Janis et al v. Earle et al

Filing 47

OPINION AND ORDER by Judge Terence Kern - Plaintiffs shall file their Amended Complaint by 1/20/2021. ; striking/withdrawing document(s); granting 27 Motion to Strike Document(s); finding as moot 30 Joinder in Motion; finding as moot 5 Motion to Dismiss; finding as moot 7 Motion to Dismiss; finding as moot 12 Joinder in Motion; granting 23 Motion to Amend (Re: 16 Amended Complaint ) (Documents Terminated: 16 Amended Complaint ) (lmc, Chambers)

Case 4:20-cv-00193-TCK-JFJ Document 47 Filed in USDC ND/OK on 01/07/21 Page 1 of 4

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF OKLAHOMA
D
JAMES JANIS and KEITH THOMAS,
Plaintiffs,
v.
JOSEPH EARLE; GORDAN MCDOUGALL;
MARK LIVINGSTON; UPPER STREET
MARKETING, INC.; LINEAR PARK
MARKETING, INC.; GROWING SPRINGS
HOLDINGS CORPORATION; and
PRIMAPHARMA, INC.,
Defendants.

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Case No. 20-CV-193-TCK-JFJ

OPINION AND ORDER
Before the Court are the Motion to Strike Plaintiffs’ First Amended Complaint filed by
Defendants Mark Livingston and PrimaPharma, Inc., and joined by Defendants Joseph Earle,
Gordan McDougall, Upper Street Marketing, Inc., Linear Park Marketing, Inc., and Growing
Springs Holdings Corporation (the “Linear Defendants”), Docs. 27, 30; and the Motion to Amend
filed by Plaintiffs James Janis and Keith Thomas. Doc. 23. Plaintiffs object to the Motion to Strike,
and Defendants object to the Motion to Amend. Docs. 26, 37-38.
I. Background/Procedural Status
This procedural quagmire commenced on May 7, 2020, when Plaintiffs—shareholders in
defendant Upper Street Marketing, Inc. (“UPPR”)—filed a derivative action on behalf of nominal
defendant UPPR and against Joseph Earle, Gordan McDougall, Mark Livingston, UPPR, Linear
Park Marketing, Inc. (“Linear Park”), Growing Springs Holders Corporation (“GSHC”)
(collectively the “Corporate Defendants”) and PrimaPharma, Inc. (“PrimaPharma”). Doc. 2. In

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their 31-page verified Complaint, they sought relief for “damages sustained, and that will be
sustained by UPPR as a result of Corporate Defendants’ conversions, breaches of their fiduciary
duties and Defendant Joseph Earle’s wrongful refusal of Plaintiffs’ well-grounded demand on the
Board of Directors” pursuant to 18 O.S. §1065 to inspect and make copies and extracts of certain
books and records of UPPR. Id. at 1-2.
Defendants Livingston and PrimaPharma were served with Plaintiffs’ original Complaint
on or about May 21 and 22, 2020. Doc. 3. Plaintiffs granted them a 45-day extension of time to
answer or otherwise plead. On July 6, 2020, Livingston and PrimaPharma jointly filed a Motion
to Dismiss Plaintiffs’ Complaint for Lack of Personal Jurisdiction and Failure to State a Claim.
Doc. 5. On July 7, 2020, the Linear Defendants filed a Motion to Dismiss Pursuant to Fed. R. Civ.
P. 23.1, and on July 16, 2020, they filed their Notice of Joinder in the Livingston and PrimaPharma
Motion to Dismiss Complaint for Lack of Personal Jurisdiction and Failure to State a Claim. Docs.
7, 12.
On August 21, 2020, Plaintiffs—without leave of Court—filed a First Amended
Complaint. Doc. 16. Subsequently, on August 31, 2020, they filed a Motion for Leave to File
First Amended Complaint. Doc. 23. On September 4, 2020, Livingston and PrimaPharma filed a
Response in Opposition to Plaintiffs’ Motion for Leave to File First Amended Complaint and a
Motion to Strike Plaintiffs’ First Amended Complaint, asserting that it was untimely and was filed
without leave of Court, in violation of Rule 15(a) of the Federal Rules of Civil Procedure. Docs.
26, 27. The same day, the Linear Defendants filed a joinder in the Livingston and PrimaPharma
Motion to Strike Plaintiffs’ First Amended Complaint. Doc. 30.

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II. Discussion
A. Motion to Strike Plaintiffs’ First Amended Complaint
Fed. R. Civ. P. 15(a) allows amendment of a complaint once as a matter of course within
21 days after service of the pleading, or the earlier of 21 days after service of a responsive pleading
or of a motion filed pursuant to Rule 12(b), including a motion to dismiss for lack of personal
jurisdiction or failure to state a claim. Thus, when the parties agreed to a 45-day extension for
Defendants to respond, the extension automatically gave Plaintiffs a 45-day opportunity to amend
their complaint in the period before the service of Defendants’ motions to dismiss. Plaintiffs,
however, failed to do so within the 45-day period. Instead, they waited until after the Defendants
filed motions to dismiss on July 6 and 7, 2020. Thereafter, they filed both a First Amended
Complaint (without leave of the Court), and responses to the Motions to Dismiss on August 21,
2020. Docs. 16, 17-18.
Plaintiffs argue that the extension of defendants’ deadline to respond to the complaint also
extended Plaintiffs’ deadline to file an amended complaint. However, they cite no authority for
this position, and extant case law is contradictory. See, i.e., Hayes v. D.C., 275 F.R.D. 343, 345
(“While the Court has the authority to extend both the time period for filing an opposition to a
motion and the 21-day time period for filing an amended complaint as a matter of course under
Rule 15, the simple fact that the Court granted an extension of the former time period does not
automatically effect an extension of the latter and fuse these two separate deadlines into one, as
plaintiff contends.”); Tamos v. Aurora Loan Servs., 2010 WL 966856, at *1 (S.D. Fla. Mar. 15,
2010) (finding that “Plaintiff’s filing of the Amended Complaint is not a proper response to
Defendant’s motion to dismiss” where the court had extended the deadline for the plaintiff to
respond to the motion to dismiss beyond 21 days after service of the motion).

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Accordingly, the Court concludes that the Motion to Strike the Amended Complaint must
be granted.
B. Motion to Amend
In their Motion for Leave to File First Amended Complaint, Plaintiffs ask that in the event
Defendants’ Motion to Strike Amended Complaint is granted, they be given leave to file an
Amended Complaint. Doc. 23. Rule 15(A)(2) states:
Other Amendments. In all other cases, a party may amend its pleading only with
the opposing party’s written consent or the court’s leave. The court should freely
give leave when justice so requires.
Accepting as true Plaintiffs’ counsels’ statement that they mistakenly believed Defendants’
counsel had agreed to an extension of time to answer or otherwise plead, the Court concludes that
Plaintiffs’ Motion to Amend should be granted.
III. Conclusion
Defendants’ Motion to Strike the Amended Complaint (Doc. 27) is granted. Plaintiffs’
Motion to Amend (Doc. 23) is granted. Plaintiffs shall file their Amended Complaint on or before
January 20, 2021.
The Motion to Dismiss for Lack of Personal Jurisdiction and Failure to State a Claim (Doc.
5), the Motion to Dismiss Pursuant to Fed. R. Civ. P. 23.1 (Doc 7), the Joinder in the Motion to
Dismiss for Failure to State a Claim filed by the Linear Defendants (Doc. 12) and the Joinder of
Linear Defendants to Response of Mark Livingston and PrimaPharma, Inc. in Opposition to
Motion to File First Amended Complaint and Motion to Strike filed by Livingston (Doc. 30) are
found to be moot.
ENTERED this 7th day of January 2021.

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