Jenkins v. Duffy Crane and Hauling, Inc. et al

Filing 368

ORDER granting 353 Motion for Leave by Magistrate Judge Kristen L. Mix on 4/25/2019. Plaintiff shall file a clean non-red-lined version of the Third Amended Complaint on the electronic docket no later than 5/1/2019.(tsher, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 13-cv-00327-CMA-KLM
FRANKLYN A. JENKINS,
Plaintiff,
v.
IMMEDIA, INC., a Minnesota corporation.
Defendant.
_____________________________________________________________________
ORDER
_____________________________________________________________________
ENTERED BY MAGISTRATE JUDGE KRISTEN L. MIX
This matter is before the Court on Plaintiff’s Renewed Motion for Leave to Amend
Complaint to Add a Claim for Punitive Damages and to Conform to the Court’s
Orders [#353]1 (the “Motion”). Defendant filed a Response [#358] in opposition to the
Motion and Plaintiff filed a Reply [#359]. The Motion is referred to the undersigned for
disposition. See [#309].2 The Court has reviewed the Motion, the Response, the Reply,
and the applicable law, and is sufficiently advised in the premises. For the reasons set

1

“[#353]” is an example of the convention the Court uses to identify the docket number
assigned to a specific paper by the Court’s case management and electronic case filing system
(CM/ECF). This convention is used throughout this Order.
2

A magistrate judge may issue orders on nondispositive motions only. Ocelot Oil Corp. v.
Sparrow Indus., 847 F.2d 1461, 1462-63 (10th Cir. 1988). Whether motions to amend are
dispositive is an unsettled issue. Chavez v. Hatterman, No. 06-cv-02525-WYD-MEH, 2009 WL
82496, at *1 (D. Colo. Jan. 13, 2009) (collecting cases). When an order on a motion to amend
removes or precludes a defense or claim from the case it may be dispositive. Cuenca v. Univ. of
Kan., 205 F. Supp. 2d 1226, 1228 (D. Kan. 2002). In this case the Court grants Plaintiff’s request
to amend his Second Amended Complaint to add a claim for punitive damages. Therefore, the
Court assumes that the issue is nondispositive.

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forth below, the Motion [#353] is GRANTED.
I. Background
Plaintiff brings this action against Defendant for injuries sustained by Plaintiff on
February 12, 2010, when he was unloading heavy printing equipment and steel lift tables
purchased by Defendant from his truck. See Order [#268] at 1; Sched. Order [#288] at 6.
Plaintiff also sued Defendants Duffy Crane and Hauling, Inc., Duffy Holdings, LLC and
Duffy Crane, Inc. (the “Duffy Defendants”), whose employees allegedly contributed to the
accident.

Plaintiff resolved his claims against the Duffy Defendants and voluntarily

dismissed those parties, effective February 5, 2018. See [#289 & #290]. In the Motion,
Plaintiff seeks leave to amend his Second Amended Complaint [#134] to: (1) remove the
Duffy Defendants as parties, (2) remove the claims against the Duffy Defendants, (3)
remove the reference to Colorado statutory law in Plaintiff’s ninth claim for relief (Joint and
Several Liability), and (4) add a claim for punitive damages pursuant to Minn. Stat. §§
549.20 and 549.191.

[#353] at 1-3; see Proposed Third. Am. Compl. [#353-54].3

Defendant only opposes the addition of a claim for punitive damages. Motion [#353] at 1;
see generally Response [#358].
Plaintiff initially filed a Motion to Leave to Amend Complaint to Add a Claim for
Punitive Damages [#307] (the “Initial Motion”) on October 5, 2018. However, the proposed
Third Amended Complaint that Plaintiff attached to the Initial Motion did not contain any of
the new factual allegations on which his punitive damages claim is based. See generally

3

The parties agree that Minnesota substantive law controls the claims in this case and
thus, applies to Plaintiff’s potential claim for punitive damages. See Motion [#353] at 3; Response
[#358] at 2.

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Pl.’s Ex. 56 [#307-4].

Moreover, Plaintiff’s Initial Motion did not comply with

D.C.COLO.LCivR 15.1(b) in that Plaintiff failed to attach a red-lined version of the proposed
Third Amended Complaint. For these reasons, the Court denied the Initial Motion [#307]
without prejudice and directed Plaintiff to file a renewed motion for leave to amend his
complaint that corrected these deficiencies on or before February 13, 2019. See Minute
Order [#347]. Pursuant to the Court’s Minute Order, Plaintiff timely filed the instant Motion
[#353] on February 6, 2019, which attaches a proposed Third Amended Complaint [#35354] that includes the relevant factual allegations and complies with D.C.COLO.LCivR
15.1(b).
In short, Plaintiff argues that the Court should permit the amendment to add a claim
for punitive damages because the evidence uncovered from the recent completion of fact
and expert discovery establishes prima facie proof that Plaintiff’s injury was the product of
Defendant’s “deliberate disregard” for his safety. See [#353] at 1-3.
In its Response, Defendant asserts two arguments for why the Court should deny
the amendment. See generally [#358]. First, Defendant argues that Plaintiff cannot
present a prima facie case of clear and convincing evidence that Defendant acted with
deliberate, intentional disregard pursuant to Minn. Stat. § 549.20. Id. at 2-12. Second,
Defendant argues that Plaintiff’s Motion [#353] is untimely and not supported by good
cause, and that Defendant would be unfairly prejudiced by the amendment. Id. at 12-15.
In his Reply, Plaintiff maintains that he has established a prima facie case and that
Defendant’s attempt to raise factual issues to oppose Plaintiff’s motion cannot be
considered because a motion to amend “only looks to the evidence alleged by the Plaintiff
to determine if it meets the threshold of proof for punitive damages.” [#359] at 2. In
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addition, Plaintiff argues that good cause exists for the late filing of the Motion and that
Defendant is not prejudiced because crucial evidence was made available only recently
and any delay has been caused by Defendant. Id. at 2-4.
II. Analysis
A.

Rule 16(b)(4)
As a preliminary matter, the Court must first determine whether Plaintiff has filed his

Motion within the deadline prescribed by the Scheduling Order, and if not, whether he has
established good cause under Rule 16(b)(4)4 for his failure to timely do so. Gorsuch, Ltd.
B.C. v. Wells Fargo Nat’l Bank Ass’n, 771 F.3d 1230, 1241 (10th Cir. 2014) (“We now hold
that parties seeking to amend their complaints after a scheduling order deadline must
establish good cause for doing so.”); Ayon v. Kent Denver Sch., No. 12-cv-2546-WJMCBS, 2014 WL 85287, at *2 (D. Colo. Jan. 9, 2014) (noting that where a party seeks to
amend his pleadings after the deadline established in the scheduling order, “the majority
of courts have held that a party must meet the two-part test of first showing good cause to
amend the scheduling order under Rule 16(b), and then showing that amendment would
be allowed under Rule 15(a)”).
The Scheduling Order that currently governs this case provides that the deadline for
amendment of pleadings was March 1, 2018. Sched. Order [#288] at 12. The Initial Motion
[#307] was filed on October 5, 2018 and the present Motion [#353] was filed on February
6, 2019. Therefore, Plaintiff’s request for leave to amend his Second Amended Complaint
[#134] is untimely and he must show good cause for his failure to timely move to amend

4

Unless otherwise noted, “Rule 16(b)(4)” and all similar citations refer to the Federal Rules
of Civil Procedure.

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pursuant to Rule 16(b)(4) (a Scheduling Order deadline “may be modified only for good
cause and with the judge’s consent.”).
To demonstrate good cause, Plaintiff must “show that [he was] diligent in attempting
to meet the deadline[ ],” and provide “an adequate explanation for any delay.” Minter v.
Prime Equip. Co., 451 F.3d 1196, 1205 n.4 (10th Cir. 2006) (explaining that lateness itself
does not justify denial of a motion to amend, but “undue” lateness does). “While rigid
adherence to the pretrial scheduling order is not advisable,” SIL-FIO v. SFHC, Inc., 917
F.2d 1507, 1519 (10th Cir. 1990), the pleading amendment deadline requires that parties
conduct discovery efficiently and promptly in order to timely comply.

See Granite

Southlands Town Ctr. LLC v. Alberta Town Center, LLC, No. 09-cv-00799-ZLW-KLM, 2010
WL 2635524, at *2 (D. Colo. June 8, 2010); Sanchez v. City & Cty. of Denver ex rel. Bd.
of Water Comm’rs, No. 07-cv-01805-MSK-BNB, 2007 WL 4557842, at *1 (D. Colo. Dec.
20, 2007) (unpublished decision). However, “[t]he fact that a party first learns through
discovery of information which may lead to amendment of deadlines set forth in the
Scheduling Order constitutes good cause for such amendment pursuant to Rule 16(b)[(4)].”
Riggs v. Johnson, No. 09-cv-01226-WYD-KLM, 2010 WL 1957110, at *3 (D. Colo. Apr. 27,
2010) (citing Pumpco, Inc. v. Schenker Int’l, Inc., 204 F.R.D. 667, 668-69 (D. Colo. 2001)).
Here, Plaintiff alleges that he learned of new information through discovery after the
March 1, 2018 deadline for the amendment of pleadings. Motion [#353] at 1-2. Plaintiff
states that “[s]ubstantial discovery has been completed and certain of the fact discovery
documents were received as late as June 22, 2018 [and that] [r]elevant expert discovery
depositions were completed prior to or on [ ] September 26, 2018.” Id. at 2. In its
Response, Defendant contends that there is no excuse or good cause for Plaintiff’s delay
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and that “Plaintiff was in possession of all of the evidence, or had the opportunity to
discover it, supporting [his punitive damages claim] well before filing this motion.” [#358]
at 13.
Plaintiff’s Reply addresses this contention by chronicling numerous discovery
disputes which, according to Plaintiff, have caused the delay in obtaining information crucial
to his proposed Third Amended Complaint. [#359] at 2-4. Specifically, Plaintiff notes that,
“[o]n March 9, 2018, Defendant served over 500 pages of emails and other documents that
had not been previously disclosed during six years of litigation, which revealed new
information and evidence for the first time . . . .” Id. at 2. Plaintiff explains that these
documents revealed the names of previously unidentified witnesses and new information
which caused Plaintiff to request supplemental depositions. Id. at 2-3. Plaintiff notes that
Defendant opposed Plaintiff’s request for supplemental depositions, requiring a ruling from
the Court which granted permission for the depositions on April 24, 2018. Id.; see Minute
Entry [#300]. Plaintiff further states that the newly produced emails contained relevant
communications between Defendant and Defendant’s broker, Adam Sarote (“Sarote”),
which necessitated Plaintiff’s taking the deposition of Mr. Sarote. Reply [#359] at 3.
Moreover, Plaintiff alleges that, on June 22, 2018, after the discovery deadline,
Defendant served Plaintiff with a copy of its previously undisclosed safety guidelines. Id.
Plaintiff forwarded this information to his safety expert who was required to review the
information and submit a report by June 28, 2018, the affirmative expert disclosure and
report deadline. Id.; see Sched. Order [#288] at 13. According to Plaintiff, “Defendant then
refused to allow Plaintiff to schedule the depositions of any of [Defendant’s] liability experts
until Defendant completed the depositions of Plaintiff’s experts.” Reply [#359] at 3.
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Because of this, Plaintiff explains that he was unable to take the depositions of three of
Defendant’s experts until September 24, 2018, through September 28, 2018. Id. at 4.5
Based on the foregoing, Plaintiff states that it was not until the September 28, 2018
deadline to complete expert discovery, that “Plaintiff had the necessary discovery
information required for evaluation of Defendant’s conduct” which led to Plaintiff filing the
instant Initial Motion [#307]. Id.
After reviewing the record in this case and the parties’ briefings, the Court finds that
the disclosure of merits-related discovery after the deadline to amend pleadings and the
timing of Plaintiff’s depositions constitute good cause for purposes of Rule 16(b)(4). In
asserting his claim for punitive damages in the Motion [#353], Plaintiff heavily relies on
evidence that was obtained after the March 1, 2018 deadline to amend pleadings. See
e.g., Motion, Exs. 13-18 [#353-14 through #353-19], Exs. 21-30 [#353-22 through #35331], Exs. 33-34 [#353-34, #353-35], Ex. 40 [#353-41], Exs. 42-46 [#352-43 through #35347]. Most significantly, Plaintiff relies on the deposition testimony taken from Dr. Richard
Ziernicki (“Ziernicki”) on September 20, 2018, two weeks prior to Plaintiff filing the Initial
Motion [#307]. See Motion, Exs. 16-17 [#353-17, #353-18]. When a party learns new
information after the amendment of pleadings deadline has passed, the newly-acquired
information satisfies Rule 16’s good cause requirement. See, e.g., Pumpco, Inc., 204
F.R.D. at 668-69 (“[t]he fact that a party first learns, through discovery or disclosures,
information necessary for the assertion of a claim after the deadline to amend established

5

Plaintiff notes that he took the deposition of Defendant’s fourth expert as late as October
24, 2018, based on that expert’s availability. This was nineteen days after Plaintiff filed his Initial
Motion [#307]. Reply [#359] at 4.

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in the scheduling order has expired constitutes good cause to extend that deadline.”); see
also

Int’l

Bhd.

of

Teamsters,

Airline

Div.

v.

Frontier

Airlines,

Inc.,

No.

11-cv-02007-MSK-KLM, 2012 WL 1857549, at *3 (D. Colo. May 22, 2012) (“[T]he Court is
reluctant to refuse an extension of the amendment deadline considering the parties’
ongoing discovery disputes which obviously have delayed production[.]”); Lewis v. Denver
Fire Dep’t, 09-cv-00004-PAB-MJW, 2010 WL 3873974, at *7-8 (D. Colo. Sept. 28, 2010)
(good cause shown to amend complaint after the Scheduling Order’s deadline where
plaintiff first learned of new information through depositions). Therefore, the Court finds
that Plaintiff has demonstrated good cause to satisfy Rule 16(b)(4), and it is thus
appropriate for the Court to proceed to the next step of the analysis.
B.

Rule 15(a)(2) and Minnesota Substantive Law
1.

Legal Standard

It is well established in the Tenth Circuit that, once good cause is shown pursuant
to Rule 16(b)(4), the party seeking leave to amend must then satisfy the standard set forth
in Rule 15(a)(2). Birch v. Polaris Indus., Inc., 812 F.3d 1238, 1247 (10th Cir. 2015)
(quoting Gorsuch, 771 F.3d at 1240 (10th Cir. 2014)); see Williams-Berrien v. Wilson, No.
15-cv-00948-REB-KLM, 2018 WL 3829955, at *2 (D. Colo. Aug. 13, 2018); Petekeiwicz v.
Stembel, No. 13-cv-1865-RM-KLM, 2015 WL 1740386, at *4 (D. Colo. Apr. 14, 2015);
Nicastle v. Adams Cty. Sheriff’s Office, No. 10-cv-816-REB-KMT, 2011 WL 1465586, at *3
(D. Colo. Mar. 14, 2011), adopted by 2011 WL 1464588 (D. Colo. Apr. 18, 2011); Colo.
Visionary Acad. v. Medtronic, Inc., 194 F.R.D. 684, 688 (D. Colo. 2000). Pursuant to Rule
15(a)(2), 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
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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).
Here, Plaintiff does not apply Rule 15 in his Motion [#353].6 Rather, Plaintiff
assumes that Minn. Stat. § 549.191 governs, which sets forth the procedure for amending
a complaint to add a claim for punitive damages under Minnesota state law. Motion [#353]
at 3-4. Defendant’s Response, on the other hand, raises arguments pursuant to Rule 15
and Minn. Stat. § 549.191. [#358] at 2-12, 15. Plaintiff addresses Defendant’s arguments
with respect to Rule 15 in his Reply [#359] at 2-4. Neither party, however, specifically
argues which standard should apply.
Pursuant to Minn. Stat. § 549.191, inclusion of a claim for punitive damages is
prohibited in the initial pleading. “After filing the suit a party may make a motion to amend
the pleadings to claim punitive damages. The motion must allege the applicable legal basis
under [Minn. Stat. § 549.20] or other law for awarding punitive damages in the action and
must be accompanied by one or more affidavits showing the factual basis for the claim.”
Minn. Stat. § 549.191.7 “[I]f the court finds prima facie evidence in support of the motion,
the court shall grant the moving party permission to amend the pleadings to claim punitive
damages.” Id. This is a “heightened standard” that “obligates the court to consider
evidence in determining the propriety of the motion to amend[ ]” and thus conflicts with Rule

6

This is despite Plaintiff acknowledging that his Motion [#353] is filed pursuant to Rule 15.

7

Here, Plaintiff has attached an affidavit sworn to by Plaintiff’s counsel. See Motion, Ex.
54 [#353-55]. Defendant does not contest the adequacy of this affidavit for purposes of Minn. Stat.
§ 549.191. See generally Response [#358].

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15 which directs the Court to “freely give leave” to amend a pleading when justice so
requires. Shank v. Carleton Coll., No. 16-cv-1154 (PJS/HB), 2018 WL 4961472, at *4 (D.
Minn. Oct. 15, 2018), aff’d, 2019 WL 121938 (D. Minn. Jan. 7, 2019); Fed. R. Civ. P. 15(a).
Plaintiff’s reliance on Minn. Stat. § 549.191 instead of Rule 15 is premised on past
decisions from the District of Minnesota which has traditionally applied the state pleading
standard to claims for punitive damages under Minnesota law in diversity cases. See
Motion [#353] at 4 (citing Healey v. I-Flow, LLC, 853 F. Supp. 2d 868, (D. Minn. 2012);
Hern v. Bankers Life Cas. Co., 133 F. Supp. 2d 1130 (D. Minn. 2001); Olson v. Snap
Products, Inc., 29 F. Supp. 2d 1027 (D. Minn. 1998)). However, in light of the United
States Supreme Court’s decision in Shady Grove Orthopedic Assocs., P.A. v. Allstate Ins.
Co., 559 U.S. 393 (2010), judges in the District of Minnesota “have freshly analyzed
whether Minn. Stat. § 549.191 or Fed. R. Civ. P. 15 should govern a request for leave to
amend to add punitive damages in a request for relief.” Ramirez v. AMPS Staffing, Inc.,
No. 17-5107 (DWF/BRT), 2018 WL 1990031, at *1 (D. Minn. Apr. 27, 2018) (citations
omitted); see also Selective Ins. Co. of S.C. v. Sela, 353 F. Supp. 3d 847, 856 (D. Minn.
2018) (acknowledging the traditional practice of applying Minn. Stat. § 549.191 to claims
for punitive damages but noting that this practice “seems inconsistent with the general rule
that federal pleading rules apply in federal court, even to claims that arise under state law[
] [a]nd . . . seems to have developed without a great deal of analysis”).
This analysis has resulted in a new consensus within the District of Minnesota that
Rule 15, and not Minn. Stat. § 549.191, is the proper standard to apply when determining
whether a motion to amend to add a claim for punitive damages should be granted or
denied in federal diversity cases. See Barry v. Consol. Asset Recovery Sys., Inc., No. 18-10-

cv-1194 (MJD/BRT), 2019 WL 351339, at *2 n.1 (D. Minn. Jan. 29, 2019) (“In conformity
with other recent decisions in this District, the undersigned concludes that Rule 15 and not
Minn. Stat. § 549.191 controls the adjudication of motions to amend.”); Williams v.
Rodenburg LLP, No. 17-cv-4962 (SRN/HB), 2018 WL 5801889, at *4 (D. Minn. Nov. 6,
2018) (holding that Rule 15 and not Minn. Stat. § 549.191 controls the adjudication of
motions to amend); Shank, 2018 WL 4961472, at *4 (same); Rogers v. Mentor Corp., No.
12-cv-2602 (SRN/SER), 2018 WL 2215519, at *6 (D. Minn. May 15, 2018), aff’d sub nom.
Urbieta v. Mentor Corp., No. 13-cv-1927 (ADM/LIB), 2018 WL 3475484 (D. Minn. July 19,
2018) (same); In re Bair Hugger Forced Air Warming Devices Prods. Liab. Litig., MDL No.
15-2666 (JNE/FLN), 2017 WL 5187832, at *4 (D. Minn. July 27, 2017) (same); but see
Inline Packaging, LLC v. Graphic Packaging Int’l, LLC, No. 15-cv-3183 (ADM/LIB), Docket
No. 534 (D. Minn. Mar. 8, 2018) (unpublished order) (finding the court must apply Minn.
Stat. § 549.191).
Nevertheless, this “is not to say that Minnesota law has no bearing; procedurally, the
Court is required to view the [proposed amended complaint] through the permissive Rule
15 lens, but must nevertheless determine whether it states a plausible claim for punitive
damages in light of substantive Minnesota law.”

Shank, 2018 WL 4961472, at *4

(emphasis in the original). To establish a prima facie claim for punitive damages pursuant
to Minnesota law, the moving party must show “clear and convincing evidence that the acts
of the defendant show deliberate disregard for the rights or safety of others.” Minn. Stat.
§ 549.20, Subdivision 1(a). As explained below, “deliberate disregard” is defined by
Minnesota statute. See Minn. Stat. § 549.20, Subdivision 1(b).
Accordingly, this Court follows recent decisions from the District of Minnesota by
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adjudicating the Motion [#353] pursuant to Rule 15(a)(2) and applying Minnesota
substantive law to Plaintiff’s claim for punitive damages where appropriate. See also Ayres
v. AG Processing Inc., No. 04-cv-2060-DJW, 2005 WL 1799261, at *3 (D. Kan. July 22,
2005) (“Under the Erie doctrine, federal courts sitting in diversity apply state substantive
law and federal procedural law. The issue of whether punitive damages are permitted is
governed by state substantive law.”) (footnote omitted)).
2.

Application

Pursuant to Rule 15(a)(2), the Court considers any arguments raised by Defendant
related to whether justice would be served by amendment. Here, Defendant raises
arguments of futility, unfair prejudice, and undue delay. See generally Response [#358].
The Court addresses each argument in turn.
a.

Futility

First, Defendant contends that Plaintiff cannot make a prima facie case for punitive
damages pursuant to Minnesota law. While this argument is couched in terms of Minn.
Stat. § 549.191, Defendant essentially objects to the amendment on grounds of futility. For
the reasons set forth below, the Court finds Defendant’s futility argument unavailing.
An amendment is futile only if it would not survive a motion to dismiss. See Bradley
v. Val-Mejias, 379 F.3d 892, 901 (10th Cir. 2004) (citing Jefferson Cty. Sch. Dist. v.
Moody’s Investor’s Servs., 175 F.3d 848, 859 (10th Cir. 1999)). In contrast to the process
established by Minn. Stat. § 549.191, which contemplates consideration of evidence
outside the pleadings, the Federal Rules of Civil Procedure do not permit the Court to
“consider matters outside the pleadings when determining whether a complaint adequately
states a claim upon which relief may be granted[.]” Shank, 2018 WL 4961472, at *6.
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Therefore, the Court must base its determination of Plaintiff’s Motion [#353] “on a
four-corners analysis of the” proposed Third Amended Complaint [#353-54]. Id. “In
ascertaining whether plaintiff’s proposed amended complaint is likely to survive a motion
to dismiss, the [C]ourt must construe the complaint in the light most favorable to plaintiff,
and the allegations in the complaint must be accepted as true.” See Murray v. Sevier, 156
F.R.D. 235, 238 (D. Kan. 1994). Moreover, “[a]ny ambiguities must be resolved in favor
of plaintiff, giving him ‘the benefit of every reasonable inference’ drawn from the
‘well-pleaded facts’ and allegations in his complaint.” Id. (quoting Retail Clerks Int’l Ass’n
v. Schermerhorn, 373 U.S. 746, 753 n.6 (1963)). “The question of whether [Plaintiff] has
sufficiently alleged facts to support [his] claim for punitive damages necessarily requires
the Court to apply the federal pleading standard -- Twombly and Iqbal -- to the elements
of a punitive damages claim, which are established by state law.” MRK Int’l, LLC v.
Earthstone Int’l, LLC, No. 09-cv-827 MCA/DJS, 2011 WL 13289855, at *3 (D.N.M. Mar. 30,
2011). Accordingly, the Court must consider whether Plaintiff’s proposed Third Amended
Complaint [#353-54] adequately asserts a claim for punitive damages pursuant to
Minnesota substantive law.
As stated above, a claim for punitive damages pursuant to Minnesota law requires
the moving party to show “clear and convincing evidence that the acts of the defendant
show deliberate disregard for the rights or safety of others.” Minn. Stat. § 549.20,
Subdivision 1(a). “Deliberate disregard” is statutorily defined as follows:
(b) A defendant has acted with deliberate disregard for the rights or safety of
others if the defendant has knowledge of facts or intentionally disregards
facts that create a high probability of injury to the rights or safety of others
and:
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(1) deliberately proceeds to act in conscious or intentional disregard
of the high degree of probability of injury to the rights or safety of
others; or
(2) deliberately proceeds to act with indifference to the high probability
of injury to the rights or safety of others.
Minn. Stat. § 549.20, Subdivision 1(b). In short, “the statute substantively requires ‘(1)
knowledge of or an intentional disregard of facts that make injury to the plaintiff's rights
probable; and (2) action despite such knowledge.’” Rogers, 2018 WL 2215519, at *8
(quoting Nunn v. Noodles & Co., No. 09-cv-1286 (JNE/JJK), 2010 WL 3170763, at *3 (D.
Minn. Aug. 6, 2010)). “[A] mere showing of negligence is not sufficient to sustain a claim
of punitive damages under Minnesota law.” Shank, 2018 WL 4961472, at *7 (internal
citations and quotation marks omitted).
Here, Defendant argues that “Plaintiff’s factual allegations (if true) at most raise the
specter of negligence [and that] [n]one of the facts or evidence supplied in the Motion
involve deliberate or intentional indifference for the safety of others.” Response [#358] at
1-2. Thus, Defendant asserts that “there is no evidence, much less clear and convincing
evidence, that [it] intentionally or deliberately disregarded the safety of others.” Response
[#358] at 3-4. Defendant attaches exhibits to its Response [#358] as evidence to rebut the
factual allegations Plaintiff relies on in the Motion [#353] and proposed Third Amended
Complaint [#353-54]. See Response, Exs. A-I [#358-1 through #358-9]. However, for the
reasons stated above, the Court does not consider this evidence at the pleading stage.
MRK Int’l, LLC, 2011 WL 13289855, at *3; Shank, 2018 WL 4961472, at *6.
Turning to the proposed Third Amended Complaint, Plaintiff’s new claim for punitive
damages is supported by eight general allegations which are, in turn, supported by
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numerous factual assertions based on the evidence Plaintiff has obtained through
discovery. See [#353-54] ¶¶ 202-253; Motion [#353] at 5-16. First, Plaintiff alleges that
Kevin Czaplewski (“Czaplewski”), in his role as Defendant’s lead manager in Colorado,
recklessly signed the printing equipment’s bill of lading as a “shipper” which, according to
Plaintiff, authorized the cargo’s transportation without any regard for how the transport and
unloading process would impact the safety of Plaintiff or the motoring public. Proposed
Third Am. Compl. [#353-54] ¶¶ 202-08. In asserting that Mr. Czaplewski was not qualified
to sign the bill of lading, Plaintiff primarily relies on Mr. Czaplewski’s own deposition
testimony in which he acknowledged not knowing that:
(a) A bill of lading must be accurate and honest. (b) A shipper is not allowed
to make false statements. (c) A shipper is required to follow the law when
completing a bill of lading. (d) The shipper, carrier and driver rely on a bill of
lading. (e) An inaccurate bill of lading may create an unsafe situation for the
shipper, carrier, driver and general public.
Id. ¶ 203; see Motion, Ex. 4 [#353-5]. Second, Plaintiff alleges that Mr. Czaplewski
recklessly certified the cargo as properly packaged and ready for transport. Proposed
Third Am. Compl. [#353-54] ¶¶ 209-16.

Based on the above testimony and other

depositions, Plaintiff contends that Mr. Czaplewski lacked the qualification to provide this
certification and that none of Defendant’s employees made an attempt to determine
whether the cargo was in proper condition for transportation according to the applicable
Department of Transportation regulations. Id. ¶¶ 210-13; Motion, Exs. 9, 10, 11 [#353-10
through #353-12]. Third, Plaintiff alleges that Defendant’s employees acted in deliberate
disregard of the directions received from Defendant’s broker, EZ Screen Printing LLC,
regarding the need for additional deck space for the steel lift tables. Proposed Third Am.
Compl. [#353-54] ¶¶ 217-21.

Fourth, Plaintiff alleges that Defendant’s employees
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repeatedly misrepresented that the steel lift tables were hydraulic when, in fact, they were
pneumatic. Id. ¶¶ 222-28. According to Plaintiff, this misrepresentation resulted in the
tables being loaded onto Plaintiff’s truck less securely. See id. Among other testimony,
Plaintiff relies on that of a loading foreman who testified that: “if he had been told the tables
were pneumatic (air) prior to the loading on February 10, 2010, he would have likely turned
the tables over and loaded them with the flat side down on the trailer floor and wheels up.”
Id. ¶ 227; see Motion, Exs. 17, 18, 19, 21, 22 [#353-18 through #353-23]. Relatedly,
Plaintiff’s fifth allegation is that Defendant deliberately concealed information from him
regarding the loading and transportation of the equipment and tables. Proposed Third Am.
Compl. [#353-54] ¶¶ 229-31. Specifically, Plaintiff avers that Defendant knew the following
information but failed to disclose this information to Plaintiff prior to the accident:
(a) [Defendant] was responsible for the disassembly of all equipment, but
they decided not to remove wheels from the tables. (b) [Defendant] did not
choose to build containers for the tables or use shrink wrap, carts or pallets
for the tables. (c) [Defendant] had not responded to requests for the
purchase of adequate deck space for the tables. (d) [Defendant] was
required to make sure the tables were suitable for shipping, and they shirked
their responsibility. (e) [Defendants’ employees] knew the tables were
pneumatic (air), and they did not divulge that information to the loaders
(Duffy), the driver (Plaintiff), the unloaders (I.M.S.) or EZ Screen (broker).
Id. ¶ 229. Plaintiff asserts that the concealment of this crucial information “impacted his
ability to make decisions about whether he should accept [Defendant’s] cargo,” and
evidences Defendant’s “deliberate disregard for the rights or safety of Plaintiff.” Id. ¶ 231.
Plaintiff’s sixth allegation in support of his punitive damages claim is that Defendant
demonstrated a deliberate disregard for Plaintiff’s safety in failing to perform a “Job Hazard
Analysis” or stop work prior to the unloading.

Id. ¶¶ 232-39. Plaintiff asserts that

Defendant’s employees knew that the unloading of this printing equipment was a
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dangerous activity and that, prior to the unloading, the cargo had shifted on Plaintiff’s truck
and that Plaintiff’s truck had been damaged. Id. ¶¶ 232, 235, 237. Relying on testimony
from David Nelson, Defendant’s Shipping and Receiving Manager, Plaintiff argues that
Defendant’s employees should have postponed the unloading or followed the company’s
internal guidelines by conducting a “Job Hazard Analysis” prior to the unloading. Id. ¶¶
234, 236, 238; see Motion, Ex. 44 [#353-45]. Similarly, Plaintiff’s seventh allegation is that
Defendant’s employees failed to follow other internal company guidelines which required
an inspection of the cargo prior to unloading, despite the inherent danger of unloading a
1500 pound steel table. Proposed Third Am. Compl. [#353-54] ¶¶ 240-45. Finally, Plaintiff
alleges that Defendant acted with deliberate disregard for Plaintiff’s safety by directing him
to park his truck in a confined area with no means to escape falling cargo. Id. ¶¶ 246-53.
In support of this allegation, Plaintiff reasserts that Defendant’s employees should have
known that the unloading would be dangerous, the cargo had shifted in transit, there was
damage to Plaintiff’s truck (if an inspection had been conducted), and Plaintiff, as the
driver, would likely be the person releasing the straps on the cargo. Id. ¶ 246. As Plaintiff’s
Motion [#353] indicates, this final allegation further relies on Dr. Ziernicki’s opinion that “due
to the space constraints, there was no room for [Plaintiff] to escape when the table was
falling.” Motion, Ex. 22 [#353-23] at 35.
In light of the detailed factual allegations summarized above, the Court cannot
conclude that Plaintiff’s claim for punitive damages could not withstand a motion to dismiss.
Because the Court must assume that Plaintiff’s factual allegations are true and must draw
all reasonable inferences in his favor, and given Plaintiff’s ample description, the Court is
satisfied that Plaintiff’s proposed Third Amended Complaint [#353-54] alleges a plausible
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claim “that the acts of the defendant show[ed] deliberate disregard for the rights or safety
of others.” Minn. Stat. § 549.20.
Defendant’s futility argument primarily focuses on the merits of Plaintiff’s punitive
damages claim rather than on whether Plaintiff has pleaded a plausible claim for deliberate
disregard pursuant to Minn. Stat. § 549.20. See Response [# 358] at 2-11. Insofar as
Defendant offers evidence to undermine specific facts stated within each of Plaintiff’s eight
generalized allegations, “the Court considers Plaintiff’s allegations alone,” Barry, 2019 WL
351339, at *5, and agrees with Plaintiff that whether a claim for punitive damages has been
adequately pled depends on the totality of Defendant’s alleged conduct. Reply [#359] at
6. Moreover, to the extent that Defendant argues that Plaintiff must demonstrate a
“knowing, intentional attempt to deceive,” Response [#358] at 5, this is not the standard set
forth in Minn. Stat. § 549.20, which is instead satisfied where a person “intentionally
disregards facts that create a high probability of injury to the rights or safety of others and
. . . deliberately proceeds to act with indifference to the high probability of injury to the rights
or safety of others.” Minn. Stat. § 549.20, Subdivision 1(b) (emphasis added). Here, taking
Plaintiff’s new factual allegations collectively, the Court finds that he has alleged “facts that
create[d] a high probability of injury” to his safety and that Defendant “deliberately
proceed[ed] to act with indifference to the high probability of injury to” his safety. Id.
Therefore, the Court concludes that Plaintiff’s claim for punitive damages is not futile.
See Foman, 371 U.S. at 182 (“If the underlying facts or circumstances relied upon by a
plaintiff may be a proper subject of relief, he ought to be afforded an opportunity to test his
claim on the merits.”). The Court emphasizes, however, that this Order does not evaluate
or address the merits of awarding punitive damages in this case, but is limited to the
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recognition that the issue of punitive damages may be properly included in the pleadings
at this time.
b.

Unfair Prejudice and Undue Delay

Next, Defendant argues that it is unfairly prejudiced by the lateness of Plaintiff’s
request. Response [#358] at 15. “Prejudice to the nonmoving party is the most important
factor in considering whether amendment should be permitted.” Minter, 451 F.3d at 1207.
“Courts typically find prejudice only when the amendment unfairly affects the [opposing
party] ‘in terms of preparing [its] defense to the amendment.’” Id. at 1208 (quoting Patton
v. Guyer, 443 F.2d 79, 86 (10th Cir. 1971)). “Most often, this occurs when the amended
claims arise out of a subject matter different from what was set forth in the [original
pleading] and raise significant new factual issues.” Id. (citations omitted).
Here, Defendant alleges that, because fact and expert discovery closed on May 31,
2018, and October 26, 2018, respectively, it is “effectively too late for [Defendant] to
conduct any further discovery regarding whether its conduct meets the Minnesota punitive
damages standard. Nor did [Defendant] have any reason to know Plaintiff would seek
punitive damages[.]” Response [#358] at 15. In making this argument, Defendant does
not cite to any specific way in which it will suffer undue prejudice in defending this lawsuit
if the Court permits the amendment. Little v. Reed-Prentice Div. Of Package Mach., Co.,
131 F.R.D. 591, 593 (D. Kan. June 25, 1990). Neither party suggests the proposed claim
for punitive damages in this case is premised on facts wholly unknown to Defendant. Thus,
it is difficult to see what, if any, new factual issues will arise by allowing the amendment.
Moreover, the Court notes that Defendant’s Response attempts to rebut Plaintiff’s proposed
punitive damages claim and substantive arguments with Defendant’s own evidence. See
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[#358] at 4-11. This demonstrates to the Court that Defendant need not conduct additional
discovery to defend against Plaintiff’s punitive damages claim. Accordingly, without any
specific indication as to how Defendant would be prejudiced by permitting the amendment
or any indication that Plaintiff’s claim for punitive damages would inject a host of new issues
or theories requiring additional discovery, the Court finds that Defendant would not be
unfairly prejudiced by permitting Plaintiff to file the proposed Third Amended Complaint.
Finally, to the extent that Defendant argues that the Motion [#353] should be denied
on the basis of undue delay, the Court disagrees. “‘Lateness by itself does not justify the
denial of the amendment.’” Minter, 451 F.3d at 1204 (quoting R.E.B., Inc. v. Ralston Purina
Co., 525 F.2d 749, 751 (10th Cir. 1975)). Finding undue delay is appropriate where Plaintiff
fails to offer a reasonable justification for why it did not seek amendment earlier. Sipp v.
Unumprovident Corp., 107 Fed. App’x. 867, 876-77 (10th Cir. 2004) (unpublished). For the
reasons discussed above, the Court finds that Plaintiff has offered a reasonable justification
for the untimeliness of the Motion [#353].
III. Conclusion
For the reasons set forth above, the Court permits Plaintiff leave to file his Third
Amended Complaint. Accordingly,
IT IS HEREBY ORDERED that the Motion [#353] is GRANTED. Plaintiff’s Third
Amended Complaint [#353-54] is accepted for filing as of the date of this Order. Plaintiff
shall file a “clean” non-red-lined version of the Third Amended Complaint on the
electronic docket no later than May 1, 2019.
IT IS FURTHER ORDERED that Defendant shall answer or otherwise respond to

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the Third Amended Complaint in accordance with the Fed. R. Civ. P. 15(a)(3) after service
of the “clean” non-red-lined version of the Third Amended Complaint.
Dated: April 25, 2019

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