Soroof Trading Development Company LTD. v. GE Fuel Cell Systems LLC. et al

Filing 241

MEMORANDUM AND ORDER granting 230 Motion to Amend/Correct: The motion to amend the Second Amended Complaint to correct the plaintiff's name (Docket no. 230) is granted. The Third Amended Complaint shall be filed within one week of the date of this order. (Signed by Magistrate Judge James C. Francis on 4/8/2014) Copies Mailed By Chambers. (ja)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
- - - - - - - - - - - - - - - - - -:
SOROOF TRADING DEVELOPMENT
: 10 Civ. 1391 (LGS) (JCF)
COMPANY, LTD.,
:
:
MEMORANDUM
Plaintiff,
:
AND ORDER
:
- against :
:
GE MICROGEN, INC., PLUG POWER,
:
INC., and GENERAL ELECTRIC COMPANY,:
:
Defendants.
:
- - - - - - - - - - - - - - - - - -:
JAMES C. FRANCIS IV
UNITED STATES MAGISTRATE JUDGE
This is an action for breach of contract and misrepresentation
against defendants GE Microgen, Inc. and Plug Power, Inc., members
of the now-defunct GE Fuel Cell Systems, LLC (“GEFCS”), and General
Electric Company.

Plaintiff Soroof Trading Development Company,

Ltd. (“Soroof Trading”) has renewed its motion for leave to amend
the caption to reflect the name under which it is currently
operating,

Soroof

International”).

International

Company,

Ltd.

(“Soroof

The motion is granted.

Background
The factual background of this dispute is set forth in my May
11, 2012, Memorandum and Order.

Soroof Trading Development Co. v.

GE Microgen, Inc., 283 F.R.D. 142 (S.D.N.Y. 2012); see also Soroof
Trading Development Co. v. GE Fuel Cell Systems, LLC, No. 10 Civ.
1391, 2013 WL 1286078 (S.D.N.Y. March 28, 2013); Soroof Trading
Development Co. v. GE Fuel Cell Systems, LLC, No. 10 Civ. 1391,
2012 WL 6554862 (S.D.N.Y. Dec. 13, 2012).
briefly here, with necessary additions.
1

I will summarize it

The plaintiff company was formed in 1996 in the Kingdom of
Saudi Arabia under the name Soroof Trading Development Company,
Ltd. (English Translation of Founding Contract of Saroof Trading
Development Co., Ltd. (Limited Liability Company) dated May 13,
1996

(“Founding

Contract”),

attached

as

part

of

Exh.

1

to

Declaration of Aaron W. Knights dated Feb. 10, 2014 (“1st Knights
Decl.”), at 2),1 and it registered with the Ministry of Commerce
and Industry in 1998 (English Translation of Company Registration
Certificate dated March 17, 1998 (“1998 Registration”), attached as
part of Exh. 2 to 1st Knights Decl.).

In June 2000, GEFCS and the

plaintiff entered into an agreement under which the plaintiff would
obtain the right to distribute GEFCS-produced fuel cells in Saudi
Arabia in exchange for a $1 million distribution fee. (Distributor
Agreement Between GE Fuel Cell Systems, LLC, and Soroof Trading
Development
Agreement”),

Company
attached

Ltd.
as

(“SAC”), §§ 1, 2.3, 6.4).

dated
Exh.

1

June

6,

2000

to

Second

(“Distribution

Amended

Complaint

At that time, the plaintiff’s name was

Soroof Trading Development Company, Ltd., and this is reflected in
the agreement.

(Distribution Agreement).

In 2000, the company’s

1

The English translation of the Founding Contract identifies
the company as “Saroof” rather than “Soroof.” (Founding Contract
at 2). Neither party asserts that this is a material difference,
and it is likely a function of the transliteration of the name from
Arabic to English. Because the parties use the spelling “Soroof,”
I will do the same.
In addition, this document, like many of the supporting
documents submitted in connection with this application, is not
individually paginated. For such unpaginated materials, I will use
the
page
numbers
generated
by
the
court’s
Case
Management/Electronic Case Filing system.
2

ownership expanded from two members of the Saudi royal family to
seven.

(English Translation of The Partners Resolution Concerning

the Ammendment [sic] of Some Items of the Founding Contract of
Soroof Trading Development Company Ltd. for the Enry [sic] of New
Partners dated Dec. 17, 2000 (“2000 Partners Resolution”), attached
as part of Exh. 4 to Declaration of Michael D. Fisse dated Feb. 24,
2014 (“Fisse Decl.”), at 3).

In 2001, Soroof Trading changed its

name to Soroof International Company, Ltd.,2 and “extend[ed] its
purposes” to include electrical works contracting as well as
wholesale

and

retail

trading,

among

other

things.

(English

Translation of The Partners Resolution Concerning the Ammendment
[sic] of Some Items of the Founding Contract of Soroof Trading
Development Company Ltd. Dated Sept. 4, 2001 (“2001 Partners
Resolution”), attached as part of Exh. 4 to 1st Knights Decl., at
45).
The plaintiff filed its original complaint, identifying itself
as Soroof Trading Development Company Ltd., in February 2010.
(Complaint, ¶ 4).

The first amended complaint, identifying the

plaintiff identically, was filed in February 2012.

(First Amended

Complaint, ¶ 4). In March 2012, the plaintiff requested permission

2

The plaintiff notes that certain translated documents
identify the company variously as, for example, “Soroof
International LLC,” “Soroof International, Ltd.,” or “Soroof
International Company, Ltd.” (Plaintiff’s Memorandum of Law in
Support of Renewed Motion to Correct its Name in the Case Caption
(“Pl. Memo.”) at 12). It asserts that this is merely a result of
“issues relating to translation” and that the name “appears
identically in every [] Arabic company document.” (Pl. Memo. at
11-12 (emphasis omitted)). The defendants do not appear to contend
otherwise.
3

to file a second amended complaint, which I granted.
Trading, 283 F.R.D. at 153.

Soroof

The second amended complaint again

identified the plaintiff as Soroof Trading Development Company Ltd.
(SAC, ¶ 4).

Approximately one year after filing the now-operative

complaint, the plaintiff sought to amend the case caption to
identify itself as Soroof International Company, Ltd. I denied the
motion without prejudice and ordered additional discovery “for the
limited purpose of obtaining information related to the name
change.”

Soroof Trading Development Co. v. GE Fuel Cell Systems,

LLC, No. 10 Civ. 1391, 2013 WL 2398888, at *2 (S.D.N.Y. May 31,
2013).

That discovery was stayed pending the resolution of the

parties’ summary judgment motions.
June 7, 2013, at 2).
discovery

proceeded,

(Memorandum Endorsement dated

After the motions were denied, the ordered
culminating

in

depositions

of

Soroof

representatives pursuant to Rule 30(b)(6) of the Federal Rules of
Civil Procedure.
Discussion
The defendants offer a series of reasons for denying the
plaintiff’s application.

First, they contend that the change

effected through the 2001 Partners Resolution was more than merely
nominal; rather it altered the business so fundamentally that
Soroof Trading ceased to exist or merged into Soroof International.
(Memorandum in Opposition of Defendants GE Microgen, Inc., General
Electric Company and Plug Power, Inc. to Plaintiff’s “Renewed
Motion to Correct its Name in the Case Caption” (“Def. Memo.”) at
3-8).

Second, they argue that the plaintiff should be judicially
4

estopped from claiming that Soroof Trading and Soroof International
are a single entity.

(Def. Memo. at 9-12).

Third, the defendants

assert that, even if Soroof International is the proper party to
assert the claims at issue in this action, the motion to amend
should be denied pursuant to Rule 17 of the Federal Rules of Civil
Procedure.

(Def. Memo. at 12-19).

Fourth, they argue that Rules

15(a) and 16(b)(4) also mandate denial of the motion.
at 20-23).

Finally, they claim to have been prejudiced by the

plaintiff’s failure to
at 23-24).
A.

(Def. Memo.

produce necessary discovery.

(Def. Memo.

Each argument fails.
2001 Partners Resolution

The evidence shows that the 2001 Partners Resolution was not
the momentous change the defendants allege it to be.

On its face,

the resolution accomplishes two things: it changes the name of
Soroof Trading to Soroof International, and it allows the company
to

engage

in

certain

Resolution at 45-46).

additional

activities.

(2001

Partners

As the plaintiff points out, Soroof Trading

was not dissolved -- Soroof International is, like Soroof Trading,
a Saudi limited liability company operating under the existing
Company Registration (“CR”) Number with the same founding date
(1998

Registration;

2001

Partners

Resolution

at

44;

English

Translation of Company Registration Certificate dated Oct. 8, 2012,
attached as part of Exh. 5 to 1st Knights Decl.); the company’s
assets were not dissipated or transferred (Auditors’ Report and
Financial Statements for the Yer [sic] Ended December 31, 2001,
attached as part of Exh. 7 to 1st Knights Decl., at 8; Auditors’
5

Report and Financial Statements for the Yer [sic] Ended December
31, 2002, attached as part of Exh. 7 to 1st Knights Decl., at 14);
indeed,

the

2001

Partners

Resolution

explicitly

leaves

all

provisions of the Founding Contract intact, with the exception of
the name and the second article defining the company’s purposes
(2001 Partners Resolution at 47).
The testimony from the company’s representatives confirms
this.
that

In October 2012, corporate designee Jim Jackson testified
Soroof

company.”

International

and

Soroof

Trading

are

“the

same

(Excerpt of Deposition of Jim Jackson dated Oct. 18,

2012 (“Jackson Dep.”), attached as Exh. 8 to 1st Knights Decl., at
7).

In February 2013, corporate designee Tahir Rashid testified

similarly, asserting that the change from Soroof Trading to Soroof
International was merely a name change.

(Excerpt from Deposition

of Tahir Rashid dated Feb. 25, 2013 (“Pl. Excerpt 2013 Rashid
Dep.”), attached as Exh. 9 to 1st Knights Decl., at 171).
Rashid reaffirmed this fact in testimony from January 2014:
Q: What is Soroof International LLC in relation to
Soroof Trading Development Ltd?
A: It’s the same company. Soroof International LLC
is the same company as Soroof Trading. It was a name
change from this company to Soroof International LLC.
. . .
Q: If I understood you[] . . . correctly, there is
no separate founding contract for Soroof International
LLC, rather the same founding contract applies to both
entities; correct?
. . .

6

Mr.

A: . . . . There are no two entities. . . . The
number of the commercial registration remains the same
. . . .
. . .
A: . . . [T]he main company is Soroof International
and this . . . was initially Soroof Trading Development,
then we took the name change and it became Soroof
International . . . .
(Deposition of Tahir Rashid dated January 24, 2014 (“2014 Rashid
Dep.”), attached as Exh. 1 to Fisse Decl., at 38).
The defendants’ counter-arguments are either obfuscatory,
irrelevant, or both.
majority

shareholder

For example, the defendants insist that
Bandar

Abdullah

“Soroof Trading no longer exists.”

Al-Saud3

testified

(Def. Memo. at 4).

that

A glance at

the deposition testimony reveals that he was actually explaining
that Soroof Trading became Soroof International:
Q: Did Soroof Trading Development Company eventually
become Soroof International?
A: That’s correct.
Q: And when did that take place?
A: I would say almost in the same year because the
world trade did not appeal because we were doing
something other than trade only.
Q: So that was the reason for the change in name?
A: Yes, and to give it more broader, you know,
business
avenues
rather
than
just
trading
and
development.
Q: Did anything other than the name change? When
you made the change in the name from Soroof Trading
3

The documents submitted in connection with this motion spell
the prince’s name, variously, “Bander” and “Bandar.” Consistent
with the majority of the documents translated from Arabic, I will
use the spelling “Bandar” throughout.
7

Development Company to Soroof International, did anything
-A: No, the strategy stayed the same and objectives
stayed the same.
Q: How was the name change completed?
A: By requesting the change goes in the paperworks
and
changing
the
CR,
which
is
the
commercial
registration.4
Q: Does Soroof Trading Development Company still
exist?
A: No.
(Excerpt from Deposition of Bandar Abdullah Al-Saud dated Dec. 11,
2012 (“Bandar Dep.”), attached as Exh. 6 to Fisse Decl., at 17-18).
In addition, the defendants assert that the 2000 Resolution
and the 2001 Resolution effected “‘a phase of restructuring whereby
Soroof International would become a holding company’ with ‘separate
business units hav(ing) their own separate organization chart,
separate financials and separate structure, management structure.”
(Def. Memo. at 3 (quoting Excerpt from Deposition of Tahir Rashid
dated Feb. 25, 2013 (“Def. Excerpt 2013 Rashid Dep.”), attached as
Exh. 7 to Fisse Decl., at 30)). However, Mr. Rashid’s testimony is
clear:
after

He did not begin at Soroof International until 2005, years
the

2001

Resolution

allegedly

worked

these

significant

changes on the business; he discusses the planned changes in the
present tense, indicating that, even in 2012, such changes had not
yet been made (Def. Excerpt 2013 Rashid Dep. at 29-30); and he
confirms this in 2014, saying that “nothing of that nature has
4

To the extent that Prince Bandar believed that the CR
changed, the records establish that he was mistaken.
8

happened” (2014 Rashid Dep. at 68).

Moreover, the evidence

establishes that Soroof International is not now and never has been
a holding company.

It is a single entity with separate business

units:
A: [T]here [are] no spin-offs. Soroof International
comes from Soroof Trading Development. Soroof Trading
Development
had
certain
activities.
Soroof
International, with the name change, inherited those
activities.
At a later date, those activities were
amended [] to capitalize on market opportunities.
. . .
Q: Do the various business units of Soroof now have
separate organizational charts?
. . .
A: They do have their own organization chart in
terms of identifying their management structure, but they
do not have their own founders’ agreement, article of
associations or anything of that nature. So they are
considered as part of Soroof International and as a
branch of Soroof International.
. . .
Q: Do these different business units of Soroof have
separate financial records?
A: No. Soroof International has only one set of
financial records and everything is combined in that.
. . .
A: I want to clarify one thing . . . . [T]he
different branches have their own commercial registration
and that commercial registration number is allocated to
the branches for their activity purposes.
Now, the contracts which are made are made under
Soroof international.
It is the choice of Soroof
International management to select which business unit
will take this particular agreement or contract. So the
contract is done with the main company, which is Soroof
International. But when they are doing their own trading
activities within the kingdom, to justify or legalize
their activity within Saudi Arabia, they need to have a
9

branch sub-CR. . . . [T]hat is the CR allocated under the
main commercial registration of Soroof International.
It’s not a separate formed company.
(2014 Rashid Dep. at 66, 69, 71, 72).
The

defendants’

focus

on

purported

structural

changes

highlights a fundamental problem with the their arguments.

The

essential question here is whether Soroof International is the
proper party to be asserting rights under the contract at issue.
Any change of ownership or planned (or accomplished) expansion into
different areas of commerce did not affect the parties’ rights with
respect to the Distribution Agreement.

The contentions that the

Distribution Agreement required the plaintiff to provide notice of
“changes in its ownership, organization and business activities”
(Def. Memo. at 6), that the purported changes would have disturbed
GEFCS’ prior approval of the company as an approved distributor
(Def.

Memo.

at

6-7),

or

that

“GEFCS

would

have

viewed

the

incorporation of Soroof Trading into a larger holding company
organization as a prohibited assignment in violation” of the
agreement (Def. Memo. at 7) may be arguments that the plaintiff
breached the Distribution Agreement, but they are irrelevant to the
question at hand.
To the extent the defendants claim that they have been
prejudiced in this litigation by the plaintiff’s alleged failure to
give notice of the 2000 and 2001 Partners Resolutions, their
arguments are unsuccessful.

The defendants had notice that the

plaintiff was operating under the name Soroof International well
before this litigation arose. (Pl. Memo. at 9-10; E-mails of Ayman
10

I. Nabhan and Frank Scovello dated June 22, 2004, attached as Exh.
12 to 1st Knights Decl.; E-mail of Ravi Menon dated Jan. 26, 2006,
attached as part of Exh. 13 to 1st Knights Decl.; E-mail of Ravi
Menon dated March 10, 2006, attached as Exh. 14 to 1st Knights
Decl.). The objections raised here are largely based on provisions
of

the

Distribution

Agreement

explored during discovery.
name

change

deadline.

during

and

therefore

could

have

been

And, indeed, the defendants probed the

depositions

prior

to

the

fact

discovery

(Bandar Dep. at 17-18; Jackson Dep. at 7; Pl. Excerpt

2013 Rashid Dep. at 171).
The plaintiff has shown that the 2001 Partners Resolution
effected a mere nominal change, and that Soroof International is
the proper party to prosecute this case under the Distribution
Agreement.
B.

Judicial Estoppel

The defendants argue that the plaintiff should be judicially
estopped from claiming that the Soroof business organization is a
single entity because “[i]n 2009, Soroof filed an Original Petition
in a Texas state court on behalf of two different Soroof business
entities” -- Soroof International Company and Soroof International
Limited -- and “[t]hese filing designations were repeated multiple
times in both the Texas state court and the federal court to which
the litigation was removed (and subsequently remanded).”
Memo. at 9).

(Def.

This argument fails.

“[J]udicial

estoppel

will

apply

if:

1)

a

party’s

later

position is ‘clearly inconsistent’ with its earlier position; 2)
11

the party’s former position has been adopted in some way by the
court in the earlier proceeding; and 3) the party asserting the two
positions would derive an unfair advantage against the party
seeking estoppel.” DeRosa v. National Envelope Corp., 595 F.3d 99,
103 (2d Cir. 2010) (quoting New Hampshire v. Maine, 532 U.S. 742,
750-51 (2001); see also Merrill Lynch, Pierce, Fenner & Smith, Inc.
v. Georgiadis, 903 F.2d 109, 114 (2d Cir. 1990) (“Judicial estoppel
. . . applies only if the party against whom the estoppel is
claimed

actually

inconsistent

obtained

position.”);

a
A.I.

judgment
Trade

as

a

Finance,

result
Inc.

v.

of

the

Centro

Internationale Handelsbank AG, 926 F. Supp. 378, 389 (S.D.N.Y.
1996) (“Thus, in order to meet its burden of establishing that
judicial estoppel is appropriate . . . [the plaintiff] must show
that in the [former action the defendant] argued a position
inconsistent with that which it takes here, and that this position
was adopted by the [other] court in its judgment.”).
The plaintiff’s contention here is that, through a simple
name-change,

Soroof Trading became Soroof International Company.

It is not clear to me how this is “clearly inconsistent” with the
caption in the Texas case, which is irrelevant to whether Soroof
International and Soroof Trading have an identity of interest under
the

Distribution

Agreement.

As

it

turns

out,

it

is

not

inconsistent: the caption erroneously named two entities because
counsel for Soroof was unaware at the time the Texas case was filed
that “Soroof’s name as set forth in Arabic in its corporate records
can be and has been expressed in different ways in English.”
12

(Declaration of Haig V. Kalbian dated March 6, 2014 (“Kalbian
Decl.”), attached as Exh. B to Declaration of Aaron W. Knights
dated March 6, 2014, ¶ 7; Pl. Memo. at 11-13).

Moreover, counsel

affirms that, although the company prevailed on its motion for
remand, the basis of the court’s decision was “wholly unrelated to
Soroof’s name.”

(Kalbian Decl., ¶ 5).

The defendants have not

shown that the plaintiff has taken, or that any court has adopted,
a position inconsistent from the one asserted here.
C.

Rule 17

The defendants argue that Rule 17(a) prohibits the amendment
the plaintiff seeks.

I disagree for two reasons.

First, I am not persuaded that Rule 17, which mandates that
the “real party in interest” prosecute the action, Fed. R. Civ. P.
17(a)(1), is the proper rule under which to analyze this question.
The rule’s “modern function . . . is simply to protect the
defendant

against

a

subsequent

action

by

the

party

actually

entitled to recover, and to insure generally that the judgment will
have its proper effect as res judicata.”

Fed. R. Civ. P. 17,

advisory committee’s notes to 1966 Amendment.

Thus, it applies

when two entities can claim an interest in the subject of an action
-- for example, a bailor and bailee, a trustee and a beneficiary,
or an executor (or administrator) and the subject estate. See Fed.
R. Civ. P. 17(a)(1)(A),(B),(D),(E).

Here, there are not two

entities, there is only one: Soroof International.

The defendants

have provided no reason to think that Rule 17 was meant to cover
the circumstances of this case.
13

Second,

were

it

to

apply

here,

it

would

work

in

the

plaintiff’s favor. Rule 17(a)(3) prohibits a court from dismissing
“an action for failure to prosecute in the name of the real party
in interest until, after an objection, a reasonable time has been
allowed for the real party in interest to ratify, join, or be
substituted into the action.” Fed. R. Civ. P. 17(a)(3). Once this
has

been

accomplished,

the

action

“proceeds

as

if

originally commenced by the real party in interest.”
P.

17(a)(3).

forfeiture

and

The

provision

injustice.”

is

“intended

Fed.

R.

to

Civ.

had

Fed. R. Civ.

insure

P.

been

17,

against
advisory

committee’s notes to 1966 Amendment; see also Fed. R. Civ. P. 15,
advisory

committee’s

notes

to

1966

Amendment

(Rule

designed “[t]o avoid forfeitures of just claims”).

17(a)

is

Thus, the

Second Circuit has held that “[a] Rule 17(a) substitution of
plaintiffs should be liberally allowed when the change is merely
formal and in no way alters the original complaint’s factual
allegations as to the events or the participants.”

Advanced

Magnetics, Inc. v. Bayfront Partners, Inc., 106 F.3d 11, 20 (2d
Cir. 1997).
Notwithstanding the defendants assertions (Def. Memo. at 1415), the plaintiff’s proposed amendment has absolutely no effect on
the operative complaint’s factual allegations: it merely changes
the plaintiff’s name in the caption.

The defendants’ insistence

that new legal issues are “inject[ed]” into the case by the
amendment is simply untrue.

(Def. Memo. at 14).

I have already

found that Soroof International is not “a different organization
14

than the one that contracted with GEFCS,” and, as a consequence of
that finding, it is clear that “Soroof International is authorized
by contract [and] law to advance these claims.”
14).

(Def. Memo. at

“[W]hether the substitution of Soroof International as party

plaintiff [] relate[s] back to the original complaint filing date
for purposes of the statute of limitations” is easily answered: it
does.

Fed. R. Civ. P. 17(a)(3); see also Advanced Magnetics, 106

F.3d at 19-20 (discussing the interplay between Rules 15(c) and
17(a)).
The defendants’ claims of delay and prejudice fare no better.
They assert that they “objected” in their answer to the Second
Amended Complaint when they pleaded an affirmative defense that
Soroof Trading was “not a proper party to advance the claims.”
(Def. Memo. at 18).

Assuming that an affirmative defense that is

not pressed in any way (except in opposition to the motions to
amend the caption) is sufficient objection, but see Brohan ex rel.
Brohan v. Volkswagen Manufacturing Corp. of America, 97 F.R.D. 46,
49-50

(E.D.N.Y.

1983)

(indicating

that

“reasonable

time”

is

measured not from interposition of affirmative defense but from
motion

to

dismiss

on

standing

grounds);

see

also

Abu

Dhabi

Commercial Bank v. Morgan Stanley & Co., 888 F. Supp. 2d 478489
(S.D.N.Y. 2012) (measuring “reasonable time” from filing of motion
for summary judgment arguing plaintiff did not have standing), the
plaintiff waited approximately 11 months before attempting to
rectify the problem (Def. Memo. at 18).

There is no need to decide

whether this is a reasonable time because, given the circumstances,
15

I would exercise my considerable discretion under the rule to allow
amendment.

The objection the defendants identify was a mere

boilerplate affirmative defense.

The proposed amendment only

substitutes the correct name for the incorrect one included in the
complaint.

And the introduction of the error was an honest, if

careless, mistake, given that (1) the name of the entity that
entered into the Distribution Agreement was Soroof Trading and (2)
the relevant documents were originally written in Arabic, which
introduces translation and transliteration issues into the mix.5
See Advanced Magnetics, 106 F.3d at 20 (noting that “the district
court retains some discretion to dismiss an action where there was
no semblance of any reasonable basis for the naming of an incorrect
party”).
Finally, the amendment will not prejudice the defendants.
They recite a litany of complaints, all based on the unfounded and
unsupported notion that a “holding company” is now asserting claims
against them.

(Def. Memo. at 19).

The evidence shows that there

is no holding company; the company asserting claims against them is

5

The defendants’ interpretation of Mr. Rashid’s testimony as
revealing a nefarious purpose for the mistake is unconvincing.
(Def. Memo. at 17). Asked “why the lawsuit that we’re involved in
today was filed on behalf of Soroof Trading as opposed to Soroof
International,”, Mr. Rashid repeatedly answered, “I don’t know.”
(2014 Rashid Dep. at 149-50). The fact that he then speculated
that “the original agreement was signed between Soroof Trading
Development and Plug Power and GE,” so “[h]ad we filed in the name
of Soroof International you would have said the agreement is
between . . . Soroof Trading Development and this” (2014 Rashid
Dep. at 150) is not, as the defendants would have it, evidence that
the plaintiff was attempting to gain a tactical advantage by
misnaming itself. This is yet another instance of the defendants
obscuring the clear meaning of the evidence presented here.
16

the same company that filed the original complaint in this action.
They also allege that they will now have to investigate the effects
of the 2001 Partners Resolution on the case.

It is not clear why

that is so, or why, if such investigation is necessary, it is
caused by the plaintiff’s proposed amendment.

As noted above, the

name change was known to the defendants before this litigation
began.

Even if they had no knowledge of that fact, the defendants

could have explored during discovery whether they could defend
against the claims or interpose a counterclaim by asserting that
the plaintiff had breached the Distribution Agreement, which is the
thrust of their arguments.

Thus, there is no prejudice to the

defendants. See, e.g. Berisford Metals Corp. v. Universal Maritime
Service Corp., 653 F. Supp. 419, 421 (S.D.N.Y. 1986) (allowing Rule
17

motion

to

join

parties

because

notwithstanding plaintiff’s delay).

of

lack

of

prejudice,

In sum, were Rule 17 the

appropriate rule here, I would grant the motion to amend.
D.

Rules 15 and 16

The defendants also argue that the motion should be denied
under Rule 15 and Rule 16 of the Federal Rules of Civil Procedure.
These arguments fail.
Under Rule 15(a)(2), after responsive pleadings have been
filed, amendments are possible only with the consent of opposing
party or leave of the court. While “[t]he court should freely give
leave when justice so requires,” Fed. R. Civ. P. 15(a)(2), “‘the
district court has the discretion to deny leave if there is a good
reason for it, such as futility, bad faith, undue delay, or undue
17

prejudice to the opposing party.’” Nogbou v. Mayrose, 400 F. App’x
617, 620 (2d Cir. 2010) (quoting Jin v. Metropolitan Life Insurance
Co., 310 F.3d 84, 101 (2d Cir. 2002)); see also Foman v. Davis, 371
U.S. 178, 182 (1962).

Rule 16 governs scheduling orders and

prohibits their modification except with the consent of the court
and for good cause.

Fed. R. Civ. P. 16(b)(4).

Clearly, the plaintiff’s motion to amend falls within the
purview of Rule 15.

See Dorchester Financial Securities, Inc. v.

Banco BRJ, S.A., No. 11 Civ. 1529, 2014 WL 684831, at *4 (S.D.N.Y.
Feb. 21, 2014) (allowing plaintiff to amend caption under Rule 15
to reflect correct name of plaintiff). I therefore have discretion
to deny it for good reason, which, in this situation, could only be
for delay and prejudice.

See Block v. First Blood Associates, 988

F.2d 344, 350 (2d Cir. 1993) (“Mere delay, however, absent a
showing of bad faith or undue prejudice, does not provide a basis
for a district court to deny the right to amend.” (internal
quotation marks omitted)). But, as discussed above, the defendants
have

identified

no

prejudice

that

they

will

suffer

if

this

technical amendment is allowed.
The defendants argue that the plaintiff has not shown “good
cause” under Rule 16(b) to allow amendment after the deadline
included in the scheduling order.

See Soroof Trading, 283 F.R.D.

at 147 (“[T]he lenient standard of Rule 15(a) is toughened by Rule
16’s higher standard under which the party seeking to amend must
also demonstrate good cause for an untimely amendment.”). In
determining whether to modify a scheduling order to allow amendment
18

to

a

complaint,

the

plaintiff’s

diligence

is

certainly

consideration, but it is “not [] the only consideration.”

a

Kassner

v. 2nd Avenue Delicatessen, Inc., 496 F.3d 229, 244 (2d Cir. 2007).
In light of all of the circumstances here, particularly the fact
that, while the defendants will suffer no prejudice from allowing
the amendment, disallowing it could result in forfeiture of the
plaintiff’s claims, there is good cause to modify the scheduling
order to allow this amendment.6

See, e.g., Digital Encoding

Factory, LLC v. Iron Mountain Information Management, Inc., Civ. A.
No. 06-1449, 2008 WL 3838014, at *2 (W.D. Pa. Aug. 13, 2008)
(allowing amendment under Rule 16 where “[p]laintiffs have not
acted unreasonably, and the prior mis-identification of the EDA
Plaintiff has not caused any undue or unfair (if indeed any) delay
in the identification of claims/issues or in the progress of
discovery.”); cf. Dorchester Financial Securities, 2014 WL 684831,
at *4 (declining to “dismiss Plaintiff’s claims simply because the
case caption contains a misnomer” and quoting Foman, 371 U.S. at
181, for the proposition that it is “‘entirely contrary to the
spirit of the Federal Rules of Civil Procedure for decisions on the
merits to be avoided’ on the basis of ‘mere technicalities.’”).
Finally, because there is no question that the defendants had
timely notice of the claims alleged here, and the name-change does
not prejudice them, the amendment relates back to the date of the
6

The defendants also complain about outstanding discovery
from the plaintiff. (Def. Memo. at 23-24). If these issues cannot
be resolved in the required meet and confer process, the defendants
may raise the dispute in a motion or letter. However, this motion
to amend is not the proper forum to determine those issues.
19

Cf.

filing of the original complaint.
Corp.,

178 F.R.D.

393,398

(E.D.N.Y.

Sokol ski v.

1998)

Trans Union

(allowing amendment

adding class action to relate back where defendant had adequate
notice of matters raised in amended pleading)
910 F. Supp. 977,

985

(S.D.N.Y. 1996)

i

Neufeld v. Neufeld,

(allowing amendment adding

plaintiff to relate back where defendant had adequate notice of
matters raised in amended pleading)
al., Federal Practice and Procedure
defendant

is

fully apprised of a

6A Charles Allen wright, et

i

§

1501 (3d ed.)

(liAs long as

claim arising from specified

conduct and has prepared to defend the actions, defendant's ability
to protect itself will not be prejudicially affected .
defendant

should

not

be

permitted

to

invoke

a

. and

limitations

defense") .
Conclusion
The motion to amend the Second Amended Complaint to correct
the plaintiff's name

(Docket

no.

230)

is

granted.

The

Third

Amended Complaint shall be filed within one week of the date of
this order.

SO ORDERED.

AMES C. FRANCIS IV
ITED STATES MAGISTRATE JUDGE
Dated:

New York, New York
April 8, 2014

20

Copies mai

this date:

James R. Lynch, Esq.

Lynch Daskal Emery, LLP

264 West 40th Street

New York, New York 10018

Haig V. Kalbian, Esq.

Mary M. Baker, Esq.

Aaron W. Knights, Esq.

Kalbian Hagerty LLP

888 17th Street, N.W., Suite 1000

Washington, DC 20006

Thomas E. Healy, Esq.

Pino & Associates, LLP

50 Main Street

White Plains, New York 10606

Michael D. Fisse, Esq.

Jan Van Steenis, Esq.

John Dubreuil, Esq.

Daigle,
sse & Kessenich PLC

P.O. Box 5350
Covington, LA 70434
Abigail K. Hemani, Esq.

Goodwin Procter, LLP

620 Eighth Avenue

New York, New York 10018

Dahl
S. Fetouh, Esq.

Natal
F. Langlois, Esq.

Lisa Lo Gerfo, Esq.

Lauren S. Kupersmith, Esq.

Goodwin Procter LLP

53 State Street, Exchange Place

Boston, MA 02109

21