Ross Eriksmoen, Inc. v. Continental Resources, Inc.
Filing
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ORDER by Magistrate Judge Charles S. Miller, Jr. granting 20 Motion to Strike. All references to punitive damages in defendant's counterclaim shall be stricken. To claim punitive damages, defendant must file a motion for leave to amend its counterclaim. (BG)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NORTH DAKOTA
NORTHWESTERN DIVISION
Ross Ericksmoen, Inc., d/b/a
T & R Transport,
Plaintiff,
vs.
Continental Resources, Inc.,
Defendant.
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ORDER GRANTING MOTION
TO STRIKE
Case No. 4:13-cv-107
Before the court is a “Motion to Strike Claims and Prayer for Relief for Punitive Damages
in Defendant’s Counterclaim” filed by plaintiff on February 4, 2014. For the reasons set forth
below, the motion is granted insofar as it requests that all references to punitive damages in
defendant’s counterclaim be stricken.
I.
BACKGROUND
Plaintiff initiated the above-captioned declaratory judgment action in September 2013. On
January 3, 2014, defendant filed an answer and counterclaim that contained causes of action for: (1)
breach of the parties’ Master Service Contract; (2) tortious breach of contract; (3) breach of
fiduciary duty; and (4) fraud/deceit. Notably, it claimed an entitlement to punitive damages in its
second, third, and fourth counterclaim. It also requested an award of punitive damages in its prayer
for relief.
On February 4, 2014, plaintiff filed a motion to strike paragraphs in defendant’s counterclaim
that asserted an entitlement to punitive damages along with defendant’s request for punitive damages
in its prayer for relief. Defendant filed a response on February 18, 2014, agreeing only to strike it
requested remedy of punitive damages but objecting to plaintiff’s motion insofar as it sought to
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strike causes of action from its counterclaim. Plaintiff filed its reply to defendant’s response on
February 24, 2014, reiterating its position that defendant’s assertions regarding its purported
entitlement to punitive damages must be struck in their entirety.
II.
DISCUSSION
Fed. R. Civ. P. 12(f) empowers the court to “strike from the pleading an insufficient defense
or any redundant, immaterial, impertinent, or scandalous matter.” Although a claim for punitive
damages does not fit neatly into either of these categories, it may nevertheless be subject to a motion
to strike. See Johnson v. Metro. Sewer Dist., 927 F.Supp. 874, 875-76 (E.D. Mo. 1996) (striking
a claim for punitive damages against defendants exempted from the imposition of such claims);
Brown v. Potter, No. 1:04-CV-350, 2005 WL 2090904, at * 5 (W.D. Mich. Aug. 30, 2005) (“The
court may utilize [Fed. R. Civ. P. 12(f)] to strike a claim for damages that is improperly contained
in the plaintiff’s complaint.”); see also Benigno v. Flatley, No. 01-CV-2158, 2002 WL 123360, at
* (E.D Pa. Jan. 29, 2002) (granting in part a motion to strike a claim for punitive damages); but see
Mitchell v. Consol. Freightways Corp. of Del., 757 F. Supp. 1446, 1447 n. 1 (M.D. Fla 1990)
(“[T]his Court held improper use of a motion to strike to attack a punitive damages claim. The
correct device is a motion to dismiss, a procedural difference that is significant precisely because
it determines the scope of review of a Magistrate’s order.”); Prof’l Asset Mgmt, Inc. v. Penn Square
Bank, N.A., 566 F. Supp. 134, 136 (D. Okla. 1983) (“By its own terms, Rule 12(f) only allows the
court to strike insufficient defenses or any redundant, immaterial, or scandalous matter. The
plaintiff’s claim for punitive damages fits into neither category.” (internal citations and quotations
omitted)).
North Dakota law prohibits a complaint from seeking punitive damages upon commencement
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of an action. See N.D.C.C. § 32-03.2-11. It further provides that a punitive damages claim may
only be asserted upon leave of court to allow such an amendment, on a showing by plaintiff “that
there is sufficient evidence to support a finding by the trier of fact that a preponderance of the
evidence proves oppression, fraud, or actual malice.” N.D.C.C. § 32-03.2-11(1). In cases where
its jurisdiction is based upon diversity of citizenship, this court has consistently held that procedural
requirements constitute a substantive right. Scheuller v. Remington Arms Co., LLC, No. 2:11-CV108, 2012 WL 2370109, at * 2 (D.N.D. June 6, 2012); McHugh v. Jacobs, 450 F. Supp.2d 1013,
1021 (D.N.D. 2003); Lowell v. Zurich Ins. Co., Civ. No. A3-91-72, 1992 WL 212233, at *3 (D.N.D.
Aug. 20, 1992) (applying North Dakota’s punitive damage statute in a case where jurisdiction was
predicated upon diversity of citizenship). “Under the Erie doctrine, federal courts sitting in diversity
apply state substantive law and federal procedural law.” Gasperini v. Ctr. for Humanities, Inc., 518
U.S. 415, 427 (1996) (citing Erie R. Co. v. Tompkins, 304 U.S. 64 (1938)).
Defendant does not concede that North Dakota law governs. It nevertheless agrees to strike
its request for damages from its prayer for relief. In so doing, it reserves its right to move to amend
it counterclaim to request punitive damages in accordance with the court’s scheduling order.
The court GRANTS plaintiff’s motion (Docket No. 20) and ORDERS that all references
in defendant’s counterclaim to punitive damages be stricken. To claim punitive damages, defendant
must file a motion for leave to amend its counterclaim.
IT IS SO ORDERED.
Dated this 10th day of April, 2014.
/s/ Charles S. Miller, Jr.
Charles S. Miller, Jr., Magistrate Judge
United States District Court
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