Li et al v. 8868 Corp et al
Filing
80
MEMORANDUM AND ORDER granting 70 Motion for Leave to File Document. For the foregoing reasons, the plaintiffs' motion (Docket no. 70) to add Thein Chau, also known as Danny Chau, as a defendant is granted. Within one week of the date of this Order, counsel shall submit a joint letter proposing an appropriate extension of the discovery schedule. (As further set forth in this Order.) (Signed by Magistrate Judge James C. Francis on 11/30/2016) (cf)
(Compl., ¶ 15).
After the defendants answered, a scheduling order
was entered, stating, “No additional parties may be joined after
9/21/15 without leave of Court.”
(Civil Case Management Plan and
Scheduling Order (“Scheduling Order”), ¶ 5). After many extensions
of discovery, an order required discovery to be completed by
October 6, 2016.
(Order dated Sept. 6, 2016).
On September 26, 2016, the plaintiffs moved to join Thein
Chau, also known as Danny Chau, as a defendant, claiming they
learned that he was an owner of Vermicelli during a September 22,
2016 deposition; they assert that although previous submissions by
the defendants identified “Danny Chau” as an owner, the plaintiffs
“did not know the legal name of ‘Danny’ Chau” and “believed that
‘Danny’ Chau’s legal name was Phuc Chau.”
(Pl. Memo. at 2-4).
Indeed, the defendants’ Initial Disclosures only identify “Phuc
Chau” as a person likely in possession of relevant information and
fails to identify “Danny Chau.”
later
declaration
by
Danny
(Pl. Memo. at 4).
Chau 2
names
him
as
Although a
an
owner
of
Vermicelli, it contains no information about “Phuc Chau” or “Thein
Chau.”
(Declaration of Danny Chau dated Oct. 15, 2015, at 1).
Additionally, although the defendants’ answers to the plaintiffs’
interrogatories
state
that
“Danny
Chau”
was
responsible
for
determining the compensation and work hours of the plaintiffs, it
2
The declaration supported the defendants’ opposition to
the plaintiffs’ motion for conditional class certification.
2
fails to state whether “Phuc Chau” was also responsible for these
duties.
(Defendants’ Responses and Objections to Plaintiffs’
First Set of Interrogatories, attached as Exh. 4 to Declaration of
John Troy dated Sept. 26, 2016, at 4-5).
Discussion
A.
Standard
The lenient standards of Rules 21 and 15(a)(2) of the Federal
Rules of Civil Procedure control joinder of parties here. Although
the Scheduling Order limited the time to join parties, it only
addressed the time to add parties without leave of court; it did
not
specify
permission.
a
deadline
for
adding
(Scheduling Order at 2).
parties
with
the
court’s
Thus, there is no need to
consider the standards for modifying a case management order under
Rule 16(b)(4).
Although Rule 21 applies to the addition of parties, courts
apply the “same standard of liberality afforded to motions to amend
pleadings under Rule 15.”
Bridgeport Music, Inc. v. Universal
Music Group, Inc., 248 F.R.D. 408, 412 (S.D.N.Y. 2008) (quoting
Soler v. G & U, Inc., 86 F.R.D. 524, 528 (S.D.N.Y. 1980)).
Rule
15 provides that courts should “freely give leave” to amend “when
justice so requires.”
Fed. R. Civ. P. 15(a)(2); see also Foman v.
Davis, 371 U.S. 178, 182 (1962); Aetna Casualty & Surety Co. v.
Aniero Concrete Co., 404 F.3d 566, 603 (2d Cir. 2005).
“This
comports with the law’s ‘strong preference for resolving disputes
3
on the merits.’”
Knife Rights, Inc. v. Vance, 802 F.3d 377, 389
(2d Cir. 2015) (quoting Williams v. Citigroup Inc., 659 F.3d 208,
212–13 (2d Cir. 2011)).
However, a motion to amend may be denied
for any of the following reasons: (1) undue prejudice to the nonmoving party, (2) futility, (3) bad faith or dilatory motive, (4)
repeated failure to cure deficiencies by previous amendments, and
(5) undue delay.
F.3d
16,
28
United States ex rel. Ladas v. Exelis, Inc., 824
(2d
Cir.
2016).
The
discretion” over motions to amend.
court
has
“considerable
Knife Rights, 802 F.3d at 389.
The defendants argue that amendment should be denied because
they would be unduly prejudiced and because there has been undue
delay. 3
B.
(Def. Memo. at 2, 5).
Undue Prejudice
Undue prejudice is one of the “most important” reasons for
denying a motion to amend.
AEP Energy Services Gas Holding Co. v.
Bank of America, N.A., 626 F.3d 699, 725 (2d Cir. 2010) (quoting
State Teachers Retirement Board v. Fluor Corp., 654 F.2d 843, 856
(2d Cir. 1981)).
Undue prejudice may arise if “an amendment would
‘require the opponent to expend significant additional resources
to conduct discovery and prepare for trial’ or ‘significantly delay
3
The defendants also state that the motion should be denied
because it is “futile” and “meritless,” yet they provide no
accompanying argument.
(Memorandum of Law in Opposition to
Plaintiffs’ Motion for Leave to Amend the Complaint (“Def. Memo.”)
at 1).
4
the resolution of the dispute.’”
Ruotolo v. City of New York, 514
F.3d
(quoting
184,
192
(2d
Cir.
2008)
Block
v.
Associates, 988 F.2d 344, 350 (2d Cir. 1993)).
First
Blood
Additionally,
“[u]ndue prejudice arises when an ‘amendment [comes] on the eve of
trial and would result in new problems of proof.’”
Id. (second
alteration in original) (quoting Fluor, 654 F.2d at 856).
discovery
has
concluded
but
the
amendment
Yet, if
arises
from
substantially the same facts, an adversary’s burden to undertake
additional discovery -- by itself -- does not warrant denial of a
motion to amend.
See Lin v. Toyo Food, Inc., No. 12 Civ. 7392,
2016 WL 4502040, at *2 (S.D.N.Y. Aug. 26, 2016); JPMorgan Chase
Bank, N.A. v. IDW Group, LLC, No. 08 Civ. 9116, 2009 WL 1357946,
at *4 (S.D.N.Y. May 12, 2009).
The party opposing amendment bears
the
that
burden
prejudicial.
of
establishing
amendment
would
be
unduly
Allison v. Clos-ette Too, LLC, No. 14 Civ. 1618,
2015 WL 136102, at *2 (S.D.N.Y. Jan. 9, 2015); Ferring B.V. v.
Allergan, Inc., 4 F. Supp. 3d 612, 618 (S.D.N.Y. 2014).
The defendants argue that they would be prejudiced since they
would be required to spend additional resources deposing Thein
Chau and reviewing more documents; furthermore, they assert that
joinder would delay resolution of the case.
(Def. Memo. at 5).
Yet, the late addition of Thein Chau is predominately attributable
to the defendants because they failed to identify him in their
initial disclosures.
Additionally, discovery has only recently
5
closed and can be reopened briefly, and it does not appear that
substantially more paper or electronic discovery is required.
(Memorandum
of
Law
in
Reply
to
Defendants’
Opposition
to
Plaintiffs’ Motion for Leave to File an Amended Complaint at 5).
Finally, the short delay in the resolution of the case here is
superseded by the law’s preference for resolving cases on the
merits.
C.
Undue Delay
“Mere delay, [] absent a showing of bad faith or undue
prejudice, does not provide a basis for the district court to deny
the right to amend.”
F.2d at 856).
Ruotolo, 514 F.3d at 191 (quoting Fluor, 654
The defendants’ delay argument fails as they do not
specifically demonstrate prejudice or bad faith, stating only that
the
plaintiffs
have
moved
now
to
“benefit
themselves
with
a
procedural technicality and to unduly prejudice the Defendants.”
(Def. Memo. at 4).
Furthermore, the delay here was largely beyond
the control of the plaintiffs.
It was the defendants who failed
to identify Thein Chau in their initial disclosures, and the
declaration
from
“Danny
Chau”
and
the
answers
to
the
interrogatories were too ambiguous to provide an adequate basis
for amendment.
Thus, the plaintiffs have not delayed in moving to
amend.
6
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