Leach Logistics, Inc. v CF USA Global Holdings, LLC

Filing 83

ORDERED hat Plaintiff's motion for default judgment and to deem the dismissal of the counterclaim to be with prejudice (ECF No. 71 ) is denied. It is further ordered that Defendant's motion to strike (ECF No. 76 ) is denied as moot. Signed by Chief Judge Miranda M. Du on 11/17/2022. (Copies have been distributed pursuant to the NEF - DRM)

Download PDF
Case 3:21-cv-00237-MMD-CLB Document 83 Filed 11/17/22 Page 1 of 4 1 2 3 UNITED STATES DISTRICT COURT 4 DISTRICT OF NEVADA 5 *** 6 LEACH LOGISTICS, INC., Case No. 3:21-cv-00237-MMD-CLB Plaintiff, 7 ORDER v. 8 CF USA GLOBAL HOLDINGS, LLC, 9 Defendant. 10 11 Plaintiff and Counter Defendant Leach Logistics, Inc. filed suit against CF USA, 12 Inc. in Nevada state court for back rent relating to the storage and milling of coffee 13 cherries (the portion of the coffee fruit that is not the coffee bean). (ECF No. 1-2.) CF 14 USA, Inc. removed to this Court and quickly filed an answer and counterclaim alleging 15 that Plaintiff caused the coffee cherries to develop a spicy aroma rendering them 16 unmarketable that began, “Defendant CF USA GLOBAL HOLDINGS, LLC, a Delaware 17 limited liability company dba THE COFFEE CHERRY COMPANY (misnamed and 18 erroneously sued as CF USA, INC. dba THE COFFEE CHERRY COMPANY and 19 hereinafter “defendant” or “TCCC”).”1 (ECF Nos. 1, 2.) But it turns out that CF USA 20 GLOBAL HOLDINGS, LLC does not exist. (ECF Nos. 48-2, 73.) The Court resolved 21 various issues stemming from Defendant’s error and directed the parties to complete an 22 entity discovery period, as even Defendant appeared confused about its corporate 23 24 25 26 27 28 1The Court will simply refer to these entities as Defendant for purposes of this order and for convenience but reiterates the fact that there was and apparently is confusion on Defendant’s side about Defendant’s corporate entities has been the predominant issue in this case up to this point. Case 3:21-cv-00237-MMD-CLB Document 83 Filed 11/17/22 Page 2 of 4 1 structure. (ECF No. 57 (“Prior Order”).)2 Upon completion of the entity discovery period,3 2 the parties filed the two motions now pending before the Court: (1) Plaintiff’s motion for 3 default judgment and to deem the dismissal of the counterclaim to be with prejudice (ECF 4 No. 71 (“Motion”));4 and (2) Defendant’s motion to strike Plaintiff’s Motion (ECF No. 76).5 5 United States Magistrate Judge Carla L. Baldwin stayed the deadline for Plaintiff to file 6 an amended complaint until the Court resolves the pending motions. (ECF No. 81.) As 7 further explained below, while the Court clarifies that ‘new answer’ would have been 8 clearer than ‘amended answer’ in the Prior Order, the Court will deny Plaintiff’s motion as 9 unsupported and overreaching, and accordingly deny Defendant’s motion as moot. 10 As the Court stated therein, the purpose of the Prior Order was to “set out some 11 next steps calculated to allow the parties to determine the correct Defendant entities to 12 sue and then move this case forward despite the existing scheduling order.” (ECF No. 57 13 at 5.) Read in that context, the importance Plaintiff places on the phrase ‘amended 14 answer’ in its Motion is an overreach. (ECF No. 71 at 2, 8, 15-17 (repeatedly making the 15 point that “Defendant sought leave to amend that which cannot be amended – a legal 16 nullity”).) Plaintiff is technically correct, of course, but even Plaintiff otherwise 17 acknowledges in its Motion that the Court meant ‘new answer’ by characterizing the ability 18 the Court gave Defendant in the Prior Order as the ability to enter a ‘late appearance.’ 19 (Id. at 5.) And the Court otherwise provided in the Prior Order that it expected Plaintiff to 20 either file an amended complaint, or not, and then Defendant would file an answer to that 21 complaint. (ECF No. 57 at 8-9.) That is still what the Court expects the parties to do. 22 Moreover, Plaintiff does not really reveal that what it seeks is reconsideration of 23 the Prior Order until its reply brief. (Compare ECF No. 71 at 8 (arguing it would be 24 25 26 27 28 2The Court also awarded Plaintiff compensatory fees and costs as a sanction for the issues Defendant’s unforced error introduced into this case. (ECF Nos. 57 at 5-6, 62 (awarding fees and costs).) 3It was extended several times. (ECF No. 70.) 4Defendant 5Plaintiff responded (ECF No. 74), Plaintiff replied (ECF No. 80). responded (ECF No. 79), Defendant replied (ECF No. 82). 2 Case 3:21-cv-00237-MMD-CLB Document 83 Filed 11/17/22 Page 3 of 4 1 appropriate for the Court to reconsider its decision once, in passing, without citing the 2 reconsideration standard) with ECF No. 80 at 3 (attempting to characterize its Motion as 3 one for reconsideration, this time with the legal standard).) If Plaintiff sought 4 reconsideration, it should have filed a motion for reconsideration instead of the Motion, 5 as raising new arguments in reply briefs is generally disfavored. See, e.g., Ironshore 6 Indem. Inc. v. Kay, Case No. 2:21-cv-01706-JAD-BNW, --- F. Supp. 3d ----, 2022 WL 7 4329790, at *7 n.60 (D. Nev. Sept. 16, 2022) (“Issues raised for the first time in 8 a reply brief are typically waived.”) (citation omitted). 9 But perhaps more importantly, Plaintiff does not mention in its Motion that the Court 10 awarded it over 12 thousand dollars in sanctions against Defendant for the same type of 11 sloppy work or obfuscation it complains about in the Motion—that Defendant does not 12 seem to know which corporate entity it is, or how its related corporate entities interact. 13 (ECF Nos. 57, 62.) Thus, Plaintiff’s Motion overlooks the fact that is has already received 14 a remedy for Defendant’s misconduct. Entering a default against CF USA, Inc. and 15 somehow blocking CF USA, Inc. or its related entities from ever filing a counterclaim 16 would be an additional remedy requiring additional justification.6 17 That said, Plaintiff does provide some additional justification. In gist, Plaintiff 18 argues that Defendant appears increasingly confused about the relationships between 19 the entities somehow involved with the coffee cherries at Plaintiff’s facility as this case 20 proceeds, so much so that Plaintiff infers Defendant is acting in bad faith—and this 21 confusion has only deepened during the entity discovery period. (ECF No. 71 at 9-11.) It 22 is indeed incredible that Defendant and its counsel did not appear to know who owns the 23 coffee cherries at issue on June 8, 2022. (Id. at 11; see also ECF No. 71-6 at 2 (“Our 24 position is that CF USA, Inc. was intended to own the property, but that CF Global 25 Holdings might directly have some ownership in the property.”).) This is especially the 26 case because Defendant filed the now-stricken counterclaim that depends on ownership 27 of the coffee cherries on May 21, 2021. (ECF No. 2.) And perhaps even more so because, 28 6Plaintiff is also not precluded from moving to dismiss any future counterclaims. 3 Case 3:21-cv-00237-MMD-CLB Document 83 Filed 11/17/22 Page 4 of 4 1 as Plaintiff points out (ECF No. 71 at 11), these statements contradict statements 2 Defendant’s counsel made earlier in this case. 3 However, as noted, Plaintiff has already been compensated—at least to some 4 extent—for Defendant’s errors, and the Court still finds that equity favors proceeding as 5 contemplated in the Prior Order. And as also noted in the Prior Order, equity also favors 6 resolving disputes like this one on their merits. Now that the entity discovery period has 7 closed, Plaintiff may either file an amended complaint or stand on its original complaint 8 within seven days per Judge Baldwin’s order. (ECF No. 81.) As Judge Baldwin notes, 9 then the remaining deadlines in the Prior Order kick back in. (Id.; see also ECF No. 57 at 10 9.) For avoidance of doubt, any answer to any amended complaint Plaintiff files would be 11 a new answer as the Court struck Defendant’s first answer and counterclaim. In sum, Plaintiff’s Motion is denied. Defendant’s motion to strike (ECF No. 76) is 12 13 accordingly denied as moot. 14 The Court notes that the parties made several arguments and cited to several 15 cases not discussed above. The Court has reviewed these arguments and cases and 16 determines that they do not warrant discussion as they do not affect the outcome of the 17 issues before the Court. It is therefore ordered that Plaintiff’s motion for default judgment and to deem the 18 19 dismissal of the counterclaim to be with prejudice (ECF No. 71) is denied. It is further ordered that Defendant’s motion to strike (ECF No. 76) is denied as 20 21 22 moot. DATED THIS 17th Day of November 2022. 23 24 25 MIRANDA M. DU CHIEF UNITED STATES DISTRICT JUDGE 26 27 28 4

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?