Petersen et al v. Petersen et al

Filing 74

ORDER AND REASONS granting 52 Motion to Substitute Lorraine Petersen in the place of plaintiff Richard Petersen.; dismissing as moot 60 Motion to Strike ; granting 61 Motion to Dismiss for Failure to Comply with Court's Order and for Costs and Attorneys' Fees, and defendants' Third-Party Complaint be Dismissed without prejudice; dismissing as moot 64 Motion to Expedite and 66 Motion to Continue.. Signed by Judge Ivan L.R. Lemelle. (ijg)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
LORRAINE PETERSEN AND
RICHARD PETERSEN

CIVIL ACTION

VERSUS

NO. 14-1516

KENNETH PETERSEN, SR.,
KAREN RUIZ PETERSEN, AND
CARTER PROPERTIES, LLC

SECTION B(5)

ORDER AND REASONS
I.

NATURE OF THE MOTIONS AND RELIEF SOUGHT
There are several motions for the Court. Accordingly, and for

the reasons enumerated below,
IT IS ORDERED that Plaintiff’s Motion to Substitute Plaintiff
(Rec.

Doc.

No.

52)

is

GRANTED,

thereby

substituting

Lorraine

Petersen, in her capacity as Administratrix of the Succession of
Richard Petersen, in the place of Plaintiff, Richard Petersen.
IT IS FURTHER ORDERED that Plaintiff’s Motion to Strike, or
in the Alternative, Motion for Leave

to File Reply Memorandum

(Rec. Doc. No. 60) is DISMISSED as MOOT.
IT IS FURTHER ORDERED that Plaintiff’s Motion to Dismiss for
Failure to Comply with Court’s Order and for Costs and Attorneys’
Fees (Rec. Doc. No. 61) is GRANTED, and Defendants’ Third-Party
Complaint is DISMISSED without prejudice.

1

IT IS FURTHER ORDERED that because the foregoing moots the
basis provided in the Unopposed Motion to Continue (Rec. Doc. No.
66) and Motion for Expedited Consideration thereof (Rec. Doc. No.
64), the same shall be DISMISSED as MOOT.
II.

FACTS, PROCEDURAL BACKGROUND AND CONTENTIONS
In this diversity action for breach of contract, Lorraine,

wife of/and Richard Petersen, assert claims against their son,
Kenneth Petersen Sr. and his wife Karen Ruiz Petersen, as well as
Kenneth and Karen’s business, Carter Properties, LLC.1 Plaintiffs
allege

fraud,

conversion,

breach

and

of

unjust

fiduciary
enrichment

duty,
arising

breach
out

of
of

mandatary,
a

“Durable

Financial Powers-of-Attorney” executed by Kenneth Petersen, Sr.2
This

matter

was

removed

to

the

Court

from

the

34th

Judicial

District Court for the Parish of Orleans.3
On December 15, 2014, Lorraine Petersen filed a Motion to
Substitute Plaintiff.4 On October 17, 2014, her husband Richard
away.5

On

Administratrix

of

passed

December
the

3,

Succession

2014,
of

Lorraine
Richard

was

appointed

Petersen,

and

on

December 15, 2014, moved for an order substituting her in that

1

Rec. Doc. No. 1-2.
Rec. Doc. No. 1.
3
Rec. Doc. No. 1.
4
Rec. Doc. No. 52.
5
Rec. Doc. No. 52 at 1; 52-2 at 5.
2

2

capacity, in the place of Plaintiff, Richard Petersen

in this

action.6
Defendants

oppose

the

motion

on

the

basis

that,

(1)

the

claims by Richard are the same as those by Lorraine; (2) confusion
would

result

as

Defendants

have

asserted

claims

against

three

heirs (Kenneth Petersen, Leonard Petersen, and Richard Petersen,
Jr.) for theft, fraud, conversion, unjust enrichment, etc.7 On
January 2, 2015, Defendants filed an Answer to the First Amended
Complaint
that

asserting

permitting

the

these

third-party

substitution

claims.8

would

allow,

Defendants
in

the

claim

event

a

judgment is rendered against one or more of the Defendants, the
Third-Party

Defendants

to

be

unjustly

enriched

through

the

judgment obtained by the estate.9
Plaintiff filed a Motion to Strike, or in the Alternative,
Motion for Leave to File Reply Memorandum because the foregoing
opposition

was

not

filed

at

least

a

Motion

eight

days

prior

to

the

submission date.10
Plaintiff

filed

to

Dismiss

[the

Third-Party

Complaint] for Failure to Comply with Court’s Order and for Costs

6

Rec. Doc. No. 52 at 2, 52-1 at 1.
Rec. Doc. No. 57.
8
Rec. Doc. No. 54.
9
Rec. Doc. No. 57
10
Rec. Doc. No. 60.
7

3

and Attorney’s Fees.11 Defendants filed a Response in Opposition to
Plaintiff’s Motion to Dismiss.12 Plaintiff filed a reply.13
III.

LAW AND ANALYSIS
There

are

Defendants’

two

main

third-party

issues

before

complaint

the

should

be

Court:

(1)

dismissed,

whether
and

(2)

whether Plaintiff’s substitution should be denied, in light of the
scheduling order in place in this matter. The scheduling order
provides: “[a]mendments to pleadings, third-party actions, crossclaims and counter claims shall be filed no later than SEPTEMBER
2, 2014.”14
Federal Rule of Civil Procedure 16(b) governs amendment of
pleadings

after

a

scheduling

order’s

deadline

to

amend

has

expired. S&W Enters., LLC v. Southtrust Bank of Ala., NA, 315 F.3d
533, 535 (5th Cir. 2003). As to post-deadline amendment, a party
“must show good cause for not meeting the deadline before the more
liberal standard of Rule 15(a) will apply to the district court’s
denial of leave to amend.” Southwestern Bell Tel. Co. v. City of
El Paso, 346 F.3d 541, 546 (5th Cir. 2003).
Four factors are relevant to good cause: (1) the explanation
for

the

failure

to

timely

move

for

leave

to

amend;

(2)

the

11

Rec. Doc. No. 61.
Rec. Doc. No. 63.
13
Rec. Doc. No. 73.
14
Rec. Doc. No. 7 at 1.
12

4

importance of the amendment; (3) potential prejudice in allowing
the amendment; and (4) the availability of a continuance to cure
such a prejudice. Fahim v. Marriott Hotel Services, Inc., 551 F.3d
344, 348 (5th Cir. 2008).
a. Motion to Dismiss the Third-Party
Costs and Attorney’s Fees

Complaint

and

for

Defendants argue that: (1) the Third Party Complaint, filed
in conjunction with the Amended Answer, is not untimely as the
filing is well within the 14-day window established by Fed. R.
Civ. P. 14 to file a complaint on a nonparty; and, (2) under Fed.
R. Civ. P. 19, the Defendants are required by law to add parties
they believe may be liable for the claims brought against them.15
Rule 14(a)(1) provides:
“A defending, party may, as third-party plaintiff, serve a
summons and complaint on a nonparty who is or may be liable
to it for all or part of the claim against it. But the thirdparty plaintiff must, by motion, obtain the court’s leave if
it files the third-party complaint more than 14 days after
serving its original answer.”

Rule 14(a)(1) does not apply here. An answer to an amended
complaint may only serve an as original answer, within the meaning
of

the

rule,

if

the

amended

complaint

changes

the

need

for

impleader. United Nat. Ins. Corp. v. Jefferson Downs Corp., 220
F.R.D. 456, 458 (M.D. La. 2003). A review of the amended answer

15

Rec. Doc. No. 63 at 3.

5

reveals that no new claims or theories of liability have been
asserted.16 Because the amended answer did not change Defendants’
need to implead the Third Party Defendants, the Amended Answer
cannot serve as an “original answer,” and Defendants should have
obtained leave of court to serve the Third Party Defendants.
Rule 19(a) provides:
(1)

Required Party. A person who is subject to service of
process and whose joinder will not deprive the court of
subject-matter jurisdiction must be joined as a party
if: (A) in that person’s absence, the court cannot
accord complete relief among existing parties...17

The Third-Party Complaint alleges that Third-Party Defendants
availed

themselves

“harassment,
emotional

of

Plaintiffs’

terroristic

distress,

threat,

stalking,

monies

and

are

intentional

unjust

liable

for:

infliction

enrichment,

of

breach

of

fiduciary duties, fraud, theft and conversion.”18
First,

joinder

of

the

Third-Party

Defendant

deprives

this

court of subject-matter jurisdiction. On the face of the Notice of
Removal,

jurisdiction

1332(a)

diversity

requires

complete

of

in

this

matter

citizenship.19

diversity

between

is

based

on

28

The

statutory

all

plaintiffs

U.S.C.

§

provision
and

all

16

Rec. Doc. No. 51.
Rule 19 goes on to provide as follows: “or (B) that person claims an interest relating to the subject of the action and
is so situated that disposing of the action in the person’s absence may: (i) as a practical matter impair or impede the
person’s ability to protect the interest; or (ii) leave an existing party subject to a substantial risk of incurring double,
multiple, or otherwise inconsistent obligations because of the interest.” Subsection B does not apply here.
18
Rec. Doc. No. 54 at 10.
19
Rec. Doc. No. 1.
17

6

defendants. KeyBank Nat’l Ass’n v. Perkins Rowe Assocs., LLC., 539
F.App’x

414

(5th

Cir.

2013).

Complete

diversity

means

that

a

plaintiff’s citizenship must be diverse from the citizenship of
each and every defendant. Lincoln Prop. Co. v. Roche, 546 U.S. 81,
89 (2005). The state of domicile of each party establishes his
citizenship for diversity purposes. Hollinger v. Home State Mut.
Ins. Co., 654 F.3d 564 (5th Cir. 2011). According to the Petition
for

Damages

filed

in

the

state

court

and

the

Third-Party

Complaint, Plaintiffs and Third-Party Defendants are all domiciled
in the state of Louisiana.20
Second, the Third-Party Defendants are not required parties
to this action under subsection (a)(1) (or (b) for that matter).
Defendants appear to be operating under the impression or fear, of
being

held

Defendants.
whole,

or

liable
As
in

for

alleged,
part,

the

alleged

whether

liable

for

conduct

of

Third

Third

Party

Defendants

the

theft

or

Party
are

in

conversion

of

Plaintiffs’ monies, is separate and apart from whether Defendants
themselves are, in whole or in part, liable for the same. The
Court can accord complete relief among the existing parties on the
claims before it.

20

Rec. Doc. No. 1-2 at 1; Rec. Doc. No. 54 at 10.

7

Third, Defendants have failed to establish good cause for the
untimely

pleading

and/or

failure

to

obtain

leave

court.21

of

Defendants claim to have been recently made aware of the need to
implead the Third-Party Defendants at December 2014 depositions of
Defendants, and as a result of exhibits presented by Plaintiff.22
Defendants’ own depositions provide the basis for the asserted
need to implead Third-Party Defendants.23 Thus, the Court fails to
comprehend why Defendants did not seek to implead until nearly
four months after the September 2, 2014 deadline for third-party
actions.
Additionally,

Plaintiffs,

whose

case

was

removed

from

the

state court, would most certainly suffer prejudice in the form of
delay to bringing this matter to a resolution, as joinder would
require additional discovery, and continuance of the current trial
date, which is two months away.
Accordingly, IT IS ORDERED that Plaintiff’s Motion to Dismiss
Defendants’
Leonard

Third-Party

Petersen,

and

Complaint

Richard

against

Petersen,

Kenneth

Jr

is

Petersen,

GRANTED

on

the

Civ.

P.

ground that the required leave of court was not obtained.
IT

IS

FURTHER

ORDERED

that

pursuant

to

Fed.

R.

16(f)(2) Plaintiffs be awarded the reasonable expenses, including
21

Rec.Doc. No. 63 at 12.
Rec. Doc. No. 63 at 11.
23
E.g. Rec. Doc. No. 63-1 at 2.
22

8

attorney’s fees, associated with the filing of this motion, and
incurred because of Defendants’ noncompliance with this Court’s
scheduling order.24
b. Motion to Substitute Plaintiff
The
cause

Court

for

a

concludes

that

post-deadline

Plaintiffs

substitution

have
of

established

Plaintiff,

good

Lorraine

Petersen, in her capacity as Administratrix of the Succession of
Richard Petersen, in the place of Plaintiff, Richard Petersen.
Specifically, Defendants concerns regarding unjust enrichment by
the Third Party Defendants are no longer an issue. Moreover, as
Defendants

acknowledge,

“the

allegations

and/or

claims

made

by

Richard Petersen are the exact claims made by his wife, Lorraine
Petersen

who

is

now

administratrix

of

his

estate.”25

Thus,

no

prejudice or delay should result from granting the substitution
sought here.
Accordingly,

IT

IS

ORDERED

that

Plaintiffs’

Motion

to

Substitute is GRANTED.

24

Federal Rule of Civil Procedure Rule 16(f) Sanctions: (2) Imposing Fees and Costs. Instead of or in addition to any
other sanction, the court must order the party, its attorney, or both to pay the reasonable expenses—including
attorney's fees—incurred because of any noncompliance with this rule, unless the noncompliance was substantially
justified or other circumstances make an award of expenses unjust.
25
Rec. Doc. No. 57 at 1-2.

9

IV.

CONCLUSION
Accordingly, and for the reasons enumerated above,
IT IS ORDERED that Plaintiff’s Motion to Substitute Plaintiff

(Rec.

Doc.

No.

52)

is

GRANTED,

thereby

substituting

Lorraine

Petersen, in her capacity as Administratrix of the Succession of
Richard Petersen, in the place of Plaintiff, Richard Petersen.
IT IS FURTHER ORDERED that Plaintiff’s Motion to Strike, or
in the Alternation, Motion for Leave to File Reply

Memorandum

(Rec. Doc. No. 60) IS DISMISSED as MOOT.
IT IS FURTHER ORDERED that Plaintiff’s Motion Dismiss for
Failure to Comply with Court’s Order and for Costs and Attorneys’
Fees (Rec. Doc. No. 61) be GRANTED, and Defendants’ Third-Party
Complaint be DISMISSED without prejudice.
IT IS FURTHER ORDERED that because the foregoing moots the
basis provided in the Unopposed Motion to Continue (Rec. Doc. No.
66) and Motion for Expedited Consideration thereof (Rec. Doc. No.
64), the same is DISMISSED as MOOT.
New Orleans, Louisiana, this 21st day of January, 2015.

____________________________
UNITED STATES DISTRICT JUDGE

10