Jewish Federation of Lincoln v. Rosenblatt

Filing 26

ORDER - Plaintiff's Amended Complaint (Filing No. 23 ), was properly filed andis the operative complaint in this case. Plaintiff's Motion for Default Judgment against Rosenblatt, (Filing No. 13 ), is denied. Defendant Rosenblatt's mo tion for additional time to respond to the initial complaint, (Filing No. 14 ), and her motion to strike the motion for default judgment, (Filing No. 15 ), are denied as moot. As to both Defendants Rosenblatt and Kurt Knecht, an answer orresponse to the Amended Complaint (Filing No. 23 ), a copy of which is attachedhereto, shall be filed on or before December 5, 2018. Ordered by Magistrate Judge Cheryl R. Zwart. (Copy mailed/e-mailed to pro se party)(LKO)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
JEWISH FEDERATION OF LINCOLN,
Inc., A Nebraska Non-Profit
Corporation;

4:18CV3048

Plaintiff,
ORDER
vs.
JENNIFER ROSENBLATT, and KURT
KNECHT,
Defendants.
Defendant Rosenblatt has filed a brief in opposition to Plaintiff’s motion for
leave to file an amended complaint. (Filing No. 24). Rosenblatt argues that she
was not served with Plaintiff’s motion to amend until October 29, 2018, and
therefore her brief opposing the motion was timely filed. Even assuming that is
true, for the reasons discussed below, the court finds Plaintiff’s motion to amend
was properly granted and the Amended Complaint is now the operative pleading.

ANALYSIS

Rosenblatt argues the motion to amend should have been denied as
untimely filed, and because the Amended Complaint will be prejudicial to her
defense of the claims, is futile, and is being pursued in bad faith.

The court has not entered a case progression order for this lawsuit As
such, motions for leave to amend pleadings, and the timing for filing such
motions, are governed by Rule 15 of the Federal Rules of Civil Procedure.

Pursuant to Federal Rule of Civil Procedure 15(a)(2), the court grants leave to
amend “freely . . . when justice so requires.”

[A] district court can refuse to grant leave to amend a pleading only
where it will result in undue delay, bad faith or dilatory motive on the
part of the movant, repeated failure to cure deficiencies by
amendments previously allowed, undue prejudice to the opposing
party by virtue of allowance of the amendment, [or] futility of the
amendment.
Dennis v. Dillard Dept. Stores, Inc., 207 F.3d 523, 525 (8th Cir. 2000)(internal
citations omitted).

Rule 15(a) does not require a party to amend its pleading at a particular
stage in the action. See, 6 Wright, Miller & Kane, Federal Practice and Procedure
§ 1488 (2d ed.1990). And “[d]elay alone is not enough to deny a motion to
amend; prejudice to the nonmovant must also be shown.” Doe v. Cassel, 403
F.3d 986, 991 (8th Cir.2005.) “Mere delay is not a reason in and of itself to deny
leave to amend. There must be found some prejudice which would result to
others if leave were to be granted.” Mercantile Trust Co. Nat'l Ass'n v. Inland
Marine Products Corp., 542 F.2d 1010, 1012 (8th Cir. 1976) (citations omitted).

When deciding whether allowing an amendment will prejudice the
opposing party, the court must consider whether asserting new claims will require
expending significant additional resources on discovery and trial preparation, or
significantly delay resolving the dispute. See, Long v. Wilson, 393 F.3d 390, 400
(3rd Cir. 2004). Here, after Plaintiff’s complaint was filed on April 2, 2018,1

1

On March 20, 2018, a criminal indictment was filed against Defendant
Rosenblatt regarding the same allegations underlying the civil complaint. See
2

Rosenblatt moved for additional time to respond on April 30, 2018, (Filing No. 7),
and was ordered to file her response on June 1, 2018. (Filing No. 8). Rather than
filing an answer, on June 4, 2018, Rosenblatt moved to stay the lawsuit, (Filing
No. 9). That motion was denied on June 27, 2018, and Rosenblatt was ordered
to file her answer on July 5, 2018. (Filing No. 12). When she failed to do so,
Plaintiff promptly moved for entry of default. (Filing No. 13). Rosenblatt
responded by untimely requesting additional time to file an answer, (Filing No.
14), and then moving to strike the motion for default judgment on July 18, 2018.
(Filing No. 15). Until today, those motions were under advisement. As such, the
parties were not ordered to complete a Rule 26(f) Report, no case progression
order was entered, and discovery has not been pursued by either party.

Under the facts presented, the court is not convinced that adding a new
defendant to this case will cause any delay in resolving the parties’ dispute. And
to the extent delay is a factor, the need for a full decision on the merits outweighs
the risk of any resulting prejudice to Rosenblatt.

Rosenblatt further argues that the claims against the newly added
defendant are futile; that “Plaintiff has failed to show any evidence, establish
good cause, or cause of action as to the amendment of the complaint. Plaintiff's
motion is unsupported by any sworn statement and should be dismissed as
frivolous and futile.” (Filing No. 24, at CM/ECF p. 3). Plaintiff was not required to
submit evidence in support of its motion to amend. Instead, under the
circumstances presented, the court considers whether the allegations of the
proposed amended complaint state a claim for relief against the additional
defendant.

4:18-cr-03023, USA v. Rosenblatt. Rosenblatt entered a plea of guilty in the
criminal case on November 6, 2018.
3

Here, the amended complaint alleges the proposed additional defendant
was aware, or in the exercise of reasonable care should have been aware, of
Rosenblatt’s embezzlement of Plaintiff’s funds, and along with Rosenblatt, he
conspired to and did embezzle and fraudulently convert funds to his own
personal use. (Filing No. 23, ¶¶ 2(b) and 11). These allegations are sufficient to
state a potential claim for recovery against the additional defendant.

Accordingly,
IT IS ORDERED:
1)

Plaintiff’s Amended Complaint (Filing No. 23), was properly filed and

is the operative complaint in this case.
2)

Plaintiff’s Motion for Default Judgment against Rosenblatt, (Filing

No. 13), is denied.
3)

Defendant Rosenblatt’s motion for additional time to respond to the

initial complaint, (Filing No. 14), and her motion to strike the motion for default
judgment, (Filing No. 15), are denied as moot.
4)

As to both Defendants Rosenblatt and Kurt Knecht, an answer or

response to the Amended Complaint (Filing No. 23), a copy of which is attached
hereto, shall be filed on or before December 5, 2018.
November 26, 2018.
BY THE COURT:
s/ Cheryl R. Zwart
United States Magistrate Judge
4

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEBRASKA
JEWISH FEDERATION OF LINCOLN
INC,
Plaintiff,
vs.
JENNIFER ROSENBLATT,
and KURT KNECHT
Defendants.

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Case No. 4:18-cv-3048

AMENDED COMPLAINT

Preliminary statement and allegations that apply to all counts:
1.

The plaintiff, Jewish Federation of Lincoln, Inc., (JFL) is a non-profit

corporation incorporated in the State of Nebraska and doing business in Lincoln
Nebraska. Its processor organization was established in the late 19th century to collect
charitable funds to assist educational and other philanthropic causes and to assist
emigrants from Eastern Europe and other locations. It collects money from donors to
distribute for philanthropic causes, such as a religious school and summer camp
scholarships.
2.

Defendants

a.

The defendant, Jennifer Rosenblatt, (Jennifer) is a resident of the State of

Kansas. Jennifer became active in Jewish community activities and in January
of 2009 volunteered to act as treasurer and was appointed to be treasure of the
plaintiff, with the responsibility of receiving and disbursing all funds collected by
JFL. Defendant Jennifer had a fiduciary obligation to act in accordance with her
responsibilities as treasurer.
b.

Defendant Kurt Knecht (Kurt), is husband of Defendant Jennifer.

Defendants moved to Lincoln sometime prior to 2010. Kurt was aware of the
conduct of Jennifer hereafter set forth, or in the exercise of reasonable care
should have been aware, and benefitted from her conduct.
3.

Commencing in March 2010, defendant Jennifer began to intentionally

and fraudulently convert and embezzle funds of the plaintiff for her own personal use

and fraudulently concealed her activities. On a continuous and ongoing basis, from
approximately March, 2010 to October 7, 2016, defendant converted and embezzled
funds from the plaintiff in excess of $100,000.00. Said conduct was not discovered until
2018, after defendant ceased being treasurer and had left the state.
4.

The conduct alleged in this action occurred in the State of Nebraska.

5.

This court has jurisdiction on the basis of diversity of citizenship; the

plaintiff is resident of the State of Nebraska and the defendants are residents

of the

State of Kansas and the amount of controversy is in excess of $75,000.00, exclusive of
costs.
COUNT I
6.

The defendant Jennifer breeched her fiduciary duty to the plaintiff and

converted and embezzled money from the plaintiff’s funds over which she had control,
and used said funds for her own purposes.
7.

Plaintiff was damaged in excess of $100,000.00
COUNT II

8.

The defendant Jennifer fraudulently transferred and converted money

belonging to the plaintiff, and both defendants benefited from this conversion.
9.

Plaintiff was damaged in excess of $100,000.00.
COUNT III

10.

The defendant Jennifer embezzled funds from the plaintiff and plaintiff is

entitled to a full accounting of the amount of funds converted by defendant from plaintiff
and other equitable relief.
COUNT IV
11. Defendants, and each of them, conspired to and did embezzle and
fraudulently convert funds from the plaintiff to their own personal use.
WHEREFORE, Plaintiff prays for judgment for an accounting of all funds
converted by defendants, and each of them, and judgment against defendants and
each of them in the amount of damages the Court determines was taken by defendants
from the plaintiff and further relief as the Court deems just equitable, and interests and
costs.

JEWISH FEDERATION OF LINCOLN
INC, Plaintiff
BY:

FRIEDMAN LAW OFFICES, P.C., L.L.O.
Attorneys for Plaintiff
3800 Normal Blvd., Suite 200
PO Box 82009
Lincoln, NE 68501
[phone]
[e-mail]
/s/Herbert J. Friedman
Herbert J. Friedman #11390

CERTIFICATE OF SERVICE
The undersigned attorney of record hereby certifies that he served a true and
correct copy of the foregoing Amended Complaint and Praecipe to:
Jennifer Rosenblatt
10217 W 81st Terrace #150
Overland Park, KS 66204
by United States Mail, sufficient postage prepaid, on November 9, 2018; and,
Kurt Knecht
10217 W 81st Terrace #150
Overland Park, KS 66204
by United States Mail, certified, return receipt requested, sufficient postage prepaid, on
November 9, 2018
/s/Herbert J. Friedman
Attorney for Plaintiffs