Triad Bank v. Colorado Capital Bank

Filing 56

ORDER granting 44 Motion to Amend/Correct/Modify. Status Conference set for 12/10/2013 09:30 AM in Courtroom A 401 before Magistrate Judge Boyd N. Boland. by Magistrate Judge Boyd N. Boland on 11/4/2013.(trlee, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Magistrate Judge Boyd N. Boland
Civil Action No. 11-cv-01220-RM-BNB
TRIAD BANK, a Missouri chartered bank,
Plaintiff,
v.
FIRST-CITIZENS BANK & TRUST COMPANY, a North Carolina chartered commercial bank,
Defendant.
______________________________________________________________________________
ORDER
______________________________________________________________________________
This matter arises on the plaintiff’s Motion for Leave to Amend Complaint [Doc. # 44,
filed 4/23/2013] (the “Motion to Amend”), which is GRANTED.
The plaintiff seeks leave to file its proposed Second Amended Complaint [Doc. # 44-1].
The defendant resists amendment, arguing (1) “jurisdiction over the declaratory relief claim is
doubtful”; (2) “undue delay in bringing the [Motion to Amend], as well as the lack of good cause
for the untimely amendment of the complaint, demands denial of the [Motion to Amend]”; (3)
futility of the proposed amendment; and (4) undue prejudice if the amendment is allowed.
A. Good Cause and Undue Delay
The Motion to Amend was filed after the deadline established in the scheduling order to
join parties and amend pleadings. Under these facts, the plaintiff must first demonstrate good
cause for seeking modification of the scheduling deadline under Rule 16(b). Colorado Visionary
Academy v. Medtronic, Inc., 194 F.R.D. 684, 687 (D. Colo. 2000). Good cause in this context
means that the scheduling deadline could not be met despite a party’s diligent efforts. Id. The

changed circumstances described in paragraphs 7 through 11 of the Motion to Amend [Doc. #
44] establish good cause for allowing the amendment after the deadline previously established,
and I find no undue delay on the plaintiff’s part in seeking leave to amend.
B. Futility
The defendant makes three futility arguments: (1) that jurisdiction over the declaratory
relief claim is “doubtful,” Response [Doc. # 48] at pp. 4-5; (2) that the “Shared Loss Agreement
does not provide for ‘payments’ under the Loan Participation Agreements,” id. at pp.8-9; and (3)
that the plaintiff is not a third party beneficiary of the Shared Loss Agreement. Id. at pp. 10-11.
As the court noted in General Steel Domestic Sales, LLC. v. Steelwise, LLC, 2008 WL 2520423
at *4 (D. Colo. June 20, 2008), an argument that a proposed amendment is futile “seems to place
the cart before the horse. Rather than force a Rule 12(b)(6) motion into a Rule 15(a) opposition
brief, the defendants may be better served by waiting to assert Rule 12 motions until the
operative complaint is in place.”
On the record now before me, I cannot say conclusively and as a matter of law that the
proposed amendments are futile.
C. Undue Prejudice
Finally, the defendant argues that it will suffer undue prejudice if the amendment is
allowed. In particular, the defendant claims that it “has several affirmative defenses to Plaintiff’s
proposed declaratory relief claim” about which it “has not had the opportunity to conduct
discovery.” Response [Doc. # 48] at p. 11. And the defendant opposes the easy remedy to that
prejudice--reopening discovery--by arguing that it would “also be unduly prejudiced if the Court
. . . reopens discovery” because “[i]t will be an expensive process to demonstrate that Plaintiff

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cannot prevail, as a matter of law or fact, on its untimely amendment.” Id. at p. 12. I do not
agree that the cost of preparing its defense constitutes undue prejudice to the defendant.
IT IS ORDERED:
(1)

The Motion to Amend [Doc. # 44] is GRANTED;

(2)

The Clerk of the Court is directed to accept for filing the Second Amended

Complaint [Doc. # 44-1]; and
(3)

A status conference is set for December 10, 2013, at 9:30 a.m., in Courtroom 401,

4th floor, Alfred A. Arraj United States Courthouse, 901 19th Street, Denver, Colorado, to
schedule any remaining pretrial proceedings.
Dated November 4, 2013.
BY THE COURT:
s/ Boyd N. Boland
United States Magistrate Judge

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