Wilson v. Greater Las Vegas Association of Realtors

Filing 52

ORDER Granting 43 Motion to Amend. Defendant shall file and serve the amended answer within 7 days of this order. Signed by Magistrate Judge Nancy J. Koppe on 9/10/15. (Copies have been distributed pursuant to the NEF - TR)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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NEDRA WILSON,
Plaintiff(s),

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vs.

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GREATER LAS VEGAS ASSOCIATION
OF REALTORS, a Nevada non-profit
cooperative corporation,

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Defendant(s).

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Case No. 2:14-cv-00362-APG-NJK
ORDER GRANTING MOTION FOR
LEAVE TO AMEND
(Docket No. 43)

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Presently before the Court is Defendant Greater Las Vegas Association of Realtors’ motion for
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leave to file an amended answer to assert a counterclaim (Docket No. 43), filed on July 7, 2015.
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Plaintiff Nedra Wilson filed a response (Docket No. 44) on July 24, 2015. Defendant submitted a reply
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(Docket No. 48) on August 10, 2015, raising new issues. The Court therefore granted Plaintiff leave
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to file a sur-reply, which Plaintiff filed on September 4, 2015. Docket No. 51.
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I.

BACKGROUND

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The parties are familiar with the factual predicate for this case, and the Court will not repeat the
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facts here except where necessary. This case is an employment dispute. It arises from Defendant’s
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termination of Plaintiff, who is African-American, from her position at Greater Las Vegas Association
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of Realtors (“GLVAR”). Plaintiff’s complaint alleges that race discrimination and disparate treatment,
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inter alia, contributed to her termination. Docket No. 1. Defendant has argued that it discharged
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Plaintiff for making an accounting error. Docket No. 11 at 1. Defendant has also sought to defend its
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treatment of Plaintiff on the grounds that she breached her confidentiality obligations. See Docket No.

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48 at 16-17.

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Plaintiff filed her complaint on March 10, 2014. Docket No. 1. The Court entered its initial

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scheduling order on April 9, 2015, which established a deadline for amending the pleadings of July 7,

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2015. Docket No. 40. On July 7, 2015, Defendant contended that it obtained new evidence

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indicating Plaintiff improperly used and disclosed its confidential information as a GLVAR employee.

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See Docket No. 48 at 17. Defendant therefore moved for leave to file an amended answer to assert

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seven counterclaims regarding Plaintiff’s conduct in relation to Defendant’s confidential information.

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Docket No. 43. It is that motion that is currently before the Court.

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II.

STANDARDS

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Generally, a party may amend her pleading once as “a matter of course” within twenty-one days

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after serving it or twenty-one days after service of a responsive pleading or motion. Fed.R.Civ.P.

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15(a)(1). In all other cases, a party may amend its pleading only by leave of court or with written

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consent of the adverse party. Fed.R.Civ.P. 15(a)(2). “The Court should freely give leave when justice

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so requires.” Id.; see also Foman v. Davis, 371 U.S. 178, 182 (1962) (“Rule 15(a) declares that leave

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to amend ‘shall be freely given when justice so requires’; this mandate is to be heeded.”). In making

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this determination, the Ninth Circuit has opined that “a court must be guided by the underlying purpose

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of Rule 15 to facilitate decision on the merits, rather than on pleadings or technicalities.” United States

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v. Webb, 655 F.2d 977, 979 (9th Cir. 1981). Thus, Rule 15(a) is to be applied with “extreme liberality.”

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Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1051 (9th Cir. 2003) (per curiam).

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In deciding whether to grant leave to amend, courts consider five factors: (1) bad faith; (2)

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undue delay; (3) prejudice to the opposing party; (4) futility of the amendment; and (5) whether the

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party has previously amended the pleading. See id. at 1052. These factors do not carry equal weight,

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however, and prejudice is the touchstone of the analysis. See id. The party opposing amendment bears

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the burden of showing why leave to amend should be denied. See, e.g., Desert Protective Council v.

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U.S. Dept. Of the Interior, 927 F. Supp. 2d 949, 962 (S.D. Cal. 2013) (citing Genentech, Inc. v. Abbott

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Labs., 127 F.R.D. 529, 530-31 (N.D. Cal. 1989)).

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III.

ANALYSIS

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Defendant moved for leave to amend before the scheduling order deadline for amending the

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pleadings. Its motion is therefore subject to the limited constraints of Rule 15(a). AmerisourceBergen

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Corp. v. Dialysist West, Inc., 465 F.3d 946, 952 (9th Cir. 2006).

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A.

Futility

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Plaintiff’s primary argument in opposition to Defendant’s proposed amendments is that they are

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futile because they would not survive a challenge to legal sufficiency under Rule 12(b)(6). Docket No.

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44 at 4-18. However, “[d]enial of leave to amend on this ground is rare. Ordinarily, courts will defer

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consideration of challenges to the merits of a proposed amendment until after leave to amend is granted

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and the amended pleading is filed.” See Branch Banking & Trust Co. v. Pebble Creek Plaza, LLC, 2013

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U.S. Dist. Lexis 73723, *3 (D. Nev. May 22, 2013) (quoting Netbula, LLC v. Distinct Corp., 212 F.R.D.

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534, 539 (N.D. Cal. 2003)). Deferring ruling on the sufficiency of the allegations is preferred in light

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of the more liberal standards applicable to motions to amend and the fact that the parties’ arguments are

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better developed through a motion to dismiss. See, e.g., In re Dynamic Random Access Memory

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(DRAM) Antitrust Litig., 536 F. Supp. 2d 1129, 1135-36 (N.D. Cal. 2008). The Court finds that

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Plaintiff’s futility arguments are better addressed through a motion to dismiss rather than the pending

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motion.1

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B.

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Plaintiff next argues that Defendant unduly delayed in moving for leave to amend. Docket No.

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44 at 19. In assessing timeliness of a motion to amend, courts “do not merely ask whether a motion was

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filed within the period of time allotted by . . . [a] scheduling order.” See AmerisourceBergen Corp., 465

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F.3d at 953. Where newly acquired information prompts a party to seek leave to amend, courts consider

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“whether the moving party knew or should have known of the facts and theories raised by amendment

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in the original pleading.” Id. Additionally, the Ninth Circuit has instructed courts to inquire into

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whether the “delay between the time of obtaining a relevant fact and seeking a leave to amend is

Undue Delay

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The Court expresses no opinion as to the viability of the newly added claims and nothing
in this order shall be construed as precluding Plaintiff from bringing a motion to dismiss.
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unreasonable.” AmerisourceBergen Corp., 465 F.3d at 953 (holding a fifteen month delay between the

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time of obtaining relevant fact and seeking leave to amend is unreasonable).

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In this case, the motion to amend was timely filed under the Court’s discovery plan and

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scheduling order. Although Plaintiff argues that these counterclaims could have been plead in the

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original answer, Plaintiff cites no facts to support this contention. Furthermore, Defendant contends it

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obtained new information that formed the basis for its counterclaims on May 18, 2015, more than a

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month after Defendant filed its answer and almost two months before it filed its motion for leave to

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amend. Docket No. 48-1 at 17. There is no indication that Defendant knew or should have known

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about this new information at the time it drafted its original answer. Once Defendant acquired this

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information on May 18, 2015, it filed its motion for leave to amend one month and twenty days later

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on July 7, 2015. Plaintiff has not shown that this time period is unreasonable as in AmerisourceBergen.

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Accordingly, the Court finds that Plaintiff has not established that Defendant unduly delayed in moving

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for leave to amend.

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Second, Plaintiff argues that Defendant’s counterclaims would have the effect of unduly

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delaying this proceeding. See Docket No. 44 at 19. However, “[a] strong presumption against finding

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undue delay exists when a case is still in discovery.” Hologram USA, Inc. v. Pulse Evolution Corp.,

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2015 WL 316900, at *3 (D. Nev. Jan. 23. 2015) (citing DCD Programs, Ltd. v. Leighton, 833 F.2d 183,

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187-88 (9th Cir. 1987)). In this case, three months of discovery remain. Thus, the strong presumption

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against finding undue delay applies. While it is true that Defendant’s counterclaims will likely require

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Plaintiff to expend more effort, “the mere fact that [a party] will be forced to refute a claim does not

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warrant a finding of undue prejudice.” Id. Moreover, much of the discovery as to Defendant’s fourth

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affirmative defense and amended counterclaims will be coterminous as they both relate to the alleged

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disclosure and improper use of Defendant’s confidential information. Accordingly, the Court finds that

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Plaintiff has failed to rebut the strong presumption against finding undue delay.

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IV.

CONCLUSION

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For the reasons stated more fully above, the Court hereby GRANTS Defendant’s motion for

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leave to amend to add the counterclaims set forth in its “(Revised Proposed) First Amended Answer to

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Plaintiff’s Complaint.” Docket No. 48-1. Defendant shall file and serve the amended answer within

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7 days of this order.

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IT IS SO ORDERED.

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DATED: September 10, 2015

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______________________________________
NANCY J. KOPPE
United States Magistrate Judge

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