Smith v. Family Auto Sales Inc.

Filing 29

ORDER granting 22 , 24 Motions to Amend. By Magistrate Judge Kristen L. Mix on 8/1/2013.(klyon, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 13-cv-00068-REB-KLM
WALTER SMITH,
Plaintiff,
v.
FAMILY AUTO SALES INC., a Colorado corporation doing business as Family Truck and
Van,
Defendant.
_____________________________________________________________________
ORDER GRANTING MOTIONS TO AMEND
_____________________________________________________________________
ENTERED BY MAGISTRATE JUDGE KRISTEN L. MIX
This matter is before the Court on Plaintiff’s Motion to File Amended Complaint
[Docket No. 22; Filed June 20, 2013] (the “Motion to Amend Complaint”) and on
Defendant’s Motion for Leave to File/Serve Amended Answer to Assert Counterclaims
[Docket No. 24; Filed June 20, 2013] (the “Motion to Amend Answer”). On July 15, 2013,
Defendant filed a Response [#27] in opposition to the Motion to Amend Complaint, and on
July 17, 2013, Plaintiff filed a Reply [#28]. On July 11, 2013, Plaintiff filed a Response [#26]
asserting his non-opposition to the Motion to Amend Answer. The Motions are thus fully
briefed and ripe for resolution. For the reasons set forth below, the Court GRANTS the
Motions [#22, #24].
This matter pertains to Defendant’s alleged violation of the Truth in Lending Act, 15
U.S.C. § 1601 et seq., and the Colorado Consumer Protection Act, C.R.S. § 6-1708(1)(a)(I), in connection with the sale of a vehicle to Plaintiff. See Compl. [#1]. Pursuant
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to the Motion to Amend Complaint [#22], Plaintiff seeks leave to add two additional claims:
(1) violation of the Equal Credit Opportunity Act (“ECOA”), 15 U.S.C. § 1691(d), and (2)
negligence, for the alleged act of publishing Plaintiff’s personal nonpublic information on
January 29, 2013 on the Court’s electronic docket. Defendant opposes the amendment
to add the ECOA claim. Response [#27] at 1. Pursuant to the Motion to Amend Answer
[#24], Defendant seeks to add counterclaims for breach of contract, fraudulent
misrepresentation, and negligent misrepresentation. Plaintiff does not oppose these
amendments. Response [#26] at 1.
As a preliminary matter, the pleading amendment deadline expired on June 20,
2013. See Scheduling Order [#19] at 5. The present Motions were filed on June 20, 2013
and, therefore, are timely. The Court thus considers any arguments raised by the parties
related to whether justice would be served by amendment. Specifically, the Court should
grant leave to amend “freely . . . when justice so requires.” Fed. R. Civ. P. 15(a)(2). Leave
to amend need not be given, however, when the moving party unduly delayed, failed to
amend despite ample opportunity to do so, the nonmoving party would be unduly
prejudiced, or amendment would be futile. Foman v. Davis, 371 U.S. 178, 182 (1962).
Defendant argues that Plaintiff’s ECOA amendment should be denied based on
futility. Response [#27] at 2. An amendment is futile if it would not survive a motion to
dismiss. Innovatier, Inc. v. CardXX, Inc., No. 08-cv-00273-PAB-KLM, 2010 WL 148285,
at *2 (D. Colo. Jan. 8, 2010) (citing Bradley v. Val-Mejias, 379 F.3d 892, 901 (10th Cir.
2004)). Defendant suggests that Plaintiff’s proposed amendment would be futile “because
the Plaintiff did not seek an extension of credit from Defendant.” Response [#27] at 2
(emphasis in original). Defendant asserts that Plaintiff actually sought an extension of
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credit from Credit Acceptance Corporation, as identified in the Retail Installment Contract.
Id. at 1-2. Plaintiff counters that Defendant, as an automobile dealership, may also be
creditor for purposes of the ECOA by entering into a finance contract with Plaintiff. Reply
[#28] at 3. Plaintiff is correct that an automobile dealership may be a creditor for purposes
of the ECOA. Treadway v. Gateway Chevrolet Oldsmobile Inc., 362 F.3d 971, 978-81 (7th
Cir. 2004). However, whether an automobile dealership is a creditor for purposes of the
ECOA is a fact-intensive inquiry. Id. at 979. At this early stage of the case, the Court may
not definitively resolve fact issues, and the proposed amendment therefore would survive
a motion to dismiss. See Innovatier, 2010 WL 148285, at *2.
Thus, in the circumstances at hand, the Court will not deny leave to amend on the
basis of futility. Cf., e. g., McKinney v. Okla., 925 F.2d 363, 365 (10th Cir. 1991) (“[T]he
preferred practice is to accord a [party] notice and an opportunity to amend his [pleading]
before acting upon a motion to dismiss for failure to state a claim[ .]”). The Court therefore
permits both parties leave to file amended pleadings. Accordingly,
IT IS HEREBY ORDERED that the Motions [#22, #24] are GRANTED.
IT IS FURTHER ORDERED that the Court accepts Plaintiff’s First Amended
Complaint [#22-1] and Defendant’s Second Amended Answer, Affirmative Defenses and
Counterclaims [#24-1] for filing as of the date of this Order.
Dated: August 1, 2013

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