.1, Ex. A. The complaint alleges that defendants have violated a prior
settlement agreement (“the Agreement”), entered into in a prior patent infringement
action between the parties. On July 29, 2015, defendants filed an answer with the
Superior Court of California. Dkt. 1, Ex. B. On July 29, 2015, defendants filed a notice
of removal to this Court. Dkt. 1. On September 28, 2015, the Court denied plaintiff’s
motion to remand. Dkt. 41. On June 14, 2016, the Court issued its claim construction
order regarding plaintiff’s patents. Dkt. 112.
On July 17, 2016, the Court issued a scheduling order, which set September 19,
2016, as the last day to request leave to file amended pleadings. Dkt. 117. The Court set
the cutoff for factual discovery as February 1, 2017. Trial is set for September 5, 2017.
Id. On September 19, 2016, plaintiff filed a motion for leave to amend its complaint,
Dkt. 130, and defendant filed a motion seeking leave to amend their answer and
counterclaim, Dkt. 127. On September 26, 2016, the parties filed their respective
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL

‘O’

Case No.

2:15-cv-05742-CAS (PLAx)

Date

Title

October 17, 2016

ALEXSAM INC. V. GREEN DOT CORP. ET AL.

oppositions. Dkt. 137, 138. On October 3, 2016, the parties filed replies in support of
their respective motions. Dkt. 141, 142.
The gravamen of defendants’ request is that defendants seek leave to add an
affirmative defense that the complaint’s allegations are barred by res judicata and
collateral estoppel in light of the decision in Alexsam,Inc. v. The Gap, Inc., 621 F. App’x
983 (Fed. Cir. 2015). Id. Additionally, defendants seek to add language to their prayer
for judgment requesting “reasonable attorney’s fees, incurred herein, and that the Court
declare this case exceptional in their favor under 35 U.S.C. § 285.” Id (proposed change
emphasized). Defendants also seek leave to make similar amendments to their first
amended counterclaim.
The gravamen of plaintiff’s request is that plaintiff seeks to add an additional
breach of contract theory and an additional claim for breach of the covenant of good faith
and fair dealing. More specifically, plaintiff claims to have discovered additional
breaches of the Agreement in that defendants have failed to properly mark their products
in accordance with the Agreement. Plaintiff also alleges that defendants have breached
the covenant of good faith and fair dealing by asserting, during this litigation, that
plaintiff’s relevant patents are invalid.
Having carefully considered the parties’ arguments, the Court finds and concludes
as follows.
II.

DISCUSSION

Both motions are governed by Federal Rule of Civil Procedure 15(a)(2) (“Rule
15"). As the parties acknowledge, Rule 15 provides that “[t]he court should freely give
leave when justice so requires.” Fed. R. Civ. P. 15(a)(2). “[T]his policy is to be applied
with extreme liberality,” and is granted at the Court’s discretion. Desertrain v. City of
Los Angeles, 754 F.3d 1147, 1154 (9th Cir. 2014). “Five factors are taken into account
to assess the propriety of a motion for leave to amend: bad faith, undue delay, prejudice
to the opposing party, futility of amendment, and whether the plaintiff has previously
amended the complaint.” Id.
The aforementioned factors support granting the parties leave to amend. There is
ample time remaining for factual discovery and the deadline to file motions is not until
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL

‘O’

Case No.

2:15-cv-05742-CAS (PLAx)

Date

Title

October 17, 2016

ALEXSAM INC. V. GREEN DOT CORP. ET AL.

May 5, 2017. The proposed amendments do not appear to cause unfair prejudice to
either party. Nor can the Court determine at this stage in litigation whether any of the
proposed amendments are futile. Absent some other important consideration weighing
more heavily in favor of denying leave, the Court concludes that the “extreme liberality”
with which leave is ordinarily granted warrants a grant of leave in both matters now
before the Court.
Accordingly, plaintiff’s motion for leave to amend the complaint is GRANTED.
Defendants’ motion for leave to amend the answer and counterclaim is GRANTED.
III.

CONCLUSION

Plaintiff’s motion for leave to amend the complaint is GRANTED. Plaintiff is
ordered to file its proposed amended complaint within seven days of this Order.
Thereafter, defendants shall have 14 days to answer or otherwise respond.
Defendants’ motion for leave to amend the answer and counterclaim is
GRANTED. Defendants shall file an amended answer and counterclaim within seven
days of this Order.
IT IS SO ORDERED.
00
Initials of Preparer

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CMJ

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