National Union Fire Insurance Company of Pittsburgh PA v. SPX Flow, Inc.

Filing 45

ORDER ON MOTION FOR LEAVE TO AMEND. ORDER denying 39 Motion for Leave to File Amended Answer With Affirmative Defenses. Signed by Judge Beth Bloom on 11/21/2018. See attached document for full details. (kpe)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE No. 18-cv-80332-BLOOM/Reinhart
NATIONAL UNION FIRE INSURANCE
COMPANY OF PITTSBURGH PA,
as subrogee,
Plaintiff,
v.
SPX FLOW US, LLC,
Defendant.
________________________________/
ORDER ON MOTION FOR LEAVE TO AMEND
THIS CAUSE is before the Court upon Defendant SPX Flow US, LLC’s (“Defendant”)
Motion for Leave to File Amended Answer With Affirmative Defenses, ECF No. [39] (the
“Motion”). Having carefully considered the Motion, the record in this case, and being otherwise
fully advised, the Motion is denied.
On March 14, 2018, Plaintiff commenced this suit against Defendant asserting claims of
negligence and strict liability. ECF No. [1]. Plaintiff, an insurance company, alleges that a
vessel, MY Bellissimo, owned by its insured, Lena N. Aquila, was damaged on July 28, 2016
when the starboard engine overheated causing a fire. ECF No. [5] at ¶¶ 2, 6-7. Upon inspection
of the vessel, it was determined that the raw water impeller pump on the starboard engine had
been replaced with a pump manufactured by Defendant. Id. at ¶ 11. It was further determined
that the pump manufactured by Defendant had malfunctioned. Id. at ¶ 12. Plaintiff paid its
insured the amount of $271,317.60 to cover the cost of the repairs and the insured paid an
additional $15,000 deductible. Id. at ¶ 13. The insured appointed Plaintiff as its attorney in fact

CASE No. 18-cv-80332-BLOOM/Reinhart

to attempt to recover the deductible. Id. Plaintiff commenced this action against Defendant to
recover the full amount of damage to the vessel, $286,317.60. Id.
On April 25, 2018 the Court issued an Order Setting Trial and Pre-Trial Schedule. ECF
No. [12]. Pursuant to the Order, the deadline to amend pleadings was June 25, 2018. Id. On
November 8, 2018, Defendant filed the instant Motion, requesting leave to amend its Answer.
ECF No. [39]. Specifically, Defendant sought to amend an affirmative defense in order to
identify with specificity the nonparties against whom it may be entitled to an apportionment of
damages. However, Defendant withdrew that request in its Reply.

See ECF No. [44].

Defendant’s remaining request seeks to add the economic loss rule as an affirmative defense.
The proposed new affirmative defense would state: “Plaintiff’s claims are barred and/or limited
by the economic loss rule because plaintiff alleges that the damages were caused by a purported
manufacturing defect in a component part that was fully integrated into the engine and yacht that
sustained damages.” ECF No. [39].
Fed. R. Civ. P. 15(a)(2) provides that “a party may amend its pleading only with the
opposing party’s written consent or the court’s leave. The court should freely give leave when
justice so requires.” “Although leave to amend shall be freely given when justice so requires, a
motion to amend may be denied on numerous grounds such as undue delay, undue prejudice to
the defendants, and futility of the amendment.” Mann v. Palmer, 713 F.3d 1306, 1316 (11th Cir.
2013) (citation omitted).
Here, because Defendant’s motion to amend was filed after the Scheduling Order’s
amendment deadline of June 25, 2018, Defendant “must first demonstrate good cause under Rule
16(b) before [the Court] will consider whether amendment is proper under Rule 15(a).” Sosa v.
Airprint Sys., Inc., 133 F.3d 1417, 1419 (11th Cir. 1998). This means that “the likelihood of

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CASE No. 18-cv-80332-BLOOM/Reinhart

obtaining permission to amend diminishes drastically after the court enters a scheduling order
with deadlines for amendments that have expired.” Donahay v. Palm Beach Tours & Transp.,
Inc., 243 F.R.D. 697, 699 (S.D. Fla. 2007).

The “good cause” requirement “precludes

modification unless the schedule cannot be met despite the diligence of the party seeking the
extension.” Sosa, 133 F.3d at 1418 (citing Fed. R. Civ. P. 16 advisory committee's note;
Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 609 (9th Cir. 1992) (“If [a] party was not
diligent, the [good cause] inquiry should end.”)). “In other words, good cause exists when
evidence supporting the proposed amendment would not have been discovered in the exercise of
reasonable diligence until after the amendment deadline had passed.” Donahay, 243 F.R.D. at
699 (citing Forstmann v. Culp, 114 F.R.D. 83, 85–86 (M.D. N.C. 1987)). Further, “good cause
is not shown if the amendment could have been timely made,” even if the opposing party would
not be prejudiced. Id.; see also Kernal Records Oy v. Mosley, 794 F. Supp. 2d 1355, 1369 (S.D.
Fla. 2011), aff'd sub nom. Kernel Records Oy v. Mosley, 694 F.3d 1294 (11th Cir. 2012)
(“Diligence is evaluated by considering the following factors: (1) whether the plaintiff failed to
ascertain facts prior to filing the complaint and to acquire information during the discovery
period; (2) whether the information supporting the proposed amendment was available to the
plaintiff; and (3) whether even after acquiring the information the plaintiff delayed in seeking the
amendment.”).
Defendant has failed to demonstrate good cause to modify the Court-imposed amendment
deadline and permit the requested relief. Defendant’s Motion offers two potential arguments to
demonstrate good cause. First, Defendant contends that it “has encountered some delay in
obtaining manufacturing documents because they were in the custody of its Swedish affiliate . . .
and a separate manufacturing company located in Tallinn, Estonia.” ECF No. [39] at ¶ 16.

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Second, Defendant suggests that revelations in discovery have caused it to seek a new
affirmative defense, stating that “after analysis of discovery to date and research into the specific
aspects of the economic loss rule, [SPX] seeks to present its legal argument as to the reduction or
elimination of National Union’s claimed damages…” Id. at ¶ 24.1
The Court is unpersuaded that Defendant has demonstrated good cause to modify the
Court’s Scheduling Order and afford the relief requested. Defendant has failed to explain any
connection between the manufacturing documents it was delayed in receiving and its ability to
raise the economic loss rule as an affirmative defense. Defendant has similarly failed with
respect to the implication that findings in discovery gave rise to Defendant seeking to assert the
affirmative defense. Defendant has identified no information that it came into possession of after
the deadline to amend its pleadings which prompted Defendant to seek to assert a new
affirmative defense. Thus, Defendant has failed to show diligence in presenting its affirmative
defense of the economic loss rule. See Saewitz v. Lexington Ins. Co., 133 F. App'x 695, 700
(11th Cir. 2005) (finding district court did not abuse its discretion in denying defendant
opportunity to amend pleadings to add affirmative defense where defendant “failed to show
diligence in presenting its affirmative defense”); Donahay, 243 F.R.D. at 699 (“even if the
opposing party would not be prejudiced by the modification of a scheduling order, good cause is
not shown if the amendment could have been timely made”).
Because Defendant has not shown good cause, the Court need not address whether
Plaintiff would be prejudiced by the proposed amendment. Nevertheless, the Court notes that
Defendant’s timing appears prejudicial.

As Plaintiff points out, it has already taken the

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 Defendant’s Reply offers an additional basis for demonstrating good cause, namely, that the law related
to the economic loss rule is complex. Defendant has not provided the Court with, nor is the court aware
of, any case law supporting “complexity of the law” as a basis for good case to amend a pleading after the
deadline has passed. 

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depositions of Lena Aquila (Plaintiff’s insured), Tom Aquila (the driver of the vessel during the
subject incident) and Shane Peacock (one of the owners of the marina that maintains and services
the vessel and performed the estimates and repairs of the vessel after the subject fire). Since the
determination of what constitutes the “product” for purposes of the economic loss rule is a
factual issue, Plaintiff may need to re-depose these individuals. Plaintiff may also need to
depose a representative of 1-Hincklet Company, LLC, the manufacturer of the vessel. As the
discovery cutoff is January 11, 2019 at the very least Plaintiff would be required to undertake
new discovery as to this newly inserted affirmative defense during the limited time remaining.
Accordingly, it is ORDERED AND ADJUDGED that Defendant’s Motion for Leave to
File Amended Answer With Affirmative Defenses, ECF No. [39], is DENIED.
DONE AND ORDERED in Miami, Florida, this 21st day of November, 2018.

_________________________________
BETH BLOOM
UNITED STATES DISTRICT JUDGE
Copies to:
Counsel of Record

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