Edwards v. North American Power & Gas, LLC
Filing
62
ORDER finding as moot 45 Motion to Amend/Correct the Complaint; granting in part and denying in part 52 Motion to Amend/Correct the Complaint. Signed by Judge Victor A. Bolden on 6/1/2016. (Dearing, S.)
UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
PAUL T. EDWARDS,
Plaintiff,
v.
CASE NO. 3:14-cv-1714 (VAB)
NORTH AMERICAN POWER
AND GAS, LLC,
Defendant.
RULING ON PLAINTIFF’S MOTION TO AMEND THE COMPLAINT
Plaintiff Paul T. Edwards has brought a putative class action against North American
Power and Gas, LLC (“NAPG”).1 Mr. Edwards has filed a motion to amend his Complaint.
Mot. to Amend Compl., ECF No. 52.2 He asks the Court for leave to add Plaintiffs from Rhode
Island and New Hampshire as well as claims under each respective state’s unfair trade practices
law and claims under each state’s law for breach of contract and breach of the covenant of good
faith and fair dealing. Am. Mot. to Amend Compl., ECF No. 52; see Proposed Am. Compl.,
ECF No. 52-1. He also seeks to add a breach of contract claim3 under Connecticut law. See
Proposed Am. Compl. at Count IV, ECF No. 52-1. Finally, he asks to add an additional named
Plaintiff, Gerry Wendrovsky, who resides in New York but owns property in Connecticut. Id.
¶9. NAPG opposes Mr. Edwards’s motion. Def.’s Opp. Br., ECF No. 53.
After the Motion to Amend the Complaint was filed, the Court issued an Order
identifying some concerns about whether the allegations in the Complaint established subject
matter jurisdiction sufficiently. Ruling Addressing the Court’s Subject Matter Jurisdiction, ECF
1
The Court has summarized the allegations and procedural history in past Orders and will not do so in a fulsome
way here. See Ruling on Def.’s Mot. to Dismiss, ECF No. 39; Ruling Addressing the Court’s Subject Matter
Jurisdiction, ECF No. 60.
2
He filed an amended version on December 29, 2015, which renders the earlier motion, Mot. to Amend Compl.,
ECF No. 45, moot.
3
Mr. Edwards notes that his claim for breach of the covenant of good faith and fair dealing is now alleged “in the
alternative” to his breach of contract claim. See Proposed Am. Compl. at Count V, ECF No. 52-1.
1
No. 60. Mr. Edwards filed a Second Proposed Amended Complaint addressing these concerns to
the Court’s satisfaction. Am. Ex. A, Proposed Second Am. Compl., ECF No. 61. Accordingly,
the Court can take up the Motion to Amend the Complaint. For the reasons that follow, the
motion is GRANTED IN PART and DENIED IN PART.
I.
Timeliness of the Motion
NAPG first argues that the Court should not evaluate Mr. Edwards’s Motion to Amend
his Complaint on the merits because it is untimely. NAPG’s Opp. Br. 6-8, ECF No. 53. The
Court agrees that the request is nunc pro tunc but finds that there is good cause to excuse the
delay.
When a plaintiff moves to amend the complaint after the deadline for filing such a motion
has passed, that party must establish “good cause” for the delay under Rule 16(b)(4), which
depends primarily on the “diligence of the moving party.” Parker v. Columbia Pictures Indus.,
204 F.3d 326, 340 (2d Cir. 2000). District courts may also consider “other relevant factors,
including, in particular, whether allowing the amendment of the pleading at this stage of the
litigation will prejudice defendants.” Kassner v. 2nd Ave. Delicatessen, Inc., 496 F.3d 229, 244
(2d Cir. 2007). Ultimately, the decision whether to allow a late motion to amend the complaint
lies within the Court’s discretion. See id.
In its Ruling on NAPG’s Motion to Dismiss, the Court explicitly gave Mr. Edwards
leave to amend his Complaint to add plaintiffs from other states.4 Mr. Edwards did not unduly
delay in doing so. He filed his Motion to Amend six days after the first set of diverse plaintiffs
retained him, and less than two months after the Court’s deadline for adding plaintiffs had
elapsed. Mot. to Amend Compl. ¶4, ECF No. 52; see also United States v. Cohan, No. 3:11-CV
4
This case initially contained claims under New Hampshire, Maine, and Rhode Island law. Compl., ECF No. 1.
The Court dismissed those claims without prejudice in its Ruling on the Motion to Dismiss, ECF No. 39, because
Mr. Edwards as a Connecticut resident lacked standing to bring claims on behalf of the residents of other states.
2
412(CSH), 2012 WL 4758142, at *1 (D. Conn. Oct. 5, 2012) (“[G]ood cause may be found
where the movant learns of the facts supporting amendment after expiration of the relevant filing
deadline….”). In the interim period, the parties have only engaged in document discovery, thus
the prejudice NAPG will suffer if the Court allows Mr. Edwards’s late motion is limited.
Because the delay was minimal, Mr. Edwards’s counsel acted diligently in finding other
diverse plaintiffs, and any prejudice suffered by NAPG will be minimal, the Court will accept
Mr. Edwards’s late-filed Motion to Amend the Complaint and will proceed to review it on the
merits.
II.
Analysis of Motion to Amend the Complaint
Rule 15 provides that “[t]he court should freely” grant leave to amend “when justice so
requires.” Fed. R. Civ. P. 15(a)(2). In considering whether to grant a litigant leave to amend, the
Court considers such factors as undue delay, bad faith, dilatory motive, undue prejudice, and
futility of amendment. See Foman v. Davis, 371 U.S. 178, 182 (1962); see also Block v. First
Blood Assocs., 988 F.2d 344, 350 (2d Cir. 1993) (“The rule in this Circuit has been to allow a
party to amend its pleadings in the absence of a showing by the nonmovant of prejudice or bad
faith.”). A proposed amendment is futile if it fails to state a claim that would survive a motion to
dismiss under Federal Rule of Civil Procedure 12(b)(6). Lucente v. Int’l. Bus. Machs. Corp., 310
F.3d 243, 258 (2d Cir. 2002).
A. Proposed Rhode Island Addition
NAPG argues that adding a Rhode Island plaintiff, John Arcaro, and claims under Rhode
Island law is inappropriate because another Rhode Island plaintiff has filed a putative class
action against NAPG in the District of Connecticut, Fritz v. North American Power & Gas, LLC,
3
No. 3:14-cv-00634(WWE) (D. Conn.) and addresses the same conduct and legal claims.5
NAPG’s Opp. Br. 8-16, ECF No. 53. Thus, NAPG asks the Court to refuse the amendment
under the “prior pending action” or “first to file” doctrine. Id. Mr. Edwards agrees that his
proposed Rhode Island claims are similar to those currently pending in the Fritz case. Pl.’s
Reply Br. 2, ECF No. 54. But he argues that his Rhode Island case was filed first and that this
Court should consolidate the Rhode Island aspect of his Proposed Amended Complaint with the
Fritz case, rather than dismiss it. Id.
The Court agrees that the Fritz case addresses the same conduct and legal claims6
implicated by Mr. Edwards’s proposed Rhode Island amendment. The Second Circuit has
indicated that, under the prior pending action doctrine, “[w]here there are two competing
lawsuits, the first suit should have priority, absent the showing of balance of convenience… or
special circumstances… giving priority to the second.” Adam v. Jacobs, 950 F.2d 89, 92 (2d Cir.
1991) (citation and internal quotation marks omitted) (alterations in original). Mr. Edwards
included Rhode Island claims in his initial Complaint filed in November 2014, four months
before the Rhode Island claims in the Fritz case were initially filed.
However, the Court finds that the balance of convenience tips in favor of prioritizing the
Fritz case. The Fritz case is already well into discovery on the Rhode Island claims. As a result,
it would be more efficient to favor Fritz over the instant case. Moreover, Mr. Edwards’s counsel
explicitly asks that his Rhode Island case be consolidated with Fritz, not that it proceed parallel
5
The Rhode Island claims in the Fritz matter were first asserted in Tully v. North American Power & Gas, LLC, No.
15-cv-469 (WWE) (D. Conn.) in March 2015. These claims were consolidated into the Fritz case in June 2015.
Order, ECF No. 58, Fritz v. North American Power & Gas, LLC, No. 3:14-cv-00634(WWE) (D. Conn.).
6
In Fritz, the plaintiff has brought claims under Rhode Island law for breach of contract and a violation of the
state’s unfair trade practices act. Am. Compl., ECF No. 69. The Court in Fritz granted a motion to dismiss on the
breach of the covenant of good faith and fair dealing claim under Rhode Island law, but the initial complaint did
contain such a claim. Order, ECF No. 68, Fritz v. North American Power & Gas, LLC, No.3:14-cv-00634(WWE)
(D. Conn.).
4
to Fritz or instead of Fritz. Pl.’s Reply Br. 4-5, 4 n.3, ECF No. 54. Thus, he does not suggest
that the Rhode Island aspect of this case be given priority.
The only remaining question is whether Mr. Edwards’s Rhode Island claims should be
dismissed or severed from the instant matter and consolidated with Fritz. “The Court has broad
discretion to determine whether consolidation or dismissal is appropriate” in this circumstance.
In re MF Global Hldgs., Ltd., 464 B.R. 619, 623 (Bankr. S.D.N.Y. 2012); see also Adam, 950
F.2d at 92 (“The decision whether or not to stay or dismissing a proceeding rests within a district
judge’s discretion.”); Johnson v. Celotex Corp., 899 F.2d 1281, 1284 (2d Cir.) (“The trial court
has broad discretion to determine whether consolidation is appropriate.”), cert. denied, 498 U.S.
920 (1990); see also e.g., Oram v. SoulCycle LLC, 979 F. Supp. 2d 498, 502 (S.D.N.Y. 2013) (a
trial court has discretion to sever claims from a case).
Where two pending actions address the same legal claims and conduct, a court may
dismiss the second action as long as the “‘controlling issues in the dismissed action will be
determined in the other lawsuit.’” Taylor v. Rell, No. 3:05CV196(DJS), 2005 WL 2807223, at
*2 (D. Conn. Oct. 24, 2005) (quoting 5A Charles A. Wright & Arthur R. Miller, Federal
Practice and Procedure §1360 (2d ed. 1990)). It may consolidate cases “when there are
common questions of law or fact to avoid unnecessary costs or delay.” Johnson, 899 F.2d at
1284. Here, because the class has not yet been certified in Fritz, Mr. Arcaro’s legal claims may
not be addressed if the Rhode Island claims in this case are dismissed. The Court also finds that
there are common questions of law and fact, which would make consolidation appropriate here.
The Court may “sever any claim against a party” at its discretion. Fed. R. Civ. P. 21; see
also Garber v. Randell, 477 F.2d 711, 714 (2d Cir. 1973) (“[T]he court’s power to sever claims
and order separate trials is [ ] discretionary.”); TLD Am. Corp. v. Mazuma Capital Corp., No.
5
3:15-cv-39 (SRU), 2015 WL 5116768, at *4 (D. Conn. Aug. 28, 2015) (“The decision whether to
sever a claim is committed to the sound discretion of the trial court.”) (internal quotation marks
and citations omitted). In determining whether to sever claims, the Court must consider the
following factors: “(1) whether the claims arise of the same transaction or occurrence; (2)
whether the claims present some common questions of law or fact; (3) whether settlement of the
claims or judicial economy would be facilitated; (4) whether prejudice would be avoided if
severance were granted; and (5) whether different witnesses and documentary proof are required
for the separate claims.” Oram, 979 F. Supp. 2d at 502-03; see also Morris v. Northrup
Grumman Corp., 37 F. Supp. 2d 556, 580 (E.D.N.Y. 1999) (same); TLD Am. Corp., 2015 WL
5116768, at *4 (same).
The proposed Rhode Island claims are distinct from the other claims in this case and are
likely to present slightly different questions of fact that are specific to the localized context of
NAPG’s operation in Rhode Island. As noted above, judicial economy weighs heavily in favor
of severing the Rhode Island claims and transferring them to the Fritz case. NAPG would also
be prejudiced if it had to defend this lawsuit separately from Fritz. Finally, it is unclear at this
stage whether the Rhode Island claims will have the same witnesses and evidence as claims
involving other states, but the necessary witnesses and evidence will certainly be the same as in
the Fritz matter. Thus, severance of the Rhode Island claims is appropriate here.
Because the Court has rejected the sole ground NAPG presents for dismissing the Rhode
Island claims, the Court will allow Mr. Edwards’s Rhode Island amendments. For the reasons
set forth above, it also orders that these Rhode Island claims and allegations be severed from this
case and consolidated with Fritz v. North American Power & Gas, LLC, No. 3:14-cv00634(WWE) (D. Conn.).
6
B. Proposed New Hampshire Addition
NAPG argues that the Court lacks jurisdiction over Mr. Edwards’s proposed claims under
the New Hampshire Consumer Protection Act (“NHCPA”), N.H. Rev. Stat. Ann. §358-A et seq.,
because they are exempt from the Act’s coverage. NAPG’s Opp. Br. 16-21, EF No. 53. He also
contends that the proposed contract-based claims under New Hampshire law are essentially the
same as the NHCPA claims and that the Court lacks jurisdiction over them for the same reason.
Id. at 19. The Court does not believe that NAPG’s argument implicates jurisdiction but rather
that Mr. Edwards’s proposed amendment fails to state a claim for a violation of the NHCPA
under Federal Rule of Civil Procedure 12(b)(6). However, as explained further below, it will
allow Mr. Edwards to add the New Hampshire Plaintiffs and their contract-based claims under
New Hampshire law.
The NHCPA exempts from its coverage “[t]rade or commerce that is subject to the
jurisdiction of” several regulators, including the “public utilities commission.” N.H. Rev. Stat.
Ann. §358-A:3, I (“The following transactions shall be exempt from the provisions of this
chapter: [ t]rade or commerce that is subject to the jurisdiction of the bank commissioner, the
director of securities regulation, the insurance commissioner, the public utilities commission, the
financial institutions and insurance regulators of other states, or federal banking or securities
regulators…”). In determining whether trade or commerce is exempt from the NHCPA’s
coverage under this provision, the Court must examine the “statutes that define the [relevant]
regulator’s powers and authority.” LeDoux v. JP Morgan Chase, N.A., Civil No. 12-cv-260-JL,
2012 WL 5874314, at *6 (D.N.H. Nov. 20, 2012) (citation and internal quotation marks
omitted). If the statutes “grant [the regulator] the authority to supervise or regulate the trade or
commerce in which the defendant’s deceptive [or unfair] practice occurred, then that trade or
7
commerce is ‘subject to the jurisdiction of’ [that entity], and the [NH]CPA does not apply.”
Elmo v. Callahan, Civil No. 10-cv-286-JL, 2012 WL 3669010, at *9 (D.N.H. Aug. 24, 2012)
(citations omitted); see also Rainville v. Lakes Region Water Co., 163 N.H. 271, 275 (2012)
(“[T]he [NH]CPA does not apply to claims of unfair competition or deceptive practices in selling
or distributing a service that is subject to the [public utilities commission’s] jurisdiction.”). The
party claiming the exemption from the Act’s coverage has the burden of showing that the
exemption applies. N.H. Rev. Stat. Ann. §358-A3, V.
Under New Hampshire law, the public utilities commission is empowered to generally
supervise “all public utilities and the plants owned, operated or controlled by the same.”
Rainville, 163 N.H. at 275 (quoting N.H. Rev. Stat. Ann. §374:3). The New Hampshire public
utilities commission may also regulate “competitive electricity suppliers,”7 like NAPG, in
various aspects of their businesses, other than price regulation and “including registration,
registration fees, customer information, disclosure, standards of conduct, and consumer
protective and assistance requirements.” N.H. Rev. Stat. Ann. § 374-F:7, I; see also HalifaxAmerican Energy Co. v. Provider Power, LLC, No. 218-2014-CV-00632, 2015 WL 10642711, at
*5 (N.H. Super. Ct. Dec. 7, 2015). The commission is authorized to take various actions against
competitive energy suppliers who “engage[ ] in any unfair or deceptive acts or practices in the
marketing, sale, or solicitation of electricity supply or related services.” N.H. Rev. Stat. Ann.
§374-F:7, III(a). These possible actions include the ability to assess fines, rescind residential
consumer contracts, and order restitution to residential consumers. Id. § 374-F:7, III.
7
New Hampshire law also allows for the operation of “competitive electricity suppliers” in the New Hampshire
marketplace that are not “public utilities.” N.H. Rev. Stat. Ann. §374-F:7, I (describing “competitive electricity
suppliers” as being distinct from “public utilities”).
8
The foregoing language indicates that the public utilities commission has authority to
supervise or regulate NAPG’s conduct alleged to have violated the NHCPA in this case. Thus,
Mr. Edwards’s proposed additions are within the jurisdiction of that commission and are exempt
from the NHCPA’s coverage. The Court is not persuaded by either of the arguments Mr.
Edwards makes to the contrary.
First, Mr. Edwards argues that, based on the rules governing the public utilities
commission’s operations, that the commission lacks jurisdiction over the conduct that allegedly
supports an NHCPA violation. Reply Br. 8-9, ECF No. 54. But New Hampshire law indicates
that in evaluating whether a claim falls under the exemption to the NHCPA, the Court’s focus
should be on the statute that empowers the relevant regulator, not its implementing rules. See
Rainville, 163 N.H. at 275 (“[T]o determine when offering for sale or distribution a service is
‘subject to the jurisdiction of’ the [public utilities commission for the purposes of the NHCPA],
we examine the statutes that define the [commission’s] powers and authorities.”) (emphasis
added). Mr. Edwards cites no authority justifying an examination of the public utilities
commission’s rules, particularly whereas here, there is unequivocal language addressing the
issue in the statute.
Second, Mr. Edwards also argues that while his claims of deception may be exempt from
the NHCPA’s coverage, his claims of unfair conduct are not. Reply Br. 9, ECF No. 54. He
reasons that the public utilities commission’s authority covers the types of disclosures required,
not conduct in the marketplace. As described above, the plain language of the statute indicates
otherwise. Moreover, the New Hampshire Supreme Court has indicated that, in determining
whether claims fall under this exemption to the NHCPA, the relevant issue “is not whether a
party’s deceptive practice is subject to the [regulator’s] jurisdiction, but whether the practice
9
occurred in the conduct of ‘trade or commerce’ that is subject to the [regulator’s] jurisdiction.”
Rainville, 163 N.H. at 276 (emphasis in original); accord Elmo, 2012 WL 3669010, at *10
(finding that the NHCPA’s exemption did not apply because the deceptive acts occurred while
the defendant was practicing law, not trading securities, and only the latter was a trade or
commerce that fell under the jurisdiction of a regulator, exempting it from the NHCPA). Thus,
the distinction Mr. Edwards seeks to draw between his unfairness and deception claims is not
one recognized under New Hampshire law.
Accordingly, Mr. Edwards’s proposed NHCPA claim is futile, because his allegations
implicate conduct that is exempted from the Act’s coverage. His request to add a claim under
the NHCPA to the case is denied on that basis. The Court is unconvinced, however, that the
New Hampshire contract-based claims should be dismissed for the same reasons. NAPG does
not identify any aspect of the NHCPA that affects the validity of the proposed contract-based
claims. Because NAPG makes no other arguments suggesting that these claims are futile or
should be dismissed for any other reason, the Court will permit Mr. Edwards to add them to this
case.
III.
Conclusion
For all of the foregoing reasons, the Motion to Amend the Complaint, ECF No. 52, is
GRANTED IN PART and DENIED IN PART. The Court will allow Mr. Edwards to add
allegations and legal claims pertaining to NAPG’s conduct in Rhode Island and orders that those
claims and allegations be severed from this case and consolidated with Fritz v. North American
Power & Gas, LLC, No. 3:14-cv-00634(WWE) (D. Conn.). Mr. Edwards is directed to file a
new complaint, containing only his Rhode Island allegations and claims, on the docket in this
case within twenty-one (21) days of the date of this Ruling. Once this complaint is filed, the
10
Clerk is directed to consolidate the Rhode Island aspect of this case with Fritz v. North American
Power & Gas, LLC, No. 3:14-cv-00634(WWE) (D. Conn.) by filing the complaint containing
only the Rhode Island allegations and claims in the Fritz matter.
With respect to this case, the Court will allow Mr. Edwards to add the proposed New
Hampshire Plaintiffs to the case, asserting claims of breach of contract and breach of the
covenant of good faith and fair dealing under New Hampshire law. It will not allow him to add a
claim under the NHCPA, because this claim is futile. The Court will also allow Mr. Edwards to
add a breach of contract claim under Connecticut law and to add Mr. Wendrovsky as a Plaintiff.
In addition to the Rhode Island complaint, Mr. Edwards is directed to file a second amended
complaint in this matter containing only the allegations and claims that the Court has allowed to
proceed in this case, and excluding the Rhode Island claims and the NHCPA claim, within
twenty-one (21) days of the date of this Ruling.
SO ORDERED this 1st day of June 2016, at Bridgeport, Connecticut.
/s/ Victor A. Bolden
Victor A. Bolden
United States District Judge
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