Rogers v. Medicredit, Inc.
MEMORANDUM AND ORDER IT IS HEREBY ORDERED that plaintiff's motion for leave to file second amended class action complaint, leave to file motion for class certification, and for amendment of case management order [Doc. # 41 ] is denied. IT IS FURTHER ORDERED that plaintiff's motion to dismiss Count III of the first amended complaint without prejudice [Doc. # 43 ] is granted.. Signed by District Judge Carol E. Jackson on 8/21/13. (KKS)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
No. 4:12-CV-2277 (CEJ)
MEMORANDUM AND ORDER
This matter is before the Court on plaintiff’s motion for leave to file a second
amended class action complaint, for leave to file a motion for class certification, and
for amendment of the existing Case Management Order. Defendant has filed a
response in opposition and the issues are fully briefed. Also before the Court is
plaintiff’s motion to dismiss Count III of the first amended complaint without prejudice.
the first amended complaint, filed on January 8, 2013, plaintiff asserts
individual claims against defendant Medicredit based on the Fair Debt Collection
Practices Act (FDCPA), 15 U.S.C. § 1692 et seq. (Count I) and the Telephone
Consumer Protection Act (TCPA), 47 U.S.C. 227 et seq. (Count II), and asserts a claim
of tortious intrusion upon seclusion (Count III).
On January 17, 2013, the Court issued a Case Management Order setting
February 18, 2013 as the deadline for joining additional parties and amending
pleadings and July 1, 2013 as the deadline for completing all discovery. On May 31,
2013, the Court granted plaintiff’s motion for partial summary judgment as to FDCPA
liability and statutory damages. The Court subsequently granted plaintiff’s request for
substitution of counsel.
On June 3, 2013, plaintiff filed the instant motion for leave to file a second
amended class action complaint, leave to file a motion for class certification, and for
amendment of the existing Case Management Order. The proposed second amended
class action complaint adds three new defendants: The Outsource Group, Inc. (TOG),
St. Francis Medical Center (St. Francis), and Union Electric Company (Union Electric).
The debts at issue in this action arise out of electricity and medical services that were
provided to plaintiff by Union Electric and St. Francis. TOG is the corporation that owns
Medicredit, the original named defendant. Plaintiff alleges that the conduct of these
defendants violated the TCPA. Plaintiff does not assert any new claims against
Medicredit. Plaintiff seeks to bring the claims as a class action.
Federal Rule of Civil Procedure 15(a)(2) provides that courts “should freely give
leave [to amend pleadings] when justice so requires.” Under this liberal amendment
policy, denial of leave to amend pleadings is appropriate “only in those limited
circumstances in which undue delay, bad faith on the part of the moving partly, futility
of the amendment, or unfair prejudice to the non-moving party can be demonstrated.”
Roberson v. Hayti Police Dept., 241 F.3d 992, 995 (8th Cir. 2001) (citing Foman v.
Davis, 371 U.S. 178, 182 (1962)); Sanders v. Clemco Indus., 823 F.2d 214, 216 (8th
Cir. 1987)). Delay alone is not a reason in and of itself to deny leave to amend; the
delay must have resulted in unfair prejudice to the party opposing amendment.
Sanders, 823 F.2d at 217.
However, when a party seeks leave to amend a pleading outside the deadline
established by the court’s scheduling order, the party must satisfy the good-cause
standard of Rule 16(b)(4) rather than the more liberal standard of Rule 15(a).
Sherman v. Winco Fireworks, Inc., 532 F.3d 709, 716 (8th Cir. 2008). “The primary
measure of good cause is the movant’s diligence in attempting to meet the order's
requirements.” Id. (citing Rahn v. Hawkins, 464 F.3d 813, 822 (8th Cir. 2006)). “While
the prejudice to the nonmovant resulting from modification of the scheduling order
may also be a relevant factor, generally, [the court] will not consider prejudice if the
movant has not been diligent in meeting the scheduling order’s deadlines.” Id. (citing
Bradford v. DANA Corp., 249 F.3d 807, 809 (8th Cir. 2001)).
Plaintiff provides two reasons for why he did not meet the February 18, 2013
deadline for adding parties and amending pleadings. First, plaintiff states that on May
9, 2013, the Federal Communications Commission (FCC) released a decision stating
that creditors who hire third party debt collectors can be held vicariously liable for the
debt collector’s violations of the TCPA. See Dish Network et al Petition for Declaratory
Ruling re: TCPA Rules, FCC 13-54, available at http://www.fcc.gov/document/dish-net
work-et-al-petition-declaratory-ruling-re-tcpa-rules. Plaintiff argues that the release
of this ruling constitutes good cause for the Court to grant leave to join the additional
defendants, as prior to the ruling there was no agency guidance on whether creditors
could be held vicariously liable. Plaintiff’s second reason is that he has retained new
The question of whether to join TOG, St. Francis, and Union Electric as
defendants in this case does not hinge on the FCC’s May 9 ruling. District courts have
had little difficulty deciding for themselves whether vicarious liability may apply in the
creditor-debt collector context. In Jamison v. First Credit Services, Inc., 2013 WL
1248306, *4 (N.D. Ill. Mar. 28, 2013), the court acknowledged that “[w]hile the FCC’s
guidance on vicarious liability is concededly scant, it has been unequivocal that an
entity can be held liable for calls made on its behalf even if the entity itself did not
directly place the call.” In Martin v. Cellco Partnership, 2012 WL 5048854, *1 (N.D. Ill.
Oct. 18, 2012), the court turned to a 2008 FCC ruling in order to hold that “a creditor
is responsible for calls made on its behalf.” See In re Rules and Regulations
Implementing the Telephone Consumer Protection Act of 1991, 23 FCC Rcd. 559 (Jan.
4, 2008). While, in contrast, Mais v. Gulf Coast Collection Bureau, Inc., 2013 WL
1899616, *13 (S.D. Fla. May 8, 2013), acknowledged the FCC’s stance on creditor
vicarious liability, but chose not to defer to the FCC’s interpretation of the TCPA.
“Ultimately, a party must ‘give a persuasive reason why the dates originally set
by the scheduling order . . . could not reasonably be met despite the diligence of the
party seeking the extension.’” Anzures v. Prologis Texas I, LLC, 886 F.Supp. 2d 555,
561 (W.D. Tex. Aug. 10, 2012) (citing Argo v. Woods, 399 Fed. Appx. 1, 3 (5th Cir.
2010)). The FCC’s ruling is not a persuasive reason for why plaintiff failed to meet the
February 18, 2013 deadline for joining additional parties. Plaintiff does not argue that
he was unaware of the identities of TOG, St. Francis, or Union Electric at the time the
original complaint was filed or that he discovered pertinent facts after the February
deadline. Instead, plaintiff argues that the “May 9th FCC ruling on vicarious liability in
the TCPA context clarified a previously unappreciated avenue of recovery for
[p]laintiff.” As demonstrated by the cases cited above, plaintiff could have discovered
through research that vicarious liability claims against creditors were being adjudicated
by other district courts prior to the May 9 FCC ruling. Additionally, plaintiff’s proposed
second amended complaint alleges that TOG is the principal owner of Medicredit and
is vicariously liable under an agency theory. The untimely joinder of TOG has no logical
relation to the FCC ruling, which dealt with liability arising from the creditor-debt
Plaintiff’s second reason--i.e, the retention of new legal counsel “who clearly
believes that a class action is the proper avenue to pursue in the circumstances of this
case and that it is necessary to add three previously unnamed parties,”--is also not
sufficient to establish good cause for amendment. “[T]he fact that new counsel seeks
to plead claims that prior counsel passed on does not establish good cause.” Field Day,
LLC v. County of Suffolk, 2013 WL 55697, *3 (E.D.N.Y. Jan. 3, 2013) (citing Scott v.
N.Y.C. Dep’t of Corr., 445 F. App’x 389, 391 (2d Cir. 2011)); Harshaw v. Bethany
Christian Services, 2010 WL 8032038, *8-9 (W.D. Mich. Aug. 5, 2010) (Retaining new
counsel with new litigation strategies is not good cause to reopen discovery or extend
deadlines); Alexander v. Westbury Union Free School Dist., 829 F.Supp. 2d 89, 118
(E.D.N.Y. Nov. 4, 2011) (“To find good cause simply on the basis of new counsel would
be to allow a party to manufacture good cause at any time simply by switching
counsel.”) (citations omitted). Filing a case as a class action is a tactical decision, which
plaintiff’s original counsel chose not to pursue. If plaintiff wished to litigate this case
as class action he should have diligently amended his complaint by the February 18th
deadline. Accordingly, the Court concludes that plaintiff cannot establish good cause
for leave to file an untimely amended complaint.
Although prejudice to the nonmoving party is a secondary issue that is generally
not considered if good cause is not found, the Court is aware of the prejudice that
would occur if plaintiff is allowed to amend his complaint. The plaintiff filed the instant
motions less than a month before the July 1, 2013 deadline for completing discovery.
When the motions were filed, the depositions of the plaintiff and defendant’s corporate
designee had not been taken. Additionally, there has been no class-related discovery.
The Eighth Circuit has held that when “considerable additional discovery would be
required to deal with the question of class certification” a district court may deny a
request to amend. Niesse v. Shalala, 17 F.3d 264, 266 (8th Cir. 1994). When a plaintiff
is permitted to join additional defendants that require extensive additional discovery,
the original defendant is prejudiced by the delay in the disposition of the lawsuit. See
Wonasue v. University of Maryland Alumni Ass’n, 2013 WL 3009316, *5 (D.Md. June
14, 2013). The Court believes that the defendant would be prejudiced by the delay
that would result from need to conduct class discovery.
The reasons proffered by
plaintiff do not justify such delay.
IT IS HEREBY ORDERED that plaintiff’s motion for leave to file second
amended class action complaint, leave to file motion for class certification, and for
amendment of case management order [Doc. #41] is denied.
IT IS FURTHER ORDERED that plaintiff’s motion to dismiss Count III of the
first amended complaint without prejudice [Doc. #43] is granted.
CAROL E. JACKSON
UNITED STATES DISTRICT JUDGE
Dated this 21st day of August, 2013.
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