Painters District Council No. 58 et al v. RDB Universal Services, LLC et al

Filing 36

MEMORANDUM AND ORDER. (See Full Order.) IT IS HEREBY ORDERED that Defendants' "Motion for Leave to File Counterclaim" [ECF No. 33 ] is GRANTED. IT IS FURTHER ORDERED that Plaintiffs shall file an Answer to the counterclaims within twenty days. Signed by District Judge E. Richard Webber on 07/15/2015. (CBL)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION

PAINTERS DISTRICT COUNCIL,
NO. 58, et al.,
Plaintiffs,
vs.
RDB UNIVERSAL SERVICES, LLC,
et al.,
Defendants.

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Case No. 4:14CV01812 ERW

MEMORANDUM AND ORDER
This matter comes before the Court on Defendants’ “Motion for Leave to File
Counterclaim” [ECF No. 33].
I.

BACKGROUND
On October 27, 2014, Plaintiffs filed a Complaint against Defendants RDB Universal

Services, LLC (“RDB”), Deloris Berry, and Relder Berry [ECF No. 1], based on RDB’s alleged
breach of a collective bargaining agreement (“CBA”). According to the Complaint, the CBA
bound RDB “to submit fringe benefits, dues remissions, contributions to the Labor Management
Cooperation Fund and evidencing [] each hour worked by its construction employees at the rate
and manner specific in the CBA and Trust documents” [ECF No. 1 at ¶ 32]. Plaintiffs allege
RDB was obligated under the CBA to make reports and contributions on a weekly basis [ECF
No. 1 at ¶ 33-34]. The Complaint states, “Since on or about the week ending August 9, 2014,
RDB has failed and refused to file accurate reports evidencing hours worked[,]” in breach of the
CBA and in violation of the Employee Retirement Income Security Act of 1974 (“ERISA”), 29
U.S.C. § 1145 [ECF No. 1 at ¶ 46]. Thus, Plaintiffs conclude, pursuant to 29 U.S.C. § 1132(a)

and (g), RDB is liable for unpaid principal amounts, liquidated damages on the unpaid principal
amounts, “liquidated damages on amounts it has paid and may pay in an untimely manner,” as
well as reasonable attorneys’ fees, accounting fees, and costs incurred in connection with this
action [ECF No. 1 at ¶¶ 47-50]. Plaintiffs seek to hold Deloris and Relder Berry jointly and
severally liable for RDB’s failures, as guarantors of the CBA obligations [ECF No. 1 at ¶¶ 5271].
On December 9, 2014, Defendants filed their joint “Answer and Affirmative Defenses”
[ECF No. 12]. On January 7, 2015, the Court issued its “Case Management Order,” which
contained the following relevant provisions of the “Scheduling Plan”: all motions for joinder of
additional parties and motions for amendment of pleadings were to be filed no later than March
4, 2015; all disclosures required by Federal Rule of Civil Procedure 26(a)(1) were to be made no
later than March 20, 2015; disclosure of Plaintiffs’ expert witnesses, and the provision of related
reports, was to be made no later than April 8, 2015, with depositions of said experts to be
completed no later than May 6, 2015; disclosure of Defendants’ expert witnesses, and the
provision of related reports, was to be made no later than May 20, 2015, with depositions of said
experts to be completed no later than June 24, 2015; all discovery is to be completed no later
than September 22, 2015; and “[a]ny motions to dismiss, motions for summary judgment or
motions for judgment on the pleadings must be filed no later than October 19, 2015” [ECF No.
16 at 1-2]. Trial is set to begin February 8, 2016 [ECF No. 16 at 2].
Subsequent to the passing of the March 4 deadline to file a motion to amend pleadings,
on June 11, 2015, Defendants filed their “Motion for Leave to File Counterclaim” [ECF No. 33].
Defendants attached their proposed “Counterclaim,” which actually contains three claims:

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money had and received (Count I); breach of contract (Count II); and tortious interference with
contract and business expectancy (Count III) [ECF No. 33-1 at 2-4]. According to the proposed
“Counterclaim,” Defendants began making certain payments and financial contributions, in
accordance with the CBA, in July 2013 [ECF No. 33-1 at ¶¶ 1-3]. Defendants allege they made
“excess payments,” resulting in “Plaintiffs collect[ing] $12,852.10 for vacation pay and
$13,073.60 for check off dues from Defendants that were not owed by Defendants” [ECF No.
33-1 at ¶ 4]. Defendants claim, “Plaintiffs have refused to return the excess payments to
Defendants and/or Plaintiffs prevented Defendants from recovering the amount of excess
payments from workers” [ECF No. 33-1 at ¶ 5]. All three of Defendants’ claims arise from these
allegations.
II.

STANDARD
When a party seeks to amend a pleading after the deadline in the applicable case

management order has passed, the request implicates both Federal Rule of Civil Procedure 15
and 16. Rule 16(b) governs the issuance and modification of pretrial scheduling orders while
Rule 15(a) governs amendment of pleadings. Fed. R. Civ. P. 16(b) and 15(a). The FRCP Rule
16(b) good-cause standard should be applied first, then the “when justice so requires” standard of
Rule 15(a) is applied. Sherman v. Winco Fireworks, Inc., 532 F.3d 709, 716 (8th Cir. 2008).
Good cause requires a change in circumstance, law, or newly discovered facts.

Hartis v.

Chicago Title Ins. Co., 694 F.3d 935, 948 (8th Cir. 2012). “The primary measure of good cause
is the movant’s diligence in attempting to meet the order’s requirements.” Sherman, 532 F.3d at
716 (quoting Rahn v. Hawkins, 464 F.3d 813, 822 (8th Cir. 2006)). If a party has been diligent

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in meeting the scheduling order’s deadlines, the Court should then decide if the amendment is
proper under Rule 15(a) including, if there is prejudice to the other parties. Id. at 716-17.
III.

DISCUSSION
In their Motion, Defendants claim, “During the course of discovery,” they “discovered

that they have a valid and meritorious counterclaim” [ECF No. 33 at 1]. Defendants argue the
three counterclaims “stem[] from and relate[] to the transaction and occurrence described in
Plaintiffs’ Complaint” [ECF No. 33 at 1].

Defendants contend they “would suffer great

prejudice” if they are not permitted to assert their counterclaims, adding Plaintiffs would not
suffer prejudice if the Court grants Defendants leave to file said counterclaims, “as only limited
written discovery has been conducted, no depositions have taken place[,] and the matter is not set
for [trial]” until February 2016 [ECF No. 33 at 1]. Defendants state, “This motion will not
cause, nor is it made for the purpose of causing prejudice or undue delay, but for the purpose of
asserting a valid and meritorious claim. It would serve the interest of justice and judicial
economy to include this Counterclaim in this matter” [ECF No. 33 at 2]. In their joint Response,
Plaintiffs emphasize Defendants’ Motion comes “[t]hree months after the deadline to amend
pleadings,” and argue, “Defendants have no reason why the allegations in their proposed counter
claim could not be brought before June 2015. These late claims only serve to delay and add
costs upon the Plaintiffs” [ECF No. 35 at 1-2].
A.

Rule 16 – Good Cause Standard

This Court has found “good cause” under Rule 16(b) can exist when facts, giving rise to a
new claim, arise during discovery. See Ghattas v. First Nat. Bank of Layton, No. 4:12-CV-2348
CAS, 2014 WL 222819 *1 (E.D. Mo. Jan. 21, 2014). In Ghattas, the plaintiff filed his motion

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for leave to amend relatively soon after he learned of the new facts, and there was still ample
time to conduct discovery. Id. at *1. Additionally, the new claim was closely related to other
claims. Id. Further, there were four months until the dispositive motion deadline, and the trial
was nine months away. Id. Here, Defendants claim they learned the information related to their
counterclaims during discovery, and Plaintiffs have not refuted this or claimed Defendants were
previously aware of the relevant information. The counterclaims appear to be closely related to
Plaintiffs’ claims, as they all relate to payments Defendants were obligated to make in
accordance with the CBA. Defendants filed their Motion over three months before the deadline
for the completion of discovery, over four months before the dispositive motion deadline, and
almost eighth months before trial. Thus, the Court finds Defendants have established “good
cause” under Rule 16(b).
B.

Rule 15 – When Justice So Requires Standard

Defendants must now meet the standard in Rule 15. Sherman, 532 F.3d at 715. A
district court may deny a motion to amend if “there are compelling reasons such as undue delay,
bad faith, or dilatory motive, repeated failure to cure deficiencies by amendments previously
allowed, undue prejudice to the non-moving party, or futility of the amendment.” Id. (quoting
Moses.com Sec., Inc. v. Comprehensive Software Sys., Inc., 406 F.3d 1052, 1065 (8th Cir.
2005)).
The current situation does not raise any of these concerns. In particular, the Court does
not believe granting Defendants leave here will cause Plaintiffs undue prejudice. As mentioned
above, the counterclaims appear to be closely related to Plaintiffs’ claims, as the question of
Defendants’ payments (or non-payment) lies at the heart of the original lawsuit. Further, it

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appears only limited written discovery has taken place, and no depositions have been taken (at
least as of June 11, when Defendants filed their Motion). Discovery is not even scheduled to be
completed until September 22.

Thus, although some limited additional discovery may be

needed, there is no reason to believe unfair prejudice will result from granting Defendants’
Motion.
IV.

CONCLUSION
The Court finds Defendants have good cause to file their counterclaims, and the Court

will allow these counterclaims, as outlined in the proposal attached to Defendants’ Motion, to be
filed. Plaintiffs shall file an Answer to the counterclaims within twenty days of the issuance of
this Order. Should the parties require discovery in addition to or outside the scope of that
contemplated by the Case Management Order, requests for such further discovery may be made
in writing and filed with the Court. If such further discovery is deemed necessary by the Court,
it may occur at the expense of Defendants. All other deadlines will remain as set in the current
Case Management Order.
Accordingly,

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IT IS HEREBY ORDERED that Defendants’ “Motion for Leave to File Counterclaim”
[ECF No. 33] is GRANTED.
IT IS FURTHER ORDERED that Plaintiffs shall file an Answer to the counterclaims
within twenty days.
So Ordered this 15th day of July, 2015.

E. RICHARD WEBBER
SENIOR UNITED STATES DISTRICT JUDGE

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